Honestly, it’s been over twenty years since Jim Collins dropped a research bomb on the corporate world. We’re talking about the Jim Collins Good to Great book, a text so ubiquitous that for a decade, you couldn’t walk into a C-suite office without seeing that white-and-red cover staring back at you. It basically became the Bible for every manager who wanted to stop being "just okay."
But here’s the thing.
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The world has changed. Since the book was published in 2001, we’ve lived through the 2008 crash, a global pandemic, and the rise of AI that’s currently eating the world. Some of the "great" companies Collins highlighted? They didn't just stumble; they cratered. Circuit City went bust. Fannie Mae became a poster child for the subprime mortgage crisis.
So, is the book a relic? Or does it still hold the secret sauce?
The Hedgehog and the Bus: Why Everyone Obsessed Over This
Collins and his team spent five years digging through 1,435 companies. They were looking for a very specific "leap"—companies that had fifteen years of average returns followed by fifteen years of returns at least three times the market. They ended up with eleven.
The stuff they found was kinda counterintuitive at the time. Most people thought a "great" company needed a celebrity CEO with a massive ego and a "visionary" complex. Collins said nope. He found Level 5 Leadership. These were people like Darwin Smith at Kimberly-Clark, who was so low-key you’d probably mistake him for the guy fixing the copier, yet he had this "ferocious resolve" to make the company win.
Then there’s the whole bus thing.
"First Who... Then What." It’s a classic line now. Basically, you don't figure out where you're going and then hire people. You get the right people on the bus, get the wrong people off, and then you figure out where to drive. If you have the right people, they’ll figure out the "what" even if the world falls apart.
Facing the "Brutal Facts" Without Losing Your Mind
One of the most human parts of the book is the Stockdale Paradox. It’s named after Admiral James Stockdale, who was a POW in Vietnam for eight years. He survived by holding two seemingly opposite thoughts at once:
- You must have unwavering faith that you will prevail in the end.
- You must confront the most brutal facts of your current reality, whatever they may be.
In business, this is the difference between a leader who is delusional and one who is a realist. You can’t fix a sinking ship if you’re busy pretending there isn't a hole in the hull. Great companies created "red flag" mechanisms—systems where the truth couldn't be ignored, even if it was ugly.
The "Great" Companies That Didn't Actually Last
Let’s be real for a second. If you look at the list of companies in the Jim Collins Good to Great book today, it’s a bit of a mixed bag.
- Circuit City: Liquidated.
- Fannie Mae: Taken over by the government.
- Wells Fargo: Hit by massive scandals involving fake accounts.
Critics love to point this out. They say the research was "backwards-looking" and that Collins mistook a lucky streak for a repeatable formula. Steven D. Levitt, the Freakonomics guy, famously noted that if you’d invested in the "Good to Great" portfolio in 2001, you actually would have underperformed the S&P 500.
But Collins actually addressed this later in How the Mighty Fall. His argument? Greatness isn't a permanent state. It's a choice. The moment a company stops following the principles—the moment they get "arrogant" or move away from their Hedgehog Concept—they start the slide toward mediocrity.
It’s like being an elite athlete. Winning a gold medal doesn't mean you'll be fit forever if you stop training and start eating donuts for breakfast every day.
The Flywheel vs. The Doom Loop
The most lasting image from the book is the Flywheel.
Imagine a massive, heavy metal disk. To get it moving, you have to push with everything you’ve got. It barely budges. You keep pushing. After hours of work, it makes one full rotation. Then another. But then, momentum takes over. Suddenly, the weight of the wheel is working for you.
Mediocre companies do the opposite. They try a new "miracle" strategy every year. They hire a new CEO, do a massive rebrand, and then get frustrated when they don't see results in six months. They’re stuck in the Doom Loop, constantly changing direction and never building enough momentum to actually break through.
How to Apply "Good to Great" in 2026
If you’re running a business—or just trying to manage your own career—the specific companies Collins picked matter less than the underlying "rigor."
We live in a world of "pivots" and "disruption." It's tempting to chase every shiny new tech trend. But the Jim Collins Good to Great book suggests a different path. It’s about being a "Hedgehog"—knowing the one thing you can be the best at and having the discipline to say "no" to everything else.
Honestly, the most important takeaway isn't about stock prices. It's about people. In an era where everyone is worried about AI taking their jobs, the "First Who" principle is more relevant than ever. Tech changes, but character and "Level 5" humility are remarkably stable assets.
Actionable Next Steps to Move Toward Greatness
- Audit your "Bus": Look at your team. If you were hiring them today, knowing what you know now, would you hire everyone on your current roster? If not, you have a "Who" problem, not a "What" problem.
- Identify your Three Circles: Grab a notebook and define: 1) What you are deeply passionate about. 2) What you can be the best in the world at. 3) What drives your economic engine. The intersection is your Hedgehog Concept.
- Create a "Stop Doing" List: Most companies fail because they try to do too much. Identify three projects that don't fit your Hedgehog Concept and kill them today.
- Find Your Brutal Facts: Ask your team, "What is the one thing we are all pretending isn't happening?" Then, apply the Stockdale Paradox: face that fact, but don't lose hope that you can solve it.
The transition from good to great isn't a single "aha!" moment or a lucky break. It’s a quiet, disciplined grind that eventually, after enough turns of the wheel, looks like an overnight success to everyone else.