There’s a storm of disruption on the horizon – and only intelligent companies will thrive.

Success in the years ahead depends on a firm’s ability to understand and harness the power of the four disruptive forces we describe in the book, and your ability to serve smart customers.

The forces you must be aware of include the power of social influence, pervasive memory (does your company remember everything about your customers?) the billions of digital sensors that populate our world and the physical web, where we interact with the real world much as we interact with the web today.

To thrive in the face of these forces depends in large part on your company’s ability to Act SMART.

To us, SMART means the five steps any organization can take – regardless of size, industry, or structure – to better serve smart customers.

You need to start by segmenting your customers. Then, modularize your products, services and capabilities, and build a culture that thrives on anticipating the needs of each valuable customer, by leveraging the data that surrounds them.

Supporting such a culture means rewarding employees for focusing on the needs of your customers. Finally, you need to transform your touchpoints – the places you interact with customers – from dumb to smart.

Your touchpoints need to be able to meet customer needs by sensing and responding to them in near real time, not hours (much less days or weeks) later...

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It is not a sustainable strategy to act dumber than the customers you wish to serve.

At the same time, everything and everyone has become or is becoming interconnected. Customers have smartphones loaded with apps that let them check prices, compare service agreements, read reviews, and check in with friends (and strangers) even as they examine your offers and products, and those of your competitors.

Consumers and businesses alike research, connect, and purchase online and over their phones without a second thought.

With these tools come radically higher customer expectations. Higher expectations of experience. Greater demands for personalization and customization. Lower tolerance for mistakes, for running through inane hoops, or for interactions that require mindless repetition (“... What is your account number ...?”).

In short, the world has changed dramatically, but many companies have not. Forget about innovation, they’re not even sure how to keep up. This is the challenge that your company needs to confront.

Companies that can’t pass basic tests of memory, flexibility, responsiveness, and innovation will die.

Among the many disruptive forces that are making it impossible for firms to survive with outdated strategies, four in particular are changing the basic ground rules for business competition and are the focus of this book: Social Influence; Pervasive Memory; Digital Sensors and The Physical Web.

Together, these forces will bring customers more choices, better information, and stunning new services. They are already providing individuals with tools more advanced in many cases than the most sophisticated commercial enterprises had just five years ago.

Put another way, they’ll continue to make your customers even smarter.

We’re just at the tip of this revolution.

For reasons that will become crystal clear as you read this book, established firms will need to reinvent themselves and disrupt their own industries to stay alive. With thousands upon thousands of very bright developers and entrepreneurs working around the globe to provide your customers with ever better, ever more disruptive tools, it’s a certainty that innovation will be coming to your industry if it hasn’t already.

Those companies who react slowly or tentatively will be increasingly marginalized, until finally, they’ll wither away. It may take five, ten, or even fifteen years, but eventually, these companies will be smothered by the competition and the growing demands of their ever-smarter customers.

INTRODUCTION

We are not talking about trivial change

ONE: SMART CUSTOMERS

Digital innovation is leaving companies behind

Customers start gaining superhero powers

Companies can’t be competitive if they can’t
stay ahead of their customers

Smart customers expect smart customer experiences

Key Takeaways

TWO: INTELLIGENCE IS EVERYWHERE

Beyond 1to1 to 1toEverything

Identify anything, anywhere, anytime

A framework for infinite opportunity and innovation

Innovators look through the eyes of their customers

What your customers could do with a pair of smart glasses

Technology is magic your customers need to trust

Key Takeaways

THREE: A PERFECT STORM OF
DISRUPTIVE INNOVATION

The four disruptive forces

Disruptive force number one: Social Influence

Disruptive force number two: Pervasive Memory

Disruptive force number three: Digital Sensors

Disruptive force number four: the Physical Web

Disruption favors the smart customer

Key Takeaways

FOUR: STUPID COMPANIES

Does your company behave stupidly?

What happens when smart customers meet
a stupid company?

