Several
years ago Jim Collins wrote a very influential business book titled
Good to Great. The idea was to study great companies.
Actually, it was a little more complicated than that. You see, Collins
had already done a study of great companies. And the results were
published, along with his coauthor Jerry Porras, as a book titled
Built to Last. The companies in Built had
essentially been great from inception. These were companies like HP
and Merck.
Then one
night at dinner Bill Meehan, a managing director for McKinsey &
Company, leaned over and asked Collins about the companies that
weren't spectacular from birth. Meehan was asking about, “the vast
majority of companies that wake up partway through life and realize
that they're good, but not great.” Collins understood the point.
And it led him to ask the questions, “Can a good company become a
great company and, if so, how? Or is the disease of 'just being good'
incurable?”
This
post isn't really about the book Good to Great. Perhaps I will
post a book report someday, but not today. Specifically, I wanted to
talk about just one of Collins' findings. Collins, and his team,
found that companies who make the leap from good to great embrace a
certain cognitive tension. It's a mindset that Collins called “The
Stockdale Paradox.”
James
Stockdale, “was the highest-ranking United States military officer
in the 'Hanoi Hilton' prisoner-of-war camp during the height of the
Vietnam War. Tortured over twenty times during his eight-year
imprisonment from 1965 to 1973, Stockdale lived out the war without
any prisoner's rights, no set release date, and no certainty as to
whether he would even survive to see his family again,” writes Mr.
Collins.
In the
later years of his life, Admiral Stockdale was a senior research
fellow, at the Hoover Institution, where he studied the Stoic
philosophers. As it turned out, this was during the same time that
Collins was a professor at Stanford. One day Stockdale invited
Collins, and one of his students, out for lunch. Having read
Stockdale's book In Love and War, Collins knew of the
experiences the Admiral went through while interned in Vietnam. Stockdale's story had Collins feeling quite depressed. He wondered how anyone
could have survived such an ordeal. Their lunch date gave Collins the
opportunity to ask.
“I
never lost faith in the end of the story,” is what Stockdale said.
“I never doubted not only that I would get out, but also that I
would prevail in the end and turn the experience into the defining
event of my life, which, in retrospect, I would not trade.” Collins
pondered the statement for a minute and asked, “Who didn't make it
out?” Stockdale replied, “Oh, that's easy. The optimists.”
Collins
said he didn't understand how that could be. To which Stockdale said,
“The optimists. Oh, they were the ones who said, 'We're going to be
out by Christmas.' And Christmas would come, and Christmas would go.
Then they'd say, 'We're going to be out by Easter.' And Easter would
come, and Easter would go. And then Thanksgiving, and then it would
be Christmas again. And they died of a broken heart.”
There
was another long pause and then Stockdale turned to Collins and said,
“This is a very important lesson. You must never confuse faith that
you will prevail in the end–which you can never afford to lose–
with the discipline to confront the most brutal facts of your current
reality, whatever they might be.”
Collins
writes, “To this day, I carry a mental image of Stockdale
admonishing the optimists: 'We're not getting out by Christmas; deal
with it.'” And this led Collins to the creation of The Stockdale
Paradox. Collins states the paradox as follows, “Retain faith that
you will prevail in the end, regardless of the difficulties. And, at
the same time, confront the most brutal facts of your current
reality, whatever they might be.”
Far be
it from me to question Admiral Stockdale but I think his use of the
word “optimist” is misplaced. The story kind of downplays the
importance of optimism. And, as we know, Martin Seligman has shown,
beyond any reasonable doubt, the usefulness of optimism. When
Stockdale spoke of, “faith in the end of the story,” he was clearly demonstrating a form of optimism. The people that didn't make it out
of the Hanoi Hilton, if they were optimists at all, were a kind of
delusional optimist. What's needed is what Heidi Grant Halvorson
would call, “Realistic Optimism.” It's a sort of grounded
optimism. And, it's the essence of The Stockdale Paradox. It's having
faith in the end game while, simultaneously, being aware of current
reality. It's the sort of groundedness that is the essence of the eastern philosophy of Mindfulness.
When
asked what the hardest part of being an entrepreneur was, Jack
Harding replied, “Persistent failure.” If you have ever built a
business you understand why Harding would say such a thing. Building
a successful business involves one mistake after the next. The key is
resiliency or what Dan Pink would call, “Buoyancy.”
Understanding, and embracing, The Stockdale Paradox is at the core of
resiliency and perseverance. Because one of the core paradoxes of
entrepreneurialism is that, "we fail our way to success."
