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In today's fast-changing marketplace, a business can't expect to thrive by just making products and selling them, argues Stephan H. Haeckel in Adaptive Enterprise. "It does not matter how good you are at making widgets if the market for widgets disappears or if your competitors offer dramatically new and improved widgets faster than you can," writes Haeckel, director of strategic studies at IBM's Advanced Business Institute. Instead, for a company to succeed nowadays, says Haeckel, it needs to know how to adapt to customers--even before they themselves know what they want. Haeckel lays out a strategy to create such a "sense-and-respond" approach that will allow companies to move quickly amid change. Among the key steps: companies must use innovative ways to gather information about customer needs. For instance, car manufacturers used video cameras in airport parking lots to discover that people often struggle to lift heavy suitcases over the high lower edges of trunks. In mall parking areas, the cameras revealed that shoppers had nowhere to put soft drinks they just bought. Now, low trunk edges and cupholders are standard features in almost every car. Because "sense-and-respond" is a relatively new business model formulated by Haeckel, the book is heavy on theory and slim on concrete examples. Nevertheless, Adaptive Enterprise has some good ideas for business leaders looking for an edge in a world where rapid change is the norm. --Dan Ring ... Read more

Reviews (12)

A practical prescription for radical change.
Haeckel has written one of the most thoughtful and useful books on the enterprise available today. By use of simple metaphor, Haeckel makes the distinction between the existing build-and-sell model and his proposed sense-and-respond model. Build-and-sell firms are like bus companies with fixed routes and schedules designed to meet predicted customer demand. Sense-and-respond firms are like taxi companies that dispatch cabs in response to customer demand. Although the concepts are well presented and readily understood, Haeckel offers the reader no easy answers!

Hackel avoids using the usual metaphors of complexity science but instead adopts and explains the term "adaptive enterprise". This choice enables him to focus upon three essential elements of business - governance, leadership, and commitment.

Beware! Adopting his customer focus concepts will produce radical organizational change. For instance, "Sense-and-Respond firms do not forecast demand for products and services. But they do place selective bets upon the stability of fundamental customer needs and on what capabilities should be in their modular response repertoire." The need to create modular organizations that support modular products - a point often misunderstood in practice by even progressive build-and-sell firms - is well made in Appendix A.

Haeckel frequently returns to the theme of a phased transition to a sense-and-respond model and demonstrates a profound understanding of the risk and reward of change in an existing organization.

The Future of Service Industries
Adaptive Enterprise covers two separate but related topics - mass customisation (customisation at mass production costs) and agility (capability to deal with changes in the business environment and the associated high levels of uncertainty). The book is primarily focused on service industries, where services can often be customised through organisational (re)configuration (hence the agility dimension). Most importantly, the book covers the difficulties of moving from make and sell to sense and respond - difficulties often ignored in cookbook style business books. The book also addresses application of systems thinking to enterprise design - an important topic that is not covered enough in business books. Those interested in agility will also find Appendix B useful. Here one finds a decision process to use when one is faced with significant uncertainty. Overall the book is refreshing in its honesty. After reading this book you might also want to read some follow-ups: Mass Customisation (Joseph Pine); Agile Virtual Enterprise (Ted Goranson) and Agile Manufacturing (Paul T. Kidd).

Paul T. Kidd

Looking for Guidance in eCommerce - its not here
Adaptive Enterprises, the title holds the promise of long term sustainable advantage. Unfortunately the book reads like an extended IBM consulting sales pitch. The central case study (Westpac) is over 10 years old. Surly if this was a break through the book would talk about long term results and how they were able to take over their market by being adaptive. There is little evidence of this. Other examples are internally focused about how IBM's training and education have become more adaptive.

Not enough detail to warrant the read or to get a real idea of how you would implement the concepts.

If you are looking for guidance on eCommerce and competing in hyper competition. It is not here.

Command and control in complex adaptive systems
If you are ready to accept the notion that complexity governs your external markets, but are not yet ready to accept that the same rules may apply inside your organisation, you may find comfort in this prescription. It purports to be about the distinction between a 'make-and-sell' organisation and a 'sense-and-respond' organisation. The first is production efficiency focused and second is focused on customer satisfaction. (What the author calls 'sense-and-respond' is in fact an unacknowledged version of the Kolb cycle or cycle of organisational learning cycle, so well examined by Nancy Dixon. It is essential to all forms of learning, whether that is applied to providing customer satisfaction or to playing a musical instrument)

Overtly he argues that the shift from a make-and-sell orientation to a sense-and-respond orientation is a major piece of unfinished business for organisations. The reason that he can argue this is that he 'bundles' the issue of customer responsiveness with the much wider issue of complexity and unpredictability in the environment - in other words, he argues that it is not possible to be truly customer responsive if you do not also recognise complexity in markets.

Beneath this surface argument that the new complexity requires new approaches and its characterisation as a move to 'sense-and-respond', lies the real issue, which is the defence of command-and-control from devolution of control, which the author characterises dismissively as 'communicate-and-hope'. The author develops a framework which is designed to retain the essential features of command-and -control, while building flexibility and responsiveness. He argues that forms of governance that challenge command-and-control have only been effective in smaller and simpler organisations than the giants with which he is primarily concerned. By extension, he argues that they can not work in such organisations.

The core of his prescription is the ability of central management to provide central direction to the organisation by the use of an analogy to 'fly by wire' technology. In other words, he advocates the use of modern technology to keep central management informed of unpredictable change so fast that they can respond appropriately within tight time deadlines. When a 'modular' approach to structuring organisations is added, he argues that they can respond effectively not only to the generality of customers but to particular customers. However, the question of relationships with internal stakeholders - employees - does not figure in his schematic, nor does the issue of external alliances and partnerships. Both (separately and together) challenge the capacity of command and control: it is not just customers and markets.

A book full of really wonderful gems
As I am quoted as saying elsewhere "I wish I had had this book years ago!" In 1994 when Steve first introduced me to these principles, now so clearly set out in the book, I intuitively recognised their brilliance, and usefulness. The problem came in trying to implement a process that was itself in the throes of development. There is many a slip between "grasping the concept" and "making money from it."

In one sense, there is little that is completely new in this book. But, what a gem, where else have all the essential pieces been put together in such a logical and user friendly fashion?

I note that reviewers have not yet reached the Annexures. Using the "Adaptive Decision Process" resulted in the most exciting and valuable discussion of high level business strategy that I have ever been involved with. Debating with my management team the many strategic choices that were available to us in about 35 areas was a time consuming exercise. It took all of a day! As we progressed we found that we had developed about five possible strategies for the future. We were rather confused as to how we would make the many choices. Then came the enlightenment from modeling the financial impacts of each. We discovered that there were only a few choices that had significant financial impacts. And for once the entire management team was agreed on what these few vital choices involved. Talk about a powerful management process! This very powerful approach is hidden in an Annexure. Readers be warned, there is gold in the pages of this book, but there is so much that it is easy to miss much of it.

