Good to Great (2001) presents the findings of a five-year study by the author and his research team. The team identified public companies that had achieved enduring success after years of mediocre performance and isolated the factors which differentiated those companies from their lackluster competitors.
These factors have been distilled into key concepts regarding leadership, culture and strategic management.
Imagine a cunning fox hunting a hedgehog, coming up with a plethora of surprise attacks and sneaky tactics each day to devour the tasty critter. The hedgehog’s response is always the same: curl up in a spiky, unbreachable ball. Its adherence to this simple strategy is the reason the hedgehog prevails day after day.
Good-to-great companies all found their own simple Hedgehog concept by asking themselves three key questions:
What can we be the best in the world at?
What can we be passionate about?
What is the key economic indicator we should concentrate on?
At the intersection of the questions, after an average of four years of iteration and debate, good-to-great companies eventually discovered their own simple Hedgehog concept. After that point, every decision in the company was made in line with it, and success followed.
Consider the drugstore chain Walgreens. They decided simply that they would be the best, most convenient drugstore with a high customer profit per visit. This was their Hedgehog concept, and by pursuing it relentlessly they outperformed the general stock market by a factor of seven.
Their competitor, Eckerd Pharmacy, lacked a simple Hedgehog concept and grew sporadically in several misguided directions, eventually ceasing to exist as an independent company.
Finding a simple “Hedgehog concept“ provides a clear path to follow.