Every institution, no matter how great, is vulnerable to decline. Anyone can fall, and most eventually do. But decline, it turns out, is largely self-inflicted, and the path to recovery lies largely within our own hands. We are not imprisoned by our circumstances, our history, or even our staggering defeats along the way. As long as we never get entirely knocked out of the game, hope always remains. The mighty can fall, but they can often rise again.

That is the premise of Jim Collins’ (Author of Good to Great) latest book How the Mighty Fall. We spend a lot of time defining and illustrating what a successful company looks like. But in these economic times perhaps it’s just as important to spot the weaknesses, whether blatantly obvious or hidden just underneath. Collins looks at companies such as Circuit City, HP and Bank of America, which saw steep declines in recent years for different reasons. Some companies were able to climb back to relevancy. Others were not.

In How the Mighty Fall, Collins offers leaders hope that they can learn how to stave off decline and, if they find themselves falling, reverse their course. Collins’ research project–more than four years in duration–uncovered five step-wise stages of decline:

Stage 1: Hubris Born of Success

Stage 2: Undisciplined Pursuit of More

Stage 3: Denial of Risk and Peril

Stage 4: Grasping for Salvation

Stage 5: Capitulation to Irrelevance or Death

The take-away message: All companies are vulnerable to decline. But by understanding these stages of decline, leaders can substantially reduce their chances of falling all the way to the bottom.

If you would like to enter for a chance to win the reviewed copy, e-mail managing editor Graham Garrison at ggarrison@mdsi.org

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