how-the-mighty-fall

Jim Collins delivers in his latest effort.  While this smallish book might not be the instant classic that both <strong>[book:Built to Last|4122]</strong> and <strong><a href="https://www.goodreads.com/review/show/1709484164">Good to Great</a></strong> were, the territory is familiar and comfortable.

Completed last fall as the United States economy was in the midst of implosion, this book offers a research-grounded perspective on how corporate decline can happen.  Collins warns that there is no law of nature that the most powerful companies are invincible.  Anyone can fall and most eventually do.

Corporate decline is harder to detect but easier to cure in the early stages and easier to detect but harder to cure in the later stages.  Collins offers <strong>The Five Stages of Decline</strong> framework and suggests that there are more ways to fall than to become great.

<strong>Stage 1</strong> begins when business leaders become arrogant, regarding success virtually as an entitlement.

<strong>Stage 2</strong> continues with the company takes undisciplined leaps into areas where it cannot be great or grows so fast that excellence can not be maintained.

<strong>Stage 3</strong> is identified by a leadership discount of negative data, an amplification of positive data and a positive spin on ambiguous data.

<strong>Stage 4</strong> exhibits a sharp decline in company operations that is evident by both internal and external constituencies.

<strong>Stage 5</strong> concludes the downward spiral with the leaders abandoning all hope of building a great future.

Collins hypothesizes that organizational decline is largely self-inflicted and recovery is largely within leadership control.  In each stage Collins compares similar companies that both managed and failed to manage the growth stages.  His most useful construct is a list of markers for each stage which managers can use to raise warning flags within the organization.

I'm looking forward to Collins' next full-sized book (the turbulence book)—what it takes to endure and prevail when the world around you spins out of control.

Access Gene Babon's reviews of books on <strong>Business Leadership</strong> and <strong>Business Strategy</strong> at <strong><a href="https://www.pinterest.com/webapprentices/" target="_blank">Pinterest</a>.</strong>