Guide from 'Good to Great' to 'Built to Last'
The main idea of the two books “Good to Great” and “Built to Last” is not to attach the discovered concepts and principles to our work to make us busier, but rather, if we arrange our time according to these principles and ignore or do not do other things, our lives will become simpler.
Collins found that a company’s transition from good to great has nothing to do with whether the industry it is in is in trend. In fact, even an enterprise in a traditional industry, even if it was initially unknown, can be great. Collins put forward a whole set of viewpoints, “As long as they are adopted and seriously implemented, almost all companies can greatly improve their operating conditions and may even become great companies.”
Guide from “Good to Great” to “Built to Last”
“Good to Great” is the prequel to “Built to Last”
“Built to Last” answered “how to build a great company from scratch and maintain it for a long time”.
“Good to Great” answered “how a company with average performance can achieve the leap from good to great”.
Existing or new company + Good to Great concept → Lasting great performance + Built to Last concept → Lasting greatness“Good to Great” answered: the difference between bold and innovative grand goals and reckless and dangerous grand goals.
The core concept of “Built to Last”, “discovering core values and goals (core concepts) higher than money, and combining them with the dynamic trend of preserving the core/stimulating progress”, is the core method for creating a lasting great company. Lasting great companies do not exist just for the benefit of shareholders. In fact, for a truly great company, profits and cash flow are like blood and water in a healthy body; they are essential for life, but they are by no means the goal of life.
Lasting great enterprises have all experienced a process from takeoff to breakthrough, and they all followed the framework from good to great in their creation process.
Core values are essential for lasting greatness, but their specific content is irrelevant. The key is not what kind of values you have, but whether you have core values and know what they are, and whether you integrate them into the organization and adhere to these values for a long time.
Lasting great companies constantly switch business strategies and operating methods to adapt to this changing world while adhering to their core values and core goals. This is the wonderful combination of preserving the core and stimulating progress.
The concept of Good to Great laid the foundation for the success of the Built to Last concept. The concept of “Good to Great” is the driving force for maintaining the flywheel turning during the period from start to breakthrough. The central concepts listed in “Built to Last” accelerate the flywheel and lift the company to an iconic status in the near future. The research results of “Good to Great” made the four central concepts in “Built to Last” possible.
Four central concepts of “Built to Last”:
Clock Building, Not Time Telling - The organization built is capable of lasting adaptation to multiple generations of leaders and multiple product life cycles; this is the exact opposite of an organization built around only one great leader or one great idea.
Genius of the AND - Possessing two extremes at the same time in many ranges. It is not a question of choosing A or B, but finding ways to have both A and B - purpose and profit, continuity and change, freedom and responsibility, etc.
Core Ideology - Instilling core values (essential and enduring tenets) and core purpose (fundamental reasons for being beyond making money), and making them principles that guide decisions and inspire employees for a long time.
Preserve the Core, Stimulate Progress - When stimulating change, improvement, innovation, and renewal, always take the awareness of preserving the core as the starting point. Under the condition of maintaining core values and goals unchanged, constantly switch methods and strategies. Set bold and innovative grand goals consistent with core awareness, and strive to achieve them.
| Concept of “Good to Great” | Connection with Concept of “Built to Last” |
|---|---|
| Level 5 Leadership | Clock Building, Not Time Telling: What Level 5 leaders build is a company that still operates normally in their absence, not to satisfy their ego by making themselves indispensable. Genius of the AND: Personal humility and professional will. Core Ideology: Level 5 leaders have great ambitions for the company and everything the company represents; they have a sense of mission that transcends personal achievement. Preserve the Core, Stimulate Progress: In order to win tangible results and achievements, Level 5 leaders relentlessly stimulate progress, even if it means firing their own brothers. |
| First Who… Then What | Clock Building, Not Time Telling: Insisting on “people first” is clock building; insisting on “things first” (setting strategy in advance) is time telling. Genius of the AND: Choosing the right people to get on the bus and driving the wrong people off the bus. Core Ideology: Achieving “people first” means looking more at whether a person adapts to core values and goals when choosing people, rather than looking at their skills and knowledge. Preserve the Core, Stimulate Progress: “First Who… Then What” means a tendency to promote candidates from within, which reinforces core values. |
| Confront the Brutal Facts (The Stockdale Paradox) | Clock Building, Not Time Telling: Creating an environment where people can speak freely is clock building, especially after you have created a red flag mechanism. Genius of the AND: Confronting the brutal facts of reality and maintaining unwavering faith that you will prevail in the end - The Stockdale Paradox. Core Ideology: Confronting the brutal facts makes the core values that the organization truly adheres to stand out, in sharp contrast to the core values it ostensibly wants to stick to. Preserve the Core, Stimulate Progress: Brutal facts make people understand exactly what needs to be done to stimulate progress. |
