Good to Great: Why Some Companies Make the Leap and Others Don’t
By Jim Collins
Harper-Collins
Most business books are written for non-farm businesses. The advice in this book, however, is generally transferable to a farm business context. After all, as I frequently explain to non-farmers who want to understand how a modern farm is run, business is business.
Of all the business books I’ve read Good to Great: Why Some Companies Make the Leap and Others Don’t is one that stands out for its foundational, relatable advice.
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No matter their size, nearly all business owners (this includes you!) constantly fiddle with their business to make it better. It may be because they want to get bigger, more efficient or more productive. Or they may want to retire comfortably or pass on a sustainable business. Or they may want some mix of all of these.
Whatever better (a.k.a “great”) looks like to you, author Jim Collins and his research team discovered that there are in fact six timeless principles that help a company make the shift from good to great.
That’s why what’s important isn’t what great companies have in common so much as what distinguishes them from all the companies that don’t get there.
It’s a key point. Collins tell us that Walgreens, for example, was able to make the leap from good to great “when other companies in the same industry with the same opportunities and similar resources … did not make the leap.”
Our anxious and constant search for new and improved ways of how we should (or shouldn’t) be operating our businesses in a fast-changing or “new” economy (often with thin profit margins), is an understandable response, but it may be wasted energy.
“The truth is, there’s nothing new about being in a new economy,” Collins writes. “Those who faced the invention of electricity, the telephone, the automobile, the radio, or the transistor — did they feel it was any less of a new economy than we feel today? And in each rendition of the new economy, the best leaders have adhered to certain basic principles, with rigour and discipline.”
These six basic principles seem to fit under one overarching rule: “The good-to-great companies did not focus principally on what to do to become great; they focused equally on what not to do and what to stop doing,” writes Collins.
For example, Collins’s data consistently showed that good-to-great business leaders — what he and his research team dubbed Level 5 Leaders — are cut from the same cloth, and they never let their ego get in the way of their concern for the business’s success.
Furthermore, “Level 5 Leaders want to see the company even more successful in the next generation, comfortable with the idea that most people won’t even know that the roots of that success trace back to their efforts,” says Collins.
This type of leadership bodes well for multi-generational farms — and I would say is even an accurate reflection of most family farms in Canada today.
Interestingly, Collins mentions the farm work ethic in his case study about Nucor, a North Carolina steel producer that went from good to great. When discussing the timeless principle of “first who, then what” (first get the right people on the bus, then figure out where to drive it), Collins writes, “Nucor built its entire system on the idea that you can teach farmers how to make steel, but you can’t teach a farmer work ethic to people who don’t have it in the first place.”
Nucor fell into the good-to-great category because their focus on finding people with the right character attributes (mostly ex-farmers) was more important, and subsequently more successful, than focusing on specific educational background, specialized knowledge, or work experience.
“Those who build great companies understand that the ultimate throttle on growth for any great company is not markets, or technology, or competition, or products,” says Collins. “It is one thing above all others: the ability to get and keep enough of the right people.”
Speaking of technology, a thought-provoking take-away from Collins’s book is a caution against an overreliance on technology (the sixth timeless principle), certainly a preoccupation in today’s agriculture industry. Collins’s research team found that it was not a prerequisite for any of the good-to-great companies.
“Technology and technology-driven change had virtually nothing to do with igniting a transformation from good to great,” he writes. “Technology can accelerate a transformation (from good to great), but technology cannot cause a transformation.”
It leads to his biggest take-away. Working in the same industry with the same opportunities and similar resources as everyone else doesn’t mean you’re doomed to remain in the “good” category.
“Greatness is not a function of circumstance,” Collins goes far to prove in this book. “Greatness, it turns out, is largely a matter of conscious choice.”
