August 2019 | Management
Leaders today are grappling with three formidable challenges: greater competition, which can seemingly come from anywhere; new, potentially disruptive technologies; and customers whose expectations know no bounds. In a new book, strategy and operations experts Nicolaj Siggelkow and Christian Terwiesch share a tested, process-driven approach for all three.
Connected Strategy: Building Continuous Customer Relationships for Competitive Advantage began in the classroom. In a number of Executive Education programs, Siggelkow and Terwiesch worked with hundreds of leaders who were trying to figure out how their organizations could react. Over time, they devised frameworks for developing stronger customer relationships (connecting differently with customers and making them happier) and connected delivery models (providing this great customer experience at a lower cost through new connections). What emerged was a highly disruptive new business model that breaks the existing tradeoff between the quality of the customer experience and the expense of providing it.
Instead of thinking through thousands of possibilities for connecting with customers, the book provides a framework that includes four powerful connected customer experiences and five different connection architectures, leading to a rich but manageable set of options for managers to investigate. Worksheets help readers think through what it would mean if their company competed using each one.
Readers of Connected Strategy will learn how incumbent firms like Disney, Nike, and 130-year-old publishing company McGraw-Hill are using connected strategies to create value for themselves and their customers. They will also learn how to develop their own connected strategy. Three Workshop chapters focus on Using Connectivity to Provide Superior Customer Experiences at Lower Costs, Building Connected Customer Relationships, and Building Your Connected Delivery Model.
The book also dispels a common misconception. “Connected strategy is not primarily about technology,” the authors write. “Clearly, it plays an important role, and you will have to adopt new technologies. But you may also have to change whom you interact with, how you charge for products and services, and how you structure your company internally. By reconfiguring these key elements, you are not blinded by the latest technology hype but can create real opportunities.”
For established firms seeking to revitalize strategy and startups trying to disrupt an industry, the connected strategy business model could be the answer.
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