Page 103 - (DK) The Business Book

LIGHTING THE FIRE 101

See also: Reinventing and adapting 52–57 ■ Beware the yes-men 74–75 ■
Good and bad strategy 184–85 ■ Avoiding complacency 194–201

Success breeds Great success can lead to
confidence. overconfidence.

This can make managers
Greedy for more success, blind to changes that
managers force the Jim Collins
company to overreach. begin to affect the
company.
Business consultant, author,
and self-titled “student of
great companies” Jim Collins
was born in the US in 1958.
Collins holds degrees in
Problems and pitfalls By the time management business administration and
are swept aside as realizes there is a major
irrelevant or mere blips. problem... mathematical sciences from
Stanford University, and
several honorary doctoral
degrees. He has worked
alongside senior executives
and CEOs at corporations of
The worst
disease that ...it may be too late all types—from health care,
education, and the arts, to
afflicts executives to save the company. religious organizations and
is egotism. government. His interest lies
in the difference between
good and great: how do
companies attain such
believe their own hype. Internal company’s directors and staff start
superior performance?
warning signs may be present long to become overconfident. In highly
In 1995 he founded a
before management—buoyed by successful companies there is a
management laboratory in
seemingly unstoppable success— risk that staff members will Boulder, Colorado, to do
notices or chooses to do anything become arrogant, and will begin further research into business
about them. Hubris, a kind of blind to regard their success as a right excellence. His books have
pride, can shield people from or entitlement. Managers lose sight sold more than 10 million
seeing that a company is already on of the underlying factors that copies globally and have been
the path to corporate catastrophe. created success in the first place, translated into 35 languages.
overestimating their own strengths
Five stages of decline and those of the business. Key works
Jim Collins identified five stages If stage 1 is a feeling that “we’re
1994 Built to Last
of corporate decline. In stage 1, the so great, we can do anything!”
2001 Good to Great: Why
business is doing well, perhaps stage 2 is characterized by the
Some Companies Make the
exceptionally well. Press coverage feeling that “we should do more!”
Leap … And Others Don’t
is positive, finances are good, and Collins calls this stage the
2009 How the Mighty Fall:
morale is high. However, as a result “undisciplined pursuit of more”:
And Why Some Companies
of such success, during stage 1 the more sales, more stores, more Never Give In
first warning sign appears—the growth, more of everything. ❯❯