One of the most famous books on management, “In Search of Excellence“, was dogged by the tale that many of the companies it extolled subsequently got into serious financial or trading difficulty.
Some years later history repeated itself with Jim Collins’s seminal study, “Good To Great“, in which he spelled out what it took to move a company from merely doing well to being truly outstanding. Many of the companies he studied have since fallen from their pedestal.
To his credit, Collins got back on the horse, writing “How the Mighty Fall”, the apt title for his latest slim but highly readable publication, underpinned by the work of his exemplary research team.
Collins explains that the initial first stage of decline is one of “hubris born of success”. The overall reason why so many previously excellent companies eventually lose their way is through complacency, in which success is viewed as deserved, rather than fortuitous.
In the early years of our company’s life, (it’s 20-years-old) I recall visiting both IBM and Sainsbury’s in the hope of winning new clients.
I came away profoundly depressed. In both cases the impression I was left with was of arrogance and a sense that “we’re successful because we do these things” rather than, as Collins argues, knowing why they did things. Sure enough within a few short years both acclaimed companies had plummeted.
Condensed into a mere 123 pages, Collins’s essential lessons are:
- Do not succumb to hubris, over-reaching or denial.
- Avoid grasping for the quick fix.
- Never accept that success will inevitably be followed by decline.
- Never give in, be willing to change tactics, but never give up your core purpose.
- Circumstances alone do not determine outcome.
- We are freed by our choices.
Collins also advocates developing “a ferocious understanding of what you’re not going to do” — make yourself a “stop doing” list and set aside some time for quiet reflection.