| The Hedgehog Concept (The Three Circles) | Clock Building, Not Time Telling: The council system is the perfect “clock building”. Genius of the AND: Deep understanding and amazing simplicity. Core Ideology: The “what you are passionate about” circle coincides exactly with core values and core goals. It is these core values that you are passionate about and will not give up no matter what that are the real core. Preserve the Core, Stimulate Progress: Bold and innovative grand goals come from understanding, while dangerous and reckless grand goals stem from bravado. Good grand plans lie exactly at the intersection of the three circles. |
| A Culture of Discipline | Clock Building, Not Time Telling: Running a company purely through the personality of playing a disciplinarian is time telling, and building an enduring culture of discipline is clock building. Genius of the AND: Freedom and responsibility. Core Ideology: A culture of discipline excludes those who do not conform to the organization’s values and norms. Preserve the Core, Stimulate Progress: When you have a culture of discipline, you can give people more freedom to experiment, and finally find the best path to success. |
| Technology Accelerators | Clock Building, Not Time Telling: Technology driving force is an important part of the clock. Genius of the AND: Avoiding temporary technology fads and being a pioneer in promoting technology application. Core Ideology: In a great company, technology is subservient to core values, not the other way around. Preserve the Core, Stimulate Progress: Appropriate technology accelerates the momentum of the flywheel and facilitates the realization of bold and innovative grand goals. |
| The Flywheel and the Doom Loop | Clock Building, Not Time Telling: The flywheel effect creates continuous momentum, rather than relying on charismatic visionaries to stimulate people’s enthusiasm. Genius of the AND: Gradual growth process and drastic change results. Core Ideology: The doom loop makes instilling core values and goals almost impossible, because people have long been doubting “who are we? what do we represent?” Preserve the Core, Stimulate Progress: The stable consistency of the flywheel and the increasing momentum towards the breakthrough point create ideal conditions, making it possible to inject core values when stimulating change and accelerating the process. |
The relationship between bold and innovative grand plans and the three circles in the Hedgehog Concept: Dangerous and reckless goals stem from bravado, while bold and innovative grand goals are the result of understanding. Combining the three circles with grand goals will result in a powerful, almost magical combination.
Summary of “Good to Great”
“Good to Great” fully answered the question “Can a good company be transformed into a great company, and how to transform”. The series of conclusions drawn from data in this book constitute the framework from good to great.
The author believes that whether it is new economy or old economy enterprises, seriously implementing the framework from good to great can greatly improve their operating conditions and upgrade them to great companies.
A summary of the overall concept framework is provided here, as well as a preview of the contents of other chapters of this book. You can imagine the process from good to great as accumulating strength, then achieving a leap, and then entering 3 broader stages: disciplined people, disciplined thought, disciplined action. In these 3 stages, each stage contains two key concepts. Surrounding the entire framework is the concept called “flywheel”, which encompasses the overall characteristics of the entire process from good to great.
Level 5 Leadership. When we finally found the type of leader needed to achieve the leap, we were all surprised and shocked. Compared with some company leaders with strong personalities, eye-catching, making headlines, and being celebrities, the leaders of companies that achieved the leap seem to have come from Mars. Low-profile, quiet, introverted and even shy - these leaders are a mixture of contradictions: personally humble, but professionally performing. They are more like Lincoln and Socrates than Patton and Caesar.
First Who… Then What. We originally thought that the leaders of companies that achieved the leap would start by establishing a set of new ideas and new strategies. Instead, we found that they first invited the right people in, invited the wrong people out, and put the right people in their places - and then considered what to do next. The maxim “people are the most important asset” now also seems wrong. People are not the most important asset, the right talents are the most important asset.
Confront the Brutal Facts (Yet Never Lose Faith). We know that a war survivor can teach us how to find a path to greatness more than any book on company strategy. Every company that achieved the leap agrees with what we call “The Stockdale Paradox”: no matter what difficulties you encounter, you must firmly believe that you will definitely and finally win; at the same time, no matter how cruel the reality is, you must have the qualities to confront it.
The Hedgehog Concept (Simplicity within the Three Circles). To complete the transition from good to great, one must transcend the curse of competence. If you think you can be the best in this line just because a certain business is your main business, or just because you have been in this line for a few years or even decades, you are very wrong. If you cannot be the best in your main business, then this business cannot become the cornerstone of a great company. There must be a concept to replace it, and this concept is simple and reflects a deep understanding of the intersection of the three circles.
