How “Productive Paranoia” helps keep high performing organizations afloat?

The three main dimensions of “Productive Paranoia” exhibited by high performing or 10X companies , as mentioned by Jim Collins in “Great By Choice” are as follows:

  1. Build cash reserves and buffers is like having sufficient oxygen cannisters to help climb Mount Everest.It is the reserve that bails a company out of crisis situations and helps to proceed with its 20 Mile March even during tough times
  2. Bound all possible risks and safeguarding against them with religious planning.The risks are a) Death Line Risks b) Asymmetric Risks c) Uncontrollable risks and d) Time bound risks
  3. Zooming out and in and being continuously vigilant to sense change conditions and threats in the environment.

Thus “Productive Paranoia” when exercised with the right intention can help to keep a company afloat and make profit and growth during difficult times.

The best example that comes to mind is how SouthWest Airlines made profits without any job cuts post 9/11 by demonstrating this quality to the best extent possible.



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