Business Worst Practices II: Electric Boogaloo

How many of you have seen the following books either on the desk or on the bookshelf of a senior military or civilian leader of the Navy in the last 15 years or so:
- Good to Great.
- Built to Last: Successful Habits of Visionary Companies.

Well, I actually have Good to Great right behind me. The author, why Jim Collins of course.

He has a new book out, How The Mighty Fall: And Why Some Companies Never Give In. In it he has a "Five Stages of Decline."

Ponder a bit with an eye on the Navy for me.

Stage 1 is hubris born of success. The company's people become arrogant, regarding success as virtually an entitlement.

Stage 2 is the undisciplined pursuit of more — more scale, more growth, more acclaim. Companies stray from the disciplined creativity that led them to greatness in the first place, making undisciplined leaps into areas where they cannot be great or growing faster than they can achieve with excellence, or both.

Stage 3 is denial of risk and peril. Leaders of the company discount negative data, amplify positive data and put a positive spin on ambiguous data. Those in power start to blame external factors for setbacks rather than accept responsibility.

Stage 4 is grasping for salvation. Common "saviors" include a charismatic visionary leader, a bold but untested strategy, a radical transformation, a "game changing" acquisition or any number of other silver-bullet solutions.

Stage 5 is capitulation to irrelevance or death. Accumulative setbacks and expensive false starts erode financial strength and individual spirits to such an extent that leaders abandon all hope of building a great future. In some cases their leaders just sell out. In other cases the institution atrophies to utter insignificance.

The comparisons are inexact and there is some overlap. All stages could be argued in time and space, but I don't think you can argue that we are not fully in the tail end of Stage 3 with parts of Stage 4 already up on step.

Stage 5, when does that start -- and more importantly, how do you stop a decline?

If you remember the great comment thread from last week on LCS here and at USNIBlog on LCS - I think this quote hits the 10-ring.

"The signature of mediocrity," Collins concludes, "is not an unwillingness to change. The signature of mediocrity is chronic inconsistency.

If you work for a Flag Officer who has either of Collins's works in his office, get him a copy of the new one. If you have the inclination, send one to the CNO and COM NAVSEA.

Tell him Phib sent 'ya.

Hat tip Marshall Loab via Steven Spruiell.