Why "Good to Great" Isn’t Very Good

There is usually information in what someone doesn't say. Long time readers may have noticed that I have never reviewed one of the most popular business books of all time – "Good to Great." Call me a heretic, but I'm not a fan of it. It's one of the best selling business books ever, but I think there is too much fluff, and I think the research team made a huge mistake when compiling it.

Before I go into detail, let me say that I think Jim Collins is a bright guy and I admire what he attempted to do with the book. His major mistake is a very common one – one that rarely gets noticed. I will also say that there is still value in reading the book. There are some good ideas inside (like the "stop doing" list), but I'm sick and tired of people taking it as gospel. I've read too many things like this:

This nearly 300-page book is packed with leading edge thinking, clear examples, and data to support the conclusions. It is a challenge to all business leaders to exhibit the discipline required to move their companies from Good To Great.

That, and the fact that the sales seem to be driven as much by churches as by businesspeople, is what finally made me write this post. (The point there being that it has sold more than other business books in part because it had a secondary market). "Good to Great" might encourage you and give you some good ideas, but it isn't a panacea to creating great organizations.

I read "Good to Great" in 2004 and lumped it together with most other business books. It was ok and there were a handful of sentences I underlined to go back to for inspiration, but it didn't impress me the way some books do. One day I happened to be chatting with someone that had worked with one of the good-to-great companies during the supposed transformation, and this person said the company was all screwed up inside. So that got me thinking…is "Good to Great" sound research?

I picked up the book and re-read it. A couple of things struck me.

The Corporate Barnum Effect
First of all, the good-to-great principles are true in the same way a horoscope is true. They are fairly generic and thus we all apply them from our own viewpoint to make them true. I believe that some "Good to Great" readers that love the book may be suffering from the Barnum effect. The principles Collins proposes aren't bad ones, but they are ambiguous and open to interpretation, which in effect decreases their usefulness. For instance, Collins says good-to-great companies practice "First Who, Then What," which basically means "hire good people." I'm willing to bet no one read the book and said "Eureka! I've been hiring slimy weasels when I should have been hiring top performers. That is why we aren't a great company." My guess is that most people think their way of hiring or interviewing is the best way to get the "good people" and so they liked hearing Collins say this. They ignore the fact that after reading the chapter, you really don't have a better idea of how to do it.

Vague but Appealing BS
Level5 leadership is vague. The only trait people seem to agree on is that level 5 leaders have humility. Humble leaders can be a good thing, but if Jim Collins can't even tell whether or not Jack Welch was a level 5, what chance do the rest of us have?

Q: Was Jack Welch a Level 5?
A: His report card does not come in until [new CEO Jeff] Immelt exceeds him. If Immelt does not exceed him, then he has failed. Jack Welch did not make GE great. GE was already great. Every GE CEO has been to his era what Welch was to his, without exception. It takes 50 years to create a GE. Generations of leaders built it. Whether Welch was a Level 5 comes down to a question we don't know the answer to. Was Welch first and foremost ambitious for himself or for GE? Only he knows that.

Isn't Collins supposed to be the expert on Level5 leadership? Hasn't more been written about Jack Welch than about most other CEOs? And Collins can't tell? He's either being diplomatic and refusing to say "no, Welch wasn't" or Level 5 leadership is business jibber jabber. Since it is vague, it allows us all to see ourselves as Level 5 leaders because of the Lake Wobegon effect. So we read this book and we feel good, like it describes our leadership style (more Barnum effect too).

A Lack of Disconfirming Research
I've read all the notes in the book about how the research was done, and I think Collins and his team made a huge mistake. The good-to-great qualities, once determined, were never used to search for counterexamples. What I mean is that Collins and his team never said "are there any companies that have all of our good-to-great qualities that weren't good-to-great?". This is important, so let me explain.

Humans have a confirmation bias. We look for things that validate our preconceptions. But when you reach a conclusion you have to say "what would it take to prove this conclusion false?" The most popular example of this is this card test.

Collins' team looked at the companies that went from good to great and said "what do all these have in common?" They never went back and said "are there any companies that have these traits that did not make the leap from good to great?" And I understand why they didn't. Because these principles are vague and it would be hard to debate whether or not an unsuccessful company was doing these good-to-great things. You could always say a company is in the process and will soon be great. Or you could say so and so isn't a *real* level5 leader. I tried to find some examples, but I kept coming back to the same questions. How can you definitely say whether or not a company is following the good-to-great principles? You can't.

Surivorship Bias
Somebody has to win. Somebody has to be the best. And being the winner does not always mean you have some skill. The belief that it does is called the survivorship bias, and it may apply to good-to-great. I really don't know. Were the good-to-great companies examples of survivorship bias? I'll be honest in that I don't fully understand how to analyze it or I would. (For years I have been nagged by the question of whether or not Warren Buffett is successful because of suvrivorship bias. I lean towards no, but I don't know how to prove it.) What I do know is that humans tend to conveniently make random demarcations in data to get the patterns and results that we want, when you are looking for something specific, it is amazingly easy to find data to support your preconceptions.

What They Don't Know
Collins also doesn't know what he doesn't know. In other words, maybe there were causes that he and his research team were not aware of. Perhaps executives at the good-to-great companies better understood the economics of their industry. Or maybe they were more financially saavy and understood how money flowed through the company and where their profit really came from. It is common for companies not to really understand these things fully. But Collins would have no way of uncovering that, and even if he did, who would write a book that encourages would-be business leaders to study up on the economics of their industry and better analyze cash flow statements? It wouldn't sell very well because that stuff is boring and hard.

The Tom Peters Criticism
Tom Peters has pointed out that Collins procedure may not have identified the companies most of us would consider great.

Point No. 2 is that companies that Jim calls great have performed well. I wouldn't deny that for a minute but they haven't led anybody anywhere. I don't give a damn whether Microsoft is around 50 years from now. Microsoft set the agenda in the world's most important industry at a critical period of time, and that to me is leadership, not the fact that you are able to stay alive until your beard is 200 feet long.

He has a good point. Has Collins really used the right criteria for greatness?

An alternate explanation
I would say that companies that most of the things Collins mentioned can be summed up by saying "good companies make good decisions." Hiring the right people? That describes a company that makes good hiring decisions. Confronting brutal facts? That is an important part of the process of making good decisions. Using technology the right way? Again, the result of good decision making. I would say that great companies don't have a list of platitudes to follow, as "Good to Great' would imply, but that they simply have good processes for making business-related decisions.

Lest you think I am the only person out there unimpressed by the book, check out Wharton's review of it.

Collins asks an interesting question. Unhappily, the methodology he used to formulate an answer is questionable and the answer is almost disappointing in its simplicity: Great companies become great by staying focused: focused on their products, their customers and their businesses. They aspire to higher levels of excellence, are never content to become complacent and are passionate about their products. They have leadership that is not ego-driven, and have organizational cultures that embrace constant change. That's the book.

And instead of sending me hatemail about how stupid I am for criticizing the world's greatest business book, you can criticize mine instead. I wrote the first chapter for the business book More Space. So go download it (click on an author's name) and mark it up. And while you are at it, download the chapters written by Lisa and by Marc. They have more practical value and immediate application to your work life than "Good to Great" ever will.

More Popular Stories:






Subscribe

Comments

  1. Chad Fowler's Gravatar Comment by Chad Fowler on January 31st, 2006 at 10:27 am

    Rob, Kind of a tangent, but have you by chance been reading Science Friction?

  2. Rob's Gravatar Comment by Rob on January 31st, 2006 at 10:34 am

    Ethan,

    Just because Tom Peters made up data doesn’t invalidate his criticism of Collins. You have to address the argument itself, even if you don’t like the person it is coming from. I think Peters has a valid argument, and nothing you said challenges that.

    The strongest point against Collins work is the disconfirmation part. If there are companies out there that do all the good-to-great things but have medicore performance, that invalidates Collins work. He didn’t check for that.

    And finally, notice I didn’t say MY chapter in Morespace had immediate and practical value, which is what I would have said if I was highly biased. Tell me this, how would you apply the good-to-great principles starting tomorrow? That is tough to do. But download Marc’s chapter and I’ll bet you could start applying his ideas before the end of the day.

  3. Rob's Gravatar Comment by Rob on January 31st, 2006 at 10:37 am

    Chad,
    Nope, but I have read some of Shermer’s books in the past. And I pick up Skeptic magazine from time to time at the bookstore.

  4. TRS's Gravatar Comment by TRS on January 31st, 2006 at 10:51 am

    I’ve always thought Collins work was generic. He basically just picked companies that hide their flaws well from investors. It reminds me of the trash that was written about how great Enron was…before they came crashing down.

  5. Rob's Gravatar Comment by Rob on January 31st, 2006 at 1:42 pm

    Ethan,
    One pRoblem with writing is that tone doesn’t come across as well as it does when speaking. I was surprised to see your comments because I knew your views on business books. Sorry for the confusion.

