The Connected Company

The Connected Company

by Dave Gray, Thomas Vander Wal
Released September 2012
Publisher(s): O'Reilly Media, Inc.
ISBN: 9781449336622

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Book description

The future of work is already here.

Customers are adopting disruptive technologies faster than your company can adapt. When your customers are delighted, they can amplify your message in ways that were never before possible. But when your company’s performance runs short of what you’ve promised, customers can seize control of your brand message, spreading their disappointment and frustration faster than you can keep up.

To keep pace with today’s connected customers, your company must become a connected company. That means deeply engaging with workers, partners, and customers, changing how work is done, how you measure success, and how performance is rewarded. It requires a new way of thinking about your company: less like a machine to be controlled, and more like a complex, dynamic system that can learn and adapt over time.

Connected companies have the advantage, because they learn and move faster than their competitors. While others work in isolation, they link into rich networks of possibility and expand their influence.

Connected companies around the world are aggressively acquiring customers and disrupting the competition. In The Connected Company, we examine what they’re doing, how they’re doing it, and why it works. And we show you how your company can use the same principles to adapt—and thrive—in today’s ever-changing global marketplace.

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Table of contents

  1. The Connected Company
  2. Dedication
  3. SPECIAL OFFER: Upgrade this ebook with O’Reilly
  4. Introduction
    1. Safari® Books Online
    2. We’d Like to Hear from You
  5. Acknowledgments
  6. Foreword
  7. One. Why change?
    1. 1. The connected customer
      1. The Balance of Power is Shifting
      2. A Wake-up Call at Starbucks
      3. Something’s Happening Here
        1. Cascading Effects Can be Initiated by Customers
        2. Cascading Effects Can be Initiated by Employees
        3. Cascading Effects Can be Initiated by Enemies or Competitors
        4. Cascading Effects Can be Initiated by Senior Executives
      4. The ATM Revolt
      5. Power in the Network
    2. 2. The service economy
      1. The Great Reset
      2. An Age of Abundance
      3. An Emerging Service Economy
        1. Product Saturation
        2. Information Technology
        3. Urbanization
    3. 3. Everything is a service
      1. The Industrial Model
      2. Service-Dominant Logic
      3. A Product is a Service Avatar
        1. Products as Verbs
        2. Products as Job Descriptions
      4. Services are Co-created
      5. A Process is Not a Service
      6. Service Networks
    4. 4. Services are complex
      1. Demands on Companies are Increasing in Volume, Velocity, Variety
      2. Customers Introduce Complexity and Variability into Operations
      3. Why is it So Hard to Keep Your Service Promises?
      4. Customers Resist Standardization
      5. Customer Support: Efficient for You, Painful for Them
      6. Cost and Quality are Not Mutually Exclusive
      7. Customer Service Doesn’t Have to be Painful
      8. Control at the Edge
    5. 5. How companies lose touch
      1. Why Do Companies Lose Touch?
      2. Over-Expansion
        1. How Starbucks Lost Touch
        2. How Krispy Kreme Flamed Out
      3. Blind Spots
        1. How Xerox Missed the PC Revolution
        2. How Kodak Faded Away
      4. Risk-Avoidant Cultures
        1. How GE Revitalized its Business
        2. How IBM Rediscovered Customers
      5. When in Doubt, Get in Touch with Your Customers
    6. 6. Structural change is necessary
      1. How Did We Get Here?
        1. Dividing Work
        2. Interchangeable Parts
      2. Conflicting Constraints Lead to Rigidity
    7. 7. Complexity changes the game
      1. Return on Assets is Dwindling
      2. Fewer and Fewer Companies are Surviving in the Long Term
      3. What is Causing this Increase in Death Rates?
        1. Faster Change
        2. Competition
        3. Increasing Complexity
      4. The Red Queen Race: If You’re Not Running, You’re Falling Behind
        1. The Red Queen Race
      5. What is a Coevolutionary Process?
      6. Every Adaptive Move by One Organization Affects Others
      7. Adaptive Moves Can be Competitive—and Cooperative
      8. Adaptive Moves Can Create Opportunities for Others
      9. Coevolutionary Relationships Can be Very Complex
      10. Optimization is a Journey that Leads to a Few Fitness Peaks
      11. We are Reaching a Complexity Tipping Point
      12. The Future is Connectedness
  8. Two. What is a connected company?
    1. 8. Connected companies learn
      1. The Company as a Machine
        1. Intrinsic Rewards Drive Productivity
        2. People Resist Being Controlled
        3. What Drives Growth?
      2. Closed and Open Systems
      3. Complex Adaptive Systems
      4. The Long-lived Company
      5. Design by Division
      6. Design for Connection
    2. 9. Connected companies have a purpose
      1. Purpose Accelerates and Focuses Learning
      2. What is the Purpose of a Company?
      3. How Profits Can Destroy Your Company
      4. Purpose Sets the Context for Organizations to Learn
      5. Purpose is a Moving Target
    3. 10. Connected companies get customer feedback
      1. Performance is How Well You are Doing
      2. The One Judge of Service Quality
      3. Balancing Promise, Purpose, and Performance
      4. Service Quality is a Moving Target
      5. Promoters and Detractors
      6. Building Long-Term Relationships with Customers
      7. The Net Promoter Score
      8. Net Promoter at Enterprise
        1. Consistent
        2. Granular and Timely
        3. Serious
      9. Net Promoter at Apple
      10. Net Promoter at Logitech
    4. 11. Connected companies experiment