Another gem is the Commitment Management Protocol. My dream is to computerise this in such a manner that my email in box becomes my "promise" list showing what I owe to whom when, and what who owes to me when. Performance management becomes quite simple. This is despite the fact that we are now in an era when jobs can no longer be planned, scheduled and delivered according to schedule because those troublesome folk, our customers, do not want the standard services or products our assembly lines are designed to deliver. They want something almost unique to them.

The idea of "negotiating" conditions of satisfaction makes so much sense that I cannot believe it has taken so long for someone to write about it.

My congratulations to Steve Haeckel on a great addition to "wisdom literature". ... Read more

Book Description

Creating Teams with an Edge: The Complete Skill Set to Build Powerful and Influential Teams

Teams can be a driving force for organizational performance-and managers can play a key role in teams' ultimate success or failure. Highlighting the latest research on team development and dynamics-and including hands-on tools for improving communication, resolving conflicts, promoting interdependence, and more-this guide will help managers at all levels to motivate teams to achieve higher performance.

The Harvard Business Essentials series is for managers at all levels but is especially relevant for new managers. It offers on-the-spot guidance, coaching, and tools on the most relevant topics in business. Each book includes the critical information that managers need on a given topic-from budgeting to hiring to communication to strategy-and offers interactive tools and worksheets that translate advice into action. Providing ready answers to day-to-day issues, these guides make sound, trusted mentoring advice available whenever managers need it.

Other Books in the HBE Series:
Managing Change and Transition
Hiring and Keeping the Best People
Finance for Managers
Business Communications
Innovation
Negotiation ... Read more

Book Description

About 75 percent of active investors consistently deliver returns below those of passive index funds. Why? In part, it's because proven methods for valuing assets are too complex to apply-causing investors to rely on commonly used benchmarks such as current earnings and price-earnings multiples that simply don't reflect how the market prices stocks.

Now, leading valuation experts Alfred Rappaport and Michael J. Mauboussin argue that the secret to beating the market stands in plain sight. Embedded in the stock price-the most accessible piece of information in the investment arena-lies all investors need to know about how the market expects a company to perform. By correctly decoding that information, say the authors, investors are on the way to anticipating changes in a company's competitive position that the current stock price doesn't reflect-and making informed buy, hold, or sell decisions before the rest of the crowd. This proven approach, expectations investing, holds the potential to change the rules and improve the odds of the stock selection game forever.

The beauty of expectations investing is that it harnesses the power of the market's own tried-and-true pricing model-discounted cash flow-without requiring difficult and often dubious long-term forecasting. Highly practical, the book provides a strategic framework and corresponding tools for using price-implied expectations (PIE) to:

Interpret current prices and anticipate revisions in expectations.
Monitor signals from managerial actions such as mergers and acquisitions and share buybacks and estimate their impact on shareholder value.
Devise, adjust, and communicate management strategy in light of shareholder expectations.

In addition, a unique expectations infrastructure helps track value creation from the initial triggers that shape performance to the resulting impact on sales, operating profit margins, and investment efficiency.

Universally applicable to public companies across the economic landscape, Expectations Investing will enable professional investors, analysts, and executives to translate heightened uncertainty into lucrative opportunity.

... Read more

Reviews (20)

Must Reading
In an investment world filled with tinsel and glitter, Rappaport and Mauboussin have given us substance and common sense. Using the invaluable information imbedded in the price of a stock to establish the market's expectations,the authors present a (fairly) simple methodology for assessing the valididity of those expectations, and to invest accordingly, It is, as Peter Bernstein says in his brilliant foreword (an absolute must- read before you plunge into the text), "a logical path to the heart of value."
I'm pleased to have give the book an earlier endorsement, because I hope that mutual fund managers will learn from "Expectations Investing" that there are far better ways to manage money--ways to focus on "value" whether their style is value or growth--than the costly, high-turnover, momentum-driven strategies that are rife in the industry today.
More than ever after the 35% fall in the stock market since March 2000, investors need wisdom. They'll find it here.

An investor's guide on how to approach the investing process
This book is a must read for anyone that invests in the market and wants to make consistent gains in his/her portfolio. Most people spend more time planning a vacation than they do in picking the stocks in their portfolios. And even when they do some research into a stock usually it constitutes asking their peers on what they think about company XYZ. And the people they solicit this advice from are just as ineffective in their research and knowledge about company XYZ.

Mr. Mauboussin and Mr. Rappaport give investors the right tools to make careful and informed investing decisions. The authors suggest that the market prices "expectations" into a stock and a good investor needs to strip this from the analysis and find the true intrinsic value of a security. The is accomplished by various financial analysis tools presented in the book and also by a fundamental shift in investor thinking and perception.

A Different Approach
Stock market investing books usually come in two flavors.

The first group of authors tell you to look for certain price and volume patterns; that the stock price depends on those patterns because those patterns are a reflection on human behavior.

The second group of authors tell you to look for certain ratios in the financial statements; that the stock price depends on those ratios.

Then there's this book, which tells you that the price could depend on a lot of things, like mergers and acquisitions and the synergy they generate, executive compensation, competitive strategies, stock buybacks, etc. But they don't tell you how to calculate those factors into the stock price. The book is a good book which certainly provokes thought. And it's probably good for finding stocks for the long term investor. But for me, it's a little too impractical. And a little too academic intellectual guru voodoo. When I have money at risk, and I have to make quick decisions (which can affect my net worth), I like to keep things simple and easily measurable which technical and fundamental analysis allows me to do.

Recommended by Enron!
I haven't read the book but I saw an unintentionally funny quote on the book jacket. Amongst other people praising the book and urging you to buy it, there is a quote from one Jeffrey Skilling from the Enron Corporation:

"Expectations Investing reinvents today's investment market architecture. . . . A valuable tool for the innovative investor." -Jeff Skilling, CEO, Enron Corp.

You too can become as "innovative" as Enron! Wonder if they'll remove that recommendation in reprints...

Expectations Investing: Reading Stock Prices for Better Retu
I used to always wonder how do investment analysts evaluate stocks.Buffett never beleived in P/E nor P/S or P/CF. Mind you [local store] never traded under P/E of 24, neither DELL nor msft.
So how do you pick these great stocks?

If a investor is reading this book, he has crossed over from Amateur investor stage to become a semi professional. Evaluate your stocks as you evaluate a business. When you buy business, you are basically looking at how much cash can I take home very month.

This is a great book. ... Read more

Book Description

The Harvard Business Review paperback series is designed to bring today's managers and professionals the fundamental information they need to stay competitive in a fast-moving world. Here are the landmark ideas that have established the Harvard Business Review as required reading for ambitious businesspeople in organizations around the globe. The Harvard Business Review on Strategies for Growth presents the latest tactics--including acquisitions, diversification, and innovation--for helping managers find and exploit the best opportunities for growth and profitability. ... Read more

Reviews (2)

From a student
Interested in case studies ? this book is for you and for students of the bussines world. A trully helpfull book to include in your collection under the usually clouded topic of strategy this one by the folks at Harvard is sure to stand out.

