Great by Choice by Jim Collins and Morten T. Hansen

Review: This is a worthwhile read, similar in style to Collins’ previous books Good to Great and Built to Last. This one focuses on companies that succeed in times of great uncertainty and draws lessons from their actions. Although the research they based the book on ended in 2002, the conclusions they’ve drawn are relevant today. The book focuses on “10Xer companies” eg a company that beat their industry by 10 fold. Only 7 companies out of 20,400 companies qualified: Amgen, Biomet, Intel, Microsoft, Progressive Insurance, Southwest Airlines, and Stryker.

Key conclusions: 10Xers are very disciplined, focused on data, and stick to their plan (called a “20 mile march”); 10Xers weren’t more innovative but were iterative in their innovation approach (“fire bullets” eg see what works, “then cannonballs” eg blow it out once you know what works); 10Xers employ "productive paranoia" eg have cash reserves and are flexible in interpreting the trends in their business and industry; 10Xers operate using Specific, Methodological, and Consistent (SMaC) rules to create consistent success; and finally 10Xers had a better “Return on Luck” (ROL) because they took full advantage of luck when it occurred and had enough of a buffer to mitigate any bad luck they encountered. This book provides directional information about how to thrive in an uncertain business climate.