The chart shows a steep rising tide for Stage 2 but we already know SG is in decline. This type of growth is akin to cancerous growth.
While there are other factors that lead to a company's fall, Jim Collins research reveal it is undisciplined pursuit of more for the majority of fallen companies.
Key points by Jim Collins are in blue.
What is Undisciplined Pursuit of More (growth) according to Jim Collins?
- Discontinuous leaps into arenas for which you have no burning passion.
- Taking action inconsistent with your core values.
- Investing heavily in new arenas where you cannot attain distinctive capability, better than your competitors.
- Launching headlong into activities that do not fit with your economic or resource engine.
- Addiction to scale.
- Neglecting core business while leaping after exciting new adventures.
- Using organization primarily as a vehicle to increase own personal success- more $$$, more fame, more power at the expense of the organization's long term success.
- Compromising on values or losing sight of core purpose in pursuit of growth & expansion.
Packard's law: No company can consistently grow revenues faster than its ability to get enough of the right people to implement that growth & still become a great company.
The hybrid regime's revenues are growing consistently such as via exorbitant World Cup subscription, regular public transport fare hikes with declining service, more & more road tolls etc.
However the hybrid regime is no longer a great political party as it no longer can get enough of the right people. It is scrapping the bottom of the barrel in terms of personnel when Kate Spade girl Tin Pei Ling are put up as an election candidate. And not forgetting the Yesmen aka military generals.
You break Packard's law & begin to fill key seats with the wrong people to compensate for the wrong people's inadequacies, you institute bureaucratic procedures; this, in turn, drives away the right people (because they chafe under the bureaucracy or cannot tolerate working with less competent people or both); this then invites more bureaucracy for having more of the wrong people, which then drives away more of the right people & a culture of bureaucratic mediocrity gradually replaces a culture of disciplined excellence. When bureaucratic rules erode an ethic of freedom & responsibility within a framework of core values & demanding standards, you've become infected with a disease of mediocrity.
An excellent explanation by Jim Collins. It clearly explains why better candidates are flocking to alternative political parties in the last general election. Look at the disease of mediocrity infecting the hybrid regime which spreads the disease down to the populace via their undisciplined pursuit of more.
If a great company consistently grows revenues faster than its ability to get enough of the right people to implement that growth, it will not simply stagnate; it will fall.
Remember the golden parachutes of the top management which we don't have. Rather than letting the top management bring us down with their misguided policies, i would say at least 50% of them needs to be voted out in the next election so as to have a buffer of 33% parliamentary seats in alternative parties hands.
Any exceptional enterprise depends first & foremost upon having self-managed & self motivated people-the #1 ingredient for a culture of discipline.
Self-motivated? No self-motivated person is joining the hybrid regime forcing it to resort to paying the world highest political salaries. And the type of people they attract?--> Yesmen.
--- Shocking Similarity with SG Inc ---
Stage 2 overreaching tends to increase after a legendary leader steps away. Perhaps those who assume power next feel extra pressure to be bold, visionary & aggressive, to live up to the implicit expectations of their predecessors or the irrational expectations of Wall Street, which accentuates Stage 2. Or perhaps legendary leaders pick successors less capable in a subconscious (or maybe even conscious) strategy to increase their own status by comparison. But whatever the underlying dynamic, when companies engage in Stage 2 overreaching & bungle the transfer of power, they tend to hurtle downward toward Stage 3 & beyond.
Best leaders we've studied had a peculiar genius for seeing themselves as not all that important, recognizing the need to build an executive team & to craft a culture based on core values that do not depend upon a single heroic leader. But in cases of decline, we find a more pronounced role for the powerful individual, & not for the better.
I reckon Jim Collins would consider this the greatest failing of the old man. Is only 5 days away from National Day & people are wondering about the condition of the old man as he show up. According to Jim Collins definition of a great leader in his book 'Good to Great', the old man is considered a level 4 leader. He hasn't reach the pinnacle of Level 5 leader.
Working folks or those having been through national service might have experienced the 'Super On' new boss who wants to outshine his predecessor. The 'Super On' new boss then implement audacious new initiative/s. It might be good or it might be bad. How you know is bad? Well that is what Jim Collins set out to research on its warning signs.
While no leader can single-handedly build an enduring great company, the wrong leader vested with power can almost single-handedly being a company down.
Again Jim Collins do not believe in a lone heroic leader. Many peasants are brainwashed into thinking the old man is instrumental in building SG Inc up with heaps of credit due to him.
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Warning Signs for Stage 2: Undisciplined Pursuit of More
The more warning signs the higher likelihood of disease. It might be a normal fever but if there are other symptoms associated with malaria, then malaria is highly likely.
Success creates pressure for more growth, setting up a vicious cycle of expectations; this strains people; the culture & systems to breaking point; unable to deliver consistent tactical excellence, the institution frays at the edges.
Institutions fraying with the recent spate of corruption scandals in SG Inc's much vaulted civil service. Police caught totally unprepared with Little India Riots & the escape of a limping terrorist.
Undisciplined Discontinuous Leaps
The enterprise makes dramatic moves that fail at least 1 of the following 3 tests:
1) Do they ignite passion & fit with the company's core values?
2) Can the organization be the best in the world at these activities or in these arenas?
3) Will these activities help drive the organization's economic or resource engine.
The people joining the hybrid regime are not passionate about serving the country. Hybrid regime's core values have mutated beyond recognition. Its core value is now $$$ & more $$$.
Declining proportion of right people in key seats
Losing the right people and/or growing beyond the organization's ability to get enough people to execute on that growth with excellence.
Is cancerous growth we are now experiencing. Gone are the days of growth with excellence.
Easy cash erodes cost discipline
Organization responds to increasing costs by increasing prices & revenues rather than increasing discipline.
Seeing peasants as cows to be milked dry for lavish wasteful projects such as Bay Gardens & shopping mall at the airport.
Bureaucracy subverts discipline
System of bureaucratic rules subverts the ethic of freedom & responsibility that marks a culture of discipline; people increasingly think in terms of 'jobs' rather than responsibilities.
'This is outside of my jobscope hence it is not my business'. Little wonder we taxpayers $$$ go into feeding those overbloated bureaucracies with its multiple permanent secretaries, deputy directors etc.
Problematic succession of power
The organization experiences leadership-transition difficulties, be they in the form of poor succession planning, failure to groom leaders from within. political turmoil, bad luck or an unwise selection of successors.
As explained earlier that old man is considered a level 4 leader.
Personal interests placed above organizational interests
People in power allocate more for themselves or their constituents - more $$$, more privileges, more fame, more of the spoils of success - seeking to capitalize as much as possible in the short term, rather than investing primarily in building for greatness decades into the future.
Check out the book "Collapse" by Jared Diamond too if you haven't done so.
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