AN OUTSTANDING COLLECTION OF THOUGHT! RECOMMENDED.
Looking for some informative, original and clear thinking about strategies for growth? This book is a great choice! This is a collection of eight outstanding articles selected from past editions of the HBR. The articles cover: value innovation; growth through acquisitions; growth through diversification; capturing the value of supplementary services; and exploiting the virtual value change. Each article begins with an executive summary which, for the fast-forward crowd, is a big plus.

So many books are merely ONE GOOD ARTICLE embedded in a thicket of verbiage. Chopping away through such a jungle of verbosity for the gist-of-it-all often proves tedious and disappointing. (Blessed are the laconic!) This book, on the other hand, just serves up a bunch of 'gists' -the pure meat and potatoes of ideas. Happily, the HBSP has published several other collections of this sort on such topics as knowledge management, change, and leadership. Each of these is collection of first-rate 'gists'. Reviewed by Gerry Stern, founder, Stern & Associates, author of Stern's Sourcefinder The Master Directory to HR and Business Management Information & Resources, Stern's CyberSpace SourceFinder, and the Compensation and Benefits SourceFinder. ... Read more

Book Description

The Harvard Business Review Paperback Series brings managers and professionals the fundamental information they need to stay competitive in a fast-moving world. Gathered in a highly accessible format are the leading minds and landmark ideas that have established the Harvard Business Review as required reading for forward-thinking businesspeople worldwide.

Corporate governance can raise many difficult leadership, strategy, and policy questions within an organization. Harvard Business Review on Corporate Governance is an essential reference, focusing on both policy and strategic challenges, for senior managers working with boards or dealing with governance issues. ... Read more

Reviews (1)

a variable overview about governance
This paperback is designed to be a reference, focusing on both policy and strategic challenges for senior managers working with Boards and Board members. Some of the chapters are articles; others are transcripts of interviews with key business leaders.

Like any edited series, there is a range of quality here.

Some of the pieces are far-out prescriptions from academics that will never see the light of day.

And some of the pieces are practical, thought-provoking ideas written by academics, consultants, and Board members themselves.

For example, Walter Solomon serves on the Board of Neiman Marcus Group, Hannaford Brothers Company, Tufts Health Plan, and Circuit City Stores. He has an excellent article that provides a framework for Board size and composition.

Philip Caldwell is former CEO of Ford Motor Company and former member of the Boards of the following companies: Chase Manhattan, Federated Department, and the Kellogg Company. He notes that the selection of the CEO is one of the most important roles of a Board. It is in the interests of the company that there be viable internal candidates and that the Board have options. It is sometimes in the interests of the incumbent CEO that the CEO be the one to nominate the one and only internal candidate.

For this reason, the Board needs to annually monitor CEO Succession development. The Board also must make sure the program is focused on the competencies of chief executive officers. For example, being a better team player may or may not be a critical issue in the role of CEO. Great team players don't necessarily make great CEOs.

... Read more

Book Description

Discover How the Best Companies Win Not By Acquiring the Right People—But By Building the Right Organization
The "war for talent" is one battle every company believes it should be waging. But while competitors are busy chasing after the same "hot" individuals, smart companies are doing something infinitely more useful and far more difficult to copy—they're building organizations that make it possible for ordinary people at every desk and cubicle in their companies to perform as if they were stars.

Blowing up the prevailing wisdom that companies must chase and acquire top talent in order to remain successful, Hidden Value argues instead that the source of sustained competitive advantage already exists within every organization. O'Reilly and Pfeffer, leading experts on organizational behavior and human resources, argue that how a firm creates and uses talent is far more important than how the firm attracts talent. The authors provide vivid, detailed case studies of several organizations in widely disparate industries—including Southwest Airlines, Cisco Systems, The Men's Wearhouse, and NUMMI—to illustrate how long-term success comes from value-driven, interrelated systems that align good people management with corporate strategy.

In a refreshing break from management tomes that force-feed superficial frameworks and trite "rules," the authors instead allow the company stories to take center stage. They guide readers in discovering for themselves how seven different firms maximize talent, why one firm hasn't fully released the hidden value in its work force, and, most importantly, how the winning companies have made it tough for competitors to imitate them. Collectively, the stories reveal a common path to success that places values before strategy, emphasizes implementation over planning, and focuses on getting the best out of all employees, not just individual stars. The authors also explore concerns or questions managers might have about how each company's experience parallels or conflicts with their own.

Providing a rare opportunity for managers to actively participate in an invaluable learning process, Hidden Value offers a customizable template for building high-performance, people-centered organizations. ... Read more

Reviews (5)

The "Value" of this book is certainly "Hidden" from me......
This book is merely a compilation of case studies. There are few -- if any -- check lists, tables, charts, bullet points, or step-by-step methodologies to help you implement the concepts within your own company or organization. In fact, THERE ARE ONLY 21 PAGES not dedicated exclusively to either a case study and/or an analysis of the various case studies presented within the book. Save your money and purchase "The HR Scorecard", "The Talent Solution", or "Aligning Pay and Results" instead. Very disappointing...

Detailed case descriptions of high performing companies
This book tells the story of eight extremely successful companies that manage to bring out the best in their people. The stories are detailed descriptions of the company's backgrounds, strategies, systems and management practices. The stories are also larded with quotes from the company's CEO's, HR managers and employees. Following this approach the authors provide the readers the opportunity to form their own hypotheses about the companies' successes. But the authors also present their interpretations of the case studies.

What these studies show is how these high performing companies have achieved their success by aligning their values, strategies and people. This is something which is easy to understand but hard to do. It requires consistent articulation and implementation of the values and vision and a relentless attention to detail in ensuring that all policies and practices support the company's values. In order to be able to show this kind of consistency a real belief and commitment are needed and a willingness to persevere.

This book shows how high performing companies consciously turn a lot of the conventional management wisdom upside down. For instance:

1. Contrary to what many people now think, recruiting, selecting and retaining unique talent is NOT the prime source of competitive advantage. Although these activities are important, the examples of these extraordinary companies show that it is much more important to build a culture and work system that enables all people to use their talents and develop their talents. A byproduct of this will be that your company will also be better at attracting and retaining people.

2. Values first instead of strategies. The conventional view puts competitive strategy on top and derives from that what structure is needed, what competencies and behaviors are needed and so on. The companies described here work differently. Although they do have competitive strategies these are secondary to their set of guiding values and to the alignment of these values with their management practices. In other words: they have a values-based view of strategy.

3. Respectful and trusting way of dealing with people. Many companies monitor, check and try to control employee behavior. The hidden value companies work differently. In the spirit of Douglas McGregor's book The Human Side of Enterprise, they seem to understand that if you begin by designing systems to protect against the small unmotivated minority, you end up alienating the motivated majority. So they put their people first by treating them respectfully, involving them and trusting them.

