"A connected company must be able to respond dynamically to change – to learn and adapt in an uncertain, ambiguous, and constantly evolving environment."
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We see it all the time – companies that start out as small, nimble, entrepreneurial entities, but as they grow, they add layers of people, processes and complexity. What happens? They become inflexible, slow moving and unable to quickly respond to the changing needs of their customers or industry.
In The Connected Company, author Dave Gray (with Thomas Vander Wal) outlines how organizations need to create better connections between employees, enabling them to maintain the dynamic and fast-response mindset of a start up environment. Customers today are using social media to form powerful communities that at times can take control of your brand. Companies need to be able to connect to these communities and respond quickly.
“Companies must be flexible enough to rapidly respond to changes in their environments, or risk extinction.”
The Big Idea
Connect People to People
"What you need is a way to let customers pull you toward the things they need and want most."
If you are listening, your customers will tell you what they need. As companies grow, they focus on infrastructure, scaling, and other complexities that distract them from the customer. Gray walks through the challenges that Starbucks faced five years ago when their sales and profitability dropped, and their CEO realized they had lost touch with their customers. They refocused internally with staff, and rebuilt their business with a stronger push on staying connected to customer needs and staying true to their brand.
Employees need to connect more deeply to each other as well. Connect them around a common purpose, bring them together to share experiences and learn from each other, and find ways to reinforce those connections through internal tools that allow them to share information.
Structural Change Is Necessary
"Big companies are inevitably slow and cumbersome; small companies are quick and responsive. Therefore, break big companies into the smallest pieces possible."
Companies have layers, no question, but how you structure those layers can make all the difference. Traditional hierarchies work well for reporting “up” results, but that means employees are more vested in looking internally than outwards to their customers. Gray describes instead the need to create smaller hubs of people, with the tools or “platform” to allow front-line employees to be a single point-of-contact for solving customer needs.
Whether you refer to them as pods, holarchies or fractal work units, Gray challenges us to think about building businesses within the business, where “each part is also a fully-functional whole in its own right” (p.135), allowing them the agility to solve complex problems quickly. Gray provides the example of Whole Foods, where store product teams are provided with data and tools, allowing them to operate autonomously and make their own front-line decisions.
Learn, Change, Grow, Repeat
"To adapt, companies must operate not as machines, but as learning organisms, purposely interacting with their environment and continuously improving, based on experiments and feedback."
The idea of learning organizations isn’t a new one, but today organizations are realizing that it is not enough to train employees; instead, you need to build an environment that encourages employees to use what they have learned to change how they work. Understanding how to learn from failure and recover is part of this mindset, and the strongest organizations are the ones who are continuing to grow and evolve. Gray provides the example of GE’s “Work-Out” program, where employees step away from the assembly line to provide process improvement feedback to management. It’s a great example of bringing front-line employees and management together to learn about making critical changes.
It can feel daunting to imagine implementing some of the changes outlined in this book, but you can start by looking at the structure of your organization, and what elements are keeping you from staying close to your customers. The book provides extensive company examples of putting these practices into place, as well as guidance on how to lead a connected company, which helps bring the ideas from the book to life.
Written in pods similar to the framework outlined, The Connected Company is delivered in chunks that can be read all as once or worked through in stages. With incredible illustrations to guide you, this book shows you what it takes to create an organization that connects people – to each other, between layers, and to their customer community.