Jack Covert Selects - Great by Choice

Great by Choice: Uncertainty, Chaos, and Luck—Why Some Thrive Despite Them All by Jim Collins and Morten T. Hansen, HarperBusiness, 320 Pages, $29.99 Hardcover, October 2011, ISBN 9780062120991

Jim Collins, author of Good to Great, which has gone on to sell well over 4 million copies, and we liked it enough to pick it as one of our 100 best business books of all time, has written, with Morten Hansen, another seminal book. All of Collins's books are research-based and are often quite contrarian. But Collins also has shown a remarkable ability to create metaphors that explain very complicated concepts, metaphors that stick in your brain, like the Hedgehog Concept and the Flywheel, which represent important business ideas and have become part of the business lexicon. With Great by Choice, Collins and Hansen continue this winning model. Based on nine years of research, the authors looked for enterprises that excelled statistically but also excelled in a particularly turbulent environment. "From an initial list of 20,400 companies, we systematically sifted through 11 layers of cuts to identify cases that met all our tests." Out of this research they found a final set of companies they called 10X because they beat their industry index by at least 10 times. I appreciate that for people who have read Good to Great this sound familiar. The difference is the second basis the researchers used: "The enterprise achieved these results in a particularly turbulent environment, full of events that were uncontrollable, fast-moving, uncertain and potentially harmful."

The researchers believe that 10Xers display three core behaviors: fanatic discipline, empirical creativity and productive paranoia.

By embracing the myriad of possible dangers, they put themselves in a superior position to overcome danger. 10Xers distinguish themselves not by paranoia per se, but by how they take effective action as a result. Paranoid behavior is enormously functional if fear is channeled into extensive preparation and calm, clear-headed action, hence our term "productive paranoia."

In the end, the number of 10xer companies were distilled to seven, Amgen, Biomet, Intel, Microsoft, Progressive Insurance, Southwest Airlines, and Stryker, and we meet them all in great detail and with surprisingly fresh stories in Great by Choice. Research is all well and good--and this book presents plenty of it including a substantial section at the back of the book of research notes--, but a book has to be readable, the advice applicable, the examples memorable to really get you thinking and inspire change. Collins and Hansen have done all of that, and in doing so, have given us the perfect book for our times.