Application of Jim Collins book “How the mighty fall” concepts to individuals and countries

Jim Collins wrote the popular book “Good to Great.”  In his newer book, “How the Mighty Fall”, Jim Collins describes the five stages through which a proud and thriving company passes on its way to becoming a basket-case. First comes hubris born of success; second, the undisciplined pursuit of more; third, denial of risk and peril; fourth, grasping for salvation; and last, capitulation to irrelevance or death.

Akio Toyoda, president of Toyota Motor Corporation since June 2009 and grandson of the firm’s founder stated in October 2009 that the book described his own company’s position. Toyota, he reckoned, had already passed through the first three stages of corporate decline and had reached the critical fourth. According to Mr. Collins, fourth-stage companies that react frantically to their plight in the belief that salvation lies in revolutionary change usually only hasten their demise. Instead they need calmness, focus and deliberate action.

It seems to me that the same five-step Collins model can sometimes be applied to both individuals and countries.  Tiger Woods and Mel Gibson along with many CEOs (e.g., Tony Hayward from BP) and politicians (e.g., Charles Rangel on 13 violations of congressional ethics standards) have made decisions that had a denial of risk and peril (phase three), which was the beginning of their downfall.  The same can be said of countries, in my mind, since no country has remained on the top forever; e.g., Roman Empire. I am concern that the U.S. could have gone through stage three of the Jim Collins’ stages and must do something significantly different relative to policy creation to address the issue.

Companies, individuals, and countries must awaken to the implication of this model and its phase three.  In companies we need a no-nonsense business management system to integrate performance measures, strategic planning, process improvement, and control so that the three Rs; i.e., everyone doing the Right things, and doing them Right at the Right time.  A system to accomplish this is described in the article “C-Suite: The Need to Re-think our Business System’s Strategic Planning, Scorecard Creation, and Process Improvement Efforts”