Lessons like the ones presented in this book can be found in several other books by for instance Jeffrey Pfeffer himself, David Maister and Jim Collins. What makes this book different and interesting to me is the presentation in the form of detailed case descriptions.

Acorns, Oak Trees, and Common Sense
One of the greatest challenges facing organizations today is attracting and then keeping "the best and the brightest" people they can. Then, there is another great challenge to develop their talents and skills. Here is one of the best books I have read thus far which addresses the second challenge directly...and indirectly, addresses the first challenge as well (pun intended). O'Reilly and Pfeffer organize their material within a series of chapters, each of which (presented as a case history) focuses on eight exemplary companies (e.g. Cisco Systems, The Men's Wearhouse, and Southwest Airlines). The authors utilize a basic format (introduction, background, values, philosophy and spirit, etc.) which enables their reader to draw relevant comparisons and contrasts. They also summarize key points at the end of each chapter.

After extensive involvement with several of the exemplary companies, I can personally attest that organizations such as they which effectively develop the "hidden value" in their employees achieve at least three highly desirable (indeed imperative) objectives: they create a workplace environment in which people at all levels are much happier as well as much more productive; as a result, they have less attrition of their "best and brightest"; and finally, they are much more successful when competing for the "human capital" they need. To their credit, O'Reilly and Pfeffer do not promise to offer all manner of "secrets" to simplify the process of attracting and developing talent. Everything they suggest is common sense and much of it is obvious. The "hidden value" of their book is revealed only as you correlate all the ideas and experiences it provides within the context of your past and current circumstances.

If you agree that an organization should be value-driven and that values are driven by people, almost everything O'Reilly and Pfeffer share can be of substantial assistance. But I presume to conclude with three caveats. First, what they recommend is relatively simple to explain but will be immensely difficult (if not impossible) to implement without a firm commitment, sufficient time, and (yes) patience. Second, given the wealth of information provided, beware of massive adoption of what may have been effective elsewhere. Rather, select only what is most appropriate to your organization's needs when formulating a model. Finally, keep in mind that all of the eight exemplary companies have changed, some quite significantly, since the period during which this book was written. So must yours in months and years to come.

OK Anecdotes Collection of People-Centric Success
"Hidden Value" purports to offer a new management book style and a "people-first" focus to organisational competitive advantage. This style involves a learn & do structure to 8 anecdotes, rather than the usual hypotheses, case study evidence and checklists often used by many US educators & consultants. Note 'learn & do" has been practiced for decades by military and engineering schools (for both physical maneuvers/value-add as well an intellectual stratagems/ designs etc..).

The repetitive anecdotal structured (e.g. introduction; background; values, philosophy and spirit; people/system, and lesson learnt) chapters span success stories from: SouthWest Airlines; Cisco Systems; The Men's Warehouse; the SAS Institute; PSS World Medical; AES; New United Motor Manufacturing Inc; and Cypress Semiconductor.

Strengths include: the broad range of case studies from different sectors including a few non-US examples; and the extremely timely "life-balance" and "people matter" message.

Weaknesses include: repetition of text (perhaps 35% of book); content gaps & granularity problems (e.g. aligned individual/team motivation models missing); a passive observational feel; a superficiality of analysis; a lack of formal tools to carry out own "people-centric" analysis; an often colloquial cliché-filled style (dates quickly); inconsistencies in many financial table rankings and formatting; and a lack of labeling/scales on the most significant table in the book on p.239.

O'Reilly/Pfeffer suggest through this table (p.239), that exceptional performance from committed people requires the organization to use the HR levers of: values, culture and strategy alignment; hiring for fit; investing in people; widespread information sharing; team-based systems; and rewards and recognition.

Better alternatives include: "The Secrets of Software Success" by Hoch et al (100 global software companies success factors including people) (ISBN 1578511054 HBS Press 1999); and the superb "First to the Future- on Active Leadership" by Willi Railo (rigorous proven methods to coach & lead Olympic-standard people, applicable to all) (ISBN82-991169-5-3 Norbok A/S 1995).

Having recently reviewed "The Knowing-Doing Gap" also co-authored by Pfeffer, I was struck by great similarities in case studies/data from SouthWest Airlines; Cisco Systems; The Men's Warehouse; the SAS Institute; PSS World Medical; AES; and New United Motor Manufacturing Inc. (couldn't remember if Cypress Semiconductor was featured). To this reviewer, both books cover a similar subject-matter less-well, and perhaps would have better been written as one really good book.

Outstanding Look at People-Centered Values for Success!
In Strategy Safari, Professor Mintzberg and his coauthors describe that most people approach strategy from one of 10 different perspectives, mostly ignoring the others. That book argues that we would be better served to integrate these 10 perspectives into a combined one. In Hidden Value, Professors OReilly and Pfeffer succeed in combining four of those perspectives in a valuable synthesis. The four that are combined here are values, which people to attract and retain, determining which core competencies to build, and the role of senior management in strategy development and implementation.

At a time when there are many excellent books out on how to find and retain top talent, this book aims to do something different. "Hiring and retaining talent is great. Building a company that creates and uses talent is even better." So after you have read all about Topgrading and other useful methods, read this book next.

The book is unusual (especially for one from Stanford professors published by Harvard Business School Press) in that it uses a structure designed to allow you to learn more than frequently occurs with straight exposition (thesis, followed by examples to support the thesis, and then a conclusion).

To do this, the authors found 8 companies that exhibited people-centered values in different industries to succeed in different ways. You are invited to peruse detailed case histories to get a sense of how these companies work. Following the eight is an example of a company with many similar approaches that was not doing as well, Cypress Semiconductor. You are invited to think through what's different. Later on, you also do mini-studies of People Express and Levi Strauss to see where they vary from the model that you have developed from the cases.

But if you do want to know what the authors think about the cases, their conclusions are summarized at the end of every chapter. Chapter 10 also looks at the overall model they discern.

They see a process whereby each of the successes starts out with a focus on people that is primarily employee centered. This focus often comes from the founder or the current CEO. The company then looks for people who share that focus. At some point, common values begin to emerge among the leadership and the rest of the company. The company continues to focus on coalescing around those values by hiring people with those values, and teaching the values to new employees. Values are reinforced everyday through communications, information flows, training, and rewards and recognition. This creates an environment of mutual trust and respect. Then the company looks at the core competencies that make sense in light of the people, values, and market opportunities and develop those core competencies The company then looks for new strategies that build on the core competencies. Senior management follows at this point in leading from and to reinforce the values.

The payoffs in the case histories relate to superior performance in key valued-added areas (which differ by case), reduced turnover of people which decreases cost of employment and improves performance further, trust and information flows that encourage useful experimentation, and consistency of focus which allows improvement to be greater and on-going.