  6. Brian Balfour's Gravatar Comment by Brian Balfour on January 31st, 2006 at 3:28 pm

    I think that a lot of these criticsms can be applied to any research project, especially to a size that good to great took on. But I think the point of the research was to find some sort of common ground between companies who have out performed the market that distinguished them from their competitors. This, I think was accomplished. With any book, you have to take it as it is and try to apply general concepts to your more specific situation. There will never be a book that can be used as a guide for every company to say… “hire the right people” or “build a great corporate enviroment”. Every situation is unique, and the succesful will be the ones who can apply these general concepts to thier own situation.

    http://www.brianbalfour.com

  7. laurence haughton's Gravatar Comment by laurence haughton on January 31st, 2006 at 3:57 pm

    You are right (I think) Brian when you write that “the point of the research was to find some sort of common ground between companies who have out performed the market that distinguished them from their competitors. The key word is “distinguished.”

    To do that you have to go back to the original sample (including those who did and who didn’t outperform) and ask “did anyone who didn’t outperform the market exhibit any of these good to great behaviors?” If you find one then you cannot reliably claim a cause and effect link between the behavior and outperforming the market. I like what I read in Good to Great. But I was troubled by the claims of scientific method.

    But maybe I am missing something…

  8. kathy kajinami's Gravatar Comment by kathy kajinami on April 15th, 2006 at 11:34 am

    Thanks

  9. Jeffrey Pelletier's Gravatar Comment by Jeffrey Pelletier on May 17th, 2006 at 10:06 am

    As a Business and People resource I have made it my business to study Good to Great and to attempt to prove or disprove it. In my pragmatic approach to helping companies I have a hard and fast rule: An idea or principle must succeed or fail based on it’s merits, not on any predesposed opinion. In short I see more failure in business because of “lip-service” or “program of the week” methodology.

    It’s vital that if we are going to invest in an idea, we understand it fully and then try it with the intent of succeeding. Then if it fails, it was a bad idea, and we didn’t “help” it fail.

    (Hint: most reasoned ideas, not all, succeed with this methodology.)

    GTG is long on philosophy and short of methodology. But then it is a research narrative NOT a how-to book. I am helping companies to ID and implement methodology, and by doing so, will prove or disprove it’s principles. My results are saying the book is on to something. Something great.

    We shouldn’t throw the baby out with the bath-water.

  10. Dr. Denning's Gravatar Comment by Dr. Denning on August 25th, 2006 at 10:15 am

    I read the review for and against Good to Great- as a clinical psychologist and consulting organizational psychologist for business owners I was impressed with the level of ‘Fashion Power’ that exists in the consulting world. THe fashionable flavor of the day truly exists. Just like the history of clinical psychology it seems that the field of business as a topic is going through the psychobabble phase, Hopefully there are a few great business psychologists who can help narrow the path to more scientific findings. Collins research methodology would have been thrown out of any good/ great doctoral program.

  11. Dr. S.Denning's Gravatar Comment by Dr. S.Denning on August 25th, 2006 at 10:17 am

    I read the review for and against Good to Great- as a clinical psychologist and consulting organizational psychologist for business owners I was impressed with the level of ‘Fashion Power’ that exists in the consulting world. The fashionable flavor of the day truly exists. Just like the history of clinical psychology it seems that the field of business as a topic is going through the psychobabble phase, Hopefully there are a few great business psychologists who can help narrow the path to more scientific findings. Collins research methodology would have been thrown out of any good/ great doctoral program.

  12. Catherine's Gravatar Comment by Catherine on May 9th, 2007 at 5:46 am

    Excellent reviews. I’m glad I happened by this site.

  13. Vanessa's Gravatar Comment by Vanessa on June 7th, 2007 at 4:29 am

    This blog has made me even more interested inthe book. I’m picking upa copy today. My church is teaching its’ principles to all active ministry members. I’ll let you know what (if any) changes I discover!

  14. Ajith Perera's Gravatar Comment by Ajith Perera on June 20th, 2007 at 1:16 am

    I happened to read a good critic in the site. I am here in Sri Lanka view the book like this. There are a few critics.
    1. The book says “Right People need not be motivated and they are self motivated”. This is applicable to senior officers in the Asian countries as I feel, but all other junior staff at lower level should definitely be motivated to get the job done. The reason for this is because most of the junior officers in Public and Private Sector earn just below or at the level of exactly sufficiaent for cost of living. So, they are all unhappy about their salary. So, in order to make them doing the job constantly, they have to be motivated always at least by non – monetory modes.
    2. Collins says “RIGHT PEOPLE ON THE BUS” but he never talks about the details of right people whether they are born, they can be made or how they can be identified. Every company employs right people in the best possible way they can, but it is only later you really realize whether they are in fact RIGHT or WRONG.Any body can say it is the RIGHT PEOPLE, RIGHT STRATEGY, RIGHT DECISIONS but no body could spell it out the source of this accurately.
    3. The statement “YOU SHOULD NOT DEMOTIVATE ANY BODY” is very critical. This statement is very important and I fully endorse that but if there are opinion leaders who try to play double game with the organization, they should be expelled in no time.Collins has missed that part. You should show no humility to these people.

  15. Richard's Gravatar Comment by Richard on July 2nd, 2007 at 7:47 am

    Excellent article, I read the book recently and – like you – even if I was paid to mark interesting passages I would still be ‘skint’. ‘Don’t do lists’ is probably the single most inspired piece of advice. Apart from that, it was an awful lot of words to point out a very few truisms. Which was a shame considering the obvious effort that went into the book – but then effort isn’t always enough!

  16. shiv's Gravatar Comment by shiv on July 15th, 2007 at 3:33 pm

    Hi,

    I agree there is too much room for criticism but if thought carefully the author might have not told “HOW” for everything like “how to get the best people” but yes he tells the important facts-
    1. Be a hedgehog 2. get the rite people blah blah.
    I believe its a good read and deserves appreciation. If you apply these to your life or your company you will definitely improve :) and thats unquestionably a good thing.

  17. Owen's Gravatar Comment by Owen on July 29th, 2007 at 5:59 am

    I liked it. It is relatively general but I think there are a lot of people in business who a) don’t face facts and b) expect things to happen overnight. If you read even a single line in a book that makes you think more positively or effectively about a situation then that’s a good result.

  18. Eric's Gravatar Comment by Eric on October 8th, 2007 at 12:18 am

    In hindsight, Good to Great research team was in the same quandary as the Olympics or the Tour de France. Specifically, doping. In hindsight, we may also need to admit that fraud may be an explanation for the sudden rise in corporate success in some (not all) cases. With respect to Fannie Mae for example: “On December 18, 2006, U.S. regulators filed 101 civil charges against chief executive Franklin Raines; chief financial officer J. Timothy Howard; and the former controller Leanne G. Spencer. The three are accused of manipulating Fannie Mae earnings to maximize their bonuses. The lawsuit seeks to recoup more than $115 million in bonus payments, collectively accrued by the trio from 1998–2004, and about $100 million in penalties for their involvement in the accounting scandal.” –http://en.wikipedia.org/wiki/Fannie_Mae

  19. Gaurav Koolwal's Gravatar Comment by Gaurav Koolwal on December 21st, 2007 at 4:56 am

    probably with the benefit of hindsight, we can say that at least one of the 15 good to great companies has not performed well in last 6-7 years, look at circuit city stock in the last 6 years , going by the book, the company should never have had those management problems and turnover which it had in the last 6-7 years and should have the right people when the management which took it to the top in its sector left the company, its stock had the largest % decline YTD in 2007 in S&P 500

  20. Stan's Gravatar Comment by Stan on January 22nd, 2008 at 3:05 pm

    what books do you recommend if you don’t buy “Good to Great”

  21. Obi's Gravatar Comment by Obi on February 7th, 2008 at 12:06 pm

    First of all I must say that I have read the Good to Great book and I think that the original review may bother on a little bit of some unconscious feeling I wouldnt like to call envy
    I totally agree with Owen. The points in the Good to Great book may seem very general, however you’ll be amazed that not many people understand “general” concepts like that things dont happen overnight or the importance of facing facts. This is even more so when these concepts are viewed in the context of various peculiar business circumstances. For me (for example) I must say it provided deeper insight into those issues and others especially as relate to my business. I dont think it is possible to come up with a step by step guide to becoming a great company that will fit every industry and business (and if in doubt, disprove me). Therefore I think that if we agree there was any value at all, and that the book was widely read, then we should give it up to Jim collins and his crew for doing a great job and contributing however “insignificant” to the development of humanity (…..even if we think we can do better)

  22. Emmi's Gravatar Comment by Emmi on February 13th, 2008 at 4:39 pm

    It’s really good to read all your reviews. More opinions means more food for thoughts.
    I am currently reading the book and I started the second chapter yesterday (First Who Then What).
    I come from a really technical background, but careers evolve and I am just not interested in spending my life reading specs and coding anymore.
    So anyway, I started reading about business with a capital b really recently. GTG would be my first business book. I am disappointed to learn that this is the most famous/sold business book. I hate following masses, that makes me feel less human, more like cattle…
    But I guess I had to start somewhere huh? So I read the first chapter and I read while frowning! Level 5? WTH? So if I am not I’m screwed? Oh no, I am not he explains… but the author categorizes things a little bit too much for my liking, going back to the feeling of belonging to a cattle.
    I’m still not convinced at the end of chapter one. I feel like the same thing is said over and over again, but I can’t really formulate why/how I don’t like it.
    But here is the thing though. I like the examples. They make me laugh most of the time because I get to know stuff that I did not.
    One thing for sure, this book opens my eyes and makes me think. On the level 5 thing I could not help it but scan thru all the people at my job and try to match the Level 5 tag on them… it was kind of funny!
    All in all I think what’s important is that you care about what you’re doing and you always accept criticism and keep criticizing things yourself… that applies to reading this book.
    I don’t think we can say that the book is good or not good. In the format, it follows a very scientific approach with hypothesis and data, a team, interviews, etc.
    The report was never to be taken as a bible, the truth, the science about it all, etc.
    If you really hate it and you can say how/why, then the book wins!
    Do you catch my drift?

