Let me start by saying I'm a big fan of Jim Collins. Built to Last and Good to Great are both terrific books. We use Good to Great for our graduate students in the capstone module of Seton Hall University's MASCL program.
I will have to say though that Collins' latest book, How The Mighty Fall is a smaller book in more ways than one. It comes off as a hastily written defense of his first two works. You need only to flip to page four before reading a highlighted page titled: Why The Fall Of Previously Great Companies Does Not Negate Prior Research. As a result, the 123 pages of primary text falls well short of his first two books, but to be fair, he had a pretty tough act to follow.
Anyone who understands the fundamental principles of Built to Last realizes that while an enterprise may be built to last, it's not guaranteed to last. If you've read Good to Great, most readers get the concept that moving from good to great doesn't ensure eternal greatness. Despite the fate of Fannie Mae, Circuit City, et. al., the fundamental principles of Collins' first two books are rock solid.
But dismissing this new book as simply an act of Collins just playing defense would be unwise. Based on his research, both new and old, he offers "five step-wise stages of decline." Understanding these stages, particularly in today's business climate may come in handy. That said, I believe layered in those stages appears to be a lack of disciplined focus on the customer and on "having the right people on the bus." It seems to me that once a company shifts from these priorities to others, even slightly, it can spark its demise.
Consider this, I've asked several people to name one company for me, that was truly focused on the customer, in need of bailout money right now. You know how many names I have on the list? Zero.
In my next post, I'm going to share a story of a retailer (for whom I worked many years ago) whose road to failure began by paying too much attention to a competitor that wasn't even in its operating area, while paying too little attention to its own customers. It's a lesson I'll never forget.
How The Mighty Fall offers us a framework about decline. If you're like me, you believe there's more to be learned from our failures than our successes. For that reason, I recommend you read it. Just realize of course that following the principles in this book are no more a guarantee for survival than Collins' previous works could guarantee long-term greatness. Collins provides the framework and principles, the ultimate results are up to you.