2014-26-August-Dave-Gray.jpgIt's been two years since Dave Gray published "The Connected Company" with Thomas Vander Wal. Since then, the disruptions to the marketplace noted in the book have only accelerated. But companies are still struggling to keep pace.

At the time of the book's release, Gray noted a lesson from evolution -- organisms must evolve with their surroundings or risk extinction. It's a lesson many businesses have learned the hard way.

How to Work Like a Network

We reached out to Gray to find out what it looks like to "work like a network."  Gray, former senior vice president of strategy at Dachis Group (since acquired by Sprinklr), now acts as founder of the business design consultancy XPLANE, where he focuses on the challenges of driving innovation and change in large organizations. 

Fagan: How would you define “working like a network”?

Gray: Most organizations are formally organized as a hierarchy. The org chart is a kind of tree, where branches represent different functions. The formal org chart is an idealized picture of the way work is organized. But in reality, people don’t like to be controlled, and every formal hierarchy is resisted by a kind of shadow organization that resists and subverts it.

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In addition, a formal hierarchy is optimized for internal efficiency, which is not the same as efficient for customers. This is why we wait on hold when calling customer support, even though the recorded message says “your call is important to us” (of course we know that’s a lie. If the call was important they would answer it, right?).

Instead of being organized for its own internal efficiency, a connected company is organized to be efficient for customers. This kind of organization requires a different approach, something that I call podular design.

A connected company is designed around three main principles:

  1. Workers are organized in pods, or small teams, that can operate independently without a lot of need for formal approval or permissions from higher-ups.
  2. This relative autonomy is made possible by platforms -- support systems and structures that allow teams to self-organize, giving them access to the tools, expertise and information they need to do their work. Platforms also include the policies and boundaries that people in the company must adhere to.
  3. The work is coordinated by a strong sense of common purpose. People in connected companies understand who they are working for, and why the work is important.

When combined strategically, pods, platforms and purpose create a powerful form of organization that is fast, flexible and adaptive, by which I mean it can learn quickly and adapt to new market situations faster than a traditional hierarchy.

Fagan: Your work often focuses on cultural change. Can you explain where culture fits in change initiatives?