What I'm reading: Good to Great by Jim Collins

I have been interested in how to use some of the decision making models touted by well known business leaders, such as Harvard Business School professor John Kotter, in my work with house museums. Specifically I am interested in addressing change, and leadership in these sometimes backward looking and often hidebound institutions.

So I was interested to see how my history colleagues could make the case that there was applicability from the book Good to Great to a nonprofit house museum or history organization. I even went so far as to buy and read Collins' short (I mean 20 pages) monograph on Good to Great in the Social Sectors, after reading through his well known book.

Ok Good to Great is not a new and just published business book, but I was curious about it because there was a session at the recent American Association for State and Local History meeting held in Rochester NY earlier this month that used Good to Great as a discussion forum.

Clearly the history movement must really be searching far and wide looking for models to help them develop better organizations, but I just don't get it. Good to Great is rightly a classic business book, published in 2001, and as such chronicles a small handful of well known Fortune 500 businesses that author Jim Collins feels made a leap from....well good to great.

Collins' researchers, graduate students and others in his think tank business, compiled copious amounts of data about financial performance during 30 years from the early 1970s to 1995 to identify the companies that fall into what he characterizes as exceptional--great.

These great companies are well known to all--

Abbott Labs

Circuit City

Fannie Mae--given the recent bail out of this quasi governmental agency by the Federal Government gives me pause--the book touts their innovations in creating new financial products such as mortgage backed securities, but I digress.

Other great companies on the list include

Gillette

Kimberly Clark

Kroger

Nucor

Philip Morris

Pitney Bowes

Walgreens

Wells Fargo

Comparisons were made between these corporations that excelled, with well regarded but not "great" companies in the same industry. From these comparisons, Collins devises his three stages of build up to breakthrough. Collins spends most of the book discussing the attributes of these great companies and has developed catch phrases that describe and thus separate the good companies from the great.

Some of these are pretty basic, such as having the right leadership--he calls this "Level Five Leadership" or the right personnel in place--"First Who, Then What."

While Good to Great did provide some good insights about leadership and reinforced the adage "what gets measured, gets done," I was frustrated again by the difficulty of applying pure business and dollar driven leadership methods to a nonprofit organization.

This concept "First Who, Then What" I found particularly difficult to envision in a nonprofit or government environment. Collins does address this matter in his companion monograph--Good to Great in the Social Sector. "Getting the right people on the bus" is the short hand that Collins uses to illustrate this point and it is apt. But for agencies with unions, civil service regulations or poor pay, the leader's choice of people to "invite on to the bus" is severely constrained. Collins offers one or two clever ways that some exemplary nonprofit leaders have overcome this problem, but these examples were extra ordinary at best. Finding and keeping smart, hard workers is difficult in any work environment, but particularly so in mission driven rather than profit driven organizations.While we might be able to take snippets of Good to Great, there is just not enough congruence between organizations driven by profits and those that are driven by mission and not profits.

There was some good applicability from the chapter on "Confront the Brutal Facts," if only because confronting the facts seemed to be in very short supply at the house museums I researched for New Solutions for House Museums. House museums, like other nonprofits are not measured by outputs, but rather on inputs such as cash flow. They do not live and die by their financial numbers. Cash flow is king, certainly. Collins makes the case that organizations that rely on sustainable means of support such as fees, tuition, contracts, ticket sales, or government allocations have greater ability to weather storms than nonprofits that rely on individual donations and "emotional connections" to their donors. What does this say about house museums lacking endowments? Are these ever sustainable organizations?

I still wonder what it was in this book that spoke to my colleagues at the AASLH meeting. Your comments, of course, are welcome.