What does good look like?

Companies are almost always assessed too late. Only when the numbers say the company is excellent.

I am interested in the moment before the numbers.

For my book project I have gone through Finnish success stories from three decades. Coronaria. Vacon. Solita. iLOQ. Fredman Group. Reka. And many more. In all of these I have had the chance to be involved in some way.

The companies are different. The industries are different. The times, owners, markets and starting points vary.

Yet the same things recur in the stories to an astonishing degree.

1. A bold strategy

Successful companies have not grown by doing a little more of the same.

At some point a bold choice was made. They entered a new market. Went international before their competitors. Built a new business model. Focused on something others were not yet interested in.

The strategy was not a plan to improve the current business. It was a choice of a different future.

In hindsight many bold choices look obvious. At the moment of decision they are not.

2. The brand tells of the change

A growth company does not just do things better. It builds a new understanding of itself.

Sometimes the change shows as a new name. Sometimes as a new story, a new look or an entirely new way of talking about the company.

The brand makes the strategy visible. It tells customers, employees, partners and finally the company itself what we are becoming.

That is why, in the best companies, the brand is not a marketing department project. It is part of the strategic change.

3. An excellent management team

A strategy does not implement itself.

Behind every success story there is a group of people who made the change happen.

A good CEO is important. Even more important is the CEO’s ability to build a strong management team around them.

The management team turns the owner’s will and the strategy approved by the board into plans, investments, recruitments, products, customers and finally results.

Strategy tells where we are going. Leadership decides whether we get there.

4. The whole machine has to work

My most interesting observation is this: successful companies usually do not have one overwhelming strength.

A good company is a whole.

The culture works. Product development creates competitive products. Marketing builds demand. Sales wins customers. Production keeps its promises. Customer support builds long relationships.

Not everything has to be the best in the world. But no critical part may be persistently poor.

In this a company resembles a top team. One superstar can decide a match. Only a team wins championships.

5. The courage to change

The fifth common denominator is perhaps the most important.

Successful companies do not stay to defend what once made them successful.

They change products, markets, operating models, leaders, organisations and sometimes even their identity.

From good they want excellent. From excellent, a pioneer of the industry.

This requires constant dissatisfaction with the present state. Not in a negative sense, but as curiosity about how much better this could still become.

Good looks like a whole

Companies are measured by single figures. Is revenue growing? What is the EBITDA? How much is the company worth?

Those are important outcomes.

The more interesting question is this: what does a company look like before the numbers say it is excellent?

It has a bold strategy and an interesting future. It has a strong brand and story. It has an excellent management team. Its key functions work well together. And it has the courage to change before change is forced.

When these meet in the same company for long enough, the result is growth, profitability, culture, competitive advantage and company value.

Sometimes the result is a Finnish success story.

In the end, good does not look like any single thing. Good looks like all the important things supporting the same direction.

What does your company look like right now, before the numbers tell it?

By Ville Tolvanen. Originally published in Finnish: Miltä hyvä näyttää?. More in English: Aura Boards — start here.