Let's focus on the methodology first. The author, Charles Ellis, asked many firm leaders which firm was the best in their field - the firm they'd like to work for, that clients seek out for their toughest challenges, and that has proven most durable through good and bad times. There was a consensus of one leading firm in each of five fields: McKinsey (consulting), Cravath, Swain, and Moore (law), Capital Group (investment management), Mayo Clinic (medicine), and Goldman Sachs (investment banking). Ellis then did over 300 interviews with leaders of these firms to see what made them so good, and concluded that they share 7 'secret' traits:
* Defining an inspiring mission (usually related to professionalism rather than commercialism)
* Recruiting the right people onto the team
* Developing people - from early accelerated training through career-long coaching
* Establishing a strong culture that unites all in teamwork to serve clients
* Assuring a strong client focus
* Innovation at all levels - from tactics to grand strategy
* Providing leadership that brings all six together and identifies problems and corrects them quickly
Now the methodological questions are:
* Is asking people's opinions a valid way to identify the 'best' firm in a field? Ellis presumes that it is. I'm tempted to disagree, and Ellis himself notes that Andersen had begun its downward slide well before its reputation was harmed, but I'll grant that reputation does count for a lot, so let's go with it.
* Are leaders of firms reliable reporters of their practices? There's much reason for doubt here too, but I'll assume that Ellis was sufficiently probing and skeptical in his questioning.
* Are these seven traits truly more prevalent in the leading firms, as compared to all other firms in the same field? Ellis seem to imply that the answer is Yes, but he doesn't offer much comparative analysis to back this up.
* Are there no other traits that are found with greater prevalence in only the leading firms? Ellis doesn't address this question directly but, again, seems to imply that the answer is Yes.
* Do these seven traits 'explain' the success of the leading firms, in the sense that other firms which adopt them can rise near or to the top? Not necessarily.
Because of these methodological issues, I could say that the whole book needs to be taken with a major grain of salt (see The Halo Effect: ... and the Eight Other Business Delusions That Deceive Managers for a general critique along these lines). But Ellis fortunately acknowledges these concerns in the Afterword of the book, where he says "But do all champions eat Wheaties? Are all those who eat Wheaties champions? No and No. There is no direct causal connection between eating Wheaties at breakfast and becoming a champion. Similarly, proving causation in professional fields - exactly why a few firms rise to and sustain professional excellence - is impossible." But defending his approach, he adds "However, the characteristics of the truly great professional firms are stunning in their consistent repetition. Every great firm is clearly strong on every one of the vital strengths - each in its own way - and superb on several. That's why they excel." Since we can't generally do blinded randomized controlled trials in the business world, I think it comes down to judgment, and based on my decades of experience in professional services (engineering), I'm willing to trust Ellis' findings - they do ring true to me.
If we accept Ellis' findings, do the seven identified traits really constitute 'secrets'? I would say No, they're relatively standard fare, but it still helps to pick out seven specific traits from the crowd of many 'good' traits a firm might aspire to. And the book adds value by illustrating the application of these traits through many engaging stories and anecdotes describing the practices of the leading firms, including mistakes they made and how they rectified them, which is all accomplished through excellent writing (and the narration of the unabridged audiobook is also excellent). One case of a formerly leading firm, which gradually 'drifted into failure' rather than rectifying its mistakes, is Arthur Andersen, and Ellis devotes the last chapter to telling this sad but instructive story as well.
So despite the methodological concerns, my verdict is still 5 stars, and I highly recommended this book to anyone with an interest in business success, especially people with a management or leadership role in a professional service firm (I've purchased copies of this book for the senior management of my own firm).