Decline can be avoided. Decline can be detected. Decline can be reversed. Amidst the desolate landscape of fallen great companies, Jim Collins began to wonder: How do the mighty fall? Can decline be detected early and avoided? How far can a company fall before the path toward doom becomes inevitable and unshakable? How can companies reverse course? In How the Mighty Fall, Collins confronts these questions, offering leaders the well-founded hope that they can learn how to stave off decline and, if they find themselves falling, reverse their course. Collins' research project—more than four years in duration—uncovered five step-wise stages of decline: Stage 1: Hubris Born of Success Stage 2: Undisciplined Pursuit of More Stage 3: Denial of Risk and Peril Stage 4: Grasping for Salvation Stage 5: Capitulation to Irrelevance or Death By understanding these stages of decline, leaders can substantially reduce their chances of falling all the way to the bottom. Great companies can stumble, badly, and recover. Every institution, no matter how great, is vulnerable to decline. There is no law of nature that the most powerful will inevitably remain at the top. Anyone can fall and most eventually do. But, as Collins' research emphasizes, some companies do indeed recover—in some cases, coming back even stronger—even after having crashed into the depths of Stage 4. Decline, it turns out, is largely self-inflicted, and the path to recovery lies largely within our own hands. We are not imprisoned by our circumstances, our history, or even our staggering defeats along the way. As long as we never get entirely knocked out of the game, hope always remains. The mighty can fall, but they can often rise again.
Author(s): Jim Collins
Edition: 1
Publisher: Jim Collins
Year: 2009
Language: English
Pages: 225
How the Mighty Fall: And Why Some Companies Never Give In (2009)......Page 1
CONTENTS......Page 5
ACKNOWLEDGMENTS......Page 6
PREFACE......Page 10
THE SILENT CREEP OF IMPENDING DOOM......Page 12
WHY THE FALL OF PREVIOUSLY GREAT COMPANIES DOES NOT NEGATE PRIOR RESEARCH......Page 15
ON THE CUSP, AND UNAWARE......Page 16
THE RESEARCH PROCESS......Page 23
A Study of Contrasts......Page 26
THE RESULTS: A FIVE-STAGE FRAMEWORK......Page 29
STAGE 1: HUBRIS BORN OF SUCCESS......Page 30
STAGE 3: DENIAL OF RISK AND PERIL......Page 31
STAGE 5: CAPITULATION TO IRRELEVANCE OR DEATH......Page 32
IS THERE A WAY OUT?......Page 33
Five Stages of Decline......Page 34
STAGE 1: HUBRIS BORN OF SUCCESS......Page 37
ARROGANT NEGLECT......Page 39
CONFUSING WHAT AND WHY......Page 46
MARKERS FOR STAGE 1......Page 53
STAGE 2: UNDISCIPLINED PURSUIT OF MORE......Page 55
OVERREACHING, NOT COMPLACENCY......Page 56
OBSESSED WITH GROWTH......Page 60
BREAKING PACKARD'S LAW......Page 65
PROBLEMATIC SUCCESSION OF POWER......Page 68
MARKERS FOR STAGE 2......Page 73
STAGE 3: DENIAL OF RISK AND PERIL......Page 75
MAKING BIG BETS IN THE FACE OF MOUNTING EVIDENCE TO THE CONTRARY......Page 78
TAKING RISKS BELOW THE WATERLINE......Page 81
A CULTURE OF DENIAL......Page 86
LEADERSHIP-TEAM DYNAMICS......Page 87
MARKERS FOR STAGE 3......Page 91
STAGE 4: GRASPING FOR SALVATION......Page 93
SEARCHING FOR A SILVER BULLET......Page 98
Behaviors That Exemplify......Page 100
PANIC AND DESPERATION......Page 106
MARKERS FOR STAGE 4......Page 110
STAGE 5: CAPITULATION TO IRRELEVANCE OR DEATH......Page 112
GIVING UP THE FIGHT......Page 114
RUNNING OUT OF OPTIONS......Page 116
DENIAL OR HOPE......Page 120
WELL-FOUNDED HOPE......Page 122
Appendices......Page 133
APPENDIX 1: FALLEN-COMPANY SELECTION CRITERIA......Page 134
STARTING UNIVERSE......Page 135
CRITERION 1:......Page 136
CRITERION 2......Page 138
CRITERION 3:......Page 139
FINAL STUDY SET, FALLEN CASES......Page 140
APPENDIX 2: SUCCESS-CONTRAST SELECTION CRITERIA......Page 141
APPENDIX 3: FANNIE MAE AND THE FINANCIAL CRISIS OF 2008......Page 148
APPENDIX 4.A: EVIDENCE TABLE-SUBVERTING THE COMPLACENCY HYPOTHESIS......Page 154
APPENDIX 4.B: EVIDENCE TABLE-GRASPING FOR SALVATION......Page 160
APPENDIX 5: WHAT MAKES FOR THE "RIGHT PEOPLE" IN KEY SEATS?......Page 164
APPENDIX 6.A: DECLINE AND RECOVERY CASE: IBM......Page 166
APPENDIX 6.B: DECLINE AND RECOVERY CASE: NUCOR......Page 172
APPENDIX 6.C: DECLINE AND RECOVERY CASE: NORDSTROM......Page 178
APPENDIX 7: GOOD-TO-GREAT FRAMEWORK CONCEPT SUMMARY......Page 183
NOTES......Page 187
INDEX......Page 216
