 Brian's Bookshelf
Good to Great and the Social Sectors:
Why Business Thinking is Not the Answer.
Boulder: Jim Collins, 2005.
Review by Brian Fraser
In the author’s note at the beginning of this provocative monograph, business scholar Jim Collins tells the story of asking John Gardner, then a professor at Stanford University, previously Secretary of Health, Education and Welfare in Lyndon Johnson’s administration, and founder of Common Cause, what Collins needed to do to become a better teacher. “It occurs to me, Jim, that you spend too much time trying to be interesting,” he said. “Why don’t you invest more time being interested?”
And that’s exactly what Collins did, to the point of leaving Stanford and setting up his own research institute. A key result of becoming more interested was Collins’ 2001 publication Good to Great: Why Some Companies Make the Leap … and Others Don’t. It topped Business Week’s best-seller list in that first year and remained on the New York Times’ best-seller list through 2006. It used rigorous analysis of some 1500 companies to identify the 15 that performed best over a 15 year period, and then analyzed what made them great.
As people inquired further about his work, Collins found that over 1/3rd of the responses were from non-business sectors. He was surprised - and again became interested. He conducted interviews and did lab work with over 100 social sector leaders resulting in this monograph.
His core ideas – get the right people with the right ideas doing the right things – attracted the attention of Colleen Kelly, manager of excitement at Volunteer Vancouver. Good to Great and the Social Sectors became a major stimulus to her thinking in developing the A People Lens.
In brief, Collins’ research shows that a great organization grows through four basic stages, each of which is guided by two fundamental principles. Here is a summary of his findings:
Stage 1: Disciplined People
- Principle 1: Level 5 Leadership
These leaders are ambitious for the cause, the organization, and the work, not themselves, and fiercely resolved to make the organization work. They have a paradoxical blend of personal humility and professional will.
- Principle 2: First Who … Then What
Great organizations have the right people on the bus, the wrong people off, and the right people in the right seats before they figure out where to go.
Stage 2: Disciplined Thought
- Principle 1: Confront the Brutal Facts
Believe you will overcome the difficulties, and at the same time, have the discipline to confront the brutal facts of your current situation, whatever they may be.
- Principle 2: The Hedgehog Concept
Greatness comes about by a series of good decisions consistent with a simple, coherent concept that derives from the intersection of what you do best in the world, what you are most passionate about, and what best drives your resources engine.
Stage 3: Disciplined Action
- Principle 1: A Culture of Discipline
In a culture of discipline, people do not have jobs; they have responsibilities. Disciplined people engage in disciplined thought and take disciplined action with freedom within a framework of clear responsibilities.
Principle 2: The Flywheel
The process of achieving greatness resembles relentlessly pushing a great, heavy flywheel in one direction, turn upon turn, building momentum until a point of breakthrough, and beyond.
Stage 4: Building Greatness to Last
- Principle 1: Clock Building, not Time Telling
Leaders in great organizations build catalytic processes to stimulate progress rather than building dependence on charismatic personalities.
- Principle 2: Preserve the Core and Stimulate Progress
Great organizations have a set of timeless core values and a core reason to exist. At the same time, they have a relentless drive to change and progress – a creative compulsion often seen in BHAGs (Big, Hairy, Audacious Goals). Core values never change, but operating strategies and culture practices endlessly adapt to new environments to preserve the values in effective ways.
As the momentum at Volunteer Vancouver builds, they have focused on four major areas essential to not-for-profit significance and greatness – governance, strategic planning, leadership, and working with people. Here’s my take on how Good to Great and the Social Sectors can inform each of these areas.
Governance
As boards face their responsibilities for building the momentum of their organizations, they face two people challenges – getting the right executive director and getting the right board members. The statistics are chilling. 40% of executive directors will move on within the next 5 years – either to retirement or others jobs. Thinking carefully through the kind of leadership needed, for the kind of organization desired, is a major responsibility of the board and it’s best to start that kind of thinking well before the resignation or retirement shows up on the chairperson’s desk. The same process, with obvious modifications, is required to recruit the right board in increasingly challenging times. Clarity on the kinds of talents needed for the right responsibilities will more readily attract the new volunteers who are looking for specific meaning and significance in their volunteer work. Both kinds of people-challenges are best met by finding people who are humble, competent, and passionate about the cause.
Strategic Planning
One of the key responsibilities of the board is to develop and monitor the implementation of the policies that best build momentum for the core values and purpose of the organization. It sounds simple and obvious, but too many organizations take this dimension for granted and get mired in ruts of administrivia. Passionate people want clarity about the cause around which they can exercise their creativity to meet its needs better and better. This kind of thinking should be part of every board meeting, not confined to planning sessions every year or two. You build momentum one push or one step at a time, aimed toward a commonly-shared purpose, exerted by people who are unified in values and purpose.
Leadership
We know from recent research by Mary Hiland i and others that great not-for-profit leadership depends on the quality of the relationship between the executive director and the board chair (and among the core leadership in not-for-profits with no staff). Leaders who can manage their egos in the service of the cause, who can combine humility about themselves with ambition for the cause, will create legacies that are rooted in the organization, not in their personalities. That is especially important in organizations where the executive director and/or the board chair is a founder.
Working with People
This is the area where Collins feels that business leaders have the most to learn from leaders in the social sectors. He draws the distinction between “executive” and “legislative” leadership. “Executive” leaders hold enough concentrated power simply to make the right decisions happen. “Legislative” leaders rely on persuasion, diplomacy, and shared interests to create the right environment for the right decisions to happen. The world is becoming more “legislative” as customers and employees are gaining more power in business transactions and processes. A recent study featured in The Nonprofit Quarterly ii found that not-for-profit leaders showed significantly higher ratings than for-profit leaders in 14 of the 17 leadership dimensions in the survey. The most dramatic differences were in those skills related to emotional intelligence and working with people. Not-for-profit leaders showed greater sensitivity to people and situations and used personal rather than hierarchical power. These qualities are essential if we are to motivate and mobilize people in the service of our cause.
This monograph is short (35 pgs. including footnotes), but it is packed with generative thinking that will help you imagine new ways of leading more effectively as you engage passionately in your not-for-profit and volunteer responsibilities. We can all be grateful that Collins followed John Gardner’s advice and became interested in great organizations in the social sectors.
About Brian Fraser
Brian Fraser is the Lead Provocateur of Jazzthink and President and Lead Coach of Starting SMART Coaching. He is also currently a mentoring associate with Executive Consulting Canada. Brian has chaired the McAdam Book Award Jury for the Alliance for Nonprofit Management for the last several years and worked with the not-for-profit sector for his entire career. Discover more about his passions and work at www.jazzthink.com.
i See for example, Mary Hiland, “New Insights into the Board Chair-ED Relationship”. Charity Channel, June 2006. Available at: www.charitychannel.com
ii Jean R. Lobell & Paul M. Connolly, “Peak Performance: Nonprofit Leaders Rate Highest in 360-Degree Reviews”. The Nonprofit Quarterly, Dec 2007. Available at: www.nonprofitquarterly.org
About Volunteer Vancouver
The mission of Volunteer Vancouver is to inspire & build leadership in the voluntary sector. This publication is intended to be a medium of communication and information for the many organizations active in the volunteer and not-for-profit sector. The opinions expressed herein are solely those of the writers and do not necessarily reflect official policy of the Board of Directors of Volunteer Vancouver.
Volunteer Vancouver
1183 Melville, Vancouver, BC
V6E 2X5 Canada
t 604.875.9144
f 604.875.0710
www.volunteervancouver.ca
A United Way Member Organization and funded in part by the City of Vancouver.
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