THRESHOLDThe limitlessness of LIMIT.Extract of Book Good to GreatMAJOR (RETD.) PRAVIN SINGH
THE CHALLENGE• By defining the management study of nineties, it has showed that great companies triumph over time and how long term sustained performance can be engineered into the DNA of an enterprise from the beginning.
NOT BORN WITH GREAT DNA??? How can good companies or enterprise or mediocre companies and even bad companies achieve enduring greatness????? How do companies defy gravity and convert long term mediocrity or worse into long term superiority? What are universal distinguishing characteristics that cause a company to Cross the THRESHOLD and take a leap while others can’t.
GOOD IS THE ENEMY OF GREAT Thats the key reason why so less become great. It is remarkable to note so many companies who have been utterly unremarkable, seemingly out of no where- ----- BANG. they CLIMB ..CLIMB..CLIMB and Then CLIMB and just keep CLIMBING.
THRESHOLD160140120 TRANSITION TIME100 80 60 40 GREAT 20 General market Direct comparsion 0 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th
WALGREENS $1 invested in Walgreens beat tech superstar intel by nearly two times. It beat General Electric five times, Coca Cola by eight times, and General stock market by fifteen times.
COMPARED TO WHAT?? They were compared to ‘direct comparisons’ and ‘unsustained comparisons’. Question is not what is common between them, but what is that made this difference. Gold medal winners and loosers both have a coach, but what is that difference that makes one a winner?
INSIDE THE BLACK BOX WHAT’S INSIDE THE BLACK BOX? 160 140 120 100 80 60 40 GREAT 20 General market Direct comparsion 0 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th
BASIS OF RESEARCH Strategy. Technology. Leadership. Interview of executives of transition period. Qualitative to quantitative anlyses looking at acquisition to executive compensation, financial ratios to management turnover.
DOGS THAT DID NOT BARK Special note of the unsustained comparison who started climbing but could not sustain the climb. Dogs that did not bark. ‘The adventure of Silver Blaze’ Sherlock Holmes. Dogs that did not bark turned out to be the best clues.
WHAT WAS NOT FOUNDINSIDE THE BLACK BOX Larger than life celebrity leaders who came from outside. All the leaders were from within the co. No systematic pattern linking specific forms of executive packages. Stategery per se.
WHAT WAS NOT FOUNDINSIDE THE BLACK BOX THEY DID NOT FOCUS ON WHAT TO DO INSTEAD FOCUSED ON WHAT NOT TO DO AND WHAT TO ‘STOP DOING’. TECH DID NOT IGNITE THE TRANSFORMATION, IT ACCELERATED IT. THEY PAID SCANT ATTENTION TO MANAGING CHANGE, MOTIVATING PEOPLE AND CREATING ALINGMENT. NO NAME, TAG LINE, LAUNCH EVENT OR PROGRAM SIGNIFIED THEIR TRANSFORMATION.
WHAT WAS NOT FOUNDINSIDE THE BLACK BOX MERGERS AND ACQUISITIONS PLAYED VIRTUALLY NO ROLE IN IGNITING TRANSFORMATION. THEY WERE NEVER BY AND LARGE IN GREAT INDUSTRIES. SOME WERE IN TERRIBLE INDUSTRIES.
CHAOS TO CONCEPT:‘FLYWHEEL CONCEPT’ 1 ST WHO.. CONFRONT CULTURE LEVEL 5 THE BRUTAL HEDGEHOG OF TECHLEADERSHIP THEN WHAT FACTS CONCEPT DISCIPLINE ACCELATOR DISCIPLINED PEOPLE DISCIPLINED THOUGHT DISCIPLINED ACTION FLYWHEEL
LEVEL 5 LEADERSHIP Self effacing, quiet, reserved, shy--- Paradoxicalblend of personal humility and professional will. Morelike Lincon and Socrates than Patton or Ceasor.
FIRST WHO….. THEN WHAT They do not begin by setting a new vision or strategy. They begin with right people on the bus, wrong people off the bus, right people in right seat. And then they decide where to drive.People are your most imp asset? Wrong….Right people are your most imp asset.
CONFRONT THE BRUTAL FACTS(Yet never loose faith) Lesson from prisnor of war, what no corporate strategy defined. Stockdale concept. Maintain unwavering faith that you can and will prevail in the end, regardless of difficulties, AND at the same time Have the discipline to confront the most brutal facts of your current realities, whatever they might be.
HEDGEHOG CONCEPT(Simplicity within three circles) Greatness requires transcending the curse of competence. Just because something is your core business- -Just because you are doing it for years----or even decades—does not necessarily mean you can be best in world at it. And if you cannot be the best in the world at your business, then your core business absolutely cannot form basis of a great company. It must be replaced with a simple concept that reflects deep understanding of three intersecting circles.
CULTURE OF DISCIPLINE All companies have a culture, some companies have discipline, but few companies have a CULTURE OF DISCIPLINE. When you have disciplined people you don’t need HIERARCHY. When you have disciplined thought you don’t need BUREAUCRACY. When you have disciplined action you don’t need EXCESSIVE CONTROL.
CULTURE OF DISCIPLINE When we combine A CULTURE OF DISCIPLINE with AN ETHIC OF ENTREPRENEURSHIP, we get theMAGICAL ALCHEMY OF GREAT PERFORMANCE.
TECHNOLOGY ACCELERATORS Tech never the primary means of igniting a transformation. Yet they are pioneers in application of carefully selected technology. Technology is never the root cause of greatness or decline.
THE FLY WHEEL ANDDOOM LOOP Revolution,dramatic changes,restructuring fails to take a leap. There is no single defining action,grand program, no one killer innovation, no solitary lucky break, no miracle moment. Rather the process resembled relentlessly pushing a giant heavy flywheel in one direction, turn upon turn,building momentum until a point of breakthrough, and beyond.
LEVEL 5 LEADERSHIP FIRST WHO….. THEN WHATCONFRONT THE BRUTAL FACTS (Yet never loose faith) HEDGEHOG CONCEPT (Simplicity within three circles) CULTURE OF DISCIPLINE TECHNOLOGY ACCELERATORS THE FLY WHEEL AND DOOM LOOP