  23. Gaurav Koolwal's Gravatar Comment by Gaurav Koolwal on February 19th, 2008 at 10:01 am

    one of the books i would recommend would be the undercover economist by tim harford, awesome simplicty in expanining the concepts and great wit

  24. Lara's Gravatar Comment by Lara on March 7th, 2008 at 4:39 pm

    Is it not the intent to make us think? If nothing else from reading the book, and reading the blog and these comments, the one thing it has done is address something we have not looked at before ‘in general terms’. Which is where it is needed the most.
    Good leaders, great leaders, people who’s goal is a balance between the reality of having to work and the humanity of having to work in environments know there is no set answer and daily objectives have to be balanced with employee motivations.
    It is a good book if you want to think about something differently. It is not if you are looking for a fool proof plan to become ‘perfect for business leadership’.
    Which in and of itself is redefined every decade.

  25. J's Gravatar Comment by J on April 3rd, 2008 at 9:55 am

    Great review. The CEO of our start up company handed out copies of this book to every employee and said if you like working here you will like this book. I read it last night and was disappointed. I couldn’t put my finger on exactly why, but your review made things clearer. In trying to find specifics of how we can improve this book only makes the tasks of specifying goals more elusive. I will tell our CEO that I will be level 5, hedgehog, the who not what, rigorous not ruthless, etc.. but in practical/real terms it is meaningless. And, I have no additional help in being more productive, effective, and happier. THANKS again for a great review. I am excited to read your book next.

  26. RW's Gravatar Comment by RW on April 4th, 2008 at 7:09 am

    I think it helps to have some experiences to compare against the book. If nothing else, the content is provocative in providing a framework of internal analysis and questioning. Every company will have a unique “how” with respect to applying the findings of the book. Any attempt to do a “My Research vs His Research” is at best narrowminded, and at worst self-serving. If you don’t see how the presentation of the material applies to your circumstances then 1.) It’s a semantic non-fit, or 2.) you’re not in a position to make the determination (i.e. my line managers don’t have the same visibility that I have into the inner-workings of the company in many instances.)

  27. Jon Hansen's Gravatar Comment by Jon Hansen on April 12th, 2008 at 9:00 am

    Even though I am a fan of the book, you make excellent points Rob.

    From the Survivorship Bias principle (only the victors write and therefore make the history) to Tom Peters’assessment that a company’s existence over the long term doesn’t reflect the importance of their impact at a particular point in history and therefore is not a true reflection of their “greatness” makes perfect sense.

    The problem Rob is that we tend to look for absolutes in a world in which absolutes are far and few between. In fact, even the very definition of an absolute is subject to debate.

    With this understanding, I believe that the critical element of this debate is governed by the lens through which one views any book – Collins’ book included.

    Specifically, I approach (or at least I try to) all research with a balance of both healthy sceptism and unbridled openess governed only by a single precept, “does it challenge me to think outside of the framework with which I am most familiar and comfortable!”

    As a professional author and speaker, I start each and every conference and seminar by making the following statement to my audience; “do not just take my word for what I am telling you. Challenge me and the findings I present! If the principles that I am advocating are valid, then they will stand the test of both scrutiny and time.”

    I conclude this opening oratory with a reference to the aforementioned statement by indicating that “my seminars can only be considered a success if it causes you to think outside of the framework of that with which you are most familiar and comfortable. You may not change your long held beliefs or opinions, but at least you will challenge their veracity.”

    And in the end Rob, isn’t this what it is all about in terms of why and how we write?

  28. Mister Ron's Gravatar Comment by Mister Ron on July 22nd, 2008 at 9:08 am

    “Good to Great,” taken from the point of view of a few years’ distance, starts to look kind of fishy. The recent performance of Fannie Mae not only skirting the edge of collapse, but possibly threatening to do so to the entire nation’s economy, sure doesn’t sound like a success story to me. Gillette, of course, did sell out to Proctor and Gamble, and in the process, threw 6000 people in Massachusetts out of work. Maybe they gave those people a copy of “Good to Great” in their severance package. Circuit City is also tottering on the brink, and has had to undergo the very restructuring that the book warns against.

    There’ probably other similar facts regarding the other “Good to Great” companies in the book. Obviously, something is wrong here, and these companies are not weathering the storm.

  29. Bill Brandt's Gravatar Comment by Bill Brandt on July 22nd, 2008 at 9:34 am

    I read g to g when it first came out. “Feel good” psychbabble was my opinion then. Have been interested enough, though, to follow up on the magic companies. Confirmed when Fannie Mae was noted to be dishonest in 2005, and then when Circuit City developed problems in 06 or 07, and the basis of the book, “right people on the bus” was destroyed this year by dishonesty of Fannie Mae. If this is where “level 5″ leaders take us, we don’t want to go there.

  30. Todd L's Gravatar Comment by Todd L on July 23rd, 2008 at 9:18 am

    With countless business books lining the shelves of every bookstore in creation, I was skeptical this book would bring me an epiphany. Unfortunately I was correct. This is another boring tale of corporate gluttony we are encouraged to accept as great corporate leadership. Fannie Mae is on life support as is Circuit City. Walgreens can thank big pharma for much of their recent success. The author would have benefited from reviewing companies like Whole Foods. A successful company that incorporates sound business principles and leadership with social responsibility

  31. Dave R's Gravatar Comment by Dave R on August 9th, 2008 at 4:11 pm

    Great dialogue about a book that has clearly influenced many people in the last 7+ years… I appreciated Rob’s mention of the lack of “disconfirming research”. Clearly, more work could be helpful if focused on the “what did we miss” topics. However, the lack of “disconfirming research” is not proof that Collins and his team were wrong in the principles they identified. Every one of the principles may in fact be valid. Further work might identify companies with the principles that failed… and we might learn what additional principle could be observed by careful scrutiny of the data. Thanks for all of your comments; I’ve enjoyed revisiting the principles in Collins’ book – which I DO consider when addressing strategy and tactical planning in both my business and personal life.

  32. Forrest Christian's Gravatar Comment by Forrest Christian on September 26th, 2008 at 2:18 pm

    Raynor discusses the problems of survivorship bias in “Good To Great” in his book, “The Strategy Paradox: Why committing to success leads to failure ( and what to do about it)”. He points out that most of us would consider making market performance success, when it these were Collins’s comparison companies. His research may still suffer from some of the faults you mention but he does state a clearer thesis.

  33. Ken's Gravatar Comment by Ken on October 20th, 2008 at 2:31 pm

    One of the problems of GTG and this review is that they don’t seem to take into account the changes that happen in a company on the path from GTG. Anyone who has been in a startup and travelled to greatness will have experienced the massive pressures that change a company as it grows. It is not often that a CEO or management team will even want to be there for every bit of the journey. The route also includes other influences – social, marital, health to mention a few – there are so many factors that change the rules on the way. To expect one book, or one research project to be able to find a single ‘optimal’ pathway that fits. It doesn’t compute. Listen to opinions, learn, discuss and form your own subjective opinions; apply them in your business and hope you have what it takes!

  34. John Smith's Gravatar Comment by John Smith on October 20th, 2008 at 10:02 pm

    My company is eating this “Good to Great” nonsense hook, line, and sinker. It’s disgusting how they use it as a tool to get rid of truly great people. Level 5 my a$$. It’s all about who is in power, and how they are going to get more by using lackies and @ss kissers to get them there.

    I won’t give the name of my company, but it is fashioned after a fruit…

  35. Jeff's Gravatar Comment by Jeff on November 8th, 2008 at 5:08 pm

    We are practicing Brutal Truth here, so something must have stuck. While the methodology of G2G can be disputed, as any other research, the principles are still applicable. Why are we not attacking the MBA management programs offered at the universities, they do the same thing.

    If you want a decent book to read, consider Black Swan.

  36. Ian Brodie's Gravatar Comment by Ian Brodie on November 12th, 2008 at 6:45 pm

    There’s a comprehensive criticism along your lines in the excellent book “The Halo Effect” by Phil Rosenzweig – recommended reading for anyone wanting to cut through the BS of management theories.

