Innovation Reading Club - Good to Great

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Innovation Reading Club - Good to Great

  1. 2. THE BOOK <ul><li>WHAT IS THIS ABOUT? </li></ul><ul><ul><li>HAVE YOU EVER THOUGHT WHAT MAKES THE DIFFERENCE BETWEEN A GOOD COMPANY AND A GREAT ONE? </li></ul></ul><ul><ul><li>HOW DO COMPANIES BECOME MAGNIFICENT? </li></ul></ul><ul><ul><li>WORKING IN A PROFITABLE FIELD? SPECIFIC TYPE OF BUSINESS? PRESSURED WORKERS? CRUSHING THEIR RIVALS? </li></ul></ul><ul><ul><li>JIM COLLINS AND THEIR COLLEAGUES LOOKED FOR COMMON PATTERNS IN COMPANIES THAT MADE A TRANSITION BETWEEN BEING AVERAGE COMPANIES AND GREAT COMPANIES </li></ul></ul>
  2. 3. STUDYING THE MARKET <ul><li>WHAT DID THEY LOOK FOR? </li></ul><ul><ul><li>Companies that appeared in Fortune List (1965-1995): </li></ul></ul><ul><ul><ul><li>Biggest American companies </li></ul></ul></ul><ul><ul><ul><li>Belonging to the stock market: public and accessible data </li></ul></ul></ul><ul><ul><li>Average companies: financial performance not higher than 1.5 times the average market during 15 years </li></ul></ul><ul><ul><li>Great companies: financial performance 3 times better than the average market for the next 15 years since a transition </li></ul></ul>
  3. 4. STUDYING THE MARKET <ul><li>COMPANIES THAT HAD A TRANSITION! </li></ul><ul><li>WHY NO HIGH-TECH COMPANIES?: </li></ul><ul><ul><li>Many of them too young (Google) </li></ul></ul><ul><ul><li>Some of them have always been great (Intel) </li></ul></ul>TRANSITION
  4. 5. STUDYING THE MARKET <ul><li>SELECTED COMPANIES: </li></ul><ul><li>HOW MANY OF THEN ARE WELL KNOWN?? </li></ul>WHY DID THEY SUCCEED AND THEIR RIVALS (COMPARISON COMPANIES) DID NOT? Abbot Laboratories Circuit City Fannie Mae Gillette Kimberly-Clark Kroger Nucor Philip Morris Pitney Bowes Walgreens Wells Fargo
  5. 6. COMMON PATTERNS <ul><li>SET OF COMMON PATTERNS SHARED AMONG THE GREAT COMPANIES, NOT PRESENT IN COMPARISON COMPANIES </li></ul><ul><ul><ul><li>Great leader (special) </li></ul></ul></ul><ul><ul><ul><li>People: First Who, then What </li></ul></ul></ul><ul><ul><ul><li>They way of confronting reality (good desitions) </li></ul></ul></ul><ul><ul><ul><li>Finding your concept (main idea) </li></ul></ul></ul><ul><ul><ul><li>Establishing a culture of discipline </li></ul></ul></ul><ul><ul><ul><li>Sensible use technology (not only for its newness) </li></ul></ul></ul><ul><ul><li>CHAPTERS OF THE BOOK BASED ON THESE POINTS </li></ul></ul>
  6. 7. COMMON PATTERNS <ul><li>LEVEL 5 LEADER </li></ul><ul><ul><li>Surprisingly found in every company! Comparison companies had other type, called level 4. </li></ul></ul>10 OUT OF 11 GREAT LEADERS CAME FROM INSIDE THE COMPANY COMPARISON COMPANIES TRIED WITH EXTERNAL MANAGERS THAT BEHAVE LIKE ‘ROCK STARS’ <ul><li>LEVEL 4 LEADER </li></ul><ul><li>Egocentrics. </li></ul><ul><li>Whatever is needed for personal success. </li></ul><ul><li>Blame external factors when failing, take the credit for succeeding to themselves. </li></ul><ul><li>LEVEL 5 LEADER </li></ul><ul><li>Mixture: humility and professional willing. </li></ul><ul><li>Whatever is needed for the company’s sake. </li></ul><ul><li>Blame themselves when failing, take the credit for succeeding to the workers. </li></ul>
  7. 8. COMMON PATTERNS <ul><li>LEVEL 5 LEADER </li></ul><ul><li>COULD YOU BECOME A LEVEL 5 LEADER? </li></ul><ul><li>ARE THEY SO DIFFICULT TO FIND? </li></ul><ul><li>COULD YOU BE STRONG ENOUGH TO MAKE THE RIGHT DECISIONS? </li></ul>
