Jim Collins creates a sort of guideline for companies that are mediocre or have had mediocre performances who want to make the leap to becoming a great company. The way Collins came up with these guidelines is by studying 11 great companies that were selected from a list of Forbes 500 companies and deemed great companies using a criteria created by Collins’ research team. These 11 companies were than each compared to a company in the same industry with similar resources but who did not perform as well as the “great” companies in the 15 year time span in which the companies were studied.
Collins was able to create the flywheel concept out of his studies which is broken down into 6 parts. The one that is the focus of this paper is the level 5 leadership. Through the study of the “great” companies and through comparison with other companies, one of the major factors of the success of those companies was the type of leadership in place in the company. It takes a leader with two characteristics to lead a truly great company to that success and those are: personal humility and professional will.
The way a company can truly be great is by utilizing a level 5 leader who exemplifies the qualities that Jim Collins describes in his book, Good to Great. A leader is at his or her best when they are able to challenge the workers in the company and to inspire them by the way they lead. What is different about the level 5 leader that Collins describes is in the paradox of it all. A leader is quiet, laid back, almost to the point of being considered shy yet at the same time there is this incredible drive to be the best not for the sake of oneself but because that is what is best for the company.
Level 5 Leadership Summary
The leader is put in that position of the company to shake things up and change the company culture but the leader does not have to be some hot shot from a different company here to save the day. No, this leader is from within the company, he knows everything there is to know about the company and he improves it everyday. No matter what the company always comes first before oneself and long after the leader is gone the company will continue to be great, in fact, a level 5 leader would consider themselves a failure if their successor and the company is not more successful than before.
Along with that the leader creates a culture of accountability while at the same time forming a mirror window effect; when things are going great the leader looks out the window to give credit but when things are going bad the same leader looks in the mirror to give himself blame. in essence he is taking the fear away from his employees in order to make them more invested in the company, by doing these simple steps the employee moral is kept high both during the good times and more importantly during the bad times. This quiet yet extremely driven individual is what makes a good company into a great company.
This idea that a leader has to be quiet and driven in order to be a part of a great company cannot be true. As a prime example there was Steve Jobs, he was a co founder of Apple, then left and co founded Pixar, all before returning back to Apple to make it one of best companies in the world today. He was charismatic, he was egotistical, he was given credit for the success of Apple and he graciously took it, he was a celebrity. When people think of Apple they think of Steve Jobs, he created Apple and brought it to its greatness. He was not a level 5 leader. He was extremely driven but he was not the quiet type.
He would not be the type of leader to just blend in with the crowd, instead hundreds of thousands would watch him during a new product release and hang on his every word. The fact that he was successful as the CEO of multiple big name companies while taking a large amount of the credit, that was well deserved, is one of the best counterexample to Collins level 5 leader. Steve Jobs was extremely devoted to the companies he worked for and he worked tirelessly to make sure they were the best that he could make them but he did all of this by going with his own style that contradicted the teachings of Collins.
There is no clear choice between a leader like Steve Jobs and the one that Jim Collins describes, a level 5 leader. There are too many factors in the business world and there are too many different industries to try to create description of the perfect leader. What Collins managed to do was to select 11 companies that he deemed great and he found similarities between the companies, one of those similarities being with the type of leaders those companies had in charge.
For those companies and the practices the companies had in place, that type of leader with personal humility and professional will was what was necessary. For Apple and Pixar it was a different type of leader that thrived, and in other companies it will be that same Steve Jobs type of leader that will lead them to greatness. It is not possible to create a prototype leader and companies should not try to do so they should put their efforts on finding the leader that fits their need the best whether that leader comes from within the company or from the outside.