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Jim Collins is not a consultant, he is a researcher. Five years of statistical study on eleven companies that made a sustained performance leap reveal a leadership profile that is the exact opposite of the charismatic leader celebrated by the business press. By Mounir Telkass, founder of MT-Transition.
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Jim Collins is not a consultant. He is a researcher. Good to Great, published in 2001, is the result of a study conducted over five years with twenty-one research associates. The protocol: identify the eleven American companies that, between 1965 and 1995, moved from average performance to sustained, spectacular performance — stock returns at least three times the market for fifteen years after the transition point — and compare them to eleven peer companies that never made that leap.
The book is not a theory. It is what Collins found. Several results shocked the management world, because they flatly contradicted the culture of the charismatic leader, the visionary CEO, and the grand strategic plan announced with fanfare. Three findings from the study remain, twenty-five years later, the most unsettling.
Probably the most unsettling finding of the study. The eleven companies that made the leap were all led, at the moment of transition, by a very particular type of leader — not the dominant profile celebrated in the business press.
Collins identifies five levels of leadership: highly capable individual, contributing team member, competent manager, effective leader — charismatic, clear vision, able to mobilize people — and finally level 5, the executive leader, who combines deep personal humility with fierce professional will.
Level 5 is rare and uncomfortable to recognize. These leaders share an almost systematic trait: they are ambitious, but ambitious first for the company, not for themselves. In practice, when the company succeeds, they credit others and luck. When it fails, they look in the mirror and take responsibility — the exact opposite of the narcissistic leader celebrated by the press. It is probably the closest profile to the transition general manager at their best: a precise mandate, hard decisions made without ego, a stronger organization left behind.
The second finding, and the most counter-intuitive from a strategic standpoint. Good leaders do not first define the strategy and then find the people to execute it. They do the reverse: they first get the right people in place, remove the wrong ones, get the right people into the right seats — and only then figure out where to drive the company.
Collins’s logic is relentless. If you start with strategy, you become dependent on the people already in place to execute it — and half of them are not in the right seat. If you start with people, you can adjust the strategy along the way, because you have a team capable of pivoting.
It is the first decision a transition general manager makes: before any industrial or commercial plan, a thorough factual review of the leadership team. This implies two demanding disciplines: removing the wrong people fast and without hesitation, not out of cruelty but out of clarity — a wrong person in a key seat costs more than the discomfort of removing them; and over-investing in recruitment and internal promotion, because when in doubt, the answer is almost always no.
The third finding, the most strategic. Collins borrows the metaphor from Isaiah Berlin: the fox knows many small things, the hedgehog knows one big thing. The companies that made the leap were all hedgehogs — focused with stubborn discipline on a single core concept, defined at the intersection of three circles: what you can be the best in the world at, what you are deeply passionate about, and what drives your economic engine.
A good-to-great company is one that has identified, sometimes after years of reflection, the point of intersection of the three circles — and sticks to it. Everything outside it is eliminated, even if it is profitable, even if it is tempting, even if the market demands it.
It is the antidote to mid-sized industrial firms that spread themselves thin by piling on product lines, markets, and acquisitions without ever pinning down their true core. A transition manager mandated to reposition a mid-sized firm must, within the first ninety days, surface the three circles with factual rigor. The strategy that emerges is not invented: it is found.
A French family-owned mid-sized firm, three hundred twenty employees, a supplier in a historically solid sector. Stable average performance for eight years, gross margin around twenty-two percent, net margin at four percent. The family owner hands over to a transition CEO for twelve months, mandated to structure the company for the next generation.
Level 5 posture — the CEO arrives without a grand plan. A three-week site tour, first executive committee meeting in week four where he reports twenty-two factual findings, fourteen of which credit the existing teams. By month nine, several managers notice the CEO never talks about “his” results, only the team’s results.
First who, then what — months one to three. A factual review of each of the seven direct reports. Two are not in the right seat, one internal reassignment, one negotiated departure, two internal promotions. Strategic work only begins in month four, with a team now capable of pivoting.
Hedgehog concept — months four to nine. Identifying the three circles: two very precise technical niches where forty years of accumulated expertise is unmatched, and a redefined economic engine — margin per project rather than revenue per customer. An uncomfortable conclusion: thirty percent of revenue falls outside the hedgehog concept, to be phased out.
At eighteen months: gross margin up from twenty-two to thirty-one percent, net margin doubled to eight percent, and renewed passion among operational teams, who finally see a clear direction.
The leadership that drives lasting transformation is the opposite of the celebrated charismatic leader. Personal humility and fierce resolve — exactly the profile of a serious transition manager.
The right people before the strategy, not the other way around. Structural HR moves happen in the first quarter, or everything that follows is compromised.
The hedgehog concept is not invented, it is found. At the intersection of three circles: best in the world, true passion, economic engine. Everything outside it must be eliminated, even if profitable.
In the context of French industry — rich in good, solid, well-performing companies stuck on average-margin plateaus — this is probably the most relevant framework for making the leap from a well-run mid-sized firm to a truly great one, including as part of an external growth transaction involving an acquisition.
A company does not become great because it has a brilliant leader. It becomes great because its leader knows how to step back behind the team he builds, and behind the one circle where the company can truly excel.Mounir Telkass — MT-Transition, industrial transition management firm.
MT-Transition places transition executives able to sort people out before drawing up the plan.
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