When Luxury Brand Partners hires a new employee, he or she is given a copy of Jim Collins’ book, Good to Great: Why Some Companies Make the Leap and Others Don’t. When Lyndsey Bardnell, LBP vice president of learning and development, introduced the author to a room of almost 2,500 salon professionals at Front Row’s Idealogue, she shared, “The book has become a fabric of who we are, and woven into the language that we speak.”

As Collins took the stage, he challenged the business owners in the room. “Good is the enemy of great. If your community has good schools, it doesn’t have great schools. If you get to the end of your life and determine you’ve had a good life, then you could have had a great one.”

Collins’ research into what makes a company great started in 1988 when he inherited the teaching of a class on small business management at Stanford Graduate School of Business. He defines a great company as one that delivers superior performance results, makes a distinct impact on the communities it touches, and endures over a long time.  

“Greatness is not a function of circumstance,” Collins said. “Greatness, it turns out, is largely a matter of conscious choice and discipline.”

At Idealogue, Collins briefly shared the 12 questions he’s designed to help business owners encompass all his teachings and lead them toward greatness.

After Collins’ presentation, the audience broke into small groups and brainstormed business questions. Luxury Brand Partners’ President and CEO Tev Finger joined Collins on stage and for more than an hour they fielded owners’ questions on a variety of topics from how to manage creative employees to how to compete in a rapidly changing world.

1. Are we willing to strive for Level 5 leadership and embrace the behaviors needed to build a great company?*
“The difference between Level 5 leaders and Level 4 leaders is humility. For Level 4 leaders, it’s about themselves, but for a Level 5 leader it’s about the cause or the quest. They’ll ask, ‘What cause will I serve?” and ‘How will I dedicate myself?’”

2. Do we have the right people on the bus in the right seats?
“You first need to address the who, then the what? Getting the right people on your bus is the first step. Life is about people, not stuff and accomplishments. The single most important executive skill to have is the ability to make excellent people decisions.”

3. What are the brutal facts and can we better live the Stockdale Paradox?
“The Stockdale Paradox means never confusing the faith that you will prevail in the end with the discipline you need to confront the most brutal facts of your current reality. Are you facing the brutal facts? If you don’t confront them, they will confront you.”

4. What is our Hedgehog Concept?
“Based on the famous essay by Isaiah Berlin, your hedgehog is the intersection between what you are passionate about, what you are encoded for, and what drives your economic engine. If you are following your hedgehog, your industry does not need to be thriving for your company to succeed.”

5. How can we accelerate clicks on the flywheel by committing to a 20-mile march?
“Most overnight successes are about 20 years in the making. Great companies focus on hitting specified performance benchmarks with consistency over a long period of time. They learn how to deliver results in difficult times, and hold back during successful times.”

6. Where should we place our big bets based on the principle Fire Bullets, Then Cannonballs?
“Especially in times of change, great companies figure out where to place their big bets by firing bullets. When they miss, they recalibrate until they hit the target. Then, they fire the cannonball.”

7. Do we have enough productive paranoia?
“Great leaders have a certain degree of productive paranoia. Despite their success, they worry about what’s coming and they channel their energy appropriately. They have a distrust of their success and are grateful, but fearful.”

8. How can we do a better job at Clock Building, not just Time Telling?
“We succeed at our best only when we help others succeed. Great leaders are clock builders, not time tellers.Their teams don’t need them to constantly check in to make sure the work is getting done right.”

9. Do we passionately embrace the genius of the fundamental dynamic, Preserve the Core AND Stimulate Progress?
“It’s not either/or thinking, the genius is in the AND. Great companies do both, they preserve the core, while stimulating progress. Values are sacred but practices change.”

10. What is our Big Hairy Audacious Goal (BHAG)?
“Your goal has to be tough to achieve. If you know for sure you can achieve it, then it isn’t a BHAG. It’s the climb that makes you stronger.”

11. How can we increase our return on luck?
“Every company gets lucky from time to time, the difference is in how you manage your luck. Luck favors the persistent.True creators stay in the game and play every hand to the best of their ability.”

12. What should be on our stop doing list?
“Every business owner or leader has a to-do list, but great owners also have a stop-doing list. These are things that if you stop doing them, they will equally help your company on its path to greatness.”

* For more information on Good to Great and 12 Questions visit jimcollins.com.