DISCIPLINED THOUGHTS
Confront the Brutal Facts
All good-to-great companies began the process of finding a path to greatness by confronting the brutal facts of their current reality. When a company starts with an honest and diligent effort to determine the truth of its situation, the right decisions often become self evident.
Good decisions are impossible without an honest confrontation of the brutal facts.
Why Kroger Beat A&P
The Great Atlantic and Pacific Tea Company (also known as A&P) had the perfect business model for the first half of the twentieth century, when two world wars and an economic depression imposed frugality upon Americans: cheap, plentiful groceries sold in utilitarian
stores. However, in the more affluent second half of the century, Americans began demanding bigger stores, more choices, fresh baked goods, fresh flowers, banking services and so forth. They wanted superstores that offered almost everything under one roof. To face the brutal facts about the mismatch between its past model and the changing world, A&P opened a new
store called Golden Key, where it could experiment with new methods and models and learn what customers wanted. It sold no A&P-branded products, experimented with new departments, and began to evolve toward the more modern superstore. A&P began to discover the answer to the questions of why it was losing market share and what it could do about it. But A&P executives didn’t like the answers they got, so they closed the store, rather than diverge from their ages-old business ideas. Meanwhile, the Kroger grocery chain also conducted experiments and, by 1970, discovered the inescapable truth that the old-model grocery store was going to become extinct. Rather than ignore the brutal truth, as A&P did, the company acted on it, eliminating, changing, or replacing every single store that did not fit the new realities. It went block-by-block, city-by-city, state-by- state, until it had rebuilt its entire system. By 1999, it was the number one grocery chain in America.
Let the Truth Be Heard
One of the primary tasks in taking a company from good to great is to create a culture wherein people have a tremendous opportunity to be heard and, ultimately, for the truth to be likewise heard.
To accomplish this, you must engage in four basic practices:
● Lead with questions, not answers. Leading from good to great does not mean coming up with the answers and motivating everyone to follow your messianic vision. It means having the humility to grasp the fact that you do not yet understand enough to have the answers, and then to ask questions that will lead to the best possible insights.
● Engage in dialogue and debate, not coercion. All good-to-great companies have a penchant for intense debates, discussions and healthy conflict. Dialogue is not used as a sham process to let people “have their say” so they can buy into a predetermined decision; rather, it is used to engage people in the search for the best answers.
● Conduct autopsies, without blame. Good-to-great leaders must take an honest look at decisions his or her company makes, rather than simply assigning blame for the outcomes of those decisions. These “autopsies” go a long way toward establishing understanding and learning, creating a climate where the truth is heard.
● Build red flag mechanisms that turn information into information that cannot be ignored. Good-to-great companies have no better access to information than any other company; they simply give their people and customers ample opportunities to provide unfiltered information and insight that can act as an early warning for potentially deeper problems. ■
The Hedgehog Concept
In his famous essay “The Hedgehog and the Fox,” Isaiah Berlin divided the world into two groups, based on an ancient Greek proverb, which pitted the two natural enemies against each other. Foxes pursue many ends at the same time and see the world in all its complexity; they are scattered or diffused, moving on many levels, never integrating their thinking into one overall concept or unifying vision. Hedgehogs, on the other hand, simplify a complex world into a single idea or principle that unifies and guides everything. Regardless of the world’s complexity, the hedgehog reduces all challenges and dilemmas to simple ideas — anything that does not somehow relate to the hedgehog idea holds no relevance. When foxes and hedgehogs are pitted against one another, the hedgehog always wins.
DISCIPLINED THOUGHTS
Confront the Brutal Facts
All good-to-great companies began the process of finding a path to greatness by confronting the brutal facts of their current reality. When a company starts with an honest and diligent effort to determine the truth of its situation, the right decisions often become self evident.
Good decisions are impossible without an honest confrontation of the brutal facts.
Why Kroger Beat A&P
The Great Atlantic and Pacific Tea Company (also known as A&P) had the perfect business model for the first half of the twentieth century, when two world wars and an economic depression imposed frugality upon Americans: cheap, plentiful groceries sold in utilitarian
stores. However, in the more affluent second half of the century, Americans began demanding bigger stores, more choices, fresh baked goods, fresh flowers, banking services and so forth. They wanted superstores that offered almost everything under one roof. To face the brutal facts about the mismatch between its past model and the changing world, A&P opened a new
store called Golden Key, where it could experiment with new methods and models and learn what customers wanted. It sold no A&P-branded products, experimented with new departments, and began to evolve toward the more modern superstore. A&P began to discover the answer to the questions of why it was losing market share and what it could do about it. But A&P executives didn’t like the answers they got, so they closed the store, rather than diverge from their ages-old business ideas. Meanwhile, the Kroger grocery chain also conducted experiments and, by 1970, discovered the inescapable truth that the old-model grocery store was going to become extinct. Rather than ignore the brutal truth, as A&P did, the company acted on it, eliminating, changing, or replacing every single store that did not fit the new realities. It went block-by-block, city-by-city, state-by- state, until it had rebuilt its entire system. By 1999, it was the number one grocery chain in America.
Let the Truth Be Heard
One of the primary tasks in taking a company from good to great is to create a culture wherein people have a tremendous opportunity to be heard and, ultimately, for the truth to be likewise heard.
To accomplish this, you must engage in four basic practices:
● Lead with questions, not answers. Leading from good to great does not mean coming up with the answers and motivating everyone to follow your messianic vision. It means having the humility to grasp the fact that you do not yet understand enough to have the answers, and then to ask questions that will lead to the best possible insights.
● Engage in dialogue and debate, not coercion. All good-to-great companies have a penchant for intense debates, discussions and healthy conflict. Dialogue is not used as a sham process to let people “have their say” so they can buy into a predetermined decision; rather, it is used to engage people in the search for the best answers.
● Conduct autopsies, without blame. Good-to-great leaders must take an honest look at decisions his or her company makes, rather than simply assigning blame for the outcomes of those decisions. These “autopsies” go a long way toward establishing understanding and learning, creating a climate where the truth is heard.
● Build red flag mechanisms that turn information into information that cannot be ignored. Good-to-great companies have no better access to information than any other company; they simply give their people and customers ample opportunities to provide unfiltered information and insight that can act as an early warning for potentially deeper problems. ■
The Hedgehog Concept
In his famous essay “The Hedgehog and the Fox,” Isaiah Berlin divided the world into two groups, based on an ancient Greek proverb, which pitted the two natural enemies against each other. Foxes pursue many ends at the same time and see the world in all its complexity; they are scattered or diffused, moving on many levels, never integrating their thinking into one overall concept or unifying vision. Hedgehogs, on the other hand, simplify a complex world into a single idea or principle that unifies and guides everything. Regardless of the world’s complexity, the hedgehog reduces all challenges and dilemmas to simple ideas — anything that does not somehow relate to the hedgehog idea holds no relevance. When foxes and hedgehogs are pitted against one another, the hedgehog always wins.
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