The point of the book is that the "what" to do is pretty simple, but few people have the commitment and patience to handle the "how" to do it. ... Read more

Book Description

With this book, managers have a rigorous new approach to building firm value. The authors offer a comprehensive system for putting customer relationships at the center of the business and give managers the tools for implementing customer-based strategies to improve profitability and growth. Fresh, practical examples illustrate how companies-including ScrubaDub car wash, Inc. magazine, and Staples office supplies-have inventively used information and knowledge management technologies to connect with their customers in new ways. Customer Connections reveals how these firms have managed to offer products and services that match the needs of their most valuable customers. It introduces a "value compass" that enables executives to target the four sources of customer value: right customer portfolio (choosing the customers you want), range of value proposition (selecting what you want to offer them), roles in relationship (deciding what type of relationship you want with them), and rewards sharing (creating mutual value). To improve its position along of these dimensions, a firm must master the three essentials of a customer connected strategy. Wayland and Cole teach managers to ask-and act on-the right questions about generating and managing customer knowledge. ... Read more

Reviews (11)

Lots of Caveats...
This book attempts to persuade the reader that businesses are best managed by customer portfolio management, a method consisting of three general parts: (a) mathematical modelling and computation of "customer value" (b) segmenting customers in "value groups" (c) optimize revenue by focusing on the "value groups" offering highest revenues

The authors' calculation of value does not include the indirect results of the customer's patronage. Will their buying habits influence others, such as their children, to remain loyal to the brand? Will their recommendations influence others to buy? This whole chain of reasoning appears absent from the text -- a puzzling omission since the importance of referrals as a positive influence in affecting sales has been known for eons.

Similarly, the authors are strangely absent with regards to providng value and quality across all products and services, not just those offering the most attractive "customer value". It should be remembered that today's carpenter, may be tomorrow's subcontractor and then may be a future home builder. By selecting and focusing only on select groups, the company's performance may be viewed by such a customer as inconsistent or spotty. Indeed, such a customer may very well ask themselves, "Will I be in the next group slighted because I'm viewed as 'low value'?" (NOTE: This is not to say that differing services can be provided to different types, levels or classes of customers. On the contrary, to fail to offer this would be foolish. Companies can, however, offer customers the *choice*, and not pre-ordain their fates, esp. when such a fate is dictated by such an abstraction.)

Relying on a highy volatile measure such as "customer value" is inherently very, very risky and one wonders if the recurrent churning of those calculations would, in fact, yield meaningful results in a fast-paced business environment.

Where are your company in the ¡§customer relationship¡¨?
I found that this book is useful as it introduced a useful tool for customer relationship. The author introduced a great customer relationship model, ¡§The Value Compass¡¨.

I think that it is important for the company to understand that ¡§reduce cost¡¨ is not the most important element to achieve success. Instead, company should put effort on creating value in order to achieve goal. And we have already known that the cost of retaining customer is much lower than the cost of acquiring new customers. So, why look for new customers, when you can improve the ones you¡¦ve already got?

Customer satisfaction is one of the elements of retaining customers. And customer satisfaction can be done by ¡§creating value¡¨. This book introduced you with ¡§The Value Compass¡¨ which provided you a great tool to create value and thus build up long-term customer relationship.

With the help of ¡§The Value Compass¡¨, company can position itself among different dimensions of relationship value. After know ¡§where you are¡¨, company should decide ¡§where are you going to be¡¨, according to ¡§The Value Compass¡¨. Then the company can achieve the target position by prepare customer connection strategy, which has discussed by this book.

So, if you are in the management level of your company, if you want your company to create value to the customers in order to build long-term customers relationship, you may read this book to achieve your goal more efficiently and effectively.

Not bad!
Customer connection
After reading this book, you will know what is the customer relationship model, that is the value compass and foundation of customer connection strategy.
I do agree that the author did present the book in an academic way which is quite bored. For the value compass, it is a complicated model and it is not easy to be understood. However, I remember that the author did distinguish the difference among the product manager, process manager and the network manager, this part is quite good and clear.
Also the author did explain the customer equity by using the equation, it¡¦s quite good and impressed.
Generally, I think you can learn something from this book, for example, we know that we need to create long term relationship with our customers and the critical success factor for running a business is to create value to the customers but not to reduce cost for the business.

Adding Economic Value through Customer Relationships
I like books that combine qualitative and quantitative techniques to describe what must be done. Customer Connections takes on the challenge of providing that perspective.

The book's basic point is that logical thinking can be applied to developing better economic results through analyzing and pursuing the potential of different ways to have relationships with various customers. For example, some customers buy more, more often, and of higher margin products or services. Find ways to attract more of their business and your enterprise is going to be more profitable and valuable. An example of Scrub-a-Dub the car wash company explores this idea.

You are encouraged to think through this opportunity by analyzing your mix of customers, the ways that you can add value for these customers, the risk involved in acquiring them, and ways of sharing risks and rewards with customers and suppliers. Then, you create a solution that combines all four elements to produce more economic value (discounted cash flow) for your company.

To do this, you are going to need to know more about your customers than many companies know today, keep them better informed about what you are doing, and use technology to strengthen your connections in economically beneficial ways. So, there's a basic knowledge management issue to be resolved.

Like many consultants, the authors propose a complicated model that requires lots of data-gathering, analysis, building of new data bases, and improved IT systems. Ultimately, the benefits can only be estimated in advance. A set of interviews with 200 Fortune 1000 executives suggests that knowing more about customers is associated with higher growth.

In the last four years I have done a lot of research into ways that companies have changed their business models to be more successful. In that research, I was struck that the kinds of thinking described in this book were hardly ever used. So although there are lots of examples in the book of applying these concepts, I really wonder if the process to be followed is the one described here. Ultimately, the book's process reminded me of the kind of mechanical "left-brained" planning that failed for so many companies in doing their strategic thinking. The methods I have seen used were based much more on inexpensive experiments, gut feel, and rapidly rolling out the successes. The approach here is more of the opposite. Find something that should be great. Make a big bet on it. Keep your fingers crossed that your one expensive experiment will work.

The value thinking in the book is also very primitive, basically only describing the expected discounted cash flow. Every enterprise has many different economic values at a given time (depending on its value form), and expected discounted cash flow is only one. You could have removed all of the "value" references and equations in this book and not lost very much.

Ultimately, I was concerned about the book's basic concept -- that you should be customer-based in your thinking rather than customer-driven or customer-led. Being customer-based in doing value calculations can be very misleading. Few market innovations have followed from understanding customer profitability better. You still have to understand customers better . . . as they see and feel themselves.

Create more beneficial results for all those you meet!

