Resources for Leaders

Vol. #15  3/17/04, Deanne G. Bryce, editor

"Good to Great" Times Two

You are not seeing double; there really are two leadership books with similar titles. One of our readers mentioned Good to Great: Why Some Companies Make the Leap… and Others Don’t by Jim Collins in an interview recorded in the April 2003 issue of ReaderStrength. The other book with a similar title is The Extraordinary Leader: Turning Good Managers into Great Leaders by John H. Zenger and Joe Folkman. Both books were published within a year of each other in October 2001 and July 2002 respectively. In this review, we look at the premises of their research and their findings. I’ll conclude with suggestions on how to combine the findings and apply them to your experience as a leader.

Good to Great: Why Some Companies Make the Leap… and Others Don’t
Jim Collins, a college professor, assembled a team of researchers at the University of Colorado to answer a question that became the title of his book: Why do some companies move from being good to being great while others don’t? The team used a very public and measurable standard to define “great.” They used stock market performance. They sifted through 1453 companies to find 11 companies that met the “Good to Great” criteria they determined prior to the search. Once they found the companies that had the pattern, they started asking questions of leaders and researching articles and speeches from the companies. The criteria included a cumulative stock return of 1.25 times the general market before a transition point, followed by at least 15 years of a cumulative stock return of 3.00 times the general market. The eleven companies included: Abbott, Circuit City, Fannie Mae, Gillette, Kimberly-Clark, Kroger, Nucor, Philip Morris, Pitney Bowes, Walgreens, and Wells Fargo. Some of the companies eliminated from the research were companies that were considered “great” for the same time periods. An example is Berkshire Hathaway. It is not that “great” companies are not worth looking at on a deeper level, it is just that Collins was seeking to identify what happened to cause a good performing company to transition into a great performing company. Collins was surprised to discover something he labeled “Level 5 Leadership.” It is explained by Collins as a leader who:

Builds enduring greatness through a paradoxical blend of personal humility and professional will. Level 5 leaders channel their ego needs away from themselves and into the larger goal of building a great company. It is not that Level 5 leaders have no ego or self-interest. Indeed, they are incredibly ambitious---but their ambition is first and foremost for the institution, not themselves.

The Extraordinary Leader: Turning Good Managers into Great Leaders
This book focused on qualities of leadership rather than business results over a sustained period of time. Zenger and Folkman reviewed 200,000 assessments from 20,000 managers from North America and Europe to identify leadership strengths or qualities. The research findings may surprise most managers, because the results suggest that the key to effective leadership is not about fixing weaknesses. Instead it is important to focus on core strengths. The research reveals that some behaviors are more noticeable than other behaviors. The more noticeable behaviors create the perception that an individual is a strong leader. When comparing the managers rated in the top 10 % with those in the bottom 10%, 16 behaviors and accompanying key drivers were revealed. The research concluded that a combination of strengths is important in terms of how a leader is perceived. For example, I know a leader that spent a lot of his time walking around to greet and interact with employees. He was rated as having strong interpersonal skills, but people perceived him as a phony because he didn’t look and listen to people when they came with an idea. Listening skills and interpersonal skills are one example of companion competencies that Zenger and Folkman uncovered in their research. With this new insight the leader that had been perceived as phony could easily add listening skills to round out his strong interpersonal skills.

Take It to Work!
The combination of findings from these two bodies of research provides insight that can be applied in our work as leaders. Collins’ research demonstrates the power of results. As we develop ourselves as leaders, it is not enough to focus on improving competencies: we need to be focused on results and be open to changing our behaviors in order to achieve the results we are seeking. It would be easy to read Collins’ definition of Level 5 leaders and convince ourselves that we have the best interest of the organization in mind. Instead we should find out how we are perceived, identify our strengths, and then make sure the companion competency from Zenger and Folkman’s research is in place.

So what is so important about moving from “Good to Great?” Collins’ first line of his book sums it up best when he writes, "Good is the enemy of great."

We humans have been writing about leadership for more than 2000 years. Is there anything new and exciting to be said about the subject? Perhaps not, but still we hunger for information and inspiration. ReaderStrength is an e-publication that adds value to your busy life as a leader by pointing you toward books to fuel your inspiration as you lead yourself and others.

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