A Culture of Discipline. All companies have a culture, and some companies are disciplined, but companies with a culture of discipline are rare. When you have disciplined employees, you don’t need to set up a hierarchy in the company. When you have disciplined thought, you don’t need to set up layers of departments in the company. When you have disciplined action, you don’t need too much control. Combine a culture of discipline with the work ethic of entrepreneurs, and you get the magical alchemy that creates great performance.
Technology Accelerators. Companies that achieved the leap have a different understanding of the role of technology. They do not regard technology as the primary tool for inducing change, but paradoxically, they are all pioneers in using technology. Of course, these technologies are carefully selected. From this we conclude: Technology itself is never the primary and root cause of moving towards greatness or decline.
The Flywheel and the Doom Loop Companies that launch revolutions, implement exciting changes, and implement earth-shaking restructuring are almost destined not to complete the leap from good to great. No matter how exciting the final ending is, the transition from good to great never happens overnight. In this process, there is simply no single clear action, no grand plan, no once-and-for-all innovation, and absolutely no lucky breakthrough and miracle falling from the sky. On the contrary, this process is like pushing a heavy giant flywheel in one direction, turn after turn, accumulating potential energy, until reaching the breakthrough point, and completing the leap.
From “Good to Great” to “Built to Last” Interestingly, I now feel that “Good to Great” is not a sequel to “Built to Last”, but should be its prequel. This book talks about how to transform a good enterprise into a great enterprise that can continuously create extraordinary performance. While “Built to Last” is about how to manage a great enterprise and make it have extraordinary temperament and last for a long time. Completing this final transformation requires core values and a purpose beyond profit, plus a key motivation to preserve the core or stimulate progress.
Level 5 Leadership
Origin of Level 5 Leadership Initially, the “Good to Great” research team spent a long time discussing how to comprehensively describe the leaders of companies that achieved the leap, without using titles such as selfless manager, which might lead readers to wrong views, and finally chose the title Level 5 Leadership. According to the classification of the research team, there are 4 levels under Level 5 leaders, which together constitute the 5-level leader system.
Two Characteristics of Level 5 Leadership
Humility + Will = Level 5 Leadership
| Professional Will | Personal Humility |
|---|---|
| Created outstanding performance, playing the role of a catalyst in achieving the leap | Showed compelling modesty, shunned public adulation, never boastful |
| In order to achieve the best long-term performance, showed determination to go forward no matter how difficult it is | Acted with quiet, calm determination; relied principally on inspired standards, not inspiring charisma, to motivate |
| Set the standard of building an enduring great company; will settle for nothing less | Ambitious, but channels ambition into the company, not the self; sets up successors for even greater success in the next generation |
| Looks in the mirror, not out the window, to apportion responsibility for poor results, never blaming other people, external factors, or bad luck | Looks out the window, not in the mirror, to apportion credit for the success of the company to other people, external factors, and good luck |
How to Become Level 5 Leadership Start practicing other concepts from Good to Great now. On the one hand, the temperament of Level 5 leaders enables you to implement other concepts; on the other hand, practicing other concepts helps you become a Level 5 leader.
First Who… Then What
To achieve the leap from good to great, there must first be disciplined people, and disciplined people are composed of team leaders with Level 5 leadership characteristics and team members selected through “First Who… Then What”.
Level 5 leaders must understand: 1. If you start with “who” rather than “what”, you can more easily adapt to a changing world. 2. The right people don’t need to be tightly managed or fired up; they will be self-motivated by the inner drive to produce the best results and to be part of creating something great. 3. If you have the wrong people, it doesn’t matter whether you discover the right direction; you still won’t have a great company. Great vision without great people is irrelevant.
Simon Sinek proposed the Golden Circle principle of Why>How>What. After reading this chapter, the question of “Who” is higher than “What”, and talent is the core of the Golden Circle. Apple only used the Golden Circle law to invent various hit consumer electronic products with Steve Jobs. Airbus could only share the market with Boeing after finding John Leahy. And the highest standard of this “Who” is a Level 5 leader, and one must continuously look for people with Level 5 leadership qualities to join the team.
And the highest standard of this “Who” is a Level 5 leader, and one must continuously look for people with Level 5 leadership qualities to join the team. A specific embodiment of the “First Who… Then What” principle is: It is not how much you pay that comes first, but who you pay? The best payment plan is: We hired 5 people, but they did the work of 10 people, and we paid them the salary of 8 people.
In achieving company transformation, manpower is not the most important asset, the right talent is. It is necessary to constantly recruit those with consistent values to get on the bus, and understand who they are, what kind of people they are, and whether their values are consistent by asking them how they make decisions.
