Jon Pittman is our VP of Corporate Strategy and Engagement - reporting to the CTO. Jon is also a Lecturer at the Haas School of Business of the University of California at Berkeley. Jon provided a review of Great By Choice by Jim Collins and Morten T. Hansen. With his permission, I am sharing it with It's Alive in the Lab readers.
Great By Choice is the latest book by Jim Collins, author of Built to Last, Good to Great, and How the Mighty Fall.
Collins' methodology -- taking a rigorous, data-driven approach toward understanding what factors drive long-term business success -- has fueled his rise to the top ranks of modern business gurus, and in Great by Choice he and his co-author apply this methodology to companies that have outperformed their peers by 10x in uncertain conditions.
The fundamental premise of the book is that success comes from preparation and disciplined execution. In the authors' research, these two factors outperformed others such as brilliant insight, far-seeing vision, and luck, and enabled strong performance to happen, even in uncertain environments.
As in his past books, Collins translates his most important ideas into easy-to-remember concepts with memorable tag lines; for example:
This is the idea that consistent, repetitive performance -- i.e., focusing on marching 20 miles every day on a trip, rather than worrying about the entire distance -- beats sprints and lags. It's a sort of "tortoise vs. hare" approach that the authors commonly found among the 10x companies in the study.
Fire bullets, then cannonballs
Innovate first with small experiments (bullets) before committing to big initiatives (cannonballs). This lets you discover and calibrate what works cheaply before having to commit a lot of resources. The authors also discuss the basic nature of innovation, and point out that, although these 10x companies were usually first among competitors to innovate, it also took much more than pure innovation for them to outperform their peers as clearly as they did. The idea is to not only innovate, but also to execute extremely well, because such post-innovation blocking and tackling is critical to the process of bringing innovations to volume.
Leading above the death line
Always remain paranoid -- via "productive paranoia" -- about what could destroy your business, and make contingency plans and appropriate course corrections to ensure its survival. To do this you need to build cash reserves and buffers, bound your risk, and keep an eye on the macro and micro factors at play in your business and industry.
Develop a specific, methodical, and consistent recipe, and relentlessly execute it. The more uncertain, fast-changing, and unforgiving your environment, the more "SMaC" you need to be.
Overall, Great By Choice has a lot of great examples, both from business and from the world of mountaineering. As always with Collins, the book seems to be primarily common sense. However, it is written and codified in such a compelling, accessible fashion that it often seems profound. The approach is so simple, it is wonder that so few follow it successfully.
Choice is alive in the lab.