Good to Great

Collins uses the example of Lee Iacocca, former CEO of the Chrysler Corporation, to emphasize that talent and eccentricity are not enough to lead a company into greatness. While Chrysler experienced temporary gains, Iacocca’s leadership suffered from self-promotion and self-aggrandizing; he personally starred in over 80 commercials, for instance. Rather than humbly fading from the limelight, Iacocca also postponed his retirement so many times that he became an inside joke within the company. Collins brings up Iacocca in the Chapter 2 in order to provide a clear anti-example to the Level 5 leaders he discusses. Unlike Level 5 leaders, Iacocca did not demonstrate humility or resolve, but rather a constant desire to promote his own name and brand. While more people may recognize Iacocca’s name than any of the other CEOs on Collins’s good-to-great list, Collins argues that his leadership was ultimately part of the reason why Chrysler never ascended to greatness before getting bought out by German carmaker Daimler-Benz.

David Maxwell is the former CEO of Fannie Mae. Born in 1930, Maxwell enjoyed a highly successful tenure at Fannie Mae, which Collins highlights as a remarkable achievement and a good-to-great success story. In summing up Maxwell’s tangible contributions as CEO, Collins writes: “Maxwell transformed Fannie Mae into a high-performance culture that rivaled the best Wall Street firms, earning $4 million every business day and beating the general stock market 3.8 to 1.” (25). Collins identifies Maxwell as a Level 5 leader who demonstrated through his actions that he was more concerned with the company’s success than his own glorification or personal wealth. Maxwell also retired at the height of his success, concerned that the company might eventually suffer if he remained CEO for too long. Like so many other Level 5 leaders, Maxwell’s success did not come as a result of extraordinary charisma, but through an unwavering commitment to excellence.

George Rathmann was the co-founder and first CEO of the biotechnology company Amgen, which eventually grew into a $3.2 billion company and an industry leader in the biomedical space. Good to Great credits Rathmann’s leadership style as one the key factors in Amgen’s massive success; Rathmann promoted and cultivated a culture of high expectations and strict financial discipline, along with an organizational framework that safeguarded self-motivated employees. In this kind of company, employees discover innovative and creative solutions that may even lead to breakthrough, because the organizational culture naturally produces this “freedom within a framework” (123). Rathmann is therefore another example of a Level 5 leader who was successful not because he was a genius visionary, but because he prioritized the development of a culture of discipline.

Darwin E. Smith was best known for his 20-year tenure as CEO at consumer goods giant Kimberly-Clark. During this time, Kimberley-Clark handily outperformed its competitors and generated stock returns over four times what the general market produced. Collins uses Smith as a primary example of a Level 5 leader who is not a charismatic visionary, but instead committed to the core principles of genuine humility and intense will. Yet, while Smith was quiet and stoic, Collins notes that “if you were to think of Darwin Smith as somehow meek or soft you would be terribly mistaken” (18).