In an evolving world of small business entrepreneurship, leadership is the driving force behind company success. Aspiring entrepreneurs set forth on this challenging journey with a dream and a vision, but disciplined leadership transforms these aspirations into reality.
A skilled leader serves as the compass, guiding the business through uncertain terrains and turbulent waters.
They possess the ability to inspire, motivate, and empower their team and manifest a culture of excellence, innovation, and harmony.
Disciplined leadership is a hidden force, a secret weapon, that can transform any ordinary entrepreneur into an extraordinary leader.
Stick around and learn the strategic twists, and game-changing principles, drawing upon the invaluable insights of renowned author of “Good to Great” and management expert Jim Collins that can shape organizations and inspire individuals to achieve extraordinary success.
Being great is a matter of Choice and Discipline.
In this article, we will discuss The traits of Disciplined Leadership described by Jim Collins and the significance of leadership in small business.
What Is The Importance Of Discipline In Leadership By Jim Collins?
According to Jim Collins, Disciplined Leadership forms the foundation of success. Leaders who prioritize discipline can guide their companies from good to great and achieve thriving greatness in the long run.
In his book “Good to Great: Why Some Companies Make the Leap, and Others Don’t,” Jim Collins extensively explores the importance of discipline in leadership and its correlation with profitable organizational success.
Collins provides several case studies to support his findings. One notable example is the comparison between two grocery store chains, Kroger and A&P.
Collins reveals that while both companies faced similar challenges and opportunities in the industry, Kroger displayed a more disciplined approach to leadership, ultimately achieving success in his business.
The disciplined leaders at Kroger focused on the consistent execution of their strategy, adhered to a clear set of principles. They made deliberate decisions based on empirical evidence and objective analysis.
With his 25 years of research and learning, Jim Collin’s states:
“Greatness is not primarily a function of a circumstance. It is first and foremost a matter of conscious choice and discipline.”Jim Collins
Collin emphasizes that impulsive actions or short-term gains do not drive disciplined leaders. Instead, they demonstrate an unwavering commitment to their core values and strategic objectives, making decisions that align with the company’s long-term vision.
From WHO To WHAT, The Winning Formula For Discipline In Leadership:
“From WHO to WHAT: The Winning Formula” is a concept introduced by Jim Collins in his book “Good to Great” and taken as critical characteristics of a small business owner.
As described by Collin, 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 figuring out where to drive it.
The critical point is that “who” questions come before “what” decisions- before vision, strategy, organization structure, and tactics.
The idea behind “From WHO to WHAT” is that to achieve sustainable success in business, it is essential to prioritize getting the right people on board before determining the specific strategies and plans (the “WHAT”).
When Dick Cooley became the Chief Executive of Wells Fargo in the late 1970s, he knew he would face a storm of deregulation; he knew the entire banking industry would be appended when deregulation swept through.
The board, understandably concerned, asked Cooley,” What is your vision and strategy? Where would you lead us?” and Dick Cooley had a fantastic answer for this,
” I don’t know. Not only that, it’s the wrong question. I’m not going first to figure out where to drive this bus and then get people on the bus. I’m going to do the complete opposite. Once I’ve got the right people on the bus and the wrong people off it, I will turn my attention to the question of ‘where’ we will drive this bus.”Dick Cooley – Wells Fargo
Collins argues that great leaders focus on first identifying and selecting the right individuals who possess the necessary skills, values, and attributes to drive the organization toward greatness.
Here are some actionable strategies for implementing the WHO-first approach:
- Define Core Values and Desired Behaviours
- Evaluate the current team members against the defined core values
- Establish a rigorous hiring process that focuses on identifying the right people
- Create success profiles for key positions
- Invest in the growth and development of the right people
- Emphasise collaboration and teamwork
Overall, “From WHO then WHAT” helps in successful business growth by recognizing the critical role of people in driving success.
Level 5 Leadership: How Disciplined Leaders Embrace Humility?
