How The Mighty Fall - Jim Collins 3/3

Stage 1 (27-44)

Hubris born of success

- Success entitlement, arrogance

- Neglect of a primary flywheel

- “What” replaces “Why”

- Decline in learning orientation

- Discounting the role of luck

Stage 2 (45-64)

Undisciplined pursuit of more

- Unsustainable quest for growth, confusing big with great

- Undisciplined discontinuous leaps
- Declining proportion of right people in key seats

- Easy cash erodes cost discipline

- Bureaucracy subverts discipline

- Problematic succession of power

Stage 3 (65-82)

Denial of risk and peril

- Amplify the positive, discount the negative

- Big bets and bold goals without empirical validation

- Incurring huge downside risk based on ambiguous data

- Erosion of healthy team dynamics

- Externalizing blame

- Obsessive reorganizations

Stage 4 (83-101)

Grasping for salvation

- A series of silver billets

- Grasping for a leader-as-as savior

- Panic and haste

- Radical change and “revolution” with fanfare

- Hype precedes results

- Initial upswing followed by disappointments

- Confusion and cynicism

- Chronic restructuring and erosion of financial strength

Stage 5 (103-123)

Capitulation to irrelevance or death

Source: How The Mighty Fall & Why Some Companies Never Give In - Jim Collins (2009)