I’m ashamed to admit I’ve had this book on my shelf for a couple of years now. I even spent time with its author – Dave Gray – when he spoke at my former stomping ground’s annual innovation summit. But it wasn’t until I was beating my head against a wall for a gnarly challenge I was trying to solve for a client a few weeks back that I just happened to see this book on the shelf and rather absent-mindedly pick it up. Wow. The Connected Company should be a must read for every start-up, small business, enterprise and everything in between. It should be on the syllabus of every professor who teaches about business and entrepreneurship. At the risk of sounding hyperbolic, it should have been on editor’s top 10 list when it was published back in 2012.

Why? Companies today really struggle with the concept of business model innovation. That’s because far too many view the process as singular and inclusive – how do I experiment with my model? how do I scale my model? how do I maintain my competitive advantage? Unfortunately this myopic view fails to take into consideration the broader implications of an intricately networked world. Which frankly is a bit ironic considering how many years we’ve been talking about the need for people to be more collaborative, open, transparent, and connected.

Companies need to adopt this same mental model.

And that’s where Dave’s concept of a “connected company” sheds important light on the business model innovation process. Because even at the company level, you simply can’t be the lone wolf.

Here’s Dave’s hypothesis:

1. Customers are adopting disruptive technologies faster than companies can adapt.
2. To adapt, companies must operate not as machines but as learning organisms, purposefully interacting with their environment and continuously improving, based on experiments and feedback.
3. A connected company learns and adapts by distributing control to the points of interaction with customers, where semi-autonomous “pods” pursue a common purpose supported by platforms that help them organize and coordinate their activities.
4. Connected companies are living, learning networks that live within larger networks. Power in networks comes from awareness and influence, not control. Leaders must create an environment of clarity, trust and shared purpose, while management focuses on designing and tuning the system that supports learning and performance.
5. Any enterprise involves risk, and connected companies are no exception. Connected companies can fail. But in times of change and uncertainty, their ability to learn and adapt faster than their competitors gives them an edge. If you want to become a connected company, there’s no reason you can’t start today.

I should add that the book is chock-full of actual examples and research that support his hypothesis. Which is really what makes it so darn good.

Hats off Dave. Sorry it took so long to drink the kool-aid!

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Here’s Dave’s story from the BIF-8 Summit in 2011 where he talks about the need to “start in the middle”