Ever Wondered What Makes One Company GREAT While Their Competition Remains Average or Even Fails?
Last month, I listened to the audiobook Good to Great: Why Some Companies Make the Leap … and Others Don’t  by Jim Collins.  I’m writing about this book specifically for our own General Manager of Splash Inn, who is a Level 5 Leader by nature and (I’m sure) has never even heard the term.  I could recommend to him to read the book, but I think it would more interesting for him to hear the highlights. Personally, I think these types of books always repeat themselves too much in trying to stretch a few really important points over 200 pages to justify selling the book for $20, so I think the reader’s digest notes may be helpful for busy people.‘Good to Great’ represents Jim Collin’s findings after 6 years of extensive research on several GREAT companies; that is, companies that sustained greatness for at least 15 years in a row. I think that when one is in business, it is really important to understand the unifying characteristics that differentiate a great business from its average/good competitors.I loved this book. My only complaint about it, other than the repetition, is that all the examples of the great companies are large, publicly-traded powerhouses like Wells Fargo, Walgreens, or Gillette so I found myself wondering at times if the principles in the book applied to a boutique dive center on an island in Honduras. In the end, I came to the conclusion that the principles in the book DID apply and that ALL companies, no matter what the size, have the potential to go from good to great if they apply these few key ‘must-do’s’.First let me tell you that Collins basically defines ‘greatness’ in terms of financial performance but he also talked about other characteristics of greatness that don’t include financial success. He mentions that there is much MORE PERSONAL SATISFACTION in owning a great company, and that great companies are EASIER TO RUN because they are more harmonious.  In essence, he states that they are just MORE FUN TO MANAGE and MORE FUN TO WORK FOR.


So, what were Jim Collin’s three most significant factors in determining a company’s ability to achieve greatness?

1. Find and Keep a Level 5 Leader: (from Chapter 2)
Most managers of good companies are Level 4 Leaders: effective leaders who successfully manage the team and the systems to realize the vision of the company. They are good managers. They get the job done!
But a Level 5 Leader is an executive leader who works on the company as if it were their own creation, and with sheer professionalism and humility. Their success is not about themselves. Their success is driven by what is best for the health and longevity of the company for the sake of the clients, the employees and the owners/shareholders.
On a small island where everybody knows everything about everybody, and there is a lot of competition in the same type of business, it’s risky to have Level 5 Leaders on board. Paulo and I are not unaware that our competition is constantly trying to persuade our Level 5 Leaders to jump ship and join their companies, but we feel confident that our company has more to offer in the long run.  We don’t worry too much about our competition coaxing our top guns, because ultimately, if a manager wants to leave, they are most likey NOT truly performing as a Level 5 leader anyway, so they may as well move on so we can get on with hiring our next top gun.
2. Hire the Right People: (from Chapter 3)I liked Chapter 3 so much that I literally made notes, and used those notes at our last ‘Employee of the Month’ staff meeting on Aug. 26th.   First let me say that having a staff meeting in a second language, and having to pause for the Spanish translator is a very weird experience for me.  It’s difficult to tell whether the translator really drives home the point that way I want it to be understood or if they ‘soften’ the words. (Personally, I think direct and to the point is better.)  We’re dealing with people who had never attended a staff meeting in the 18 years prior to us owning so they sit and listen in silence and probably think that we take things a bit too seriously for an island.  However, it seems as if the results of our monthly staff meetings are paying off.  A hotel/restaurant/dive resort can easily measure results with customer service surveys and the comments on Trip Advisor.  From these two tools alone, we can see that the staff seems to be ‘getting it’!Here are my staff meeting notes taken from Chapter 3 of ‘Good to Great’:The key in taking a company from good to great is having the RIGHT people on staff. I DON’T mean GOOD people, I mean the RIGHT people.Who are the RIGHT people?Those with good character, excellent work ethic, are intelligent, have a good attitude, and share the values of the company.The management of Splash Inn are RIGOUROUS – NOT RUTHLESS! :Ruthless means to fire anybody and everybody for anything. That is not our intent. Let me give you an example:Paulo and I own a small cleaning company in Canada which we started in 1999. We hired and fired more than 200 women in the first 5 years of being in business. It was so frustrating! However, for the past 10 years, we have had the same 4 or 5 women working for that company and they require very little managing.   We were rigorous in finding the right people until we found them.How do you know if you are a RIGHT person?Right people care about their jobs and care about the company.Right people don’t need to be micro-managed.  They don’t need to be disciplined.They don’t need to be motivated.Right people DO need to be guided, taught and lead, – but NOT tightly managed.What happens to a company when it has a WRONG person on board?  The right people have to pick up the slack of the wrong person, which frustrates the right people, possibly causing them to want to quit.Management wastes valuable time and energy trying to fix the wrong person (which rarely works anyway).Having the wrong people around is UNFAIR to the right people and to the management.Cross training: There is no position in this company where there will be only one person who knows that job. So if you are asked to train a new person in your position, don’t take it personally; it’s the new company policy.Ask yourself this question:“If I quit today, would the management be really sad that I am quitting, or secretly happy?” If you think the answer may be ‘happy’ to this question, you may consider making some changes ASAP.3. Apply The Hedge-hog Concept: (from Chapter 5) (My FAVOURITE CHAPTER)Is your company a hedge-hog or a fox?  And what’s its BHAG? (Big Hairy Audacious Goal)
The fox is a crafty and cunning creature, able to strategize sneak attacks upon its prey. The hedgehog, on the other hand, is a dowdy creature that waddles around all the day, minding its own business, and only knows how to do one important thing to ward off the attacks from the multi-talented and skillful fox. It rolls up into a little ball becoming a sphere of sharp spikes. Despite the calculated and various plans of attack from the fox, the hedgehog always wins by repeating this SINGLE and SIMPLE expertise and automatic response. The fox, on the other hand, wastes its valuable time and energy, unaware that chasing a hedgehog is not what he is BEST AT.
The idea behind the Hedgehog Concept lies in the center of the circle when you ask yourself these 3 questions:
The key is to be able to find that one (or possibly two things) which you/your company are deeply passionate about, which you can be the best at, and which can make money.   Once you define these few things, do them over and over again. That’s how you become a great company.  It’s a simple as that!
“A Hedgehog Concept is not a goal to be the best, a strategy to be the best, an intention to be the best, a plan to be the best. It is an understanding of what you can be the best at. The distinction is absolutely crucial.”
In our little boutique hotel/restaurant/dive center, we are passionate, and excellent at delivering QUALITLY for the economic traveller. That is: quality of the facility, quality of the rooms, quality of the food, quality of the dive boats, and quality customer service. Our hedgehog is to pay attention to the details that make up that quality.If you get a chance, pick up or download a copy of Good to Great, let me know what you think of the book.  I’d be interested in hearing ‘What’s your BHAG and what’s your Hedgehog?’

by Kathy Berner

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