Good to Great: A culture of discipline

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In Good to Great, the structure follows three core disciplines. Disciplined people, disciplined thought and disciplined action.

Disciplined people covers Level 5 Leadership and First Who… Then What.

Disciplined thought covers Confront the Brutal Facts and Hedgehog Concept.

Disciplined action covers Culture of Discipline and Technology Accelerators.

Culture of discipline in good-to-great companies means that they have a consistent system with clear constraints but they also give people freedom and responsibility within that system. The company employees self-disciplined people who do not need to be managed, and instead manage the company instead of the people.

Jim Collins’s research of those companies uncovered consistent use of words like disciplined, rigorous, dogged, determined, diligent, precise, fastidious, systematic, methodical, workmanlike, demanding, consistent, focused, accountable and responsible.

The chapter states that great companies had people who were “extreme in their fulfillment of responsibilities bordering on fanaticism”. And it likened the fanaticism to athlete Dave Scott who won Hawaii Ironman Triathlon six times and was known to even rinse his cottage cheese to remove any extra fat.

Kind of makes me think of what the 2015 & 2016 fittest woman on earth must go through each day… You can’t have an off day. Or an off moment.

crossfit

The key takeaways for this topic were:

  • You need to build a culture of self-disciplined people that focus their disciplined action within the three circles
  • You don’t need bureaucracy in your workplace if you have the right people on the bus; it only exists when compensating for those self-disciplined people you need
  • A culture of discipline is a balance between two opposites: people who strictly adhere to a consistent system and also people who are given every freedom and responsibility within the framework of the system
  • People have to engage in disciplined thought and then take disciplined action
  • Good-to-great companies appear boring on the outside, but under the microscope are frantic with diligence and the intensity of rinsing their cottage cheese
  • A culture of discipline is not ruled by a tyrant; saviour CEOs ruling through force will fail to produce sustained results
  • People must strictly adhere to the Hedgehog Concept and leave behind any opportunities that fall outside of it; that will also ensure more opportunities for growth
  • AND most importantly “stop doing” lists are critical… even more so that “to do” lists

That last one is going to be a hard one. I will really have to review what I’m committing to.

Time to get out those weekly planning tools and really figure out what we’re going to achieve day by day, week by week, month by month…

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Good to Great: Hedgehog Concept

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In Good to Great, the second part of disciplined thought is the hedgehog concept (the simplicity withing the three circles).

The thought is that all companies (and perhaps people too, in order to achieve greatness that is) need a “deep” understanding of three areas that join together to form one simple concept (the Hedgehog Concept).

Hedgehog-Concept
So what you love = “what you are deeply passionate about”. What you’re good at = “what you can be the best in the world at” and I think it’s important to note the best-in-the-world part! And finally, what pays well = “what drives your economic engine”.

About the “what you can be the best in the world at”. It’s not about what you want to be the best at but what you can be the best at. Mr Collins says that the Hedgehog Concept is not a goal or strategy or an intention. Instead it is the understanding of your potential.

If, for instance, your core business is X but you can’t be the best in the world at X, then that cannot be the basis of your Hedgehog Concept. This is a severe stance and, rather than what you have a competency in, you instead need to pick what you could truly be the best in the world (to borrow a Jeremy Clarkson phrase) at. This also means that you might not be competent at something but actually be the best in the world at it!

To choose the drivers of your economic engine, you need to find indicators that have the greatest impact of your company. Profit per customer of employee (or cashflow per X in non-profits) must result in the greatest impact in order for you to become great.

The difference between great companies and their comparisons is that great companies set goals and strategies on this core understanding (what I can be the best at, what I’m passionate about, what drives economic value) rather than pure bravado.

How do you settle on your Hedgehog Concept? Setting up a Council might be an idea. The Council exists to work on understanding important issues the company is facing. It is assembled using leading executives (but it doesn’t necessary limit itself to members of the membership team; it can/should included) and ranges from five to twelve people in size. Council members can argue to their heart’s content, not to win some e

Finally, you don’t need to be in a great industry to be a great company. Great news: being great is industry agnostic!

Good to Great: Confront the Brutal Facts

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In Good to Great, the first part of disciplined thought is to confront the brutal facts, but never lose faith.

Key points from this chapter:

  • Confront the brutal facts of your reality
  • When you’re honest and diligent, the right decisions become apparent
  • You need to create a culture where people can be heard and the truth comes out
  • To create a culture where truth is heard, there are four practices:
    • Lead with questions not answers
    • Engage in dialogue and debate but not coercion
    • Conduct autopsies without blame (that’s a hard one)
    • Build red flag mechanisms that make information unable to be ignored (what does this really mean?)
  • You have to respond to adversity but hitting it head-on in order to emerge from it stronger
  • This chapter also introduces the “Stockdale Paradox” which is that you confront the brutal facts of your current reality but also know that regardless of the battle you will come out a winner
  • Charisma can be a liability as well as an asset, as it might deter people from raising the brutal facts
  • Leadership starts with inviting people to confront the brutal facts and act, not with a vision
  • Spending time and energy motivating people is a waste; if you have the right people on the bus, they will self-motivate, and if you ignore the brutal facts this acts as to demotivate them… (I think we’ve all been here before)

Whether this really does lead to a great company, I think the Stockdale Paradox is great match for the Best Year Yet process. At the beginning of a year, and reflecting on the past year, you have your accomplishments and disappointments and limitations. This is “confronting the brutal facts” in action. And setting yourself up for the next year with the mind you will prevail is necessary in order to have a successful year.