Labor Law Guy

‘Good to Great’ Author Answers My Question

Posted in Random Musings by laborlawguy on May 22, 2009

Jim Collins, author of Good to Great, was the subject of an earlier post of mine entitled “Good to Great, Then Gone or Gobble Up.” In that ditty, I queried how Circuit City, which Collins claimed had gone from being a good to being a great company, could go under just a few years after having been proclaimed “great.” At the same time, I also e-mailed Collins to get his take.

Turns out that the author of Good to Great has been busy, but he didn’t neglect my letter. I got a response yesterday to my question about what happened to Circuit City, and here’s what Mr. Collins wrote:

Thank you for your email.  I apologize for my long delay in reply; I’ve been buried working on two books, feeling like a snake that swallowed two watermelons at the same time.   In response to your question: Circ uit City engineered its transition from good to great under Alan Wurtzel and his team principally during the 1970s and 1980s, then fell in a later generation; we focused our research for Good to Great primarily on the Wurtzel era, when CC made its leap.  Perhaps it might be helpful to underscore that the principles we uncovered in prior research do not depend upon the current strength or struggles (or even the later demise) of the specific companies we studied.  Think of it this way: If we studied healthy people in contrast to unhealthy people, and we derived health-enhancing principles–such as sound sleep, balanced diet, and moderate exercise–would it undermine these principles if later some of our previously healthy subjects started sleeping badly, eating poorly, and not exercising?  Sleep, diet and exercise would still hold as principles of health.    That said, the question of how once-great companies can self-destruct ignited my curiosity.  Not all companies that attain greatness manage to sustain that greatness for two, three or more decades.  Some do, but others lose their greatness in later generations of leadership.  Some companies fall a long way and come back as great, and others disappear or become irrelevant. The question is: why do some great companies fall, and others not?  And also, why do some come back, and others not?    I have recently published a small book on this topic entitled How the Mighty Fall.

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