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The Connected Company

Cover of The Connected Company by Dave Gray... Published by O'Reilly Media, Inc.
  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
      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
    3. 3. Everything is a service
      1. The Industrial Model
      2. Service-Dominant Logic
      3. A Product is a Service Avatar
      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
      3. Blind Spots
      4. Risk-Avoidant Cultures
      5. When in Doubt, Get in Touch with Your Customers
    6. 6. Structural change is necessary
      1. How Did We Get Here?
      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?
      4. The Red Queen Race: If You’re Not Running, You’re Falling Behind
      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
      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
      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
      4. Organizing for Agility
      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?
      2. What Kinds of Companies have been Successful with a Podular Approach?
      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
    5. 16. How connected companies learn
      1. The Growth Spiral
      2. Level One: How Entrepreneurs Learn
      3. Level Two: How Organizations Learn
      4. Level Three: How Platforms Learn
      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?
      3. Power and Control in Networks
      4. Exercising Power in Networks
  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
      4. Be Connectable to Everything
      5. Strategy by Discovery
    2. 19. Leading the connected company
      1. Leading from the Edge
      2. Edge Leadership
      3. You are a Learning Field
      4. Influence—Give Meaning and Moral Authority to the Purpose
    3. 20. Managing the connected company
      1. Management is a Support System
      2. Designing the System
      3. Operating the System
      4. Tuning the System
      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
      6. Failure of Purpose
      7. Customers First
    2. 22. Starting the journey
      1. How to Get there from Here
      2. The Organic Path
      3. Top-Down, Leader-Driven Change
      4. Pilot Pods
      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
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Chapter 5. How companies lose touch

Your most unhappy customers are your greatest source of learning.

Bill Microsoft Gates

Companies tend to lose touch with customers as they grow, for a variety of reasons. Companies must find ways to create, maintain, and develop deep connections as they grow.

Why Do Companies Lose Touch?

Running through every business success story is a common theme: stay connected to customers, stay connected to your market, anticipate and expect change. This seems pretty obvious. It’s simple and it’s easy to understand. Customers, after all, are the one thing no business can do without. They are the key to every company’s survival.

Paying attention to customers seems like such a fundamental thing. So why do so many companies do it so poorly? How do companies lose touch with their customers, and lose their grip on the realities of the marketplace?

As any athlete will tell you, just because something’s fundamental, that doesn’t mean it’s easy.

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Without question, customers are the single biggest factor in any company’s long-term growth and profitability. And yet, as companies grow, distractions multiply. Success can create such a dazzling array of opportunities that companies try to capitalize on too many of them, over-expanding and diluting their offerings. Internal efficiency and organization become paramount as companies struggle to maintain their growth trajectories ...

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