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Ian Watt Personal Real Estate Corporation - Sotheby's International Realty Canada

Blog by Ian Watt

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Why Some Companies Make The Leap...and Other's Don't

Jim Collins book is titled Good To Great. If you haven't read it yet, buy, beg, or borrow it. It's that important.
  
   
  
Collins calls Good To Great a "prequel" to his hugely successful Built To Last. I call it the most important Business Leadership book I have read in a long time. 1997's Built To Last was a great book. It set a target for all of us. However, it left out critical information, because those companies were already great. What about those of us struggling to move our companies from Good To Great as opposed to those trying to hold on to greatness? The missing piece is clearly identified in Collins' Good To Great.
  
  
       

Collins and his team identified 11 companies that followed a pattern of "fifteen-year cumulative stock returns at or below the general stock market, punctuated by a transition point, then cumulative returns at least three times the market over the next fifteen years." Public companies were selected because of the availability of comparable data.Fifteen-year segments were selected to weed out the one-hit wonders and luck breaks. While these selection criteria exclude "new economy" companies, Collins contends that there is nothing new about the new economy, citing earlier technology innovations of electricity, the telephone, and the transistor.

 

Why Some Companies Make The Leap...and Other's Don't