Great by Choice by Jim Collins and Morten T. Hansen

Summary

'Great by Choice' by Jim Collins and Morten T. Hansen explores why some companies consistently outperform others in turbulent, unpredictable environments. The authors identify a set of core behaviors and principles that enabled certain organizations to thrive while others faltered, focusing on discipline, creativity, and productive paranoia. Through detailed research and case studies, they show that greatness is not about luck, but about deliberate choices and steadfast consistency in chaos.

Life-Changing Lessons

1. Performance excellence is achieved by a combination of discipline, empirical creativity, and productive paranoia—leaders who blend these attributes are more likely to succeed in uncertain environments.

2. The '20 Mile March' principle emphasizes the importance of consistent, sustained progress regardless of circumstances, rather than erratic sprints or reacting to short-term events.

3. Being prepared for the worst through rigorous risk management and contingency planning can spell the difference between survival and collapse during turbulent times.

Publishing year and rating

The book was published in: 2011

AI Rating (from 0 to 100): 91

Practical Examples

1. 20 Mile March

   South Pole explorers Roald Amundsen and Robert Falcon Scott are contrasted to highlight the value of steady progress. Amundsen adhered strictly to a daily travel goal, regardless of weather, which allowed his team to survive and succeed. Scott, on the other hand, overextended in good weather and underperformed in bad, leading to disaster.

2. Fanatic Discipline

   Southwest Airlines was cited for maintaining discipline in operations by limiting routes and sticking to proven models even during industry chaos. This discipline enabled them to remain profitable when competitors faltered. It illustrates how avoiding unnecessary risks is sometimes as important as innovation.

3. Empirical Creativity

   Intel’s shift from memory chips to microprocessors wasn’t a gamble based on intuition alone, but on empirical evidence and market tests. By relying on data-driven innovation, they adapted successfully to market changes and industry disruption, anchoring creativity in real-world results.

4. Productive Paranoia

   The book explains how companies like Intel maintained a healthy fear of what could go wrong, resulting in strategic reserves and cautious decision-making. Their leaders kept worrying about downturns and competition, always preparing contingencies, which provided crucial resilience in challenging times.

5. SMaC Recipes

   SMaC (Specific, Methodical, and Consistent) recipes are defined as clear, actionable practices that guide an organization through chaos. For instance, Southwest Airlines created a concise set of operating principles that rarely changed, providing stability and clarity amid industry volatility.

6. Luck and Return on Luck

   The authors study how leaders respond to luck rather than luck itself as the crucial differentiator. Companies that made the most of 'luck events'—good or bad—used them as opportunities to reinforce good practices or learn critical lessons, rather than blaming fate.

7. Fire Bullets, Then Cannonballs

   This concept suggests testing ideas on a small scale (bullets) before scaling up (cannonballs) with major investments. For example, Biomet tested new products in small batches before full-scale launches, minimizing risk and learning from early feedback.