    Ian

  37. Ken's Gravatar Comment by Ken on November 13th, 2008 at 7:51 am

    It will be interesting to see how many of the GTG examples in the book fall by the wayside during the current ‘down turn’. So far both Fannie Mae and Circuit City have fallen, even though Fannie Mae has been resurrected from the dead. I suppose it just goes to show that what looks great from one direction can look a lot different from other angles?
    K

  38. Gerard's Gravatar Comment by Gerard on December 23rd, 2008 at 7:05 pm

    I like this review. Thank you.
    For those of you who have read Jeremy Hope’s books, the same critism go for his books, not really a how to approach to actually doing it.

    For me, I love both Jim Collins books and many other business books, but often they lack a how to part. Most of the time they give hope but little else.

  39. David's Gravatar Comment by David on January 7th, 2009 at 6:35 am

    Clive Woodward applied the principles of the book to the England Rugby team…. they won the world cup!

    There’s a fact for you Rob! don’t hide from the facts remember. If a book can be responsible for such a great achievement you cannot doubt that it delivers.. it already has.

    By the way Clive Woodward openly promotes this book.

  40. Jared Lyda's Gravatar Comment by Jared Lyda on January 7th, 2009 at 12:31 pm

    Critical Reviews are needed. Thanks for using your time to uncover some of the generalities of Good to Great. However, I gained important insights into my own company and found the book fascinating. I will continue to recommend Good to Great wholeheartedly……

    Jared Lyda
    http://www.fireandmotionblog.com

  41. Richmond's Gravatar Comment by Richmond on January 15th, 2009 at 1:52 am

    Although I read and got great value from ‘Good to Great’ I understand that not every book appeals nor has value for every person (I don’t put much value in Jane Austen nor Harry Potter yet I can appreciate that others get value from them).

    Becuase ‘Good to Great’ has helped my company and the English Rugby team doesn’t mean it will help everyone. It’s refreshing to read an assessment of the book that focuses on measurable facts, not just opinions.

  42. jason's Gravatar Comment by jason on January 16th, 2009 at 3:01 pm

    IF YOU’RE GOING TO LEND ANY CREDENCE TO THIS REVIEW, PLEASE READ THIS FIRST:

    Sad, angry little reviewer… You’ve missed the points, and are stretching for contrarian perspectives. You lost me at the Barnum Effect, though I did continue to read your whole review. When you try to pick apart the First Who Then What concept, you’re oversimplifying and missing the point. Yes, the concept is make good hires. However, this isn’t a suggestion to the readers. This is what those companies who succeeded DID. Collins is merely telling us the themes that these businesses had in common, not telling us what people should do. If this reviewer has ANY experience in corporate America, he surely knows that a huge number of businesses DON’T place enough emphasis on hiring decisions, and work from the opposite angles. It is very common for businesses to decide WHAT they want to do first, then try to fit the people in. Collins is merely explaining that ALL of these Good to Great companies did the opposite. They brought in great people, then decided what they should do with all this talent.

    SECOND MAJOR POINT: The Lack of Disconfirming Research. OF COURSE THERE’S NO DATA ON THIS!!! What did the reviewer expect, that somehow Collins’s team would somehow be able to review the THOUSANDS of other businesses out there over a period of MANY YEARS? Again, if this reviewer had any foundation in reality, he wouldn’t have included this statement. Surely, it would be an unending labor to try research EVERY ASPECT of this book in reverse. How do you identify whether or not the other FEW THOUSAND businesses operated from a First Who Then What principle? Or if those THOUSANDS OF BUSINESSES used a Hedgehog concept overtime?

    This reviewer is clearly biased and grasping at straws here. Please don’t use this review to make a conclusion about the value of this book. Collins NEVER asserts that he is writing a roadmap for all businesses. The point of the book was to identify key concepts that some of the very best businesses have in common. What you do with that information is up to you.

  43. Phil D's Gravatar Comment by Phil D on February 4th, 2009 at 4:46 pm

    The fact that there is such a lot of posting on this review highlights the fact that the book hits the spot. Yes there are generalisations (that was the aim to find the common themes). Yes good companies go bad and yes its a good read – take from it what you will.

  44. Ken's Gravatar Comment by Ken on February 5th, 2009 at 1:43 am

    Well spoken, Jason and Phil D.
    GTG is not a formula, it’s a report. For anyone who is trying to go from Nothing to Good and, perhaps, GTG one day there are a number of things in the book that are notable and can be encouraging when you find that you are already on that path. There are also some good examples of ‘how it can be done’ but it is not ‘the’ recipe for success. Just observation of what happened in the time frame. We can all see that some of the Great have developed massive cracks or fallen completely. Perhaps a follow up in current conditions would be interesting reading.

  45. Andrew's Gravatar Comment by Andrew on February 18th, 2009 at 7:21 pm

    Wow, apparently nothing is actually real ever, and every single idea in the world is flawed. Is there any idea that is immune from criticism? They proved their ideas in context and we spend incredible intellectual energy talking about the ideas outside of the context they were presented in. Crazy. We nitpick every aspect of everything and dissect it. Anything based on hardcore research like this is true in a certain context and that’s the wisdom that is imparted in the book no one pays any respect to.

  46. Jane's Gravatar Comment by Jane on February 25th, 2009 at 6:43 pm

    I am an educator and our new principal is now suggesting that we read this book. I have just started it and am not quite seeing the connection yet. When did education turn into a business?

  47. Henry's Gravatar Comment by Henry on March 9th, 2009 at 10:10 am

    Jane

    Education is about getting results, just as business is about getting results. The principles of humble, determined leadership; having the right people on the team; etc. can all be applied to any organisation: not just business.

  48. gpaskill's Gravatar Comment by gpaskill on March 17th, 2009 at 1:42 pm

    That’s a really interesting insight about “hiring good people.” Just what are good people?

    Hiring today is in really dismal shape. There’s this erroneous belief that if you were a “good person” (whatever that is) in one company, you’ll be good in all others. Consequently, if you didn’t succeed in your past companies, then you will consistently fail in all companies afterwards.

    When you look at some of these proven performers with big company names in their background, some actually have the benefit of being at the right place at the right time. Those who hire them for subsequent jobs believe, well if you created a browser and revolutionized the world at age 25, everything you touch will turn to gold.

    The part that is sorely lacking in track “hiring good people” is this. If you as a hiring manager, HR representative or peer manager deemed that somebody wasn’t good, were you right? Did you look to see where that reject candidate landed, and did that person go ahead and destroy your competitor because they were bad? No, hiring managers the world over can cry that talented people are so hard to find and nobody challenges them on it. Have employers cry that enough, and the world believes it, unless you stop to think that not all the laid off people of 2009 are losers (even if they worked for Bear Stearns and Lehman Brothers.)

    The real problem in hiring is this. Hiring focuses way too much on what you have done. Hiring now more than ever needs to focus on what you can do. People who were good in one company can fail. People who were bad in another can succeed in another. Some “good people” are indeed really good, they just never had the bosses and environments to demonstrate they were good.

    P.S. If you want to hire good people, resumes are useless!

  49. Estelle DESTRIBOIS's Gravatar Comment by Estelle DESTRIBOIS on April 29th, 2009 at 10:14 am

    Dear Rob,
    I was very happy reading your note about the “godd to great” book. In fact, there are very interesting points about which I never though about such as “A Lack of Disconfirming Research” or “The Corporate Barnum Effect”. There is a point we have in common: “The Tom Peters Criticism”. This is exactly what I was saying to my collegues: “he based all his study on he fact that the great companies, but if the stock exchange would be the universal way to define a great company, it will not fluctuate so much !”.
    There is a point that he very important I think and that was not in your article: Jim Collins declare that things are like that and that it is proven, but how can you prove something with a sample of 11 companies???? How can you generalize and make rules for all the companies in the world with a sample of 11 companies???? Not very scientific ;o)

    As you, I don’t say that Jim Collins is right or not, I just say that he can not affirm such things based on a so fragile basis…

    Thanks for this very interesting article once again,
    Estelle

  50. J. MacAuslan's Gravatar Comment by J. MacAuslan on April 29th, 2009 at 7:54 pm

    To test Buffett’s reputation for survivorship bias [which I, too, have often wondered about]:
    Among publicly traded US companies, what fraction of CEOs performed better in, say, the increase in book value of their companies during 1965 [when he took over BH] to 1974? How many during each of the subsequent 3 decades? (Suppose the average of those 4 numbers is 2% — I don’t really know, but it’s not rocket science to look up the numbers.) That gives you an estimate of general rarity, and it lets you state a concrete hypothesis to test:
    Picking companies, or CEOs, at random each decade, you would get 4 such performances once in 6 million tries. (.02*.02*.02*.02) The question is, were there about 6 million people who led that collection of companies over that length of time? (Then one of them would certainly have been at least in Buffett’s league!) Or even 100,000?
    If 2% (or less) is the right number, then the answer is almost certainly, “No, Buffett really is special.”
    But if it’s 10%, then it’s a 1-in-10,000 chance, and there have probably been almost that number of CEOs, so the answer is probably, “No, he’s just an especially good example of a survivor: a good enough CEO, and young enough, and healthy enough, to stay in the game for a very long time.”
    My guess (and it is only that!) is that 2% is closer to the mark. But the question is an empirical one, and it has an empirical (albeit statistical) answer.
    FWIW, you could instead ask how likely it is that any randomly chosen S&P500 company would beat the S&P500 average, 34 times over those 40 years (or 38 over the last 44 years). The answer is 1 in a few million. But it’s not so clear whether BH should be considered in that way, especially in the early years (I vaguely recall a market value of $20M, which might let it outperform just for reasons of size, rather than CEO quality).

