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Kindle Notes & Highlights
by
Jim Collins
Read between
June 11 - August 22, 2019
Entrenched myth: Successful leaders in a turbulent world are bold, risk-seeking visionaries. Contrary finding: The best leaders we studied did not have a visionary ability to predict the future. They observed what worked, figured out why it worked, and built upon proven foundations. They were not more risk taking, more bold, more visionary, and more creative than the comparisons. They were more disciplined, more empirical, and more paranoid.
Innovation by itself turns out not to be the trump card we expected; more important is the ability to scale innovation, to blend creativity with discipline.
10X leaders figure out when to go fast, and when not to.
We feel calm because we have increased understanding of what it takes to survive, navigate, and prevail. We are much better prepared for what we cannot possibly predict.
As the influential management thinker Peter Drucker taught, the best—perhaps even the only—way to predict the future is to create it.10
On the one hand, 10Xers understand that they face continuous uncertainty and that they cannot control, and cannot accurately predict, significant aspects of the world around them. On the other hand, 10Xers reject the idea that forces outside their control or chance events will determine their results; they accept full responsibility for their own fate.
10Xers then bring this idea to life by a triad of core behaviors: fanatic discipline, empirical creativity, and productive paranoia.
Discipline, in essence, is consistency of action—consistency with values, consistency with long-term goals, consistency with performance standards, consistency of method, consistency over time.
True discipline requires the independence of mind to reject pressures to conform in ways incompatible with values, performance standards, and long-term aspirations. For a 10Xer, the only legitimate form of discipline is self-discipline, having the inner will to do whatever it takes to create a great outcome, no matter how difficult.
Social psychology research indicates that at times of uncertainty, most people look to other people—authority figures, peers, group norms—for their primary cues about how to proceed.16 10Xers, in contrast, do not look to conventional wisdom to set their course during times of uncertainty, nor do they primarily look to what other people do, or to what pundits and experts say they should do. They look primarily to empirical evidence.
the comparison leaders were often brazenly self-confident. But the 10Xers had a much deeper empirical foundation for their decisions and actions, which gave them well-founded confidence and bounded their risk.
The 10Xers don’t favor analysis over action; they favor empiricism as the foundation for decisive action.
By embracing the myriad of possible dangers, they put themselves in a superior position to overcome danger.
empirical validation allows them to simultaneously make bold moves and bound their risk. Being empirical doesn’t mean being indecisive. 10Xers don’t favor analysis over action; they favor empiricism as the foundation for decisive action.
The 20 Mile March is more than a philosophy. It’s about having concrete, clear, intelligent, and rigorously pursued performance mechanisms that keep you on track. The 20 Mile March creates two types of self-imposed discomfort: (1) the discomfort of unwavering commitment to high performance in difficult conditions, and (2) the discomfort of holding back in good conditions.
The critical step lay not in finding the perfect program or in waiting for national education reform, but in taking action; picking a good program; instilling the fanatic discipline to make relentless, iterative progress; and staying with the program long enough to generate sustained results.
“The only way we’re going to get to where we want to be in five years is to make incremental progress year by year…We’ve got to get 20% of the way there every year. We can’t do 2% in year one, two, three and four, and 92% of it in year five. It will never happen that way.”
By adhering to a 20 Mile March no matter what challenges and unexpected shocks you encounter, you prove to yourself and your enterprise that performance is not determined by your conditions but largely by your own actions.
20 Mile Marching wasn’t a luxury afforded to the 10X cases by their success; they had 20 Mile Marches in place long before they were big successes, which helped them to become successful in the first place.
First, you fire bullets to figure out what’ll work. Then once you have empirical confidence based on the bullets, you concentrate your resources and fire a cannonball. After the cannonball hits, you keep 20 Mile Marching to make the most of your big success.