Why CRM hasn't helped

Does this mean the end of loyalty?

Many managers don't care – and aren't paid to

Guess what? Your customers don’t care either

Dumb touchpoints anchor your performance to the past

Key Takeaways

FIVE: GET SMART

A five-step system for acting smart and growing faster

Getting smart: a simple system you can use

Segment your customers by needs and value

Modularize your capabilities to increase your flexibility
and responsiveness

Anticipate your customers' needs

Reward your employees for win/win behaviors

Transform touchpoints (and make them smart)

In summary: It really pays to get – and act – smart

Key Takeaways

SIX: CRITICAL STEPS

“If anyone disrupts this industry, it's going to be us.”

Welcome to simultaneous change

Be smart enough to learn what your customers really need

Start making your company smarter, now

Key Takeaways

AUTHORS

Acknowledgements

Michael Hinshaw

Bruce Kasanoff

INDEX

SOURCES

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126

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136

140

144

145

147

166

168

171

173

175

176

177

179

183

Popular Highlights:

“Only the most “intelligent” companies will be able to respond to – and profit from – these radically greater customer expectations.”

“The world has changed dramatically, but many companies have not. Forget about innovation, they’re not even sure how to keep up. This is the challenge your company needs to confront.”

“Established firms will need to reinvent themselves and disrupt their own industries to stay alive.”

“Look out your window. Nearly everything you see – cars, office buildings, people, the weather, birds, restaurants, or billions of other possibilities – can and will be identified and differentiated on your behalf by applications that are already flooding onto the market.”

“Customers can now be incredibly insightful, spotting patterns in data and emerging trends, because they have immense computing power at their fingertips and because they can immerse themselves in this data in dozens of different ways.”

“In a world in which memory is everywhere, it is inevitable that human beings will resist having their lives reduced to a series of data points under the control of – and mismanaged by – others.”

“The profit incentive exists for venture capitalists to fund aggressive startups who see the immense potential of giving customers full control over their data. The majority of established companies don’t use customer data to benefit their customers.”

“New competitors will surface that possess truly customer-focused cultures. These cultures will invent new services that no inward facing, self-absorbed, siloed enterprise could imagine.”

“Anyone 20 or younger has never known a world without the Web. The oldest of this generation are now adults, and they are already potent consumers, buying music, games, clothing, and other items in large numbers.”

“For the next few days, try this: wherever you go, imagine everything being collected to the Web. Imagine that by clicking, touching or perhaps just looking at an object, you could know everything about it.”

“Social Influence means that the opinions and experiences of countless other people comebetween your firm and its customers.”

“Pervasive Memory makes it inevitable that companies will begin to profitably leverage the data generated by the trillions of interactions and transactions made through digital devices.”

“Digital Sensors expand exponentially the scope of actions, events, and behaviors firms can sense…and to which they can respond. ”

“The rise of the Physical Web has begun. Today, we are linking people, devices, places and locations in the real world like we do on the Web.”

“We are confronting a fundamental shift in the ways that companies interact with – and serve – their customers.”

“Smart customers can now tap into sensor networks that used to be available mainly through large, established firms who were often using proprietary systems.”

“We are burying sensors in our gardens, embedding them in our bridges and roads; they are floating on the seas and sometimes in the air. They are being used in warfare and research. Each creates more data, more information, and more opportunities for innovation.”

“Your company can introduce products and services that were not conceivable five years ago. A retail store could recognize and greet customers as they enter the store; not a clerk, mind you – the store itself.”

“Physical Web technologies will solve small but frequent problems like losing your keys in your house, your car in a parking lot, or your kids outside playing.”

“Companies structured in operating silos with performance metrics and reward systems at odds with other departments deliver a customer experience that can be discordant at best, jarring and off-putting at worst.”

“As the Physical Web rises, pretty much everything a company does for its customers will become more interactive, dynamic, and open to scrutiny.”

“It’s stupid to be so obviously oblivious to your customers. They can tell that they’re not seen as individuals, and that their wants and needs are neither addressed nor understood.”

