Book of the Month: April ’12

Learning new things is important.  Challenging ourselves to read things that might change the way we think about our jobs is brave.   Every month we’ll be bringing you a book that has the potential to challenge us!

Our first Book of the Month is “How The Mighty Fall” By Jim Collins.

What’s it about?  

Collins has spent his life studying what makes organisations great; in this book he looks at hundreds that either failed or massively declined and worked out why.  What makes a company brilliant one moment and a disaster the next?

Collins argues that most organisational decline isn’t sudden.  Issues accumulate slowly over many years – sometimes almost unnoticed by very senior management but nearly always well within the vision of others working inside the company.  However, often, the impact of those issues appears to happen very suddenly.

Collins contends there are five stages of company decline but, and here’s the kicker, the first stages usually happen when the company is either on the up and/or bringing in lots of revenue – so leaders fail to notice the truth of what’s happening.  His stages are, briefly:

  • Stage 1 – Hubris Born of Success – at this stage the company probably looks like it’s doing well.  Revenue is high, morale is good.  However, it’s at this stage the organisation doesn’t horizon scan far enough into the future, and doesn’t begin to make changes that are required for long term success
  • Stage 2 – Undisciplined Pursuit of More - fuelled by past success, leaders pursue ‘more’ with less discipline that they have in the past.  They may bring on more products with less due diligence, fail to understand the way their market or environment is going, not know about competitor plans or capabilities, and so on. They’re continuing as if the success is going to continue, rather than checking to see how likely that is before authorising ‘more’
  • Stage 3 – Denial of Risk and Peril - just because the leadership cannot see the reality of their organisation’s situation, doesn’t mean other staff can’t.  In every case researched by Collins, some or most staff completely understood the risks their company was taking and the potential outcome of that action.  Often they spoke up, but felt they went unheard.
  • Stage 4 – Grasping for Salvation – This is the point at which the leadership realise they’re in trouble.  Usually they initally think there has been some kind of ‘sudden’ change – ‘suddenly’ customers don’t purchase the product or the cost of supply changes or… The warning signs have been present for a while, if they’d been looking, but it’s at this point the impact begins.
  • Stage 5 – Capitulation to Irrelevance or Death - This is the end stage.  At this point there is no return.  The accumulated issues mean the company either fails or becomes irrelevant to the market.  If it’s the latter then the company becomes a much smaller player than it has been in the past; if it’s the latter, everyone loses their jobs.

The trick with each stage is that, Collins says, it’s often possible to rescue an organisation from any stage – except Stage 5.  But it’s much easier to do this in the earlier stages.

How does it challenge business continuity planners?

As business continuity planners, we ensure the organisation has plans to manage disruptions to business.  But we are rarely charged with watching out for the possibility of gradual decline.  Here at ContinuityInBusiness.com, we think this is where the boundary exists between Business Continuity and Resilience.   If we’re dealing purely in the realm of business continuity we won’t or can’t get involved in flagging the slow burn of a declining organisation to senior management.  However, if we’re operating a much more strategic capacity, can identify the stage the organisation is at, and have the ear of the topmost leadership then we are able to move into the Resilience role in order to help the organisation deal with the issue.

So the challenge is – are you, or are you going to be, a continuity planner or a resilience manager?  They’ve got a lot in common but they’re very different things.

Is it an easy read?

Yes.  It’s pacey and reads more like a novel than a text book.  It’s clear, concise, and there are loads of real-life examples from organisations who’s names you will recognise… though in some cases they may feel like a blast from the past.

View/Buy UK

View/Buy USA

View/Buy Canada

 


Sorry, this book doesn’t seem to be available from Amazon Canada.

Do let us know if you find it on another site and we will link to that for future readers.

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