Chapter 3 - first who... then what
- To be clear, the main point of this chapter is not just about assembling the right team - that's nothing new. The main point is to first get the right people on the bus (and the wrong people off the bus) before you figure out where to drive it. The second key point is the degree of sheer rigor needed in people decisions in order to take a company from good to great.
- We found no systematic pattern linking executive compensation to the process of going from good to great. The evidence simply does not support the idea that the specific structure of executive compensation acts as a key lever in taking a company from good to great.
- Yes, compensation and incentives are important, but for very different reasons in good-to-great companies. The purpose of a compensation system should not be to get the right behaviors from the wrong people, but to get the right people on the bus in the first place, and to keep them there.
- Nucor rejected the old adage that people are your most important asset. In a good-to-great transformation, people are not your most important asset. The right people are.
- Six of the eleven good-to-great companies recorded zero layoffs from ten years before the breakthrough date all the way through 1998, and four others reported only one or two layoffs.
- Those who build great companies understand that the ultimate throttle on growth for any great company is not markets, or technology, or competition, or products. It is one thing above all others: the ability to get and keep enough of the right people.
- The good-to-great companies showed the following bipolar pattern at the top management level: People either stayed on the bus for a long time or get off the bus in a hurry. In other words, the good-to-great companies did not churn more, they churned better.
- It might take time to know for certain if someone is simply in the wrong seat or whether he needs to get off the bus altogether. Nonetheless, when the good-to-great leaders knew they had to make a people change, they would act.
- There is an important corollary to this discipline: When you decide to sell off your problems, don't sell off your best people. This is one of those little secrets of change. If you create a place where the best people always have a seat on the bus. they're likely to support changes in direction.
- Indeed, one of the crucial elements in taking a company from good to great is somewhat paradoxical. You need executives, on the one hand, who argue and debate - sometimes violently - in pursuit of the best answers, yet, on the other hand, who unify fully behind a decision, regardless of parochial interests.
- The good-to-great leaders began the transformation by first getting the right people on the bus (and the wrong people off the bus) and then figured out where to drive it.
- The key point of this chapter is not just the idea of getting the right people on the team. The key point is that "who" questions come before "what" decisions - before vision, before strategy, before organization structure, before tactics. First who, then what - as a rigorous discipline, consistently applied.
- The comparison companies frequently followed the "genius with a thousand helpers" model - a genius leader who set a vision and then enlists a crew of highly capable "helpers" to make the vision happen. This model fails when the genius departs.
- The good-to-great leaders were rigorous, not ruthless, in people decisions. They did not rely on layoffs and restructuring as a primary strategy for improving performance. The comparison companies used layoffs to a much greater extent.
- We uncovered three practical disciplines for being rigorous in people decisions:
1. When in doubt, don't hire - keep looking. (corollary: A company should limit its growth based on its ability to attract enough of the right people.)
2. When you know you need to make a people change, act. (corollary: first be sure you don't simply have someone in the wrong seat.)
3. Put your best people on your biggest opportunities, not your biggest problems. (corollary: if you sell off your problems, don't sell off your best people.)
- Good-to-great management teams consist of people who debate vigorously in search of the best answers, yet who unify behind decisions, regardless of parochial interests.
- We found no systematic pattern linking executive compensations to the shift from good to great. The purpose of compensation is not to "motivate" the right behaviors from the wrong people, but to get and keep the right people in the first place.
- The old adage "People are your most important asset" is wrong. People are not our most important asset. The right people are.
- Whether someone is the "right person" has more to do with character traits and innate capabilities than with specific knowledge, background, or skills.
let go questions
1. would you hire the person again?
2. would you feel terribly disappointed or secretly relieved?