Blown to Bits Chapters 911

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Blown to BitsChapters 9-11

• Chapter 9
• Deconstructing Supply Chains

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Industrial Supply Chains

• Industrial supply chains are impacted similarly
  as the supply chain between consumers, retailers,
  and product suppliers.
• Although industrial supply chains are more about
  things, information is still the glue

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The Players in Industrial Supply Chains

• More hard-nosed and sophisticated than consumers.
• The transaction sizes are much larger.
• The value of reach is greater
• Affiliation is more likely defined contractually.
• Richness requirements are more complex and
  stringent.

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The Spectrum of Scale

• The richness/reach trade-off is really richness,
  reach and cost.
• This means that the amount of money you are
  willing to spend on richness and reach is a
  function transaction size and frequency.
• Sequence is the transfer of technology from large
  high-value transactions to smaller lower value
  transactions.

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Deconstructing the Automotive Supply Chain

• Automotive Network Exchange (ANX)
• Non-proprietary, global communication network
  built on internet technology.
• Creates opportunities for small Tier Four
  suppliers.
• This happened in an industry with three large
  players that made this happen.

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Deconstructing Health Care

• Largest information industry in the U.S. economy.
• The information part of health care is complex
  and inefficient.
• Results in a system that is bureaucratic,
  expensive, difficult to navigate, opaque, and
  rife with conflicts of interest and intrusive
  controls.

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Chapter 9Sound Bits

• Connectivity is achieved, standards are the more
  critical challenge.
• Radical uncertainty governing the evolution of
  standards.
• Communication channels start within the industry
  but quickly move out.
• Explosion of richness and reach will change
  competitive advantage.
• Extranets encourage outsourcing.

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Chapter 10 Deconstructing the Organization

• The Traditional Hierarchical Organization
• The Japanese Corporation-Greater Richness, Less
  Reach
• Deconstructing Ownership, Risk Bearing, and
  Control.
• Deconstructing Employment
• Comprehensive Deconstruction Silicon Valley

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Chapter 10Sound Bits

• Markets vs. Hierarchies and Western vs. Japanese.
• If information is symmetric, trust substitutes
  for control.
• Structures are similar within and across
  organizations boundaries become fuzzy.
• All organizations interact on the basis of
  flatness, fluidity, and trust.
• Cooperation and competition, Collaboration and
  initiative, richness and reach all coexist.

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Chapter 11Monday Morning

• No business leader today can presume that the
  business definition in his or her business will
  still be valid a few years from now.
• Deconstruction is most likely to strike in
  precisely those parts of the business where
  incumbents have most to lose and are least
  willing to recognize it.
• Waiting for someone else to demonstrate the
  feasibility of deconstruction hands over the
  biggest advantage a competitor could possibly
  wish for time.

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• Leaders need to wrestle with the full range of
  possible patterns of deconstruction.
• Strategy really matters. It creates economic
  realities in a deconstructed world.
• The value of winning will esclate as will the
  cost of losing.

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• The reconstructed business definitions will
  rarely correspond to the old.
• The hardest step for an incumbent organization is
  the mental one of seeing the business through a
  different, deconstructed lens and then acting on
  this insight.
• The subtler pitfall is co-option and passive
  resistance by a skeptical and self-preserving
  organization.

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• Strategy in a deconstructing world has to be
  generally right, but need not be specifically
  right, as long as the organization maintains a
  capacity to learn from its mistakes.
• The value of incumbents best assets is all too
  often destroyed by the organizational,
  behavioral, and personal baggage that they insist
  on bringing to the new venture.

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• Incumbents can be the insurgents, if they choose.
• Old models of leadership become invalid in a
  deconstructed world. But leaders must create
  culture and establish a big move strategy.