More important than being first or the most creative is figuring out what works in practice, doing it better than anyone else, and then making the very most of it with a 20 Mile March.36
10Xers appear to have no better ability to predict impending changes and events than the comparisons. They aren’t visionary geniuses; they’re empiricists.
the only mistakes you can learn from are the ones you survive.
the probability of any particular Black Swan event might be less than 1 percent, but the probability that some Black Swan event will happen is close to 100 percent; it’s just that you can’t predict what it’ll be or when it’ll come.
10Xers remain productively paranoid in good times, recognizing that it’s what they do before the storm comes that matters most. Since it’s impossible to consistently predict specific disruptive events, they systematically build buffers and shock absorbers for dealing with unexpected events. They put in place their extra oxygen canisters long before they’re hit with a storm.
When Herb Kelleher described how Southwest Airlines responded to 9/11, he showed no personal bravado. He choked on his own tears, unable to finish his sentences, as he tried to describe how Southwest people came together to get the planes in the air as soon as the skies opened, unified in a communal act of defiance.20 You can attack us, but you cannot beat us; you can try to destroy our freedom, but you’ll only make us stronger; you can inflict horror, but you cannot make us terrified. We will fly!
recognizing a change or threat early, and then taking the time available—whether that be short or long—to make a rigorous and deliberate decision yields better outcomes than just making a bunch of quick decisions.
The key question turns out not to be, “Should we be fast to act or slow?” but “How much time before our risk profile changes?”
Sometimes acting too fast increases risk. Sometimes acting too slow increases risk. The critical question is, “How much time before your risk profile changes?” Do you have seconds? Minutes? Hours? Days? Weeks? Months? Years? Decades? The primary difficulty lies not in answering the question but in having the presence of mind to ask the question.
“Sure, it’s human nature to want to make the uncertainty go away. But that desire can lead you to decide quickly, sometimes too quickly. Where I come from, you soon realize that uncertainty will never go away, no matter what decisions we make or actions we take. So, if we have time to let the situation unfold, giving us more clarity before we act, we take that time. Of course, when the time comes, you need to be ready to act.”
One of the most dangerous false beliefs is that faster is always better, that the fast always beat the slow, that you are either the quick or the dead. Sometimes the quick are the dead.
When facing fast-moving threats, 10X teams neither freeze up nor immediately react; they think first, even when they need to think fast.
A fast-moving threat does not call for abandoning disciplined thought and disciplined action.
A SMaC recipe is a set of durable operating practices that create a replicable and consistent success formula. The word “SMaC” stands for Specific, Methodical, and Consistent. You can use the term “SMaC” as a descriptor in any number of ways: as an adjective (“Let’s build a SMaC system”), as a noun (“SMaC lowers risk”), and as a verb (“Let’s SMaC this project”). A solid SMaC recipe is the operating code for turning strategic concepts into reality, a set of practices more enduring than mere tactics. Tactics change from situation to situation, whereas SMaC practices can last for decades and
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Conventional wisdom says that change is hard. But if change is so difficult, why do we see more evidence of radical change in the less successful comparison cases? Because change is not the most difficult part. Far more difficult than implementing change is figuring out what works, understanding why it works, grasping when to change, and knowing when not to.
What are the brutal facts? Not opinions, but facts.
We sense a dangerous disease infecting our modern culture and eroding hope: an increasingly prevalent view that greatness owes more to circumstance, even luck, than to action and discipline—that what happens to us matters more than what we do. In games of chance, like a lottery or roulette, this view seems plausible. But taken as an entire philosophy, applied more broadly to human endeavor, it’s a deeply debilitating life perspective, one that we can’t imagine wanting to teach young people.
The key to crafting a SMaC recipe is to go directly to the practical, the empirical, and when possible, the specific and concrete.
Our research suggests that treating innovation alone as the silver bullet for achieving a competitive advantage would be naïve and unwise. We conclude that 10X success requires the ability to scale innovation with great consistency, by blending creativity and discipline to build organizations that turn innovation into sustained great performance.
Remember a lesson from Chapter 5: it’s what you do before the storm comes that most determines how well you’ll do when the storm comes. Those who fail to plan and prepare for instability, disruption, and chaos in advance tend to suffer more when their environments shift from stability to turbulence.
