

"Good to Great" Circuit City finally dead, could be managed with Quickbooks. - tptacek
http://www.google.com/hostednews/ap/article/ALeqM5jcl8rcgf4NoaPu6hVXAlaMFJXuygD96Q4LK80

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tptacek
From the article:

 _"I wish there was one kind of fatal blow that we could all pick out," said
Stephen Baker, vice president of industry analysis at market researching firm,
The NPD Group Inc. "Every time there was a crossroad ... in hindsight they
almost always did the wrong thing."_

In one of the most famous business books of all times, Jim Collins singled out
Circuit City as one of the best managed companies in the world, distilling
lessons on how to run a succesful company from its story. Yeah, Best Buy
depantsed them, but why would a "Good to Great" management team allow that to
happen?

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gruseom
The main thesis I remember from _Good to Great_ was that in each of its cases,
the turnaround from good to great had come from a change in leadership at the
top. The new leaders (the book claimed) had all fit a certain profile and
shared a similar leadership style. I liked the book quite a bit because the
character of these leaders that Collins was describing seemed admirable.

It isn't obvious whether the demise of Circuit City refutes the thesis.
Perhaps the leader Collins wrote about retired and was replaced with someone
who didn't share the same values? In that case GtG would actually predict a
decline. Alternatively, if the company failed under the same leader that
Collins wrote about, that would refute GtG pretty well. One can also imagine
scenarios between these two poles where it might not be so clear.

By the way, your point reminds me of a similar one people made about _In
Search of Excellence_ (the GtG of its day), the "excellent" companies of which
didn't seem so excellent a few years later.

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tptacek
Yeah, I guess I'm not saying this refutes the book so much as I'm asking
whether the principles in the book (like "the hedgehog concept") illustrate
what went wrong with Circuit City.

You could level similar critiques against other GtG companies, like Abbott
Labs or, hello? Fannie Mae.

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gruseom
I forgot that Fannie Mae was in there. Yikes. The analogy with In Search of
Excellence is starting to look pretty convincing.

These are really just story books anyway.