  51. Marie's Gravatar Comment by Marie on April 29th, 2009 at 10:01 pm

    Interesting read of comments. I have owned a growing business for almost 30 years — and get motivated by ideas – and G2G did exactly that! We started applying the principles of G2G a few years ago and have soared at a time when most in our industry are hurting… was it the book alone? No… but the principles have value… if you and your team are passionate about what you do, if you do have the “right” people on the bus, if you focus on what you are “best” at… then things will change! As an entrepreneur, I am a sponge and thrive on ideas and philosophies that will excite… from books, lectures, discussions… learning as we go! It is interesting to read some of these comments as I never read trying to find fault, I read to learn and grow… and am grateful for being so very blessed!

  52. Alex Murphy's Gravatar Comment by Alex Murphy on June 19th, 2009 at 5:13 am

    To me, reading business books is somewhat similar to the act of going to church … you know the core principles but you need to listen and internalize the subtle nuances so that you truly stay on the right path.

    Collins’ book addresses two of these subtleties in a way that I think is unique and is something for every person to apply to their business.

    The point of deciding what “can” you be the best in the world at is a different way to look at your mission. He discusses the need to look at the market, and your talent, and passion, and understand that all of these factors have to work together. In many respects this is somewhat obvious, but I haven’t seen it put that way.

    First who they what is something that every business “knows” but so few actually practice. Almost every single business works their staff as hard as possible until they are on the verge of quiting and then they hire some additional “help” to address the looming to do list that needs to be addressed yesterday. This is the process of first what then who. This leads organizations to make bad hires which is bad for both employer and employee. Google has not been around for dozens of years, but look at their hiring practices and their methodologies. They have set up campuses next to the three leading tech related universities in the US for the purpose of attracting talent first and then determining what to do with the talent.

    There are holes in the research, but the general concepts will help most business people who are in the position of trying to “transform” their businesses.

  53. Reese's Gravatar Comment by Reese on July 15th, 2009 at 9:57 pm

    I liked this review. It give a different perspective and makes you think.

  54. Parth's Gravatar Comment by Parth on July 21st, 2009 at 2:54 pm

    I would not agree to this point above – The Corporate Barnum Effect

    I have been reading this book and what I got before reading this post was – rather than working on strategy and then finding right people that fit in that strategy it is important to find good people first and then driving the bus. I was surprised at picking up few sentences and going after that. You have to consider whole picture for getting idea behind those lines

  55. Nick's Gravatar Comment by Nick on October 5th, 2009 at 3:43 pm

    The review misses an important point- this book was written in an emergent style based on available data and interviews. And out of that process, these principles emerged as statistically significant. Not exclusive, but significant. It’s a walk through organizational behavior using incredibly cool techniques to highlight the impact of certain principles.

    To look at the principles but not the process that they are derived through misses the magic of the book. And the method is elegant.

    The point about disproving these points and including that in the study method is worthless and misses the point of the research methodology. It is a highlighting of the significance of these facts across many companies by using a research methodology that tries to remove the researcher. The fact that many of the point are counter-intuitive to business thought of the 70s and 80s is refreshing. I’m sure you can find exceptions to all of these- that’s the nature of complex organizational behavior. And other factors certainly could wipe out these companies in the future.

    BTW- the point about Microsoft confuses this book with ‘Built to Last’. This book is about companies turning themselves around. Also, Microsoft’s industry leadership is questionable. Who cares if they use Windows, OS/2 or OS X. Talk about survivor bias.

    1. Companies that went from good to great promoted to CEO from within thoughtful leaders that are contrary to the charasmatic CEO rockstars.
    2. Companies that went from good to great massacred their management layer, and planned strategy in an organic, collaborative manner.
    3. Companies that went from good to great broke free from the status quo.
    4. Companies that went from good to great had organizational alignment and a great operating model focus (see Discipline of Market Leaders, Crossing the Chasm, marketing strategy books by Al Ries, and other books that talk about the importance of alignment and focus)
    5. This is more about culture then discipline. It’s interesting.
    6. There is an interesting story here about early adoption based on clear business models. Marketing theory about early adopters (e.g. Crossing the Chasm) selecting barely functional new products talks a great deal about other principles mentioned here.
    7. Incremental improvement over time. The principle of alignment. Evolution of capability . Adaptation of complex systems. All interesting concepts buried in here.

    Anyway- I’m a big fan.

  56. Jonathan Wolfman's Gravatar Comment by Jonathan Wolfman on October 7th, 2009 at 12:55 am

    I’m writing a paper on Good to Great for a graduate-level course, and some of the commenters here might be interested in taking a look. My review is in progress and posted online so that I can add discussion input as I write.

    http://sites.google.com/site/jonathanwolfmansite/summaries/good-to-great-review

    Overall, I agree with Rob’s logic-oriented arguments, but I think the findings of the book are much more specific and applicable than he lets on. For example, the study shows correlation but not causation. Also, Collins never presents any data that prove the findings are applicable to organizations that aren’t large companies competing between the years of 1970-2000. Nevertheless, the definition of a Level 5 leader includes six points in the Chapter 2 summary along with many illustrating examples, so it is much more specific than “humility,” as Rob claims.

    Please reply on my website, which is for educational purposes and has no commercial interest.

  57. Jaimini Ram's Gravatar Comment by Jaimini Ram on December 8th, 2009 at 9:52 pm

    The one interesting trend I noticed in this blog itself: Initially there is a lot of negative criticism, and towards the end more support for g2g. That itself is a good pointer towards the relevance of g2g – because typically people who are critical are more vocal and drown out the supporters. Here the supporters are equally vocal too.

    Jim Collins mentions right at the beginning that he does not expect people to accept the book at face value, but to “consider it”.

    There will always be criticism for anything you do, that does not make it incorrect or wrong by itself.

    I think there are many points that Jim Collins brings out are very relevant, though as someone already mentioned, something we know inside but dont necessarily practise it.

    Of course the collapse of circuit city and fannie mae may contradict the findings in this book (but Jim also says that the g2g principles have to be followed continuously..)

    Also I am not sure if Google has a hedgehog concept – they seem to be getting into everything. So why are they successful?

    Overall, I like the book. With an open mind I will consider it. But its not a bible to be followed to the last word. Jim has taken great effort and brought out good points- on the other hand it does not take the same kind of effort to criticize.

  58. Brad's Gravatar Comment by Brad on December 10th, 2009 at 7:56 pm

    One thing that would be really interesting to see is what conclusions Collins and his team would have drawn had they found disconfirming evidence. I think one way they could have done this is by doing the following:

    At the beginning or end of the book, they could ask each company in the United States for help in participating in this research. They should have asked each company to voluntarily analyze itself to see if it had each of the 6 core principles of a GTG company, and to contact Collins’ research team if, despite their efforts to become great, they had NOT become a lasting, great company. This would have allowed more data to draw conclusions from and would have provided disconfirming evidence to prove Collins’ theories. This is the only way I could think of that would provide disconfirming evidence without spending an eternity of research (although it doesn’t guarantee any companies would actually respond to such an inquiry…).

    I personally think the book is a better personal improvement book than a business book. Like many have said before me, the book doesn’t scream anything revolutionary. However, the principles are so general that they can apply to almost any situation: parenting, church, government, etc. If it sucks as a business book, then at least apply it to other areas!

  59. Jaimini Ram's Gravatar Comment by Jaimini Ram on December 12th, 2009 at 4:02 am

    In many ways, the work of a critic is easy. We risk very little yet enjoy a position over those who offer up their work and their selves to our judgment. We thrive on negative criticism, which is fun to write and to read. But the bitter truth we critics must face is that, in the grand scheme of things, the average piece of junk is more meaningful than our criticism designating it so. But there are times when a critic truly risks something, and that is in the discovery and defense of the new. Last night, I experienced something new, an extraordinary meal from a singularly unexpected source. To say that both the meal and its maker have challenged my preconceptions is a gross understatement. They have rocked me to my core. In the past, I have made no secret of my disdain for Chef Gusteau’s famous motto: Anyone can cook. But I realize that only now do I truly understand what he meant. Not everyone can become a great artist, but a great artist can come from anywhere. It is difficult to imagine more humble origins than those of the genius now cooking at Gusteau’s, who is, in this critic’s opinion, nothing less than the finest chef in France. I will be returning to Gusteau’s soon, hungry for more.

    From the movie “ratatouille”

  60. PJ's Gravatar Comment by PJ on December 17th, 2009 at 11:32 am

    Great book and excellent criticism.

    At some point most of us have hired someone less than desirable because of cost or time constraints, or because we wanted to help someone, or because we knew the person would watch our back.

    I think Collins is pointing out that such compromises would not work for the company long term. Many findings in the book seem obvious, but those obvious things are the hardest to follow. My 2c.

