Good to Great: Why Some Companies Make the Leap… and Others Don’t

Good to Great: Why Some Companies Make the Leap... and Others Don't
Publisher: Harper Business
Published: 10/16/2001
To find the keys to greatness, Collins's 21-person research team read and coded 6,000 articles, generated more than 2,000 pages of interview transcripts and created 384 megabytes of computer data in a five-year project. The findings will surprise many readers and, quite frankly, upset others.

Good to Great by Jim Collins

Key insights

Companies are not always top-notch in the way they conduct business.

Actually, a lot of the time companies can be pretty sub-par with their strategies of operation.

So, how does a company go from being bad or even good to great?

Jim Collins shares his business knowledge once again with his book, “Good to Great” which teaches how to take your company from mediocre to thriving.

“Good is the enemy of great. And that is one of the key reasons why we have so little that becomes great. We don't have great schools, principally because we have good schools. We don't have a great government, principally because we have good government. Few people attain great lives, in large part because it is just so easy to settle for a good life.”-Jim Collins

Collins based this book off heavy research he compiled by studying three groups of public U.S. companies over the span of five years. Talk about dedication!

Here were the groups studied:


  1. Good/great companies that were performing averagely in stock market performance for at least 15 years.
  2. Direct comparison companies that remained average at best.
  3. Unsustained comparison companies which were once great, but made their way back to just average very quickly.


The goal of this project was to understand what the good-to-great businesses did and how to sustain it. Then, with this information, Collins could share it with other companies to help them do the same.

Key Points

  • Finding A Simple Concept

Good-to-great companies ask themselves three questions in order to determine their simple concept…


  1. What can we be the best at?
  2. What can we be passionate about?
  3. What is the economic indicator we should direct our attention to?


Take for example the successful pharmacy Walgreens. Their simple concept was determined by answering these three questions. The concept that they came up with was this: The best convenient pharmacy with high-profit customer visits.

A simple concept paves a clear path for a company to follow. The clarity of the outcome and that specific goal is what makes it successful.

  • Success Is Little Steps Put Together

Success doesn’t come in one big swoop. It’s actually a lot of little tiny carefully planned steps put together.

If a company undergoes a huge change suddenly, chances are they didn’t know it was going to happen. So, how are they supposed to stay at the top or recreate the same transformation again?

However, think about this, if that company has been moving forward with their concept in mind, they likely made dramatic success slowly without even realizing it! So, how do you ask will they create that success again? By going back to the original simple concept!

The trick is staying pointed in the right direction and keep moving. That is the only route to success.

  • New Technology

Technology should be thought of as a way to get where you plan ongoing. It should not be used by companies in order to “keep up” with the trends. If the technology will benefit your processes then go at it. If not, stay away!

“Mediocrity results first and foremost from management failure, not a technological failure.”- Jim Collins

Adding new technology into the mix such as an app or a website to bring more convenience to your customers while keeping your concept in mind is always a good idea.

  • Level 5 Leaders

A level 5 leader is…


  1. A superb individual, manager, and team member
  2. Humble
  3. Driven toward results
  4. Share credit for the company’s achievement
  5. Takes responsibility


“The good-to-great leaders never wanted to become larger-than-life heroes. They never aspired to be put on a pedestal or become unreachable icons. They were seemingly ordinary people quietly producing extraordinary results.”- Jim Collins

When a company is blessed enough to have a level 5 leader as a CEO, they will most likely go from good to great. That is because this person in charge is passionate and cares about the success of the company long-term.

  • The Right People

Finding the right people for your company can be a challenge, but it’s necessary for success. When a company hires people based on traits and qualities rather than experiences, oftentimes it works out in their favor. Hiring someone who is determined and passionate sometimes trumps an impressive resume.

“Great vision without great people is irrelevant.”- Jim Collins

Companies who designed environments to make hard workers thrive and lazy workers fail are often successful. This weeds out the weak links and also motivates hard workers to work harder.

  • Confronting Facts

When companies fall on hard times, it’s important for them to keep faith in their simple concept.

Wavering away from the original concept of the company will make its lose all its past success without the hope of getting it back. A company can go with the flow and change with the times without compromising its initial intent.

  • The Environment

It’s vital that leaders of a company create an environment that allows for brutal facts to come to light. This allows for a quick pick-up when things go south.

Raging debates in meetings should be encouraged by leaders in order to get everything out in the air and be able to come to the right decision for the company.

And, when mistakes are made, they must be examined and understood so that they do not repeat themselves in the future.

  • Self-Discipline

Every member of the successful company must have some sort of self-discipline in order for the company, as a whole, to be successful.

A culture of discipline sounds pretty miserable. However, it doesn’t mean there is one leader bossing everybody around. Instead, every member of the team is strict with themselves and others so that everyone is accountable for their responsibilities. This can be done in a kind and respectful manner.

The Main Take-Away

Companies can easily go from good to great by following a simple concept as long as they have the right people on their team.


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