InReview – Issue 5

New Rules for the New Economy by Kevin Kelly; New York, Viking, 1998; 179 pp.

Kevin Kelly is executive editor of Wired magazine and was formerly the editor and publisher of the Whole Earth Review. His previous book, Out of Control, provocatively argued for a new paradigm for understanding the latest stages of the technological revolution. Technology and biology are converging and, in an important sense, their evolutionary process is chaotic and out of control. But such chaos is the path to progress and life and should be welcomed.

New Rules for the New Economy was born as a long article in Wired and is now more fully argued in this book. Kelly’s basic theme is that “technology, which once progressed at the periphery of culture, now engulfs our minds as well as our lives. . . We now live in a new economy created by shrinking computers and expanding communications” (p. 1). The fundamental reality of the world is “ubiquitous electronic networks.”

Kelly proposes that ten principles that are “hardwired” into the new economy and all businesses will thrive or flounder depending on their adaptivity to these principles. Kelly’s way of expressing his ideas is over-the-top glib, breathless with enthusiastic, globally-stated pronouncements. The book has some of the jerk-you-around feel of Kelly’s Wired magazine or MTV videos. Style considerations aside, Kelly’s argument is very important and deserves attention, even if not total agreement.

Kelly’s ten new rules argue (if I may summarize them in two points) that business success requires, first, an embrace of the swarming, decentralized new electronic communications network. “Feed the Web first,” be generous, build connections and relationships; support the network. Second, in this context, let go at the top, embrace flux (not harmony), stimulate innovation, unleash the power of discovery, be prepared to abandon quickly what has been successful and create new opportunities.

Reviewed by David W. Gill

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The HP Way: How Bill Hewlett and I Built Our Company by David Packard; New York, Harper Business, 1995; xii, 212 pp.

The HP Way has the great virtue of being a factual, historical “this is what we did” business book,in contrast to dozens of “this is what you should do” advice books by consultants of less assured insight (could all of our leading management gurus actually run a successful business?). Hewlett-Packard is not only one of the most successful businesses in the world in terms of profitability and industry leadership, it is also perennially on those “best companies to work for” lists.

David Packard and Bill Hewlett first met as freshman engineering students at Stanford in 1930. By 1938 they were founding a company together in a garage in Palo Alto, California. In 1947 they incorporated. Their story is fascinating from many angles. A sample: when Hewlett was drafter into the armed services during WWII, Packard reports: “I kept my salary at a lower lever than it should have been because I did not think it was fair for my salary to be higher than Bill’s army salary” (p. 58). This (and the commitment early on to cut their employees into the company’s success with a generous profit-sharing program, and the extraordinary charitable work of both Hewlett and Packard over the decades) is refreshingly out-of-step with today’s culture of “I’ll take as much as I can possibly get for myself.”

In 1957, Packard and Hewlett retreated for two days with twenty of their top company leaders to articulate the core values and objectives at the heart of HP. Slightly revised in 1966, these seven objectives became the “HP Way.” Each one gets a chapter.

Briefly stated, the HP Way means commitments to (1) profit,a measure of success, a source of strength; maximize it so long as you do so in ways consistent with the other objectives; (2) customers,listen to them; give them products of continually improving quality and value; (3) field of interest,commit to innovation but stay focused on a limited range in which HP has capability; (4) growth,emphasize it as a measure of strength and requirement for survival; (5) employees,trust them, let them share in the company’s success, provide job security based on performance, provide opportunities for satisfying work; (6) organization,create an environment of freedom which encourages individual initiative and creativity; and (7) citizenship,contribute to the community and society around HP.

In addition to its superior products and services, HP is well-known for “management by objective” (instead of centralized command and control), “management by wandering around” and an executive open door policy, a wide-open work environment (instead of closed offices isolating people), and flexible, self-scheduled work hours. The HP Way brings the story into the middle 90s. Packard wants to see the older traditions and values preserved but it is also clear the HP will be tested and changed in various ways under pressure of the new global, networked, economic environment.

Reviewed by David W. Gill

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Business @ the Speed of Thought by Bill Gates; New York, NY, Warner Books, 1999; xxii, 470 pp.

Bill Gates is the wealthiest man in the U.S. and one of the most influential business and technology leaders, so his book has attracted a great deal of attention. The theme of this book is the vital role of information in running a business. Unlike his previous book The Road Ahead, which contained a great deal of technology gossip and daring but wrong forecasts, this one is more a book on business and the role of information in decision making.

He offers some very good advice in areas of large scale reengineering (dealing with small pieces of the problem at a time so that something gets delivered). He recognizes that building large IT systems are really about the business, and discusses the necessity of the Chief Information Officer (CIO) engaging the CEO in business decisions. And he focuses attention on how to deal with bad news.

The book is well illustrated with case studies from various Microsoft customers. His humor shows through in several places such as his comment “I’d much rather be alive today than at any time in history, and not just because in an earlier age my skill set wouldn’t have been as valuable and I’d have been a prime candidate for some beast’s dinner.”

The weakness in the book is his reality in dealing with the difficulties caused by information systems. In this book systems don’t fail, and the data is always right. Some of the difficult tasks of keeping systems running and up to date are ignored.

Reviewed by Al Erisman