  61. Charles Haase's Gravatar Comment by Charles Haase on February 25th, 2010 at 1:57 pm

    This is not hate mail! I appreciate your analysis and will continue to consider it.

    I was very taken by Good to Great but I’m open to whatever else is out there.

    I will say that the principle of “First who” has led to better hiring practices in my organization. We used to think that we would hire the best of the pool of candidates. We’ve learned that sometimes no one in the pool is great so we have to be patient. We’ve also learned that sometimes after someone begins their new job, we realize they aren’t a good match. Rather than hanging on to them, we let them go.

  62. kama maharaj's Gravatar Comment by kama maharaj on February 27th, 2010 at 7:12 pm

    I am the founder of a 30 year old company that, although small, is “good” enough to have won a few awards (including one that is sponsored by the Inter American Development Bank). I have just read “Good to Great” and made a summary of the core concepts to share with my staff. Frankly, I have to agree that the book was essentially fluff, with a few key messages:

    1. hire the right people who will be naturally self motivated.
    2. put your best people in the biggest opportunities.
    3. prepare for succession.
    4. confront the brutal facts, focus on what you are passionate about, can be the best in and maintain your focus.
    5. enforce dicipline.
    6. measure performance
    7. make best use of technology as a business accelerator.

    Really, how can this be cutting edge, game-changing work?

    For instance, we ensure dicipline by enforcing punctuality. If we have a meeting at a scheduled time, we remove all the extra chairs and start the meeting. No one comes late any more to our meetings. We consider discipline to be a proxy for the type of behavior and attitudes that characterize a progressive organization.

    In initally when we had a problem with punctuality, we came down hard on every fourth person and everyone got the message. This is not fluff but teachable lessons that every organization can benefit from. It is ideas and experiences like this I expected from this book.

  63. Jeff Tong's Gravatar Comment by Jeff Tong on March 15th, 2010 at 1:01 pm

    Thanks for the great review. So many are reluctant to go against the norm. I’m glad this review did.

    http://gundamwing4132.wordpress.com

  64. HigherEdCritic's Gravatar Comment by HigherEdCritic on March 24th, 2010 at 2:44 am

    Jim collins should be banned from speaking to university administrators and trying to influence universities to run like corporations that have gone bust whether they be Circuit City or Fannie Mae. The “hire good people” tenet has been eggregiously misinterpreted by university adminsitrators who avow Collins as their great guru! They then bring “bad” expensive corporate types on the bus– such as million dollar coaches and fund raisers all while universities and faculty are going bust– Presidents pay huge amounts of money to Collins and his ilk for “life coaching!” This is rather like the relentless positive thinking that Barabra Ehrenrich says is destroying America! Let the little people rant and rave! Get rid of this mumbo jumbo from venues that should be for teaching critical thinking!

  65. NotSold's Gravatar Comment by NotSold on March 31st, 2010 at 11:41 pm

    I worked for one of the ‘great’ companies Mr. Collins has identified. To be sure, the company is one of the best performers in its sector. But the culture of the company belied application of any of the core concepts which serve as the anchors of Mr. Collins criteria. Most colleagues of mine felt that the company under-utilized their strengths by compartmentalizing tasks in order to limit the amount of independent judgment. A substantial bureaucracy ensued to serve as the watchdog over checklist execution. Self motivation became irrelevant, in favor of thousands of pages of procedures which were to be followed without exception. To question the procedures was tantamount to questioning the authority of those who blessed the procedures. Discipline was cast aside in an effort to preserve status quo. If a manager was propped up by a team of high performers, the manager could not be removed, irrespective of his or her impact on performance and morale. One thing this company did well – it kept at the forefront of technological development. I have worked for a number of its peers, and by far it was the most forward-thinking in terms of technology (that said, we were two years behind the curve in scanning technology, using the fax instead).
    The point to my rambling is this – irrespective of what might be observed (or even reported as observed), the core concepts that were supposed to have made this company great were not even barely recognizable, let alone pervasive. Perhaps – though it is highly doubtful – they existed in the boardroom, whence they appeared in the findings of Mr. Collins’ ‘research’. I’m afraid that “Fluff”, versus “Research”, is a more accurate assessment of the observations in GTG.

  66. John's Gravatar Comment by John on April 3rd, 2010 at 9:34 am

    I am surprised that

  67. John's Gravatar Comment by John on April 3rd, 2010 at 9:56 am

    It is amazing that proponents cannot realize that one cannot PROVE a point and at the same time DISPROVE it.That is not how life works.Even if Jim were to find “disconfirming,” evidence by logic he will only be comlelled,not to dispel his assertions, but explian why those company which practiced the principles did not make it BIG.In short the most approriate critisism of Jims work will be to prove that other companies which did not follow his outlined principles did make it just as big.

  68. Doc's Gravatar Comment by Doc on April 8th, 2010 at 7:37 pm

    Perhaps you should write the sequel “Grate to Great” …

    You missed the most key point (which you can include in your next book) … it is the customers of these companies that make them Great. Once they go away, so does the Great Company (e.g. Wang, Lucent, and more to come – see http://247wallst.com/2008/12/19/companies-that).

  69. Marie's Gravatar Comment by Marie on April 24th, 2010 at 7:03 pm

    I’ve read this forum with interest over the past year as our small company (10 full time and 50 part time) continued the process of Good to Great which we started over 4 years ago. When I first read the book, as a business owner who started the business 30 years ago, it made sense. It was based on research. And we were doing very well at the time.

    What has happened since is short of a miracle – and there is no question in my mind that it does work. It takes passion and discipline to change your path when you are doing well, to follow what feels right — and for us, the flywheel is now really speeding ahead. We would not have taken this direction had it not been for the teachings in this book. And I would challenge any small company leader passionate about raising their company to greatness to read it – many times – and follow its concepts.

    Are there things that may not be perfect? Who cares if it raises the bar and takes you one step closer to doing better than yesterday? One can sit and criticize or stand up and take action – I am glad that action is what we did! Would we have attained the same results – possibly – but highly unlikely. And I could give so many examples – but that would take me away from my passion! Good to Great is a definite recommendation to anyone looking at learning how they can grow their company and their team!

  70. R Shah's Gravatar Comment by R Shah on May 7th, 2010 at 9:30 am

    This article has actual DATA that showed “Good to Great” is for suckers…

    http://growthsci.com/blog/hello-world-2/

  71. Doug's Gravatar Comment by Doug on June 24th, 2010 at 8:05 am

    Rob, your comment has a logical error: “If there are companies out there that do all the good-to-great things but have medicore performance, that invalidates Collins work.”

    No, it does not. Collins never said that the conditions were sufficient. Take the following thought experiment: Barings Bank does all of the “good things” from Good to Great yet it still collapses due to a rogue trader. There are thousands of little, trivial, things that one needs to do to do well in business – things that both the comparison and good to great companies did. Not doing one of these could lead to poor performance without invalidating anything in the book.

    Of course, the book doesn’t claim that they are necessary conditions rather that they are correlated (some of them were found in most but not all of the companies). That is there is evidence that suggests these practices might cause good to great performance but not conclusive.

    The research was interesting but the book doesn’t give enough space to the limitations of the research methodology. University of Chicago professor Steven Kaplan has some upcoming research exploring the problem in a similar fashion with different data (start-ups that VCs funded) that suggest that some of the book was correct and some was incorrect.

    I must say I liked the book a lot more than the typical book that is research-free (just offering the author’s opinion based on “experience”).

  72. Dave R's Gravatar Comment by Dave R on June 27th, 2010 at 11:57 am

    Doug’s comment on 24-June-2010 is spot-on. Collins’ book (supported by the research) asserts that the conditions in Good to Great are necessary. He never claimed that the conditions were sufficient to propel a company from good to great.

    Bravo for Marie’s comments on 24-April-2010! It’s refreshing to hear the voice of optimism that comes from the encouragement of success. You took action instead of taking pot-shots!!
    Cheers!

  73. Matt's Gravatar Comment by Matt on June 27th, 2010 at 10:23 pm

    I would go one further on the “research.” Collins clearly isn’t a scientist, mathematician or engineer. In the same way that enough monkeys with typewriters will compose Shakespeare, his approach guarantees an outcome, even if the facts are random. I’ll even ignore for a second that some of his principles are so subjective that researchers who know the desired answer can’t help but assign one leadersip team “low ego” and another “arrogant.”

    I’ll even ignore his prediction at the end of the book about the companies that would continue to succeed and the one that was iffy (Nucor). Since his metric for greatness was stock performance, one would expect that the companies for which he guaranteed greatness would have exceeded the market. The results are astounding. It’s not that they’re merely random. I haven’t gone back to confirm this since I first researched it in 2007 because I’ve tried to permanently purge this book from my mind. But, in 2007, from the time that the book was published 10 of 11 of the great companies had UNDERPERFORMED the S&P. 10 of 11. That’s astounding. And here’s the kicker: the only one that outperformed was Nucor. The company he had singled out as being tenuous in the Great camp. But we’ll ignore results on Collins’ own metric, because really, we don’t need it to prove the point.

    Here’s the reality. If you give me enough meaningless variables and a set of outcomes, I can 100% of the time conclude that 6 of the random varaibles perfectly predict outcome.

