Good-to-great executives, such as those at Wells Fargo, cultivate a culture of discipline that pervades

the whole company. The level 5 leader's departure does not change the culture of discipline, which is
founded on each individual's grasp of the three circles and their hedgehog concept.

Discipline was imposed from the top-down with the executive functioning as the disciplinarian, rather
than via a broad culture pervading the whole business, while comparative organizations had disciplined
cultures. When the executive departed, he took the discipline with him.

Ray MacDonald, for example, was a skilled but divisive CEO who led Burroughs to returns 6.6 times the
market in the 1960s and 1970s. He regularly chastised individuals he thought were less intelligent than
he was, and he obtained results by placing a lot of pressure on his employees. Burroughs'
administration, on the other hand, was beset by indecision when MacDonald resigned. They used to be
able to rely on Burroughs' personal discipline, but now they lacked the discipline culture to make
judgments on their own. Burroughs' returns had dropped 93 percent behind the market by 2000, 23
years after MacDonald's departure. This was not a real disciplined culture.

Finally, in order for your business to succeed, all three principles must function together. But keep in
mind that a disciplined culture is more than simply activity. It's about cultivating a culture and team of
self-disciplined and enthusiastic individuals that think in a systematic way and disregard possibilities that
fall outside the three rings. Only then will you be able to take deliberate steps to guarantee that the
flywheel (your retail business) can truly take off.