In personnel management, adhere to the strict four principles of talent:
- When in doubt, don’t hire - keep looking. Level 5 leaders should put a lot of energy into finding excellent talents, and should make various efforts to find the most appropriate people to fill vacancies, preferring shortage to abuse. To measure whether someone is suitable, mainly look at inner character and innate capabilities, rather than specific knowledge, background or skills.
- When you know you need to make a people change, act. The senior staff of companies that achieved the leap have two extremes in staying or leaving, either staying on the bus for a long time, or getting off in a hurry. Companies that achieved the leap do not rely on frequent replacement, but on high-quality replacement to achieve their goals. Companies that achieved the leap will not adopt the “cast the net first, then train” plan, but select strictly, and once they find the right person, they will try every means to keep them around. If not suitable, they will also face it frankly and not delay each other.
- Put your best people on your biggest opportunities, not your biggest problems.
- The company’s excellent talents should achieve: In looking for the best solution, they will argue endlessly, insist on their own opinions, and even have violent tendencies. However, once a decision is made, they must obey resolutely and never care about personal gains and losses.
Confront the Brutal Facts (Yet Never Lose Faith)
The most important point of this chapter is: In the process of leaping from good to great, adhere to a key psychological secret: The Stockdale Paradox.
Jim Stockdale was a US Navy admiral during the Vietnam War, captured from 1965-1973, fought a hard struggle during his captivity, and was finally released. After returning to the United States, he was established as an American hero, spent the rest of his life studying philosophy at the Hoover Institution, and co-authored “In Love and War” with his wife. When Jim Collins, author of “Good to Great”, asked Stockdale who could walk out of the prisoner of war camp alive, Stockdale said: The optimists didn’t make it out, because they held unrealistic hopes, and then died of a broken heart. The reason why he could make it out was: He had the faith that he would definitely make it out, and at the same time, he had a clear understanding of the brutal reality. From this, Jim Collins derived the Stockdale Paradox:
Retain faith that you will prevail in the end, regardless of the difficulties. AND at the same time, confront the most brutal facts of your current reality, whatever they might be.
The faith in inevitable victory, every entrepreneur has it, no entrepreneur will linger on, and everyone hopes to win with a great posture. As Churchill said “never, never, never, never give up”. Leadership does not begin with vision, but with getting people to confront the brutal facts and to act on the implications. But not everyone can confront the brutal facts. First, some people are blindly optimistic, thinking that their enterprise is the leading force in the industry, ignoring the latecomers, and finally the market share is snatched away. Second, some entrepreneurs cannot find out the truth, so they cannot confront the brutal facts. For various reasons, their subordinates are unwilling to report the actual situation. Only by being humble and listening to opinions can one obtain the real market, product, and competition situation. Third, after learning the brutal facts, they lose the determination to struggle, become cowards, capitulationists, and the likes of Wang Jingwei.
The first thing to confront the brutal facts is to find out the truth of the problem: Jim gave four principles
- Lead with questions, not answers. By asking more questions, find out the truth of the problem. You can ask more questions like: “What do you think?”, “Can you tell me the situation there?”, “Can you explain this matter”, “What problems do we have to solve currently?”. Being an excellent company leader does not mean starting with answers and then letting your employees follow you, but means being humble, you have to admit the fact that you haven’t understood the whole situation yet, and should ask more questions to help yourself better grasp the situation.
- Engage in dialogue and debate, not coercion. All companies that achieved the leap advocate frequent dialogue, such as “loud arguments, heated discussions, reasonable collisions”, etc. Their discussions are not a pretense, letting people talk, and finally reaching a preset conclusion. The whole process is more like a scientific debate, where everyone joins in to find answers.
- Conduct autopsies, without blame. When conducting autopsies without blame, you can create an atmosphere where the truth can be heard. If you have the right people in the same boat with you, there is no need to blame, just to understand and learn. PS: Spending time and energy to motivate people is a huge waste. The real problem is not how to motivate employees. If there are the right employees, they will be self-motivated. The key is not to de-motivate them. And the most de-motivating thing is to ignore the brutal facts.
- Build red flag mechanisms. In order to ensure listening to the real thoughts and actual problems of customers, employees, management, and partners, a set of self-restraining mechanisms must be established to ensure that one can truly listen. The “red flag” and “short pay” mechanisms listed in the book are very good.
The leap of all enterprises is based on major decisions at several key nodes. On major issues, the four principles of finding out the truth must be followed to obtain the truth.
Published at: Jul 1, 2020 · Modified at: Jan 14, 2026