    Don’t believe me? Give me 1000 arbitrary variables about NFL games. Not passing stats and efficiency ratings. I mean: jersey color, whether the mascot is a mammal, if the team has changed cities in the past 10 years, if the coach’s name starts with a Q, if the starting QB is a fraternal twin.

    We can agree none of these impacts the outcomes of games. Yet it is a mathematical fact that if you give me enough, I guarantee that I can find six that predict, with 100% accuracy, NFL winners last season. Not all games will qualify, but I will be able to give you some number (Collins chose 11) of games that all went the same way.

    It’s not research. It’s mathematical hocus pocus. Any true research professional would laugh Collins out of the room.

  74. Doug's Gravatar Comment by Doug on June 28th, 2010 at 11:28 pm

    Saying that 10 of 11 didn’t continue their stellar performance is like saying that a good NFL coach is no longer good because he looses three seasons in a row – to sustain such performance would be rare. You’d also need to see if the companies continued to practice the principals outlined in the book (if they decided not to then it would actually support his conclusions) and you should also compare them against their industries, not the S&P.

    That being said, you are absolutely right that if you pick 100 variables you’ll find some that are only in the “good” companies and not in the “bad” companies that have nothing to do with performance. Collins likely found some of them and he’s quite likely wrong about some of his principles. Ideally someone would do another study that just looks to confirm or disconfirm his research (though, as many say, some of the findings may be too subjective to capture and thus count as research).

    That’s the problem with a lot of social science research – the variables are mixed together. Voter behaviour is an area that immediately comes to mind – you can’t do experimental research in either so you need to do observational research. It’s not as good, especially like in the case of Collins’ book where the results are not replicated, but it’s certainly not worthless either.

    Of course, the distinction is lost on many who see his work as some sort of scientific proof when it is nothing of the sort. In comparison to much of the management literature and training out there (I was once sent on a course talking about interpersonal relations that had its tenants based on “ancient wisdom”) it’s not too bad. If more researchers will do data-based studies in the management field I’d be delighted (and as I mentioned, professor Kaplan has just completed some research along these lines).

    I agree with you, show me the proof is better than give me some possible indicators in the data which may or may not be true (what Collins has done). But I’d take Collins’ flawed study over a consultant’s hunch any day of the week.

  75. J. MacAuslan's Gravatar Comment by J. MacAuslan on June 29th, 2010 at 8:10 am

    I think Doug’s final comment is the best take on this book that I’ve heard: “take Collins’ flawed study over a consultant’s hunch.”

    As for the difficulties of observational research in the social sciences: Those sciences get off the hook far too easily. Astrophysics and geophysics are observational sciences too, yet they are manage to be HARD sciences. (You think it’s hard to directly experiment on voter behavior? Try experimenting on black holes located 10,000 light years away. ;-)

    Replicating a study is one of the best ways to “harden” a finding. So is looking for disconfirming evidence, such as failures to outperform after abandoning Collins’ principles, if you fail to them. Neither of these studies have been done, even by Collins, AFAIK.

    A flawed study indeed, with correspondingly weak conclusions. But still better than a consultant’s hunch, especially if someone ever builds on his work instead of taking it as gospel.

  76. Doug's Gravatar Comment by Doug on June 30th, 2010 at 2:20 am

    J. thanks for your kind words. I do think that Professor Kaplan of the University of Chicago’s latest research will shed some light. He took long, structured interviews of CEOs in pre-venture capital firms (standardized and performed by the same company) and analyzed the scores on it with the success of the firms in, I think, 5 years. Some of the conclusions were similar to Collins’ and some were opposed. I believe the research will be published soon (I saw it presented in Shanghai last week while the professor was visiting).

    In terms of voter behaviour, there are some hard findings about different systems and how they impact voting. There’s also a fair bit of hard data (tracking polls, exit polls, and election results) in contrast to a lot of other areas of political science, which, unfortunately has a lot of fluffy models and arguing and a few people like Paul Collier that do extremely useful, scientific research.

  77. Doug's Gravatar Comment by Doug on June 30th, 2010 at 2:25 am

    I clicked too soon. Take a look at:
    http://faculty.chicagobooth.edu/steven.kaplan/research/

    “Which CEO Characteristics and Abilities Matter?” and
    “Should You Bet on the Jockey or the Horse? Or What Are Firms? Evolution from Early Business Plan to Public Companies”

  78. Vivi's Gravatar Comment by Vivi on July 8th, 2010 at 10:19 am

    I love this article.. i would have to disagree with good to great .. i think is a waste of time to read, some of people i know do not really enjoy reading it, they just have the book to just have it because a lot of people have it and because everyone is saying that is the number 1 best business book and to be honest, open the book and you do have to kind of interpret in your own way… so everyone who reads this will have a different interpretation of the subject on the book,. so if more than one author does not like this book DON’T READ THE GOOD TO GREAT… but like a good author Rob is, he suggests to read GOOD TO GREAT.. so he’s actually just critiquing with some factors, DON’T HATE ON HIM … But once you try reading Good to Great and someone asks you to do a presentation… good luck, you might be like a dummy, because everyone looking at you will say, OH that’s not what i understood, or that’s dumb … so
    in Conclusion Good to Great<- BS

  79. Vivi's Gravatar Comment by Vivi on July 8th, 2010 at 11:21 am

    Good to Great.. go ahead read it.! I dont mean to write bad stuff about it, I m just observing and hoping people read more thoroughly and do better with their actions towards other people and at work.. dont let a book tell you what to do other than GOOD ETHICS AT WORK….good to great!

  80. Marc's Gravatar Comment by Marc on August 28th, 2010 at 8:35 pm

    I follow what Rob is trying to say, and to a degree, I concur. As a stand-alone how-to manual, the book is a total flop. As a consciousness-raising evaluation, it fits in well as part of a larger compendium. Had the book never been written, it would not be particularly missed; however, it does serve well as a valuable adjunct to a larger body of learning.

  81. Steve's Gravatar Comment by Steve on September 12th, 2010 at 9:35 am

    My company is emabarking on the GTG strategy to deliver growth on a turnover of $7.5 million. The book is being shared amongst the middle management and directors so I felt I would buy a copy and review. I have to say that I am only on page 55 and struggleing to see the relevance in todays business world. The statistics that have been trumpted relate to the organisations growth and only up to the year 2000 (pre-dotcom). Out of 1400+ organisations in the study only 11 have been selected and of these Circuit City (has been purchased/sold)and Fannie Mae has been bailed out by the US government. These compnaies are also Multi Billion Dollar enterprises. Malcolm Gladwell’s recent book Outliers makes a case that any smaple data set if enlarged will throw out clusters of data that any case could be be made from, this seems to be true in GTG. On the basis of chance if we take the sample number of companies and divide it by the sample selected you have a 1 in 140 chance of being ‘lucky’. If every aspiring business person reads this book guess what, your odds of success will dimish even further. My advice it is far easier to become a ‘First’ business than a ‘Best’ business and my heroes are not estabilshed businesses that have been around for decades and decades its those that took risks, saw market gaps and went for it. Microsoft, Nokia (was a paper mill before it went in to cell phones) apple et etc

  82. J. MacAuslan's Gravatar Comment by J. MacAuslan on September 13th, 2010 at 6:41 pm

    My sympathies, Steve.

    Yes, survivorship bias is alive and well and living in *parts* of GtG. (Reading “Outliers” now. Haven’t come to that section, but I’m looking forward to it.) FWIW, Berkshire Hathaway was excluded from GtG on what I consider fluke grounds (calendar date), and it might confirm Collin’s finding, not undercut it.

    As I see it, the problem with looking for the groundbreaking companies (MS, Nokia, Apple) as models is that the ground is constantly breaking *everywhere* — but only exposing extraordinarily fertile soil in a few places that don’t announce themselves at the time. (Why didn’t videophones take off to dominate the world in 1955? or jet packs in 1965? or Segways in 2000?)

    You might get more from Collin’s first book, BtL. At least in there you can see businesses that have been around for decades (my favorite, and Bill Hewlett’s(!): 3M) AND “took risks, saw market gaps, and went for it.”

  83. Gilraen's Gravatar Comment by Gilraen on October 2nd, 2010 at 5:19 am

    Thank you for this honest review. This book was just recommended to me as the beesknees to learn about leadership. I was searching for some counter balance as the description of great company by Collins makes my skin crawl in a negative way. The synopsis we were given was too so vague that I felt it to be just another business book with some interesting ideas to do with as I see fit, but not a business gospell book as it is being presented.

  84. Eric's Gravatar Comment by Eric on October 21st, 2010 at 11:14 pm

    I read this book and loved it. I understand the points brought forth but think the here argument misses the point entirely. I think the book is great because it breaks down the fundamentals of running a great business. Often times businesses look for silver bullets or start focusing on things that don’t matter. It is human nature for CEO’s and other C-levels in the company to neglect that which seems easy but the mark of a great company as pointed out by this book is one that has a firm grasp of following the fundamentals. Of course they sound easy and everyone knows they should be hiring good people and if they don’t work out in a role they should find another role but you would be surprised how many companies don’t execute on this concept. The reason smart business people rave about this book is it reminds them that to be great you can never neglect the fundamental elements of running a good business. What are those fundamentals you ask, read the book!!!!

