How the Mighty Fall: And Why Some Companies Never Give In (Good to Great Book 4)

by Jim Collins

The critical question is “What do we learn by studying the contrast between success and failure?”

When the rhetoric of success (“We’re successful because we do these specific things”) replaces penetrating understanding and insight (“We’re successful because we understand why we do these specific things and under what conditions they would no longer work”), decline will very likely follow.

Common “saviors” include a charismatic visionary leader, a bold but untested strategy, a radical transformation, a dramatic cultural revolution, a hoped-for blockbuster product, a “game changing” acquisition, or any number of other silver-bullet solutions.

companies that change constantly but without any consistent rationale will collapse just as surely as those that change not at all.

First, those who build great companies have drive and passion and intensity and an incurable itch for progress somewhere in their DNA to begin with; if we studied companies that never excelled, those that fell from so-so to bad, we might see a different pattern.

The greatest leaders do seek growth—growth in performance, growth in distinctive impact, growth in creativity, growth in people—but they do not succumb to growth that undermines long-term value.

Big does not equal great, and great does not equal big.

Investing heavily in new arenas where you cannot attain distinctive capability, better than your competitors, is undisciplined.

Audacious goals stimulate progress, but big bets without empirical validation, or that fly in the face of mounting evidence, can bring companies down, unless they’re blessed with unusual luck. And luck is not a reliable strategy.

There is no organizational utopia. All organizational structures have trade-offs, and every type of organization has inefficiencies.

The signature of mediocrity is not an unwillingness to change. The signature of mediocrity is chronic inconsistency.

If you want to reverse decline, be rigorous about what not to do.

The point of the struggle is not just to survive, but to build an enterprise that makes such a distinctive impact on the world it touches, and does so with such superior performance, that it would leave a gaping hole—a hole that could not be easily filled by any other institution—if it ceased to exist.

we are not imprisoned by our circumstances, our setbacks, our history, our mistakes, or even staggering defeats along the way. We are freed by our choices.