Chapter 1-The greatest business decisions of all time overview

All great decisions that Collins found was never taken by unanimous agreement. It accompanied some degree of disagreement every time. That is, a major decision is what people carry disagreement and the following debate first before they work together for the success of their enterprise. Aside from creating a debate, Collins specifies other ingredients that are necessary for great decisions. An internal drive is one of them. And the three questions with big decisions are. First, ‘’what are our real core values and aspirations?’’ to know what we truly are standing for, which is the internal imprint driving all the action. The great companies are said to be internally driven, not only responding to the outside. Second, ‘’how is the outside world operating and changing?’’. And third, ‘’what can we contribute better than any competitors?’’ which can be figured out by intersecting the answers to the first and second questions. For example, Boeing’s decision to build the 707 had the internal value as ‘’we are adventurers for goodness’’. That said, they liked doing big and adventurous things rather than operating in just a secular business. And relevant to the mentioned second question, they did not have that positive outside environment where ended the war meaning that the demand for bombers decreased, showed changes in technology from propellers to jets, and had the demand for military aircraft going to decline relative to demand for commercial aircraft. About the third question asking what Boeing then can do better than any other competitors in the world, Boeing had jet technology that can enable building big strato bombers, the B-47 and the B-52. They could build a large-scale jet. Being challenged the truth, internal and external, Boeing was able to make a distinctive impact by calling the jet age and that is when Bill Allen decided to go for the 707. Some decisions can be bigger than others and some can be smaller. But as far as what determines outcomes, Collins says that the big decisions are six of 100 points made by people who are 0.6 or 0.006 respectively. That is, big decisions are made as an aggregate of a small fraction. Another important factor for big decisions is said to be psychological or physiological. As an example, the airline industry can be considered; all the events and factors happened including fuel shocks, interest rate spikes, deregulation, wars, and 9/11 since 1972. And yet an airline is the best performing company in terms of return to investors from 1972 to 2002. According to Money magazine’s retrospective look in 2002, Southwest Airlines beat others including Intel and Walmart. Luck is obviously a factor for good results from decisions but overall Collins’ research shows that the main elements reside more under leaders’ control than the outside. In other words, the fundamental assumption needs to be like Southwest Airline’s. In addition, one other variable to be vital for both the quality and implementation of decisions would be a long-term vision. If we look at Andy Grove deciding to abandon memory chips at Intel, Bill Allen and the Boeing 707, Reg Jones choosing Jack Welch to run GE and such, the leaders were clear in that they had their ambition for the long-term greatness of their companies.