In it Collins and his team summarise the results of years of work studying and comparing the activities of good companies (those that match general stock market performance) from great companies (those that performed on average 6.9 times better than the market over a 15-year period). He draws conclusions on many aspects of business from leadership to recruitment but a central idea is called the hedgehog concept for reasons that you can discover in the book.
The concept has three questions: 1) What can you be best in the world at 2) What are you deeply passionate about 3) What drives your economic engine
Tantalisingly, Collins points out that the answer to question 1) may not be the activity that your business is currently involved in even if it is profitable and you are growing. The importance of passion is self-evident, starting and running a business is hard with manysetbacks in the road so if you dont have a passion for your project you will probably tire ofthe challenge at some point. The third aspect also requires little explanation. Frankly, if yourpassion doesnt generate a profit then unfortunately it is not viable at least in its current form.
This question also implies a more forensic analysis of where the profit is generated within abusiness. Once identified, you will have the option to fine-tune your procedures to maximisethe most profitable elements. Once you have identified the specific business that your company can be supreme at you mustengage on a deliberate and determined process of implementation of a simplified strategythat step-by-step drives your plan forward. Each step is small and may have an imperceptibleeffect on the direction but by sticking at it the business develops momentum Collins likensit to a flywheel.
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Eventually it becomes easier and the growth shows what might be describedAs positive feedback success breeds success.
I am struck by the comparison with Dave Brailsfordsconcept of “marginal gains” from the totally differentsphere of competitive cycling. Brailsford believes thatturning good cyclists into world-beaters is not doneovernight but is the culmination of many, smallimprovements over time all focused on the same goal to be the best. He led British cycling to the pinnacle ofthe sport.
A key element to achieving your goal is the compilation of the right team around you and soyour recruitment skills will need to be tested. Clarity of vision is also important and thediscipline to persist with the plan and be single minded about focusing on what you are bestAt. If you are correct in your analysis, given sufficient time the results should take care ofthemselves.
I can illustrate this point with a clear case study. Earlier this year the Swedish carmanufacturer Volvo declared that by 2020 no one will bekilled or seriously injured driving a new Volvo car or SUV. Volvo has been a byword for driver safety for decades andthe team just keeps the development going forward. Ihave to declare an interest, in that I am a fan and haveowned a series of Volvos over the years and safety hasAlways been a key factor in the buying decision.
The brand is much more than that however, representing a benchmark in build quality andmid-to-high end luxury. That said, most of the stand-out innovation has been safetyoriented and so this latest claim is I suppose the natural destination. Whether you like thebrand or not you have to admire the focussed, determined approach that the company hasAdopted seemingly over its entire history and the mark has never been more successful thantoday. World leading companies are fanatical about their products and obsess about the details andhow they affect the user experience Apples Steve Jobs was a classic example of thisApproach.
Standing out from the crowd can be achieved in any area of the experience fromcustomer service, ease of ordering, delivery, packaging to ease of use and design a thousanddetails that all amount to satisfaction or disappointment within the user. Nowadays you canreach out through social media and other channels to project your message and your passionAnd commitment to improving the user experience must be seen as authentic and shinethrough such interactions. If you are successful in this your will reinforce the brand andconfirm the perception that you have a world-leading offer.
All this will take time though, there are few overnight success stories at least ones that remainsuccessful for decades after. Perhaps one of the challenges of modern business is that we areAll too often looking for a fast return on investment rather than the bigger prize long-term,sustainable success.
With reference from great leaders such as Jack Welch, Steve Jobs and Ross Perot, JE Invest’s managing director, Andrew Low, unveils five hiring tactics that could be helping the competition especially if you don’t know.