“A typically stupid company is much more likely to send a printed direct mail piece with an offering that’s irrelevant, unwanted, and/or annoying to the 98 percent or more of customers that don’t respond, in hopes of an incremental sale.¹”

“What happens when smart customers interact with stupid companies in a free and open market? Change starts in pockets, coming from the edges of an industry, ultimately becoming a wave that threatens mainstream competitors.”

“CRM has not worked because it does not actually track relationships or experiences; it tracks transactions. It doesn’t take into account the customers’ views of the company, and doesn’t capture what they want or need.”

“Your customers and their expectations of experience are changing. Your touchpoints should be changing, too.”

“Companies will have the ability to leverage “sense and respond” touchpoints to better manage relationships, supply chains, and distribution.”

“Massive disruption is coming, and the only question is whether your firm is going to profit from it or fall victim to it. Disruption is not easy, either to create or to confront.”

More Testimonials:

“Entrepreneurs looking for the next big thing need to grab a copy of our book and this one, and fast.”
– Bob Dorf, co-author with Steve Blank of THE START UP OWNER’S MANUAL: The Step-by-Step Guide for Building a Great Company

“So energizing it actually made my skin tingle and my pulse race. Lot of books prod you to think about the future; this book is like a punch in the face. My thinking has changed and I'm now light years ahead. I'm fortunate I had the opportunity to read this before my competitors.”
– Chris Zane, Founder & President, Zane's Cycles, and author of REINVENTING THE WHEEL: The Science of Creating Lifetime Customers

“We, as business leaders, are often so worried about our competitors we often forget about our customers. Kasanoff and Hinshaw remind us that our customers are smarter and know more than we know. The book is an easy read and stuffed with ideas that can be implemented on Monday morning.”
– Michael Le Goff, CEO, Plessey Semiconductors

“Technology-enabled customers are getting smarter every day, while companies mired in the same old ways of doing business just come off as stupider and stupider. Do not let that happen to you. Instead, follow Hinshaw and Kasanoff's prescription to ride the waves of today's perfect storm of disruptive innovations.”
– B. Joseph Pine II, co-author, THE EXPERIENCE ECONOMY and INFINITE POSSIBILITY: Creating Customer Value on the Digital Frontier

“This is a very insightful book, and one that provides a really different (smarter) perspective on customer centric value co-creation! Hinshaw & Kasanoff make sense of many recent trends and provide a number of coherent frameworks to analyze the state of the industry and to create actionable ideas for change.”
– Frank T. Piller, Professor of Management, RWTH Aachen University, Technology & Innovation Management Group and Massachusetts Institute of Technology, MIT Smart Customization Group

“Every CEO should read this book. The bigger your company the more you need a reality check and this book is just that. Your customers now know more than you do about your business and your competition. With so many innovative technologies present today and coming soon, this is a must read for all business executives!”
– Jocelyn Smith, Managing Partner, CEO, infinitee Communications

“If your company regards customers as creatures they 'acquire,' 'manage,' 'control,' 'own' or 'lock in,' your company suffers from a fatal condition that only this sort of respect for customer independence and intelligence can cure.”
– Doc Searls, author of THE INTENTION ECONOMY: When Customers Take Charge, and co-author of THE CLUETRAIN MANIFESTO

“This is a real page-turner! Hinshaw and Kasanoff provide a quick and thrilling tour of the immediate future of business. So read it and heed it, folks, because it just doesn’t come any more direct or compelling than this!”
– Don Peppers and Martha Rogers, Ph.D., authors of EXTREME TRUST: Honesty as a Competitive Advantage

“In healthcare, we need to realize that it is not just science and technology that are advancing rapidly, but also the expectations of the individuals we are here to serve. As this book so eloquently argues, an informed patient is a smart customer.”
– William W. Burke, Executive Vice President & CFO, IDEV Technologies