      1. Moments of Truth
      2. The Problem with Procedures
      3. The Front Line is not a Production Line
      4. The Law of Requisite Variety
      5. Reducing Variety
      6. Absorbing Variety
      7. Freedom to Experiment
  9. Three. How does a connected company work?
    1. 12. Wrangling complexity
      1. The Complexity Issue
      2. Agile Development
      3. Service Orientation
        1. Service Contracts
        2. Composability
        3. Loose Coupling
      4. Organizing for Agility
        1. Netflix, a City of Services
        2. Whole Foods, an Agile Team of Agile Teams
      5. Most Companies are Not Built for Agility
    2. 13. The future is podular
      1. The Parable of the Watchmakers
      2. The Podular Organization
      3. Morning Star’s Self-Organizing Marketplace
      4. The Nordstrom Way
      5. Self-Organizing Teams at Rational Software
      6. Democratic Management at Semco
      7. Can Your Company Go Podular?
    3. 14. Pods have control of their own fate
      1. What is a Pod?
        1. Process to Pod
        2. Chains Versus Nets
        3. Pods are Flexible, Pods are Fast
        4. Pods Can Fail
        5. Pods Can Scale Up Fast
      2. What Kinds of Companies have been Successful with a Podular Approach?
        1. 3M is Podular
        2. Amazon is Podular
      3. A Podular System Trades Flexibility for Consistency
      4. Why aren’t more Companies Going Podular?
    4. 15. Pods need platforms
      1. What is a Platform?
      2. What is the Value of a Platform?
      3. A Platform is a Government
        1. Standards
        2. Attractors
        3. Support
        4. Governance
        5. Balancing the Needs of Constituents
        6. You don’t have to be Big
        7. Well-Designed Platforms Absorb Variety
    5. 16. How connected companies learn
      1. The Growth Spiral
      2. Level One: How Entrepreneurs Learn
      3. Level Two: How Organizations Learn
        1. Tacit and Explicit Knowledge
        2. Learning Fields
      4. Level Three: How Platforms Learn
        1. Pace Layers
        2. Front Stage and Back Stage
        3. Balancing the Front Stage and the Back Stage
        4. Making Platform Decisions
      5. Growth Spirals in the Connected Company
    6. 17. Power and control in networks
      1. Linking Things Changes Them
      2. What is a Social Network?
        1. Small Worlds
        2. Scale-free Networks
      3. Power and Control in Networks
        1. Power in Networks
        2. Control
      4. Exercising Power in Networks
        1. Situation Awareness
        2. Influence
        3. Compatibility
        4. The Platform
        5. Three Principles of Network Power
  10. Four. How do you lead a connected company?
    1. 18. Strategy as a Pool of Experiments
      1. Strategies Don’t Last Forever
      2. Let a Thousand Flowers Bloom
      3. A Portfolio of Experiments
        1. Small Bets: Set a Low Bar for Initial Experimentation
        2. Medium Bets: Many Sources of Funding
        3. Big Bets: The Responsibility of Senior Leaders
        4. More Experiments Means More At-Bats
      4. Be Connectable to Everything
      5. Strategy by Discovery
    2. 19. Leading the connected company
      1. Leading from the Edge
        1. Three Types of Strategy
      2. Edge Leadership
        1. People First
        2. Awareness
        3. Adaptive Tensions
        4. Diversity Matters
      3. You are a Learning Field
      4. Influence—Give Meaning and Moral Authority to the Purpose
        1. Purpose
        2. What You Stand For
        3. Moral Authority
        4. Principles Trump Processes
        5. It Takes Trust to Build Relationships
    3. 20. Managing the connected company
      1. Management is a Support System
      2. Designing the System
        1. Balance the Individual Freedom with the Common Good
        2. Participation
        3. Build Slack into Central Resources to Ensure Availability
        4. Rely on Peer-to-Peer Reinforcement Whenever Possible
      3. Operating the System
        1. Critical Values in Complex Adaptive Systems
        2. Symptoms
      4. Tuning the System
        1. Adaptive Tensions
        2. Attractors
        3. Information Transparency
        4. Density
        5. Diversity
        6. Permeability
        7. Rate of Flow
        8. Parameters
        9. Structural Change
        10. Emergent Leadership
      5. The Job of Managers
  11. Five. How do you get there from here?
    1. 21. The Risks of Connectedness
      1. Networks are Neutral
      2. Pod Failure
      3. Too Much Autonomy
      4. Not Enough Autonomy
      5. Platform Failure
        1. Failure to Invest in the Platform
        2. Over-Controlling the Platform
      6. Failure of Purpose
      7. Customers First
    2. 22. Starting the journey
      1. How to Get there from Here
        1. It Won’t be Easy
        2. Do You Work at a Place that Ignites Your Passion?
        3. Design Around Customers
        4. Taking Steps Versus Crossing Chasms
      2. The Organic Path
      3. Top-Down, Leader-Driven Change
        1. Connecting an Internal Group at Marriott
        2. Connecting with Customers at U.S. Cellular
        3. Common Threads
      4. Pilot Pods
        1. Launch a Pilot Pod to Shift to a New Business Model
        2. Launch a Pilot Pod to Serve Unmet Customer Needs
        3. Disrupt Yourself Before Someone Else Does
        4. Disrupting Desktop Software at Autodesk
        5. Disrupting Full-Service Telecom at O2
        6. The Difference Between a Proof-of-Concept and a Pilot
      5. Network Weaving
      6. It’s Time to Change
  12. A. Bibliography
  13. Index
  14. B. Discussion Questions
  15. About the Authors
  16. SPECIAL OFFER: Upgrade this ebook with O’Reilly
  17. Copyright

Product information

  • Title: The Connected Company
  • Author(s): Dave Gray, Thomas Vander Wal
  • Release date: September 2012
  • Publisher(s): O'Reilly Media, Inc.
  • ISBN: 9781449336622