Tiny pushes

Success comes from many tiny incremental pushes in the right direction.

In retrospect, good-to-great companies seemed to go through a sudden and dramatic transformation. The companies themselves, however, were often unaware they were even in the midst of changing at the time: their transformation had no defined slogan, launch event or change program.

Rather, their success was a sum of tiny, incremental pushes in the direction of their simple strategy, the Hedgehog concept. Like pushing a flywheel, these small improvements generated results which motivated people to push further, till enough speed was gathered for a breakthrough. Unwavering faith and adherence to the Hedgehog concept was rewarded by a virtuous circle of motivation and progress.

Consider Nucor, the steel manufacturer which outperformed the general stock market by a factor of five. After battling the threat of bankruptcy in 1965, Nucor understood they could make steel better and cheaper than anyone else by using mini-mills, a cheaper and more flexible form of steel production. They built a mini-mill, gained customers, built another one, gained more customers, and so on.

In 1975, CEO Ken Iverson realized if they just kept pushing in the same direction, they could one day be the most profitable steel company in the US. It took over two decades, but eventually the goal was reached.

Comparison companies did not strive to consistently build momentum in one direction, instead trying to change their fortunes with dramatic changes and hasty acquisitions. Since these delivered lackluster results, they became discouraged and were forced to once again attempt a change, not letting the flywheel gather speed.