“Thanks to dramatic technological advances of the past decade, computers can help us become smarter and smarter in our everyday tasks. As a result, today's customers are much more sophisticated, and companies need to change in response. Kasanoff and Hinshaw highlight some of these changes and help companies understand how to deal with smart customers.”
– Roberto Pieraccini, author of THE VOICE IN THE MACHINE: Building Computers That Understand Speech and Director of ICSI, the International Computer Science Institute at Berkeley

“This engaging book provides a useful roadmap for navigating today's and tomorrow's technological innovations to improve your customer's experience. Ignore its lessons at your (and your shareholders') peril.”
– Christopher Oddleifson, President & Chief Executive Officer, Rockland Trust Company

“Bruce Kasanoff and Michael Hinshaw have correctly flagged the start of a major revolution. I especially hope their SMART framework gets adopted in education, where we desperately need a new approach.”
– Bart Stuck, Managing Director, Signal Lake

These four disruptive forces will combine to change every industry, including yours (if they haven't already)

Social Influence

Social Influence is the result of people being linked 24/7 to other people, having access to pervasive memories, and being able to share information anywhere and anytime. It literally inserts a crowd of friends, experts and strangers between a company and its customers. Imagine a crowd of your customer’s friends shouting, “Stop!” just as your salesperson is about to close a big deal, and you get the idea.

Pervasive Memory

Pervasive Memory expands with each new sensor, smartphone, tablet, computer and digital interaction. When you use digital devices, you create a memory in numerous databases. This information creates countless opportunities for companies to offer new services, for community groups to help local residents, and for researchers to better understand our world. But it also creates mind-boggling opportunities for abuse. The traditional ways most companies sell their goods – by “targeting” prospects – not only won't work in this environment, but they also will most likely be illegal.

Digital Sensors

Digital Sensors are a big part of what will make the Physical Web possible. They are being embedded everywhere: cars, appliances, clothes, walls, bridges, the oceans, your garden, in the skies, in space, and even in human bodies. They will be linked to events (a truck pulls into your driveway) and ideas (climate change). They will transform dumb objects into smart ones (your refrigerator orders more milk from the grocery store.)

Physical web

The Physical Web is just starting to emerge, and it will link people, things, ideas and events. Business won’t be the same. Your personal life won’t be the same. Nothing will be the same, and it’s important that you understand that these words aren’t simply another overblown dose of hype.

The principles and systems behind the smart framework will help any company thrive by becoming more intelligent

In addition to being a framework, acting smart is an organizational mindset, a way of thinking, and an ongoing system of capabilities comprised of the following five steps:

Segment

Segment your customers by needs and value.

Modularize

Modularize products, services, processes and capabilities. to increase flexibility and responsiveness.

Anticipate

Anticipate customer needs.

Reward

Reward your employees for win/win behaviors.

Transform

Transform touchpoints by making them smart.

SMART provides the lenses you need to assess opportunity and act intelligently, methodically, and confidently in response to the fast-paced, continually evolving complexity of smart customers, disruptive technologies, and potentially infinite touchpoints.

SMART CUSTOMERS STUPID COMPANIES

There’s a storm of disruption on the horizon – and only intelligent companies will thrive.

LEARN ABOUT THE FOUR DISRUPTIVE FORCES HEADING YOUR WAY »

LEARN ABOUT FIVE THINGS YOUR ORGANIZATION CAN DO TO ACT SMART »

Buy the book »

Read an Excerpt »

Popular Highlights »

Table of Contents »

SHARE

ADVANCE PRAISE:

Read More Testimonials »

Download Chapter One:

READ AN EXCERPT:

Table of Contents

Popular Highlights:

More Testimonials:

Author: Michael Hinshaw

Author: Bruce Kasanoff

These four disruptive forces will combine to change every industry, including yours (if they haven't already)

Social Influence

Pervasive Memory

Digital Sensors

Physical web

The principles and systems behind the smart framework will help any company thrive by becoming more intelligent

Segment

Modularize

Anticipate

Reward

Transform

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