Hmmmm... I don't know about this one.
The book was part of the compulsary literature used for a relationship marketing course at my university, so I had to read it, but if I had the choice, I probably wouldn't have read it. The book provides some useful insights, but I believe the first two chapters cover the whole book. The rest consists of numerous boring case examples, which don't clarify that much. And I didn't like the authors' use of mathematics, or is that just me? I think the field of relationship marketing could be presented in a more interesting way than that. In their words, for me as a customer, the costs were higher than the value I got back for it in the end (but I don't know my mark for the exam yet :). I don't think they'll keep me as their customer. ... Read more

Amazon.com

God forbid that doing business and making money on the Internet should bear any resemblance whatsoever to the past millennium of bricks-and-mortar capitalism--that would be too easy.Nope, it's a whole different ball game now, and the new rule is: adapt or die.At least that's the message behind Digital Capital.From the three principal cyberconsultants at the Alliance for Converging Technologies (one of whom, Don Tapscott, authored the bestsellers The Digital Economy and Growing Up Digital), comes a paradigm for global takeover: the business web, or "b-web" for short. In their words, b-webs are "strategically aligned, multi-enterprise partner networks of producers, suppliers, service providers, infrastructure companies, and customers that conduct business communication and transactions via digital channels."Some examples are eBay, Cisco, Dell, MP3.com... in short, any enterprise that a) knows how to form lateral partnerships with other goods-or-service providers, and b) eliminates the role of planes, trains, and automobiles--not to mention lots of time, money, and human energy--by doing almost everything over the Internet. Not only do the authors provide a wealth of b-web case studies (including Charles Schwab, Priceline.com, Webvan, AT&T Solutions, and OptiMark in addition to those mentioned above), they outline a step by-step process for weaving a b-web of one's own.

Too often, Digital Capital's sound ideas come marinated in think-tank jargon so alienated from plain English as to be nearly impenetrable. Consider: "Disaggregation leads to 'disintermediation' and 'reintermediation'," which, believe it or not, isn't a line that French film theorists use in pick-up bars, but the simple statement that business webs manage to cut out a lot of the traditional steps between producers and customers. Now why couldn't they just have said that?No matter. After you nibble through the self-important MBA-speak, you'll find a smart look at how online shops are rewiring early 21st-century capitalism. --Timothy Murphy ... Read more

Reviews (36)

Establishing Improved Business Models in a Connected Age
This is one of the few business books that dare address the central issue for most companies today: How to establish competitively-advantaged business models for serving customers that capture the power of the Internet to work with others. Anyone who doesn't know what they want to do for an Internet-based business model or doesn't like the one they have will get great benefit from this book.

Like Blown to Bits, Digital Capital looks squarely at the economic impact of the Internet on existing business models. But Digital Capital goes further in laying out the necessary steps to build on five business models that have been working that involve creating business networks that are Internet enabled (b-webs in the parlance of this book).

You will instantly recognize the five business model types, because the authors provide lots of examples (at least some of which will be familiar to you) and lists of characteristics of each type.

You will also know how to go from where you are to reaching one of these archetypes by the strategy directions the authors provide. The only drawback of this section is that the language gets a little b-schoolish (and full of very long words).

The conceptual basis of the work is sound. The only two points that were not discussed were (1) how these models might evolve into more powerful models in the future, and (2) how they might merge with each other.

Where the book is at its best is in helping you think through how to add other companies into a related web of interests to get more done -- thinking that goes well beyond the well-known outsourcing mindset.

Good luck with improving your Internet-based business model! Keep in mind that technology will evolve rapidly and enable some new business models that can only be dreamed about today in just 3-5 years. So be sure to look at the irresistible forces of technology development in thinking ahead.

Prospering from Electronically-Connected Business
Digital Capital is one of the few business books that dare address the central issue for most companies today: How to establish competitively-advantaged business models for serving customers that capture the power of the Internet to work with others. Anyone who doesn't know what they want to do for an Internet-based business model or doesn't like the one they have will get great benefit from this book.

Like Blown to Bits, Digital Capital looks squarely at the economic impact of the Internet on existing business models. But Digital Capital goes further in laying out the necessary steps to build on five business models that have been working that involve creating business networks that are Internet enabled (b-webs in the parlance of this book).

You will instantly recognize the five business model types, because the authors provide lots of examples (at least some of which will be familiar to you) and lists of characteristics of each type.

You will also know how to go from where you are to reaching one of these archetypes by the strategy directions the authors provide. The only drawback of this section is that the language gets a little b-schoolish (and full of very long words).

The conceptual basis of the work is sound. The only two points that were not discussed were (1) how these models might evolve into more powerful models in the future, and (2) how they might merge with each other.

Where the book is at its best is in helping you think through how to add other companies into a related web of interests to get more done -- thinking that goes well beyond the well-known outsourcing mindset.

Good luck with improving your Internet-based business model! Keep in mind that technology will evolve rapidly and enable some new business models that can only be dreamed about today in just 3-5 years. So be sure to look at the irresistible forces of technology development in thinking ahead. The current crash of the dot coms is just the beginning of what will be a period of enormous innovation and progress.

Don Tapscott's Way... 'Clear Vision' & 'Great Thinking'


Like his other books, this 'Digital Capital' will bring us to a new level of thinking about how Net-Economy will work and shape the world we've already known.

Tapscott's clear vision about 'digital money' will surely give us a higher perspective about what works and what doesn't work in this internet 'boom and bust' era.

One of the best Tapscott's book since 'Digital Economy'.....

Digital Capital: Harnessing the Power of Business Webs
Digital Capital articulates the characteristics of web based business models and illustrates how the application of these business models can rapidly change the status quo. Ample examples and quotations from business web innovators show the practicality of the models while the authors' framework offers guidelines to explore and examine business web opportunities. I can now better run and build my company's digital future.

Putting your money where your business should be
If the University Texas is correct, the Internet economy is "increasingly being driven by traditional companies adapting Internet technologies." This book discusses how other companies are doing it.

Don Tapscott is a must for any executive looking for tangible case studies. Find more than just a justification for your Internet initiative--find out how other companies are doing it. Fight Coase's Law through more efficient outsourcing; Streamline your partnerships; And more...

I recommend this book to all of my Internet marketing students and would love to make it required reading. ... Read more

Amazon.com

The lure of new and profitable markets has lead many companies to formulate strategies to capture these markets. This focus on strategy often leads to downsizing and the shedding of old businesses in favor of a "lean" economic model that stresses outsourcing. The strategy that leads to downsizing has its short-term rewards--a fatter bottom line and happy shareholders.

Jeffrey Pfeffer argues that much of this downsizing is nothing more than a throwback to 100-year-old employment practices. Instead of cutting costs as a means to increase profits, companies should focus more on building revenue by relying on solid people-management skills. Through dozens of examples, Pfeffer demonstrates that successful companies worry more about people and the competence in their organizations than they do about having the right strategy. Pfeffer contends that the strategy part is relatively easy--it's the day-to-day execution that's hard. Companies that understand the relationship between people and profits are the ones that usually win in the long run. ... Read more

Reviews (9)

The importance of people to organizations' returns
Summary:
This book highlights the importance of respecting employees in an organization. By treating employees as a strategic asset, a firm can make lucrative profits. The book can be divided into the following parts.

¡P Wrong sources of organizational success that firms
commonly use
¡P Seven practices of successful organizations
¡P Reasons why smart organizations sometimes do dumb
things and the suggested solutions
¡P How conventional wisdom about employment contract,
compensation method, and unions is wrong
¡P The role of public policy in making profits through
people

Comment:
- Good points:

1. Good insights provided:
The author provides his opinions about why and how putting people first can bring great returns to organizations with different detailed examples such as Lincoln Electric. This can make me understand the importance of employees to organizations.

