From Good to Great: Transforming U.S. Manufacturing Companies with Jim Collins’ Proven Principles
Nelinia (Nel) Varenas, MBA
U.S. Manufacturing Strategic Value+ Solutions Advisor | Certified ISO 9001 QMS Auditor | Six Sigma Black Belt (candidate) | FP&A SME | Marketing Guru | AI & Automations Nerd | Author | Speaker
In the evolving landscape of U.S. manufacturing, small- and medium-sized enterprises (SMEs) face mounting challenges: global competition, rising labor costs, supply chain volatility, and workforce shortages. Amid these pressures, Good to Great by Jim Collins offers a framework for sustainable success grounded in discipline, leadership, and strategic clarity.
Though Collins’ research focused on publicly traded companies, the core findings are deeply applicable to SMEs striving to rise above mediocrity and achieve industry leadership. Let’s explore how today’s U.S. manufacturing firms are using these principles — along with real-world examples and supporting data — to build greatness from the ground up.
1. Level 5 Leadership: Humility + Fierce Resolve
“Level 5 leaders channel their ego away from themselves and into the larger goal of building a great company. It’s not that they have no ego or self-interest. Indeed, they are incredibly ambitious — but their ambition is first and foremost for the institution, not themselves.” – Jim Collins
Application in Manufacturing:
Level 5 leadership is especially crucial in the SME sector, where the CEO is often directly involved in daily operations. These leaders exhibit a paradoxical blend of personal humility and intense professional will. They’re not interested in personal accolades; instead, they measure success by how well the company performs after they’ve moved on.
Example – AccuRounds (Avon, MA):
Under the leadership of Michael Tamasi, AccuRounds—a precision machining company—experienced a profound cultural and operational transformation. Tamasi embraced a servant leadership model, fostering open communication, shared decision-making, and workforce development. He instituted a “Values First” culture that empowers every employee to contribute to quality, safety, and process improvement.
Significance: Tamasi’s leadership highlights the power of humility in an industry often driven by top-down control. His focus on people over profits initially may have seemed risky, but over time it created a resilient organization with low turnover, high employee engagement, and above-average productivity. It’s a textbook example of how Level 5 leadership directly translates to long-term performance in manufacturing.
2. First Who, Then What: Get the Right People on the Bus
“If we get the right people on the bus, the problem of how to drive it largely goes away.”
Application in Manufacturing:
Manufacturers frequently rush to adopt new technologies or enter new markets. However, without the right talent in place—those with the right mindset, work ethic, and cultural alignment—strategic initiatives often fail.
Example – H&S Manufacturing (Marshfield, WI):
H&S faced high turnover and inconsistent production quality, threatening its long-term competitiveness. Leadership took a step back and rethought their hiring and onboarding strategy. They began using skills assessments and structured behavioral interviews to ensure cultural fit. In addition, cross-functional training programs were introduced to promote internal mobility and workforce flexibility.
Significance: This shift allowed H&S to stabilize its workforce, improve quality assurance, and enhance adaptability during market fluctuations. More than a hiring policy, it was a strategic alignment of human capital to long-term goals. By putting “who” before “what,” H&S turned its workforce into a competitive advantage.
3. Confront the Brutal Facts (Yet Never Lose Faith)
“You absolutely cannot make a series of good decisions without first confronting the brutal facts.”
Application in Manufacturing:
Manufacturing companies often operate under intense pressure to deliver short-term results. This can lead to denial about systemic inefficiencies or market declines. Collins emphasizes the importance of facing reality without losing faith in the organization’s ultimate potential.
Example – Smalley Steel Ring Company (Lake Zurich, IL):
Facing flat sales and shrinking margins, Smalley’s leadership resisted the urge to simply “cut costs.” Instead, they confronted the brutal facts—internal audits revealed inefficiencies in inventory management, outdated production systems, and weak supplier relationships. Leadership responded by implementing lean manufacturing, investing in automation, and renegotiating vendor contracts.
