The book Good to Great: Why Some Companies Make the Leap . . . and Others Don’t sheds light on the shared characteristics of businesses that achieve exceptional success. Jim Collins, author and researcher, identifies seven key traits that enable companies to transition from doing okay to doing phenomenally well.
- Level 5 Leadership
- First Who, Then What
- Confront the Brutal Facts
- Hedgehog Concept
- Culture of Discipline
- Technology Accelerators
- The Flywheel
These may all sound a bit cryptic! That’s why, in this article and several others to come, we will discuss the characteristics that Collins discovered so that you can consider them as you strive to improve and grow your business.
Great Companies Characteristic #1: Level 5 Leadership
Collins describes five levels of leadership that embody different skills and strengths. All levels are important for business owners to achieve and maintain. But getting to Level 5 is especially critical for taking a company from good to great.
- Level 1: Highly Capable Individual—Contributes their work ethic, talents, and knowledge to advance the company
- Level 2: Contributing Team Member—Applies their individual capabilities to group efforts and objectives and collaborates effectively in group settings
- Level 3: Competent Manager—Effectively organizes people and other resources to further company objectives
- Level 4: Effective Leader—Stimulates higher performance standards by motivating others to work together toward a clear and compelling vision
- Level 5: Executive—Embodies a powerful blend of unwavering will and humility, a combination that develops trust and inspires others to aspire to excellence
Contracting companies might find it difficult to transition from the first three levels to the fourth and fifth. In small businesses, owners are often tasked with working heavily in the business (meeting with customers, writing quotes, doing the construction, etc.) to get jobs done and keep operations running smoothly. But working on the business (planning, strategizing) to develop a clear and compelling vision is critical, too. So is communicating that vision and having the right mindset and demeanor to energize others in the company to want to help fulfill it.
So, what can you do if you haven’t quite reached Level 5? Here are a few tips to consider:
- Delegate work to others in your business who have the necessary skills and knowledge—and don’t micro-manage!
- Take time to think about what you want your business to achieve. What vision do you have for your company?
- Establish KPIs (Key Performance Indicators) that allow you to set benchmarks for success, measure performance, and track what’s working and what isn’t.
- Give credit where credit is due. Acknowledge a job well done and show appreciation for your team’s hard work.
- Be confident but not cocky. Feel gratified by your achievements but keep focus on how everyone in your business has contributed collectively to your success.
Stay tuned for more about going from good to great! Next time, we’ll talk about the second characteristic, “First Who, Then What.”