Let’s turn first to the inputs, beginning with the role of discipline. An overarching theme across our research findings is the role of discipline in separating the great from the mediocre. True discipline requires the independence of mind to reject pressures to conform in ways incompatible with values, performance standards, and long-term aspirations. The only legitimate form of discipline is self-discipline, having the inner will to do whatever it takes to create a great outcome, no matter how difficult. When you have disciplined people, you don’t need hierarchy. When you have disciplined thought, you don’t need bureaucracy. When you have disciplined action, you don’t need excessive controls. When you combine a culture of discipline with an ethic of entrepreneurship, you create a powerful mixture that drives great performance.

To build an enduring great organization—whether in business or the social sectors—you need disciplined people who engage in disciplined thought and take disciplined action. Then you need the discipline to sustain momentum over a long period of time. This forms the backbone of the framework, laid out in four basic stages:

Stage 1: Disciplined People

Stage 2: Disciplined Thought

Stage 3: Disciplined Action

Stage 4: Building to Last

The first principle was “Story Is King,” by which we meant that we would let nothing - not
the technology, not the merchandising possibilities - get in the way of our story. We took
pride in the fact that reviewers talked mainly about the way Toy Story made them feel and not about the computer wizardry that enabled us to get it up on the screen. We believed that this was the direct result of our always keeping story as our guiding light.

The other principle we depended on was “Trust the Process.” We liked this one because it was so reassuring: While there are inevitably difficulties and missteps in any complex creative endeavor, you can trust that “the process” will carry you through. In some ways, this was no different than any optimistic aphorism (“Hang in there, baby!”), except that because our process was so different from other movie studios, we felt that it had real power. Pixar was a place that gave artists running room, that gave directors control, that trusted its people to solve problems. I have always been wary of maxims or rules because, all too often, they turn out to be empty platitudes that impede thoughtfulness, but these two principles actually seemed to help our people.

1. Identify Barriers to Choice

The fourth step in the process constitutes a 180-degree flip. The previous step stayed assiduously away from opinions on whether the conditions would hold true. This creates an environment that enables each team member to explore the logic behind the possibility and to codify and organize it. Now, and only now, you can cast a critical eye on the conditions your team has identified. The task is to assess which of the conditions your team believes are the least likely to hold true. In other words, now that you’ve specified what would have to be true for this possibility to be a great idea, which of those conditions worry the team the most and seem the least likely to be true? These conditions constitute the barriers that keep you and the team from choosing that possibility. Until you know if they are true or not, you can’t move ahead. In this step, it is extremely important to pay close attention to the group member who is the most skeptical that a condition will hold true; a skeptic can provide extremely valuable insurance against making a bad choice. So

skeptical group members must be encouraged to raise, not suppress, concerns at this point in the process. Even if only one person has concerns about a given condition, it should remain on the list of key barriers.

How people actually go about their works, how decisions are made, who gets promoted, how employees interact with one another, what motivates them - these are the things that really count. What makes things especially tricky, especially for an outsider, is that as with real cultures of any type - from corporations to schools, towns, and even nations - most of the really important rules are not written down.

The place to start assessing a culture is to listen, really listen, to how employees describe a place. We believe that within most generalizations there lies an inner core of truth.

In the Win/Win agreement, the following five elements are made very explicit:

Desired results (not methods) identify what is to be done and when.

Guidelines specify the parameters (principles, policies, etc.) within which results are to be accomplished.

Resources identify the human, financial, technical, or organizational support available to help accomplish the results.

Accountability sets up the standards of performance and the time of evaluation.

Consequences specify—good and bad, natural and logical—what does and will happen as a result of the evaluation.