2. Lots of evidence provided:
This book explains why putting people first can help companies make great profits by providing lots of examples, which include companies in different industries. Some examples are explained in a more detailed way such as Albert Dunlap.

3. Clear illustration of the concepts:
The main message of each chapter is clearly delivered.

Also, as the main theme of this book is about ¡§building profits by putting people first¡¨, the author has provided a diagram called ¡§Downward Performance Spiral¡¨ to illustrate the relationship between organization¡¦s poor treatment of its¡¦ employees and its¡¦ corresponding performance. Besides, he provided a diagram about how ¡§People-based strategy¡¨ can make sustained profits to organizations. All these diagrams can increase my understanding about these concepts.

4. Comprehensive information provided:
The author not only states what are the wrong sources of organizational success that firms commonly use, he also provides what and how organizations can do to make lucrative profits.

- Bad points:

1. Not interesting enough:
The author has repeated the main theme of this book ¡V ¡§building profits by putting people first¡¨ many times in different chapters. Although this can remind readers about the main theme of this book, readers may feel too bored.

Explains the importance of putting people before profits
This book is very well researched, although perhaps over-long in some parts.

The underlying message is that "do you see people as labour costs to be reduced or eliminated, or do you see your people as the only thing that differentiates you from your competition?"

I did find it quite satisfyingly radical for a US author to actually recommend that US Managers need to look overseas, as in this quote :
"One might be well-served to spend more time outside of the United States ... What has come to be taken as 'good management practice' in the United States is very, very culturally specific to the United States. Managing in a different way may require developing a broader world view ..."
I can related to that, given that I work in the UK for a US Fortune 500 Company.

The Case Studies cover a broad range of Industries such as Automobile, Banking, Steel, Clothing, Semiconductors, Retailing, Oil Refining, Energy, Airlines; and Geographical coverage includes not only North America, but quite a number of Countries in Europe & Asia.

A Chapter dedicated to Unions but yet not to Union-bashing is a pleasant change.

All in all, an interesting book that I wish more CEO's & HR Officers would read to see the alternatives to boom-and-bust downsizing & outsourcing.

People and organization success
The Human Equation (1998) is an exceptional book. In the first chapter Pfeffer shows that conventional wisdom about the sources of organization success are not correct. In particular he disproves the ideas:

- that it is essential to work in the right sector,
- that the size of the organization is crucial,
- that it is necessary to have an international precense,
- that downsizing is indispensible, and
- that it is necessary to have a technological lead.

Then the author clearly and impressively presents the enormous amount of evidence of the last decade showing the strong association between how organization treat people and how they score on financial and operational performance indicators. Pfeffer describes the following seven HR practices that demonstrable correlate with organization success. He names these practices High Performance Work Practices. They are:

1. Employment security
2. Selective hiring of new personnel
3. Self-managed teams and decentralization of decision making as the basic principles of organization design
4. Comparatively high compensation contingent on organizational performance
5. Extensive training
6. Reduces status distinctions and barriers, including dress, languag, office arrangements, and wage differences across levels
7. Extensive sharing of financial and performance information throughout the organization

This list contains some elements that may seem counterintuitive to some. For instance: how can it be that high wages contribute to financial performance? Don't they just keep the profits low? And how can you afford to be selective in this hard labour market? And how can companies afford to invest much in training of personnel? Aren't employees so mobile and disloyal that you run the risk of training them for your competitor? Speaking about this, how can you in this time of employability of employment security? And it is wise to have an open information policy? If you'd do that, wouldn't you weaken your position by feeding your competitor with valuable information?

If you read this book you will find crystal-clear answers to these questions. The conclusion is that the seven practices do indeed work.

Interesting but found lacking
Although some of his fundamental theories are interesting, this author's means of proving his hypothesis are weak in my opinion. His facts lack substance. There is a lot of work that needs to be done before he is going to convince large companies of his theories. Basically, his magazine articles are much more interesting than this book. Save your money.

A company doesn't grow to greatness by shrinking...
The premise of Pfeffer's book is that companies' success is directly correlated to the quality of people and their management. This seems like common sense. After all, many companies proclaim "people are our biggest asset." In practice, however, it's uncommon sense: companies often lack the deep conviction necessary to follow through. It's much easier to take a "tough love" approach to "management," cut training and lay off 10% of the workforce than it is to focus on the long-term people issue.

Based on his research, Pfeffer offers several HR practices that are common in effective organizations. Among them:

* Maintain a sense of employment security. Psychologically speaking, people will work more effectively when they can focus on doing their job rather than worrying about keeping it. Similarly, if employees are your company's hugest asset, then it behooves you to ensure they're not working for your competition. This is common sense. More companies practice uncommon sense and get sucked into the peformance death-spiral. For example, we frequently read where a new CEO is brought in and his first action is to initiate layoffs. (Apple Computer is an often-cited case study of this.) With their sense of security threatened, the remaining employees will become less motivated. Profits begin to sag, so the company reacts by cutting training. Employees may have more accidents, and customer service is affected. The spiral continues until it or the company broken.

* Hire selectively - a recurring theme is that to avoid layoffs, you need to be operating efficiently enough not to *have* extra employees.

In a perfect world, we would have a large number of applicants, screen them based on corporate fit and their attitude, then filter them out through several rounds of screening. Senior staff should become involved in the latter part of the process to emphasize the importance of hiring. After hiring, we need to evaluate the success of our hiring practices and adjust them as necessary. This follows the axiom "that which gets measured, gets done." This common sense approach is used by highly successful companies such as Southwest Airlines and Cisco. Companies exhibiting "uncommon sense" may get so desperate to fill the position that they go against their own guidelines. Having made this mistake before, I am very much aware that a bad hire is far worse than no hire.

* Facilitate ownership and responsibility through decentralized decision making.

Assuming you hire the "best and brightest," you should trust them to use their brains. This provides a sense of ownership, challenge, and supports the organization's organic development. We all hope to have the equivalent of the "Post-It" note developed internally by folks taking initiative.

Pfeffer had an interesting comment from Bill Gurley about the effectiveness of stock options. Specifically, they're not really as much a sense of ownership as we'd like to believe because if the market has a violent downswing (as it did in early 2000), employees are almost incented to leave their underwater options.

-

Pfeffer's book is an evolution of his previous ideas. What's also interesting in his analysis was seeing that long-term company success was *not* correlated to technology or industry.