Significance: By acknowledging hard truths and acting decisively, Smalley not only returned to profitability but became more agile in responding to market demand. Their story illustrates the balance of realism and resilience that distinguishes great companies from average ones.
4. The Hedgehog Concept: Simplicity Within the Three Circles
“The Hedgehog Concept requires a deep understanding of three intersecting circles: what you can be best at, what drives your economic engine, and what you are deeply passionate about.”
Application in Manufacturing:
Too many SMEs fall into the trap of chasing growth through diversification. Instead, Collins advises a laser focus on what a company can be best in the world at. This clarity leads to excellence and differentiation.
Example – Carr Machine & Tool (Elk Grove Village, IL):
Carr Machine was a generalist job shop for years, taking any work that came its way. In 2016, after an internal strategic review, the company realigned itself around aerospace precision machining—a segment where its quality standards, certifications, and tooling gave it a competitive edge. The leadership team doubled down on training, acquired industry-specific machines, and marketed heavily to aerospace clients.
Significance: Carr’s decision to specialize allowed them to deepen their expertise, attract premium clients, and stabilize revenue even through economic headwinds. The Hedgehog Concept not only gave Carr direction—it provided a scalable growth model centered on mastery, not expansion for its own sake.
5. A Culture of Discipline
“Disciplined people who engage in disciplined thought and who take disciplined action... are the cornerstone of a culture that creates greatness.”
Application in Manufacturing:
A culture of discipline ensures that standards don’t slip, even in high-growth environments. It’s not about bureaucracy—it's about self-managed teams that take pride in consistency, safety, and accountability.
Example – Protolabs (Maple Plain, MN):
Protolabs blends digital technology with precision manufacturing to deliver custom parts in record time. Their ability to ship in as little as 24 hours is underpinned by tightly managed workflows, automated quoting systems, and standardized production cells. Employees are empowered to monitor quality and suggest process improvements, ensuring continuous feedback loops.
Significance: Protolabs illustrates how discipline fuels innovation. By standardizing core processes, the company frees up resources to invest in speed and customer experience—setting them apart in a crowded market.
6. Technology Accelerators: Use Tech to Support a Great Strategy
“Technology alone never holds the key to greatness. Great companies use technology as an accelerator of momentum, not a creator of it.”
Application in Manufacturing:
While there’s a rush toward Industry 4.0—smart sensors, cloud platforms, AI—many SMEs mistakenly assume that adopting the latest tech will solve fundamental problems. Collins cautions that technology must be aligned with a clear business objective.
Example – AmesburyTruth (Owatonna, MN):
Rather than adopting IoT just to keep up with the times, AmesburyTruth began by streamlining its manual processes. After achieving lean consistency, they introduced IoT-enabled systems to monitor machine uptime, reduce unplanned downtime, and optimize energy usage.
Significance: By using technology as a tool—not a crutch—AmesburyTruth saw real ROI. Their approach demonstrates how SMEs can leapfrog competitors by marrying innovation with strategic readiness.
Conclusion: Greatness is Within Reach
Jim Collins' framework was never about instant success. It's about disciplined, purpose-driven growth. For U.S. manufacturing SMEs, these principles offer a roadmap to resilience, relevance, and industry leadership. Whether you're a job shop in Ohio or a precision parts supplier in Texas, greatness is not a function of size—but of focused strategy, disciplined execution, and principled leadership.
Action Item: See the Whole Picture. Drive the Right Decisions.
The most effective manufacturing leaders today aren’t just reacting to yesterday’s performance — they’re predicting and driving toward tomorrow’s opportunities.
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Resources for Further Research:
#GoodtoGreat #JimCollins AccuRounds H&S Manufacturing Co., Inc Smalley CARR Machine & Tool, Inc. Protolabs Quanex International (Amesbery Truth)
Keywords:
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This is one of the most impactful business books that I’ve enjoyed reading. Many timeless and valuable lessons. Thanks Nel Varenas for the post.