Good To Great Summary

The Good to Great book was written as part of a research project to explore why some companies went from being good to being great and why others never achieved or sustained great status. The first chapter introduces the criteria used for selecting the companies that are analyzed in the book. Companies that achieved a great status were identified by their ability to grow and sustain growth higher than the industry after a transition period for fifteen years. All companies selected were publicly traded; therefore stock returns were available for financial analysis. Companies that were chosen included Abbott, Circuit City, Fannie Mae, Gillette, Kimberly-Clark, Kroger, Nucor, Philip Morris, Pitney Bowes, Walgreens, and Wells Fargo. These companies

The primary question in the study that kept coming up was what do they all have in common that the comparison companies lacked? They developed a framework of concepts from what they considered buildup to breakthrough. It was broken into three broad stages; disciplined people, disciplined thought and disciplined action.

The second chapter describes the different leadership levels of hierarchy. The levels are rated on a scale of one to five with five being at the highest level in the hierarchy. The companies that achieved great status had level 5 CEO’s.

Level 5 leaders have profound humility and professional will. They are not egocentric and always have a succession plan in place. Level 5 leaders are modest and typically do not talk about themselves. They are ambitious for the company and will do whatever it takes to make the company great. Many of these leaders come from within the company and have a vested interest in its

A company that can experience cumulative returns three times more than the market for a period of fifteen years should be considered a great company. It was very interesting to read the research results of a level 5 leader. A Level 5 leader shuns accolades and praise, instead giving credit to others involved. They do the opposite when things go bad, taking responsibility instead of blaming others. Their main concern is for the organization, not themselves. I have found this to be true in my career. The best and the most effective leaders downplay their influence, giving credit to others, and always have the best interest of the organization in mind, not their own.

I found it interesting that all but one of the Good-to-Great companies had CEOs that were hired from within the company. It is a common thought that to turn a company around, you need to bring in new blood, from the outside. One notable example is the Chrysler Corporation, which brought in Lee Iacocca as CEO. Although he did turn the company around and increased profits, it was not sustained. Lacking Level 5 leadership qualities, he soon turned his focus away from making improvements at Chrysler to touting his successes to the