From good to great. Part 2

    We continue to read good books from this list from Milfgard and I continue to write extracts from them. In a previous article, I started writing the content of Jim Collins' Good to Great (from good to great). The book was simply amazing and exciting. I recommend reading it immediately.

    The first thing to start is to read the previous article . It contains the first five most important postulates and what you read below in this article will not work without these very first five elements.

    Culture of discipline

    Usually with the growth of the organization, the bureaucracy also grows. It becomes more and more difficult to control all processes, so they have to be formalized. In fact, the task of the bureaucracy is to compensate for the lack of competence and discipline. A similar problem will not occur if you immediately approached the selection of frames correctly. When we create bureaucratic procedures, we try to manage undisciplined employees. This, in turn, makes good employees leave, not ready to endure all these “unnecessary” procedures.

    The alternative is a three-disciplinary culture of discipline.
    • Create an organization in which discipline and responsibility for the results will be respected.
      Great companies created systems with clear limitations, but they also gave people freedom and responsibility within the framework of this system. Attention: the transformation does not begin with the fact that you begin to instill discipline in undisciplined people, but with the fact that you hire people with self-discipline. It is necessary to attract disciplined people with disciplined thinking, who then act in a disciplined manner.
    • Keep freedom, but within the basic concept. This means that there must be clear rules for which you cannot go, but within the framework of these rules there is complete freedom and responsibility.
    • Make subjects of this culture disciplined people.
    • A culture of discipline should not become tyranny.
      It is very important to recognize the difference between culture and tyranny. In companies that have achieved outstanding long-term results, it was culture, while in ordinary companies there was tyranny. Yes, the company can “take off” and under total control, but such growth will not last long, because it rests mainly on a strong leader, with the departure of which the system begins to crumble. Such a leader himself is responsible for the whole result, he serves as a monitoring tool, works 80 hours a week, expecting his managers to do exactly the same.
    • Give up all that is superfluous. Create a list of what you don’t need to do.
      When it was necessary to cut costs, great companies started with management expenses: they refused individual elevators, sold planes, refused top-class canteens, and stopped buying expensive folders. For example, Nucor had only four levels of management and 25 people in the head office, which was located in a rented room the size of a dental office. They rejected all the “goods” that separated leadership from the rest of the world. Management began with itself, thus creating a special corporate culture.

      Outstanding companies, along with lists of what needs to be done, used a list of what is n’thave to do. They abandoned job tags, extra levels of hierarchy, exited useless business associations, sold mills. They posed the question with the budget as follows: "which activities should receive financing, and which should not receive it at all."

    Technologies as Accelerators

    Many conventional enterprises are chasing technology. Every time something new comes out, they try to implement it as soon as possible in fear of falling behind their competitors. Often there is a reverse situation when everyone has already begun to apply some kind of technology, and some still do nothing.

    Companies that have achieved outstanding results have used technology with caution. The company Walgreens in the midst of the boom of online stores said: "We are a company that crawls first, then goes and only then runs." Prior to investing in the Internet, the Walgreens leadership seriously thought about how new technologies would be combined with their concept of convenient location of pharmacies. As a result, Walgreens customers were able to fill out an online application, get in a car and pick up their order at the nearest pharmacy. At this point, he was already equipped. Before starting, they thoroughly thought out their website, delivery system and logistics. As a result, the quality of service is not inferior to Amazon. Meanwhile, the share price of some competitors, which acted spontaneously and “on the wave”, fell 26 times.

    The wise use of technology may be associated with production. Gilette sells its machines worldwide, because they have learned how to make them cheaply and very high quality. They spent $ 200 million to develop “Sensor”, and most of this money went to the development of the production process, where they received 29 patents. The secret of Gilette is in the unique manufacturing process that they safeguard in the same way that Coca Cola does with its formula.

    Important: technology is an accelerator, not a reason for development.
    First, great companies worked out their concept of three circles, and only then called on technology to help. Great companies have never started transforming with the introduction of new technologies for the simple reason that you cannot truly use technology until you understand which technologies you need.

    Interestingly, 80% of executives did not mention technology among the first five key development factors.

    Flywheel and vicious circle

    Imagine a huge heavy flywheel that you need to swing. He is cast-iron and heavy. You are doing your best to move him from his place, but he moves only a few centimeters. So you work for an hour. But after an hour, a transformation occurs: moving the flywheel is much easier. Its amplitude is already about two meters and you spend less effort on its buildup. Then an unimaginable thing happens: the flywheel continues to move, regardless of you, you simply support it with light movements, and it swings itself due to inertia and its own weight.
    The question as to which particular push you led to success will be inappropriate. You will say that all the shocks were important.
    The analogy is simple: first comes capacity building, and then rapid growth .
    Companies that have achieved long-term success have achieved it through a lengthy process - step by step, action by action, decision by decision. You can recall Angry Birds in this place, who weren’t the first time to reach the audience and before the release of their bestseller they created a whole bunch of other games.

    By the way, if you read the press, it seems that everything is wrong. That, as if, “suddenly” something happened and the company went uphill. As if the breakthrough happened due to some kind of instant metamorphosis. This is simply because no one pays attention to small steps and the gradual movement is less noticeable.

    Vicious circle.
    Companies that are notThey achieved outstanding results, tried to find some kind of “magic cure”, introduce one single innovation that will change everything. When it doesn’t work out, they look for another solution and start over. They spin the flywheel in one direction, but, not achieving fast results, they stop and change direction.

    Companies often change managers, however, together with the leader, the strategic vision of the situation often changes. The previous manager saw the development of the company in the production of toothbrushes, and the next manager saw the future of the company in the production of vacuum cleaners. As a result, the company turns into a monster, which takes on everything and brings nothing to the end.

    The vicious circle looks like this:
    1. Choosing a new direction
    2. Lack of capacity building
    3. Unsatisfactory results
    4. Response without understanding the situation

    Ordinary companies combine two characteristic actions. Namely: promiscuous takeovers and the choice of leader, negating the efforts of the previous one.

    That is all . Further, the author tells the story of the relationship of the Good to Great study with the Built for Eternity study, which talks about how timeless companies are created and maintained.

    If someone has their own experience in implementing the principles listed above and in the previous article , write in the comments. Well, objections / reviews / complaints also write.

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