Article originally published in the Philadelphia Business Journal on May 26, 2020
“Good is the enemy of great” are the opening words of “Good to Great,” the best-selling iconic book by preeminent leadership and management thought leader Jim Collins on “why some companies make the leap [to outstanding sustained performance] … and some don’t.”
If you think that “good” is good enough, you will never become great. In these days of the Covid-19 pandemic, the companies that think they are good enough may not survive.
In January 2015, I wrote an article headlined “In business good is the enemy of great.” This is an update of that article.
When I became the president and CEO of PQ Corporation, chairman of the PQ board Richard D. Wood Jr. gave me a copy of “Good to Great.” I will be forever grateful to Wood, because Collins’ book served as a guide for leading PQ during my tenure as CEO, and later serving as an independent board member at other companies.
Collins and his team of researchers pored over reams of data to uncover 11 companies that had cumulative stock returns at least 6.9 times that of the general market over a 15-year period.
Collins and his team then studied the characteristics of these companies and the characteristics of their CEOs, versus comparison companies that did not perform as well. Collins identified eight principles that differentiated high-performing companies from the comparison companies. Here are the four differentiating principles that were most impactful to me:
Surround yourself with the right people
Get the “right people on the bus [and] the right people in the right seats … [and they will] figure out how to take it someplace great.” Collins states that leaders should start with “who,” not “where,” since the right people will decide the strategic direction of the enterprise, and when a change in direction is needed, they will decide what that change should be. By having the right people decide the strategic direction and goals for the organization, they own them, and they will be more committed to achieving them.
Level 5 leaders build enduring greatness
Collins identifies a Level 5 leader as one who “builds enduring greatness through a paradoxical blend of personal humility and professional will.” Collins goes on to state that Level 5 leaders are very ambitious, but “their ambition is first and foremost for the institution, not themselves.” Level 5 leaders are not imperial leaders. They do not self-aggrandize and are not focused on the perks of their position. To the contrary, they are focused on building teams within the company that can achieve great results, which are led by effective leaders throughout the organization who can inspire their people.
Level 5 leaders have an iron will to be successful, and they inspire their employees to greatness. Observing many CEOs over time, my experience is that Level 5 CEOs are more successful in the long run than imperial CEOs.
Recognize the brutal facts of your reality
Organizations that think they are great can be blinded by their hubris and not see the brutal facts of their reality. You can’t fix a problem if you don’t acknowledge it. When the problem becomes glaringly apparent, it is much more difficult to fix, or perhaps eventually it becomes unfixable. The CEO loses credibility with the board because problems and issues were not addressed early.
CEOs don’t want surprises from their direct reports, and board members don’t want surprises from the CEO. Both want the brutal facts of reality. Employees already know where the problems are, and if the CEO does not acknowledge them, the employees feel that either the CEO doesn’t know about them, or the problems are so bad the CEO is afraid to tell them. The CEO loses credibility when problems are not acknowledged and addressed. I have found that recognizing the brutal facts of your reality is a key characteristic of high-performance leaders and their organizations.
Achieving greatness is a journey, one that never ends
Once you think you are great, you have nowhere to go but down. Very few organizations ever achieve greatness, even though at times leaders and those who they lead may use that term to describe their organizations. As CEO of PQ, I would tell our employees never to refer to our company as great. This is for third parties to do, and our response should always be, “Thank you, but we are on a journey, and have a long way to go to achieve greatness.”
To the list above, I would add a fifth principle that also differentiates high-performing companies:
Take care of key employees
Showing key employees that you value them is imperative in normal times. During a pandemic, it’s critical. These employees will help you to reinvent your company to survive in times of great disruption like we are facing today. Understand that they are probably facing increased stress at home. Perhaps their spouse has been furloughed or laid off, significantly reducing family income or they are dealing with other challenges.
When possible, give employees some time off to rejuvenate. Treat them like you would like to be treated. Letting them know that you care and showing empathy will earn you their loyalty for many years to come.
Regardless of your position in a company, always remember you are on a journey that never ends, and that good is the enemy of great.
Stan Silverman is founder and CEO of Silverman Leadership and author of “Be Different! The Key to Business and Career Success.” He is also a speaker, advisor and widely read nationally syndicated columnist on leadership, entrepreneurship and corporate governance. He can be reached at Stan@SilvermanLeadership.com.
