The Overdrive

do information work, people in the company have to be able to find information easily. Until recently though, we've been

The Overdrive

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vous system-helped GM to dominate the car business throughout Sloan's career. It wasn't yet digital, but it was extremely valuable.course, you couldn't get nearly as much information flowing through your company then as you can now. It would have required too many phone calls and too many people moving paper around and looking at the data to find patterns. It would have been very expensive. If you want to run a world-class company today, you have to obtain much more data and do it much faster. To manage with the force of facts-one of Sloan's business principles-requires information technology.


4. How to achieve advantage over competitors in the information age?

information management and quick responses made such a basic difference in a traditional industry seventy years ago, how much more difference will they make when they are powered by information technology? A modern car maker may have a strong brand name and a reputation for quality today but it is facing even greater competition from around the world. All car makers use the same steel and the same machines; they have similar manufacturing processes and they have roughly the same transport costs. Today the tests of success are how well they design their products, how intelligently they use information from their customers to improve their products and services, how quickly they can improve their production processes, how cleverly they market their products, and how efficiently they deliver their products and services to customers. All of these processes are rich in information and they benefit from digital technology.value of a digital approach is especially clear in businesses such as banks and insurance companies where information is central to the business. In banking, data about customers is the heart of the business, and banks have always been big users of information technology. Crestar Bank of Richmond, Virginia, offers all its banking services over the Internet. It has bank employees in supermarkets and malls who can offer banking services to customers using digital information flow.the age of the Internet and increasing competition in financial markets, the key to success is the intelligence of a bank's use of data and how well it responds to its customers. Its brains that give one bank or another the advantage. But I don't just mean the individual abilities of bank employees. I mean the overall ability of the bank to make use of the best thinking of all its employees.


5. Information should work

the introduction of ENIAC, the first general-purpose computer, during the Second World War, computers quickly proved that they were faster and more accurate than humans at many tasks. Computers were not working at a high level, though. They assisted people but not in an intelligent way. It takes brains to understand the physics of a rocket; it takes a computer to do the sums in seconds.need to do another kind of work, «information work.» This phrase comes from Michael Dertouzos, director of MIT's laboratory for computer science, and author of What Will Be. We usually think of information-a letter, a picture, or a financial report-as something that doesn't change. But Dertouzos argues that another form of information is active. Information work is the processing of information by human brains or computer a building, making a deal, filling in tax forms-is most of the work done in developed countries. Dertouzos estimates that information work contributes 50 to 60 percent of the total value of the goods and services produced by an industrialized country.'s idea is important. When computers went from simple number-work to modeling business problems, they began to play a part in information work. Even manufacturing firms have always put more energy into information about the work than into the work itself: information about product design and development; about marketing, sales, and supplies; about payments and finance; about cooperating with sellers; about customer service.


6. Simplicity of received data

do information work, people in the company have to be able to find information easily. Until recently though, we've been told that «the numbers» should be reserved for the most senior executives. Sometimes there are good reasons for secrecy, but usually information has been reserved simply because it took time, money, and effort to move information around, so you had to be senior to order the work. On today's computer networks you can find and present data easily and cheaply. You can dive into the data to the lowest level of detail and look at it from different angles. You can exchange information and ideas with other people. You can bring together the ideas and work of many people for a better result.need to stop thinking that getting information and moving information around is difficult and expensive. It's just basic common sense to make all of your company's data easily available to every person who can use it.of a company's employees, not just its high-level executives, need to see business data. It's important for me as a Chief Executive Officer (CEO) to understand how the company is doing across regions or product lines or different types of customer, and I take pride in staying informed. However, it's the middle managers in every company who need to understand where their profits and losses come from, what marketing programs are working or not, and what expenses are under control or too high. They're the people who need accurate, useful data because they're the ones who need to act. They shouldn't have to wait for upper management to bring information to them. Companies should spend less time protecting financial data from employees and more time teaching them to analyze and act on it.many companies the middle managers can drown in day-to-day problems and not have the information they need to fix them. A sign of a good digital nervous system is that middle managers are made more effective by the flow of accurate, useful information. The systems should tell them about unusual events-for example, if an expense item is too high. Then the managers don't need to look at normal expense activity. Some companies work like this, but I'm constantly surprised by how few companies use information technology to keep their middle managers well-informed and avoid routine review.'m amazed by the twisted path that important information often takes through many Fortune 500 companies. At McDonald's, until recently, sales data had to be «touched» by hand several times before it made its way to the people who needed it. Today McDonald's is installing a new information system that processes sales at all of its restaurants in real time. As soon as you order two Happy Meals, a McDonald's marketing manager will know. So that manager will have hard facts to analyze sales, not unreliable data.we'll see in the description of Microsoft's reaction to the Internet, another sign of a good digital nervous system is the number of good ideas coming from your middle managers and knowledge workers. When they can analyze real data, people get detailed ideas about how to do things better-and they get excited, too. People like knowing that something they're doing is working and they like being able to show managers that it's working. They enjoy using technology that encourages them to test different theories about what's happening in their markets. People really appreciate sign of a good digital nervous system is how effective your face-to-face meetings are. Good meetings are the result of good preparation. Meetings shouldn't be used mainly to present information. It's more efficient to use e-mail* so that people can analyze data before the meeting. Then they will be prepared to make suggestions and debate the issues at the meeting itself.that are struggling with too many unproductive meetings don't lack energy and brains. The data they need exists somewhere in the company in some form. Digital tools would enable them to get the data immediately, from many sources, and to analyze it from many angles.'s Alfred Sloan said that without facts it's impossible to put an effective plan into action. I believe that if you have good facts, you can put an effective plan into action. Sloan did, many times over. At the speed business moves today, we need more than ever to manage with the force of facts.I'm describing here is a new level of information analysis that enables knowledge workers to turn raw data into active information-what Michael Dertouzos calls knowledge-as-a-verb. A digital nervous system enables a company to do information work with more efficiency, depth, and creativity.


found this book rather interesting to read. If you would like to run your own company, or you are just interested in reading about big business, then you will be satisfied with this book. Gates does a great job of citing examples of how technology is impacting business in today's economy. It might even give you a few ideas for making your own business more efficient.recommend this book because it can help you in future. Some things in this book I had heard before, but gave them no attention. Now, I seriously thought about it. This information was really useful for me.


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