We cannot predict the future. But we can create it.

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culled from:leadershiparticles.com

Think back to 15 years ago, and consider what's happened since, the destabilizing events -- in the world, in your country, in the markets, in your work, in your life -- that defied all expectations. We can be astonished, confounded, shocked, stunned, delighted, or terrified, but rarely prescient. None of us can predict with certainty the twists and turns our lives will take. Life is uncertain, the future unknown.

We began the nine-year research project behind this book in 2002, when America awoke from its false sense of stability, safety, and wealth entitlement. The long-running bull market crashed. The government budget surplus flipped back to deficits. The terrorist attacks of Sept. 11, 2001, horrified and enraged people everywhere, and war followed. Meanwhile, throughout the world, technological change and global competition continued their relentless, disruptive march. It led us to a simple question: Why do some companies thrive in uncertainty, even chaos, and others do not? When buffeted by tumultuous events, when hit by big, fast-moving forces that we can neither predict nor control, what distinguishes those who perform exceptionally well from those who underperform or worse?

We don't choose study questions. They choose us. Sometimes one of the questions just grabs us around the throat and growls, "I'm not going to release my grip and let you breathe until you answer me!" This study grabbed us because of our own persistent angst and gnawing sense of vulnerability in a world that feels increasingly disordered.

Yet some companies and leaders navigate this type of world exceptionally well. They don't merely react; they create. They don't merely survive; they prevail. They don't merely succeed; they thrive. They build great enterprises that can endure. We do not believe that chaos, uncertainty, and instability are good; companies, leaders, organizations, and societies do not thrive on chaos. But they can thrive in chaos.

To get at the question of how, we embarked upon an ambitious journey to identify and study a select group of companies that had done just that. We set out to find companies that started from a position of vulnerability, rose to become great companies with spectacular performance, and did so in unstable environments characterized by big forces, out of their control, fast-moving, uncertain, and potentially harmful. We then compared these companies to a control group of companies that failed to become great in the same extreme environments, using the contrast between winners and also-rans to uncover the distinguishing factors that allow some to thrive in uncertainty.

From an initial list of 20,400 companies, we sifted through 11 layers of cuts to identify cases that met all our tests (our study era ran through 2002). Only seven did. We labeled our high-performing study cases with the moniker "10X" because they didn't merely get by or just become successful. They truly thrived. Every 10X case beat its industry index by at least 10 times. Consider one 10X case, Southwest Airlines (LUV). Just think of everything that slammed the airline industry from 1972 to 2002: Fuel shocks. Deregulation. Labor strife. Air-traffic controller strikes. Crippling recessions. Interest rate spikes. Hijackings. Bankruptcy after bankruptcy after bankruptcy. And in 2001, the terrorist attacks of Sept. 11. And yet if you'd invested $10,000 in Southwest Airlines on Dec. 31, 1972 (when it was just a tiny little outfit with three airplanes, barely reaching breakeven and besieged by larger airlines out to kill the fledgling), your $10,000 would have grown to nearly $12 million by the end of 2002, a return 63 times better than the general stock market. These are impressive results by any measure, but they're astonishing when you take into account the roiling storms, destabilizing shocks, and chronic uncertainty of Southwest's environment. Meanwhile, Southwest's direct comparison, Pacific Southwest Airlines (PSA), flailed and was rendered irrelevant, despite having the same business model in the same industry with the same opportunity to become great.

Why did the 10X companies achieve such spectacular results, especially when direct comparisons -- companies operating in the same fast-moving, unpredictable, and tumultuous environments -- did not? Part of the answer lies in the distinctive behaviors of their leaders.