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Rules for Good-to-Great

By Jason Milligan


What makes a company great? For years we’ve all been combing book shelves for the secret that we can use to also make our company great. Whether its a set of business principals, marketing fads, technology advances, or hiring the best people with just the right incentives, or a mix of all of the above. To that end I recently read a Harvard Business Review article that had the same goal, figuring out what great companies did differently to achieve their status over time. The authors Michael Raynor and Mumtaz Ahmed both with Deloitte Services conducted research on 25,000 companies from 1996 to 2010 traded on US exchanges looking for sustained success, and the root causes.

Ultimately, the researchers discovered that the only common link between the category leaders over an extended period was a concise decision making process. And in there soon to be released book The Three Rules: How Exceptional Companies Think, (http://thethreerules.com/) the authors suggest that these successful companies rely on three simple yet elementary rules in order to achieve success.

The rules are:


1.       Better before cheaper – drive value through differentiation, and don’t compete on price alone.


2.       Revenue before cost – priority one is revenue generation, then cost reduction never the reverse.


3.       There are no other rules – if you have other questions refer to rules 1 & 2.


The executive take away: Great companies over time have accepted higher prices as the cost of excellence, investing in and creating non-price value positions and then focusing on revenue generation.

I know what you’re thinking…could this work in the highly competitive and somewhat commoditized world of lift truck distribution? Perhaps….Could you envision using this strategy? Do you use some version of this now, and if so do you feel it’s effective? How does this research change the way you think about your daily marketing and sales process? What changes might you consider knowing the rules?


I look forward to the ensuing discussion…