Collins’ research found that Level 5 Leadership was a common trait among the Disciplined leaders of the most successful companies in the world. A deep sense of personal humility characterizes it.
“Humility is the solid foundation of all virtues.”Confucius
These leaders are instrumental in taking their companies from good to great, achieving remarkable success, and creating a continuously growing and evolving culture.
The author placed different individuals in an entrepreneurial circle in Levels of Hierarchy:
- Level 1 represents good individual skills
- Level 2 shows good team skills; they play well with others
- Level 3 individuals demonstrate exceptional management skills
- Level 4 represents effective leadership skills
- Level 5 leadership demonstrates humility combined with a ferocious will to achieve something bigger
Good to Great companies have level 5 leaders, while the comparison companies have level 4 leaders. Level 5 Leadership represents a powerful combination of:
- Personal humility
- Unwavering resolve
- Strong commitment to the company’s success and well-being
Jim Collins introduces the concept of Level 5 Leadership as a key differentiating factor between good and great companies. Following are some key traits of level 5 leadership that also represent the essential qualities for a successful entrepreneur:
Level 5 Leaders display a remarkable sense of humility. They are modest individuals who downplay their accomplishments and attribute success to their teams.
They do not seek personal recognition or put themselves on a pedestal. Instead, they share credit with others and acknowledge the collective efforts of their company.
Jim Collins highlights Darwin E. Smith, the former CEO of Kimberly-Clark, as an exemplar of Level 5 Leadership.
Under Smith’s leadership, Kimberly-Clark transformed from an average paper company to a global consumer products powerhouse. Smith displayed personal humility and professional will, attributing the company’s success to his team’s collective efforts.
Another example is Alan Wurtzel, the former CEO of Circuit City, also mentioned as a Level 5 Leader.
Wurtzel transformed Circuit City into a highly successful electronics retailer, following the essential traits of level 5 leadership and demonstrating a practical example of humility and unwavering resolve.
He prioritized the success of the company over personal accolades or recognition.
Despite their humility, Level 5 Leaders possess an exceptional professional will. They are fiercely determined and ambitious, driven by a solid commitment to the enterprise’s long-term success.
They consistently demonstrate high dedication, perseverance, and resilience in pursuing their goals.
Anne Mulcahy assumed the CEO role of Xerox in 2001 when the company faced significant financial challenges and struggled to stay afloat. She displayed remarkable professionalism and determination in turning the company around.
Mulcahy took decisive actions to address Xerox’s financial crisis, including implementing cost-cutting measures and restructuring initiatives. She made tough decisions, such as reducing the workforce and divesting non-core assets, to stabilize the company’s financial situation.
Despite the daunting challenges, Mulcahy maintained an unwavering commitment to the long-term success of Xerox.
She instilled a sense of urgency and rallied the employees around a shared vision, emphasizing the need for innovation and customer-centricity.
Xerox transformed into a more agile and competitive company through her professional will and strong leadership.
Ambitious for the Organization:
Level 5 Leaders channel their ambition and energy toward building a great organization rather than seeking personal fame or fortune.
Instead of being discouraged by setbacks, they channel their energy into finding creative solutions, learning from mistakes, and adapting to changing circumstances.
An inspiring real-life example of leadership with such ambition is seen in Elon Musk, the CEO and founder of SpaceX. He demonstrated remarkable leadership ambition in his pursuit of revolutionizing space exploration.
When he founded SpaceX in 2002, the private space industry was dominated by government agencies, and the prevailing belief was that only governments could send spacecraft into orbit.
Despite numerous skeptics and the enormous technical and financial challenges involved, Musk set an audacious goal for SpaceX: to make space travel more accessible and eventually colonize Mars. This vision represented an unprecedented level of ambition that went against conventional wisdom.
Under Musk’s leadership, SpaceX achieved several groundbreaking milestones. In 2008, SpaceX became the first privately-funded company to launch a liquid-fueled rocket into orbit.
