Chapter 8 – the Flywheel and the Doom loop
Key points
- Good to great transformations often look like dramatic, revolutionary events to those observing from the outside, but they feel like organic, cumulative processes to people on the inside. The confusion of end outcomes (dramatic results) with process (organic and cumulative) skews our perception of what really works over the long haul.
- No matter how dramatic the end result, the good to great transformations follow a predictable pattern of build up and breakthrough. Like pushing in a giant, heavy flywheel, it takes a lot of effort to get the thing moving at all, but with persistent pushing in a consistent direction over a log period of time, the flywheel builds momentum, eventually hitting a point of breakthrough.
- The comparison companies followed a different pattern, the doom loop. Rather than accumulating momentum – turn by turn of the flywheel – they tried to skip buildup and jump immediately to breakthrough. Then, with disappointing results, they’d lurch back and forth, failing to maintain a consistent direction.
- The comparison companies frequently tried to create a breakthrough with large, misguided acquisitions. The good to great companies, in contrast, principally used large acquisitions after breakthrough, to accelerate momentum in an already fast-spinning flywheel.
Unexpected results
- Those inside the good to great companies were often unaware of the magnitude of their transformation at the time, only later in retrospect, did it become clear. They had no name, tag line, launch event, or program to signify what they are doing at the time.
- The good to great leaders spent essentially no energy trying to “create alignment”, “motivate the troop”’ or “manage change”. Under the right conditions, the problems of commitment, alignment, motivation, and change largely take care of themselves. Alignment principally follows from results and momentum, not the other way around.
- The short-term pressures of Wall Street were not inconsistent with following this model. The flywheel effect is not in conflict with those pressers. Indeed, it is the key to managing them.
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