Pfeffer's suggestions seem like common sense, but Pfeffer realizes they're not AND is aware of the need to quantify the information. The case studies and quantitative research are very helpful in supporting these ideas. In a few of the cases -- Lincoln Electric springs to mind -- it would be especially helpful to have a more recent examination, perhaps a follow-up. ... Read more

Amazon.com

The days of lifetime jobs and employee loyalty are over. Instead, competition and other market forces lead companies to lay off people, and employees to leave for the highest bidder, writes Peter Cappelli in The New Deal at Work. These changes in the workplace are making a salient impact on companies, employees, and the nation. For instance, companies are less likely to provide employee training and development, for fear employees will be poached by other firms. At the same time, companies are more apt to hire outside consultants than full-time employees, in order to stay competitive in a rapidly changing environment. This affects everything from national educational policy to employee morale to corporate management and payment principles, warns Cappelli, who is a Wharton School professor of management and codirector of the U.S. Department of Education's National Center on the Educational Quality of the Workforce. The book, well researched and filled with footnotes, provides historical perspective and insight for company leaders looking to manage the current economic reality. It's aimed primarily at managers, but anyone concerned about the nation's economic policies will gain some valuable insight. --Dan Ring ... Read more

Reviews (3)

Insightful Analysis of Complex Trends
Cappelli's main idea -- that HRM is changing because the external marketplace is being brought into the firm -- really gets to the essence of changes in the employment relationship. Once you've read the first two chapters, you'll never think about HRM the same way again. However, I wish Cappelli had explored the complexity of labor markets and practices more deeply -- we really have a multi-model HRM now, rather than the "new deal" he outlines, and probably always will because of differences in product and labor markets and industries.

Insightful Reading
The New Deal explores the breaking of the structural ties that modern employees have with employer. It strives to explain the employee's basis for his association with his managers. A good read..no doubt.

A Wakeup Call for Middle Managers !
Cappelli provides an understanding of the changes in the social and psychological contracts between employees and their employers in todays world. I feel as if blinders have been removed from my eyes and that I now have the tools to understand the changing work environment and labor market of the new economy.

A must read for those in large companies that have existed longer than 40 years (or are over 40 years old themselves).

For for those who believe they have security and entitlement based upon their "knowledge of the company"... Here's a News Flash " Organizational man is dead ..."

Thanks Professor for the heads up ! ... Read more

Book Description

Record breaking economic growth.Rapid global expansion.Dizzying technological innovation.As we head toward the new millennium, it seems as if there are more opportunities than ever for your company to create new value, satisfy customers, and make money.But, given today's bewildering array of management methods, how do you determine which path to follow--and how do you adapt your company for the journey?With Invented Here, authors Victor and Boynton argue that to succeed in a market where consumers increasingly demand customized goods and services, you cannot rely on any one formula.Instead, you must look within your own organization to invent, develop, and deliver the distinctive competencies that ensure growth and profitability.The authors conclude that there are distinct patterns in the way that successful companies manage their internal growth--patterns found in the evaluation and application of organizational knowledge.More important, they provide a workable strategy for emulating these patterns; arguing that any company, in order to more closely satisfy the needs of its customers, can develop the capabilities necessary to evolve from craft work to mass customization, and beyond.With examples from companies such as Beretta, Taco Bell, Dell Computer, Xerox, and Merrill Lynch providing a real-world context, Invented Here reveals how managers can determine the best path of change for their company by assessing its existing knowledge base.The book is a pioneering guide to using the knowledge that resides within your company in the actual transformation of work: the nature of what you do, the value that you can create with your customers, and the organizational knowledge to be mined along the way. ... Read more

Reviews (6)

Simply a milestone
The key concept of this book is that every organization could evolve trough several status. There is no a suggested preeferred status. Winning organisations are those which could find the right 'alignment' between market needs and behaviours and the internal organization. The evolution of the organization is only driven by the market change. The book focus on transitions between these different stages, analysing the impact of these changes through the entire Value Chain. Invented Here is a milestone for those people which needs to manage transition also in a turbulent environment. It helps managers to think about the actual company positioning and to build a framework helping to identify market changes and relevant organizational needed impact. Simply great!

Learning From Others
The importance of organization design on the success of a business, be it that of a service company or a product supplier, is often underestimated. Strategy alone is not enough.

The great value of this book lies in 3 areas :

i) Use of illustrating failure as well as success - better to learn from someone else's mistakes so that you can, hopefully, avoid them.

ii) Identifying in meaningful terms where to position your organisation for your product/service e.g. if you need a great mass production machine, that is how you should organize;when your customers need more, don't hide from it - just do it well.

iii) The style is refreshingly alive.You feel you can relate to real people solving real problems.Too often, books like this feel like they belong only in libraries - this one offers genuinely practical insight.It's up to you to apply it.

If I have one (minor) criticism, it is the title. Don't let it mislead you. This book is a very helpful guide to many aspects of organizational design and a better title, in my opinion, would be something like:- "Optimizing Your OrganizationFor Your Customers"

Important insights into the learning organization.
This book reveals how to use knowledge residing in the company to transform organization and manage growth. It presents a model of organizational learning and development with four steps: craft, massproduction, process enhancement, and mass customization. It explores theleveraging of four associated types of knowledge and presents a learningsystem for developing organizational knowledge. Provides important insightsthe learning organization.

Wakes you up to the importance of Knowledge Management.
A well written book to help you understand how to develop your company'sbusiness along the "right path"to deliver higher customer value. The format and language of the book make it a joy to read.The concreteexamples from both service and product industries are very useful.

The keys to corporate success are in the corporation!
Too many managers look to external consultants to provide the keys to their organization's success.Was it quality circles, TQM, or re-engineering you last tried as a way to rejuventate your struggling organzation?Victor and Boynton suggest you save your money and focus within.Their logical process of analysis and implementation will help your firm on the "right path" to organizational success.

The process demands that firms think clearly and carefully about who they are and what business they are in compared to what their customers really want.This analysis helps a firm determine if it should compete on the basis of novelty, commodity, quality, or precision.The choice made suggests that craft work, mass production, process enhancement, or mass customization provides the best strategy to meet those customer demands. Achieving these strategies can only occur as a firm moves from craft work, through mass production and process enhancement to mass customization via the "right path."

In an engaging combination of personal insight andcase examples, the authors lead the reader along the "path."They offer numerous stories of organizations around the world that have followed this "path" to organizational success.

Don't let the reletive brevity of their effort mislead you. The ideas they propose should force the thoughful manager into careful and thoughful consideration of the firm's current structure, products, and processes.If the analysis suggests that changes are warranted, then Victor and Boynton's guidebook along the "right path" will prove well worth the initial investment.

A thoughtful, creative tour de force in a fieldlittered with lightweight, feel-good competitors.Enjoy! ... Read more

Book Description

A No-Nonsense Approach to Customer-Focused Business

In their relentless quest for differentiation, many companies have poured their energies into making their offerings distinctive from competitors'. Yet, according to marketing experts Patrick Barwise and Seán Meehan, in doing so companies have neglected the very basic activities that matter most to customers.

This refreshingly straightforward book argues that it is not the addition of unique gizmos or features that wins and keeps customers, but the steadfast delivery of the fundamentals-products that actually work and reliable services that take place on time.

Barwise and Meehan show that being truly "customer-driven" means