Positioning Systems Blog

We’ve all known friends or relatives who have cancer, and yet you wouldn’t know it by the way the act or the way the look.   My oldest brother Jim, who all though he was a quadriplegic for 36 years, when he was diagnosed with cancer, it was impossible to tell by the way he responded to it.

 

Jim Collins indicates the same is true with businesses that enter stage three of decline in his book How the Mighty Fall.  Stage three is when you deny risk and peril. Like a disease it is difficult to detect early. It’s hard to see from the outside. Yet some company’s like Rubbermaid fall so far they are unable to reverse their mistakes. Others like Nucor, Xerox and Disney manage to right themselves even after entering Stage four, Grasping for Salvation. The terrifying part of stage three is that just before it your business is on the rise. If you’d compare it to a graph it’s like the vertical slope of the downside of a mountain. To understand this third stage one must realize the importance of the first stage – Hubris born of success. If you’re unfamiliar with the book, I’d suggest reading an excellent primer on it in Newsweek, How the Mighty Fall, A Primer on the Warning Signs. 

 

The key point I took from this discussion is whether you prevail or fail, live or die, decline is self inflicted. Ascent is self-created. Success or failure depends on what you do to yourself more than anything the world does to you. 

 

Of course that’s the good news and bad news. You may, as I have, spent a good deal of time beating myself up when I make mistakes. It is perhaps a property of our upbringing, however we need to move beyond it quickly and focus on recognizing that while we may have made mistakes, seldom are they fatal. We can work to correct them and redeem ourselves. Rick Sapio, CEO, Mutual Capital Alliance who study the work of 13 billionaires and several other extremely successful people, whom I will write about in a subsequent blog, noted that people who are successful have two rules. Rule #1, Don’t make big mistakes. Rule #2, Always remember Rule #1. 

 

How did Nucor, Xerox and Disney pull themselves out of Stage four? They hired level five leaders, who in turn hired level 5 executive team members. Collins credited Harry Truman for a quote I’ve seen also attributed to John Wooden, “It is amazing how much we can accomplish when no one cares who gets the credit.”

 

Next blog we’ll talk about what a level five leader and executive team member looks like and how to eliminate blame despite demanding accountability. 

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