Thursday, April 06, 2006

Good to Great - First Who

To be clear, the main point of this chapter is not just about assembling the right team -- that's nothing new. The main point is to first get the right people on the bus (and the wrong people off the bus) before you figure out where to drive it. The second key point is the degree of sheer rigor needed in people decisions in order to take a company from good to great.

"First who" is a very simple idea to grasp, and a very difficult idea to do -- and most don't do it well. It's easy to talk about paying attention to people decisions, but how many executives have the discipline of David Maxwell, who held off on developing a strategy until he got the right people in place, while the company was losing $1 million every single business day with $56 billion of loans underwater? When Maxwell became CEO of Fannie mae during its darkest days, the board desperately wanted to know how he was going to rescue the company. Despite the immense pressure to act, to do something dramatic, to seize the wheel and start driving, Maxwell focused first on getting the right people on the Fannie Mae management team. His first act was to interview all the officers. He sat them down and said, "Look, this is going to be a very hard challenge. I want you to think about how demanding this is going to be. If you don't think you're going to like it, that's fine. Nobody's going to hate you."


Dick Cooley and David Maxwell both exemplified a classic Level 5 style when they said, "I don't know where we should take this company, but I do know that if I start with the right people, ask them the right questions, and engage them in vigorous debate, we will find a way to make this company great." -- pp 44-45 Good to Great

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