    To be a world class marathon runner you have to eat healthy, run every day, have a great coach, and put your heart into running. That doesn’t mean that by finding someone who follows these things and is not a great marathon runner that the principles are useless. Conversely it doesn’t mean that by finding an exceptional person who is a great mararthon runner and doesn’t follow these principles that you would advise others to negelect the fundamentals.

    From a scientific point of the argument pointed out here does put holes in his book. But for anyone who has run a business or been deeply involved they understand that Jim’s principles are right on and they serve as a reminder that we always need to focus on the fundamentals. We don’t need it to be proven with the scientific method to understand that… we just like knowing that Jim followed a reasonable methodology based in science.

  85. Doug's Gravatar Comment by Doug on October 23rd, 2010 at 7:02 am

    Eric, I enjoyed the book too but to say it breaks down fundamentals just isn’t true. It is not a fundamentals book (it doesn’t go through accounting, production, HR, etc.) and doesn’t try to be. It is the publication of the results of an exploratory study.

    Jim’s methodology could be used to find that companies with red stars in their logos do better (or blue bars or gold stripes – you’d need to actually do the research to find out which) but this wouldn’t be a good reason to switch your corporate logo. Likewise, “people-first” might make sense sometimes and not at other times (just to take one example). Thus, business leaders who follow his advice might end up, as you say, focusing on things that don’t matter in search of a silver bullet.

    The findings have not been replicated (i.e. proven) and though many have intuitive appeal some have been at least partially refuted (take a look at the link I submitted above). I can’t see how your analogy with the marathon runner fits – it’s more like if most successful marathon runners drink soy milk then aspiring marathon runners should too – it may or may not be a good idea. And in business, focusing on something that may or may not add value is rarely a great idea. For this reason, I’ve not heard of a whole lot of “smart business people [raving] about this book.”

  86. COne's Gravatar Comment by COne on November 7th, 2010 at 3:37 pm

    I’m a fitness manager reading several business and leadership books in rapid succession, so that no one idea becomes fixed in my mind as THE WAY. My goal is to improve my position and bring timely, relevant ideas to an industry that mostly fails when it should be skyrocketing; The national obesity crisis and health care hell scape are examples of how the fitness industry can’t get it together enough to capitalize on these gapping opportunities. I also practice Yoga and meditation, (don’t laugh) which provide me with paradoxical insights. For example there is a Buddhist principle that reminds students not to mistake the light of moon to be the same as the light of the sun. One is the source and the other is a reflection. Books are good, research is good, but as a whole they are mere reflections of something greater. If you are reading any book for guidance, be on your guard for “mistaking the moon for the sun”. People will always agree with things they already understand and appreciate. Jim Collins carefully presents concepts that many people will agree with – DUH! Who wants to read anything else? Finally, consider this. Moon gazing is very pleasant. We get the light without becoming blind or sun burned. Gazing at the sun will blind you and, without protection will burn your skin and potential give you skin cancer. In this way, the best chapter concept in Jim’s book is Disciplined Thought, (i.e. meditation… Sorry, had to go there). Meditation allows one to align themselves with the source/essence so you won’t ever get burned. Note, you are aligning with with the source, not gazing at it for inspiration. Mediation will allow you to hire the right people, make the right decision and, most of all, not be deluded by the allure of greatness in the first place. Thanks to all of you for your comments.

  87. Higor Torchia's Gravatar Comment by Higor Torchia on November 27th, 2010 at 10:41 am

    This kind of books usually don’t impress me. Neither did this one. However, all those comments about it do impress me a lot!
    My point is that there is no way to determine some actions or behaviors that will for sure make your company to be successful. When you talk about business you talk about people, about adversities, about situations, about interactions… And those are all very variable. Business Management is way too far to be an exact science. It is not like cooking a cake, that you just have to follow the steps correctly and things will go good. There are so many other things that can change the path you’re walking on.
    And that’s why all this comments impress me that much. Well, stated that this is not an exact science and that there is no way to create a check list that will make you succeed amazingly on your company, why people get so impressed that sometimes it doesn’t work at all? The true is that it will never happen. And if (surprisingly for me) it happens at some point, you can sell that book for millions, cause anyone would pay whatever is costs to make his/her company the greatest.

  88. J Toole's Gravatar Comment by J Toole on December 15th, 2010 at 10:08 pm

    Rob has done a service here by bringing the searchlight closer to the subject. Nature is harmonious and every element fits in perfect proportion. The laws of nature are indestructible, permanent and invariable. It’s secrets are yet to be completely revealed, yet if even feebly emulated in family or business matters, for example, an astonishing outcome will result. Could we say that such families or businesses have uncovered the vastness of nature’s secrets?

  89. J. Steinberg's Gravatar Comment by J. Steinberg on February 10th, 2011 at 11:01 pm

    I’m impreesed with the number of comments about the book, and unimpressed with the book. This idea, ‘Get the right people on the bus, then figure out where to go’ sounds like typical hokey jargon, meaningless. How does one determine the qualities needed in the right people if one does not first determine what you want out of them? Scary that so many people look to this book for guidance.
    As a VP for a non-profit health organization, I am struck with how the business world thrives on jargon instead of substance. Helps explain failures.

  90. Karolyn's Gravatar Comment by Karolyn on February 18th, 2011 at 11:09 pm

    Had to comment – so many good comments on such a cranky review!

    Overall, methodological critiques are a good thing. If the first thing you think when you see statistics or any research is “how did they screw this up?” — you’re in good company.

    On the other hand, tossing out a half-baked list of potential problems with a book addressing a comprehensive research program is capricious at best. The methodology is based in behavioral science and if only platitudes are gleaned from it, that appeared to me intentional. The book is supposed to be describing the similarities between a subset of companies that experienced unprecedented success.

    No kidding, the companies regressed toward the mean over time. J. MacAuslen was right to think of probability, although his plan to test whether a company performed better than random would produce consistent, unhelpful, significant results.

    Here’s the ACTUAL problem with the book (confirmed by another commenter’s 2007 comparison of the G2G companies’ S&P): Regression toward the mean (and here’s an excellent student-written explanation of the phenomenon : http://www.socialresearchmethods.net/tutorial/Cheng/lcheng.htm)

    Other critiques of G2G sound too much like old standby criticism to drag out in a grad school response paper… “sample was drawn from college students only” or “results may vary by gender/race/location/day/time/etc”

    I personally liked the add-on monograph, Good to Great and the Social Sectors – Why Business Thinking is Not the Answer. The case studies were selected as examples, but did not emerge from a major data based study like in G2G. If we’re questioning the validity of his selection criteria, Good to Great and the Social Sectors dodges that bullet altogether. I *strongly* recommend starting with the 35page 2005 follow-up. There’s just enough information about the main concepts, like hedgehog, that you may want to buy G2G to elaborate. But, if you’re unimpressed, you saved yourself a lot of fluff reading and still retained the main concepts (with examples that AREN’T of failing business!)

  91. J. MacAuslan's Gravatar Comment by J. MacAuslan on February 22nd, 2011 at 12:22 pm

    Thanks for the kind words, Karolyn. Selection bias, and subsequent regression to the mean, is indeed the bane of any such historical study. FWIW, that is why I stacked 4 decades in a row when I mentioned Buffett’s case. With so much data, the statistical-significance threshold can be set low enough that you have an excellent chance of seeing RTTM, if that’s all his performance really is: The company would fail to live up to the standard it set in the previous decade, with high probability.

    One thing that justifies this much attention on Collins’ study is that the quantity of available data is so large that you can ask more probing statistical questions. The conventional stat. significance threshold in social sciences is 5%, which would indeed yield lots of “significant results” that are completely meaningless. If you wanted to use the methodology for Buffett, though, you could easily go with .001, or even lower, just because the data are so numerous: Maybe he will flunk that test — I haven’t run the numbers. But if he does pass it, you can have very high confidence that selection bias is NOT the cause. (You might even be able to run a full Bayesian analysis, to assess the conditional probability that he is extraordinary. But that’s getting a bit arcane here.)

    I still stand by my earlier comment, though, that this flawed study — statistics or no statistics — is more useful than a consultant’s hunch. For one thing, we can dissect the study as we are doing here, and appreciate its limitations as well as its virtues.

    For another, I believe that GtG and BtL have a salutary effect on business discourse. The conclusions are often contrary to conventional business thinking. But unlike a lot of the latter, they are backed up by SOME real data, not merely antisocial excuses masquerading as “hard-headed business logic”.

  92. Brad's Gravatar Comment by Brad on March 14th, 2012 at 5:57 am

    Having only just read the book, I was struck by how Jim Collins downplayed the one factor that some CEO’s were telling him was their main success factor: PURE LUCK. Jim claims that this reflected their humility, but I suspect that luck is very important – some of the businesses identified made fundamental changes in strategy during their transition and those decision could have easily backfired and sunk those businesses. I was not convinced by the book, the identified characteristics were just too subjective.

Leave a Reply