One of SpaceX’s most notable accomplishments came in 2020 when they successfully launched the Crew Dragon spacecraft carrying NASA astronauts to the International Space Station.
This marked the first crewed mission to space launched from American soil since the retirement of the Space Shuttle program in 2011.
Hence, Musk’s leadership ambition and relentless pursuit of his vision propelled SpaceX to become one of the most significant players in the space industry.
The Genius of “AND” vs. the Tyranny of “OR”:
Jim Collins and Jerry Porras initially introduced this concept in their book “Built to Last: Successful Habits of Visionary Companies”.
In “Built to Last,” Collins and Porras examine the characteristics of enduring and successful companies and explore how they navigate strategic choices.
The concept highlights the importance of integrating seemingly conflicting ideas and goals rather than choosing between them.
The “Genius of ‘AND’” encourages companies to pursue multiple objectives simultaneously and find ways to harmonize different elements. It emphasizes the power of synergy and the belief that companies can strive for short-term and long-term success, stability and innovation, and other seemingly contradictory goals.
On the other hand, the “Tyranny of ‘OR’” represents a mindset that sees choices as trade-offs, where pursuing one option necessarily means sacrificing another. This binary thinking limits potential opportunities and inhibits the ability to achieve profitable results.
Instead of succumbing to the “Tyranny of the OR,” highly visionary companies liberate themselves with the “Genius of the AND.”
They possess the ability to embrace opposing extremes across various dimensions simultaneously. Instead of choosing between A OR B, they find ways to have both A AND B.
This concept does not merely refer to achieving balance here. “Balance” implies finding a midpoint or a fifty-fifty split. A visionary company doesn’t settle for a balance between idealism and profitability. It aims to be highly idealistic and highly profitable.
A highly visionary company doesn’t blend Yin and Yang into an indistinguishable gray circle. It aspires to be distinctly Yin and distinctly Yang simultaneously and consistently.
As F. Scott Fitzgerald pointed out:
“The test of first-rate intelligence is the ability to hold two opposed ideas in the mind simultaneously and still retain the ability to function.”F. Scott Fitzgerald
George Merck II captured this paradox in 1950, stating,
“We try to remember that medicine is for the patient. We try never to forget that medicine is for the people. It is not for the profits. The profits follow; if we remember, they have never failed to appear. The better we have remembered it, the larger they have been.”F. Scott Fitzgerald
Contrary to conventional business school teachings, research reveals that “maximizing shareholder wealth or profit” was not the dominant driving force for most visionary companies throughout history.
These companies pursued defined objectives, of which making money was just one and not necessarily the primary one.
For many visionary companies, business has been more than a mere economic activity or a way to make money. For the body, profitability is crucial, like oxygen, food, water, and blood. Still, it is not the ultimate purpose of life for these visionary companies.
Conclusion About Disciplined Leadership:
The Traits of disciplined leadership discussed in this article, advocated by Jim Collins, can significantly impact business outcomes.
Disciplined Leaders can establish a solid foundation for their teams and organizations, fostering a culture of accountability and continuous improvement.
Do not forget to share your thoughts about disciplined leadership in the comment section below!
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What is the core message of Jim Collins’ perspective on Disciplined Leadership?
Jim Collins asserts that Disciplined Leadership is a cornerstone for achieving sustained greatness in organizations.
It involves a structured approach to thinking and acting, aligning with a clear vision and maintaining a steadfast commitment to long-term goals.
How does “Level 5 Leadership” relate to Disciplined Leadership?
“Level 5 Leadership” is a crucial characteristic of Disciplined Leadership. It involves a combination of personal humility and unwavering commitment, contributing to long-term organizational success.
How does “Genius of ‘AND’” apply to visionary companies?
Visionary companies embrace the “Genius of ‘AND’” by pursuing dual goals that might seem conflicting, achieving high ideals and profitability simultaneously. This approach sets them apart from conventional binary thinking.