Character is like a tree and reputation like its shadow: the shadow is what we think of it: the tree is the real thing.

A. Lincoln

Lean by Choice

In Jim Collins latest book Great by Choice he examines companies that rose from good to great from a different angle. He zooms into study companies that have outperformed industry indexes by a minimum of ten times over fifteen years in fast changing and highly unpredictable environments.

In this new study, Collins contrasts these companies with a group of companies who failed to achieve greatness in similar tumultuous environments. In addition, Collins shares some very surprising findings that contradict conventional thinking about leadership, innovation, fast decision making and the effective pace of changes within companies. In the last chapter of this book, Collins even explores the role of luck on companies that achieved in extreme times.

Collins used empirical business research to share credible findings from his studies. In reflecting on the book Great by Choice I have a couple of observations regarding the role of lean thinking and leadership in enabling companies to achieve and sustain greatness in challenging and uncertain environments. Collins refers to the great companies in this book as 10Xers. He points out consistent traits of  leaders which translate into the mindset of the organizations in these 10Xer companies. Collins describes the leaders in these companies as being fanatic about discipline, possessing productive paranoia and committed to empirical creativity.

My first observation is that Collins does a very good job in providing what differentiates companies that have become great in extreme environments. He does not provide a consistent methodology on how to build a great company. My belief (through experience) is that lean thinking is an enabling strategy which provides the how to achieve and sustain greatness in difficult and uncertain times. Toyota and a select group of companies that are exceptional at lean have incredible discipline, a very healthy paranoia which fuels their continuous improvement efforts. They use real experience and information to enhance creativity. A truly lean enterprise is able to inculcate a mindset of continuous improvement throughout the business through the behaviors of the leaders in the organization.

My second observation is that the companies that Collins deems to be great demonstrate they are committed to continuous improvement and employee engagement. However they are not among the companies we commonly refer to as excellent lean enterprises. My take is that there are many different approaches to become a great company. In my opinion, the adoption of lean throughout ¬†a company will significantly increase a company’s chances of rising from good to great. Companies can become great by choice through becoming lean by choice.

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