  8. 9. COMMON PATTERNS <ul><li>FIRST WHO, THEN WHAT </li></ul><ul><ul><li>Key Concept: finding the right people ! </li></ul></ul><ul><ul><li>Get this right people and then give them something to do! (madness?) </li></ul></ul><ul><ul><li>Right people has to do more with innate capabilities than with knowledge or specific abilities. </li></ul></ul>GET THE RIGHT PEOPLE IN THE BUS GET THE WRONG PEOPLE OUT OF THE BUS AFTER FILLING THE BUS WITH GREAT PEOPLE, DECIDE WHERE TO GO
  9. 10. COMMON PATTERNS <ul><li>FIRST WHO, THEN WHAT </li></ul><ul><li>HOW TO KNOW IF WE SELECTED THE RIGHT PEOPLE? </li></ul><ul><li>WHAT IF WE DISCOVER IN THE MIDDLE OF THE TRIP THAT WE WERE WRONG? </li></ul>
  10. 11. COMMON PATTERNS <ul><li>CONFRONT THE FACTS </li></ul><ul><ul><li>Being too much charismatic might discourage your people (they will not show you the cruel truth) </li></ul></ul><ul><ul><li>Leading with Questions and not with Answers </li></ul></ul><ul><ul><li>Very important to talk, debate, discuss to make a final decision. In great companies, long and heated debates are very usual ! (mentioned by all the leaders) </li></ul></ul>ALWAYS KEEPING THE FAITH NO MATTER THE DIFFICULTIES CONFRONTING THE ADVERSITIES IN AN HONEST WAY BUT
  11. 12. COMMON PATTERNS <ul><li>THE HEDGEHOG CONCEPT </li></ul><ul><ul><li>The main concept that will move your company. </li></ul></ul><ul><ul><li>Take into account, some years could pass before finding the MAIN CONCEPT. </li></ul></ul>GOOD COMPANIES : FOX. CLEVER, INGENIOUS, KNOW MANY THINGS GREAT COMPANIES : HEDGEHOG. SIMPLE, KNOW ONLY ONE IMPORTANT THING THREE CIRCLES INTERSECTION IS THE KEY
  12. 13. COMMON PATTERNS <ul><li>THE HEDGEHOG CONCEPT </li></ul><ul><li>WILL WE BE PATIENT ENOUGH FOR FINDING THE MAIN CONCEPT? </li></ul><ul><li>CAN A COMPANY AFFORD AND SURVIVE FOR SEVERAL YEARS BEFORE FINDING THIS CONCEPT? </li></ul>
  13. 14. COMMON PATTERNS <ul><li>CULTURE OF DISCIPLINE </li></ul><ul><ul><li>Culture full of disciplined people which make disciplined decisions inside the three circles </li></ul></ul><ul><ul><li>Many times, it is more important to make a list of things that you must NOT do, than things that you must do </li></ul></ul>DO NOT CONFUSE DISCIPLINE WITH TYRANNY! BUROCRATIC CULTURE EXISTS BECAUSE A LACK OF RIGHT PEOPLE IN THE BUS WITH DISCIPLINED AND RIGHT PEOPLE, HIERARCHY IS NOT A PROBLEM (YOU CAN MANAGE YOUR COMPANY WITH MUCH LESS LEVELS OF HIERARCHY)
  14. 15. COMMON PATTERNS <ul><li>CULTURE OF DISCIPLINE </li></ul><ul><li>HOW LONG CAN A PERSON BE DISCIPLINED IN HIS WORK? </li></ul><ul><li>HOW TO KEEP THIS DISCIPLINED CULTURE? </li></ul>
  15. 16. COMMON PATTERNS <ul><li>TECHNOLOGY ACCELERATORS </li></ul><ul><ul><li>WHAT GREAT LEADERS THINK ABOUT IT? </li></ul></ul><ul><ul><li>Comparison companies simply use technology because of the fear of falling behind, because of its newness </li></ul></ul>80% OF GREAT COMPANIES LEADERS DO NOT INCLUDE TECHNOLOGY AMONG 5 MAIN REASON OF THEIR SUCCESS!! THEY ARE PIONEER IN APPLYING SELECTED TECHNOLOGIES CAREFULLY IT IS SEEN AS AN ACCELERATOR OF THE SUCCESS, NOT A CREATOR OF SUCCES BUT
  16. 17. QUESTIONS TO THINK ABOUT <ul><li>PEOPLE INSIDE A COMPANY IS NOT CONSCIOUS ABOUT THE TRANSITION. THERE IS NO NAME, NO KEY EVENT THAT SUDDENLY CHANGES THE COURSE OF A COMPANY. HOW TO KNOW IF WE ARE IN THE RIGHT PATH? </li></ul><ul><li>VERY COMMENTED IN THE BOOK. PEOPLE IS NOT THE MOST VALUABLE ACTIVE. RIGHT PEOPLE IS . </li></ul><ul><li>COULD YOU BECOME A LEVEL 5 LEADER? COULD YOU BE STRONG ENOUGH TO MAKE THE RIGHT DECISIONS? </li></ul><ul><li>WHERE DO I START FROM? WHAT IF A HAVE A VERY SMALL COMPANY? CAN I APPLY THIS IDEAS? </li></ul><ul><li>CAN I APPLY THIS IDEAS TO ANOTHER FIELD? DO I NEED TO BE A BUSSINESS MAN TO READ THIS BOOK? </li></ul>
  17. 18. THANK YOU FOR YOUR ATTENTION

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