Good to Great

Good to Great by Jim Collins

The Lawyer Who Sold the Mills

In 1971, a mild-mannered in-house lawyer named Darwin Smith became chief executive of Kimberly-Clark, a sleepy paper company that had spent the previous two decades trailing the stock market by thirty-six percent. A board member pulled him aside, gently, to mention that he probably wasn't qualified for the job. Two months later, Smith was diagnosed with nose and throat cancer and given less than a year to live. He told the board, refused to quit, and commuted weekly from Wisconsin to Houston for radiation treatments. He lived another twenty-five years, every one of them as CEO.

Then he did something the financial press called stupid. He sold the mills. The paper mills had been Kimberly-Clark's core business since the company's founding, and Smith concluded they were doomed to mediocrity. He took the proceeds, poured them into consumer paper products like Huggies and Kleenex, and went head to head with Procter and Gamble. Wall Street analysts downgraded the stock. The business press called the decision foolish. A board member later said it was the gutsiest move he had ever seen a chief executive make. Twenty-five years on, Kimberly-Clark owned Scott Paper outright and was beating Procter and Gamble in six of eight product categories. Asked on his retirement to describe his management style, Smith was silent for a long uncomfortable moment, then said one word: "Eccentric." Asked what allowed him to do what he did, he said, "I never stopped trying to become qualified for the job."

This is the kind of leader Jim Collins did not expect to find. When he started the research project that became Good to Great, he expected charisma. He expected swashbuckling outsiders riding in to save the day. He expected big personalities, big visions, big speeches. Instead, again and again, in eleven companies that made the leap from good to great, he found something much quieter, much weirder, and much more useful. The book is the story of what he and his team found over five years and 10.5 person-years of research, and it begins with a line that the rest of the book is essentially a long argument for: good is the enemy of great.