Decline can be avoided. Decline can be detected. Decline can be reversed. Amidst the desolate
landscape of fallen great companies Jim Collins began to wonder: How do the mighty fall? Can
decline be detected early and avoided? How far can a company fall before the path toward doom
becomes inevitable and unshakable? How can companies reverse course? In How the Mighty Fall
Collins confronts these questions offering leaders the well-founded 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 By
understanding these stages of decline leaders can substantially reduce their chances of
falling all the way to the bottom. Great companies can stumble badly and recover. Every
institution no matter how great is vulnerable to decline. There is no law of nature that the
most powerful will inevitably remain at the top. Anyone can fall and most eventually do. But
as Collins' research emphasizes some companies do indeed recover?in some cases coming back
even stronger? even after having crashed into the depths of Stage 4 . 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.
