Sunday, 26 July 2009

“How the Mighty Fall...” – the new book from Jim Collins

Like me, you may have followed Jim Collins work through the excellent “Good to Great”, to “Built to Last” and “Beyond Entrepreneurship” (possibly having previously read the seminal “In Search of Excellence” by Peters and Waterman). And now Collins is back with a new work entitled, “How the Mighty Fall and Why Some Companies Never Give In”, which appears quite timely in the current economic landscape.

The headline premise of this work is that: -

Decline can be avoided
Decline can be detected
Decline can be reversed

In the book, Collins identifies the 5 main stages of decline which he describes as: -

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

In essence, he is looking for the main reasons why companies fall, and the stage that they go through from being successful to completely failing; he asks if such decline can be spotted early (much like a screening for a medical condition) and, if treated early, repaired.

The book is full of anecdotal examples of the good, the bad and the ugly in business and is short, punchy and very readable at 123 pages long (211 pages when taking into account the appendices and associated notes).

In my opinion this is a great reference resource for all senior executives to read and reflect on. By looking in to the corporate mirror with complete honesty, does your company fall into any of the 5 stages of decline? According to Collins, even if they do, it may not be terminal as long as you take the right action now.

Sunday, 5 July 2009

10 Essential Elements of an Effective Leader

In any economic climate, and particularly in the one we are currently experiencing, an organisation needs clear and effective leadership. But what traits help to make up the character of a good leader?

Here I suggest 10 such elements that are an integral part of leadership: -

1) Vision – a leader must have a vision that everyone in the organisation can believe in, and gives a common sense of purpose throughout.

2) Focus – keep your eye on the ball and be ready to seize the opportunity as it arises. Be decisive in the pursuit of your objectives.

3) Respect/Trust – lead by example, work hard and be consistent in all that you do, and your team will build up their respect and trust in you.

4) Courage – a leader must be prepared to make tough decisions that can often be unpopular with other team members. The leader is there to be effective, not to win a popularity contest.

5) Communicate effectively – clear direction must be communicated to all team members in order that the entire team understands the objectives of the business model, but as a leader you must also have the ability to listen effectively. A casual conversation at the coffee machine can often unearth facts that haven’t been imparted within a meeting; an effective leader is always good at recognising and extracting these facts.

6) Prioritise – always prioritise your top five tasks and ensure that you work them through to completion.

7) Be Commercial – run the business to suit the customer wherever possible. Remember, they are the gatekeepers of your future revenue streams.

8) Accept Mistakes – be prepared to make mistakes and remove the blame culture from your Company. If employees are too scared to make mistakes then creativity and innovative decision making will be stifled and the organisation will suffer as a result. Remember the old maxim, “We learn from our mistakes” – the trick is not to repeat them.

9) Continual Learning – the effective leader must have the ability to continually learn, adapt and change in this fast moving world. To stand still is to go backwards in real terms.

10) Teambuilding – as a successful leader, surround yourself with the best team possible to cover all areas that you are not an expert in. Never fall into the trap of feeling threatened and, consequently, building a team where you are still the best within each discipline. The best team will produce superior results for your organisation.