Posts Tagged ‘Good to Great’
By far, this blog post has been the hardest to write. To start, I went back to Jim Collins to see what he had to say on the subject. This tenant is one of the most complex in the Good To Great thinking.
“Put another way, the most enduring and successful corporations distinguish their timeless core values and enduring core purpose (which should never change) from their operating practices and business strategies (which should be changing constantly in response to a changing world).”
To clarify what Kodak’s mission is, I looked in the history section of their website. I found this very clear message “make photography simpler, more useful and more enjoyable”.
Kodak has managed to preserve the core of their business, while undergoing technological changes. As the film industry continues to wither into nothingness, Kodak has jumped into the digital camera world. They have also extended into the online world with websites like Kodak Gallery that lets you print and share photo.
They have even forge relationship with local drug stores including CVS to you can order online and pick them up in the store. That is a model being used by several online e-commerce leaders.
What I have realized in searching for these stories is that there are more stories about companies that have ‘lost their way’ than about companies who got it right. There are a lot of companies that are just a flash in the technical pan.
In a hyperfinicky marketplace, technology companies need to stay on their toes, but they still need to keep their eye on the same spot of the horizon and keep moving toward it – no matter how far off it might seem.
In my continuing discussion of Good To Great Technologies, I started looking at the Hedgehog Concept. As part of the hedgehog concept, a company is challenged to understand what it is the best at doing. Not what it will be or can be, but what it does the best.
A company that leaps to mind in this regard is 37 Signals. It has focused it efforts on creating a suite of productivity tools such as Basecamp and backpack.
As it has expanded its product offering, it has kept itself in the same realm of product offerings that surround the concept of communication and project productivity. It works on refining its programs and listens to its customers.
This company definitely figured out what it was best at doing. So much so that it has a 94% approval rating from customers.
When considering this, it makes the constant expansion of Google, Apple and Microsoft seem counterintuitive. It also helps account for some less than profitable ventures by those companies.
Another company to look at is Distributive Networks. The company made Deloitte’s 2007 Rising Stars list and is focused on Mobile. They work on Mobile technology, content and mobile donations.
They list Barrack Obama as a client. Their singular focus on a specific industry and the three elements that will make it powerful and accepted has helped them rise through a very crowded market space.
I think there is merit in also looking at companies who didn’t have a hedgehog concept has suffered. The first example I think about is AOL. While they were trying to diversify their company, they lost focus of their core business – internet access. The company got left behind in the internet access world as DSL and cable invaded their space – maybe to never recover.
As a matter of fact, McKinsey Quarterly just wrote an article about Where software vendors should focus and said their findings suggests that “they do better when they focus on specific capabilities that are crucial for their particular products and customers, rather than trying to be great at everything. A self-assessment can help identify strengths and shortcomings.”
When I started doing research for this blog post, I started with Jim Collin’s entry about confronting the brutal facts. There were two main messages that I gleaned from the website: 1 – keep faith that in the end you will prevail and 2 – confront the ugly truth about what it will take to get there.
In this lesson, there is a counter idea of which to be aware: Charisma. I think that is an interesting concept. It could be so easy to be seduced by a very charismatic leader who has a lot of their own pet projects.
I started looking for companies that managed a technological turnaround. Companies that were given a challenge and have used this tenant to come out of it. I thought about Apple. However, I think that Steve Jobs is an brilliant ego maniac, but without him, the company fails. Even with him, it pursues pet projects with sometimes horrible results. With its current string of winners, it is hard to remember and see that fact, but it shouldn’t blind the overriding principle.
I wanted to say Eastman-Kodak. Once the world of digital photography became so pervasive, it was looking at the loss of a massive portion of its business. Granted, Kodak has bandaged the bleeding by getting into that arena, but it is not the company that it once was.
That idea lead me to use Nikon as the main example of Confronting the Brutal facts. I wouldn’t normally consider Nikon, a camera manufacturer, a technology company. However, that has changed in the past few years. The company has realized there is not a future in making manual cameras and made a move to focus on digital. It also evaluated it business decided to eliminate it eye wear division to invest it other parts of the company.
Nikon started moving not only to digital, but to the places that were natural extensions of digital – the social web. Nikon formed a relationship with Flickr to create the Nikon Digital Learning Center.
It also seems like Nikon has hopped on the mobile phone theory of disposable technology. I bought an Coolpix S51 camera last November that was already obsolete in the camera aisle this summer. Consumers want faster shutters, better features and more megapixels.
So what does this mean, look at the market, understand what it is demanding from you, and be honest with yourself and your company about how you can succeed.
Do you know a technology company that managed to do that?
When Jim Collins wrote the book Good To Great, he talks about the concept of Level 5 leaders. It is a relatively illusive concept. Given the other steps in the process, I thought those thing help demonstrate Level 5 leadership. So, I am going to start these posts in a different place – First Who.
Simply stated, Collins challenges companies to determine who should be part of a company. “Get the right people on the bus. Build a superior executive team.”
This concept seems so simple. If you have the right leadership and talent, you have the ability to create a great company. So who in the technical world is following this concept?
The first resource that springs to mind is Fortune’s Best Companies list. Planted firmly at the top of the stack is Google. However, Cicso and Qualcomm are included in the Top 10.
I am not going to belabor the point that Google seems like a dreamlike company – not only for the perks, but for understanding that employee empowerment can translate into growth and money. Instead, I am going to turn to the other two technical firms in the top 10.
When reviewing the Forbes article, the summary about Cisco jumped right out at me. Though the stock flatlined in 2007, CEO John Chambers won praise for his leadership and his new blog, On My Mind, which solicits employee ideas.
If you create an environment with the right people who understand the direction you are heading, you are not going to see you staff jump ship when the going get a little tough. It seems like a simple notion. Hire smart people who are capable of doing their job and LISTEN to them. In return, they might just listen to the company.
I guess the first point is that companies like Google, Cisco and Qualcomm take the time to vet candidates who are capable of doing their job and stretching beyond that. That ideal comes from management who understand who to hire. When companies hire ‘figure heads’ or ‘bean counters’ who focus purely on the bottom line and don’t know how to dream about being a bigger technology company, it never bodes well.
Just looks at how Apple flagged under the leadership of John Scully in the 1980s. Thinking a man who leads a soda company can make a technology company great, is not a good idea. He was not the right Who.
An author named Jim Collins wrote a book called Good to Great in 2001. He and his research team set out to discover the traits of companies who experience success over long period of time had in common. Collins found that many of these companies challenged the conventional notions of corporate success.
As part of this book, he identifies some key concepts that help explain these great companies. These concepts are:
- Level 5 Leadership
- First Who
- Confront the Brutal Facts
- Hedgehog Concept (the Three Circles)
- Building your Company’s Vision
You can read a little more in-depth about these good to great concepts on Collin’s website.
Now I will answer your question of why any of this information is important in the online marketing and emerging technology world. I think our industry can be examined through this lens. Over the next few weeks, I am going to go through each of these concepts and apply it to some aspect of the online marketing or technology world. Next week, I will be posting about Blog about Level 5 leadership in the online world, and think about how to spot it – or the lack of it – at your company. See you tomorrow.