Jim Collins has already written some of the seminal works on business strategy and management with Built to Last and Good to Great. While those books are great, How the Might Fall a short eclipses them in my opinion.
Given the Global Financial/Economic Crisis its easy to see this book as coming at an opportune time and it is but not for the reasons you would think. First, my recommendation is simple: get this book, read it, reflect on it and see where you stand. This is an example of what a five-star business book should be.
Why? Well the answer is simple, its well researched, clearly written, devoid of significant pontification and provides advice that everyone can use. While these factors were present in Collins other works, they were not so to this degree.
Here is what I mean.
Good to Great provides the characteristics of great companies in terms of some simple to remember characteristics, for example, level 5 leadership. These characteristics all described what executives aspired to become. That aspiration is born out of executive desire to be successful. That led to many people seeing themselves as having these characteristics when clearly they did not.
When Good to Great came out there were many executives who said that they were or aspired to be level 5 leaders when the best they could manage was 1 and 3/4s. We all want to see ourselves as successful and that undermined the applicability of the Good to Great ideas.
Not this book. How they mighty fall clearly describe five stages of enterprise failure and distress. Because no one wants to be them, the guidance these stages provide create an environment for real discussion about the company rather than self-reflective revisionism on how we are great. That clarity, which supports the Good to Great principle of “Confront the Brutal Facts,” is what sets this book apart. It should a design principle for Collins current project on managing in turbulence.
The five stages all describe the antithesis of the Good to Great concepts, which is ok, but the book is more than just inverting good to great – it looks beyond that.
Stage 1: Hubris born of success – describing the cultural tipping point when hard work and focus to earn the business turns into a sense of entitlement to future success. This is the death of Level 5 Leadership.
Stage 2: Undisciplined pursuit of more – building from stage one is people chasing goals that take them away from their core, their competitive advantage all in the name of growth, or the grand strategy. This leads to thinking what before you think about who and abandoning the hedgehog concept in favor the rabbit’s pursuit of quick gains.
Stage 3: Denial of risk and peril – now that you are chasing things that are not part of your core, you fail to see the problems or blame the problems on the outside world. In this stage you are blind to the brutal facts.
Stage 4: Grasping for salvation – often in the form of the silver bullet, visionary leader all of which keep your attention away from the core (Flywheel) and lead you into further decline. I lose a culture of discipline, abandoning the flywheel and chase things outside the core.
Stage 5: Capitulation to irrelevance or death – the final demise when people throw in the towel and the cause is lost. This is the terminus of the lifecycle and the one place you cannot recover from.
Rather than re-write the book here are what I see as strengths and challenges
Well researched and more importantly Collins makes key elements of the research process, scoring models and approaches visible to the reader. This is a piece of work that says see what I did so you can have confidence in the results – a true example of a well-done book.
Case studies that go beyond those done in Good to Great and Built to Last. This broadens the range of examples, a good thing. But there are still a number of repeats here.
Clear writing, the book is focused neat and trim. Sure its short, the book is physically small and the core text is only 123 pages, but each page is loaded with content. I read the book on two 90-minute airplane flights and will come back to it time after time.
Clearly structured and summarized information, which makes the book very usable. This is seen in the way Collins uses tables – sparingly but when needed and other summarization techniques.
Descriptive without being prescriptive, which is a strength, but people looking for recipes to avoid failure – ala silver bullets – will not find them and for good reason – chasing them is a characteristic of stage 4. But some people will see this as a weakness. People who reflect on the book’s principles will come up with more than enough things to take action.
Repeats some of the prior books concepts and precepts. This makes it seem a little repetitive in places and can lead the reader to think that this book is just the photographic/cognitive negative of Good to Great.
Takes the easy road in a couple of places use well-worn examples – IBM, the Challenger, among others where deeper or new analysis would be helpful.
Overall the best book so far for 2009 – it is well worth the read, the time and spreading the news.
This review also appears on amazon.com at http://tinyurl.com/noj4jr