Survival of the Smartest
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As we begin the new millenium, executives around the world are feeling the heat. Unlike the gradual 100-year transition from the Agricultural Age to the Industrial Age, the Information Age has arrived at lightning speed, leading to dramatic changes in the competitive landscape. The stakes are high, and change is unstoppable. Yet, to most managers, it is still unclear how business practices should change in response to the new realities.

Consultants and management gurus have jumped on the change bandwagon, creating and selling techniques for leading and implementing organizational transformation. These techniques, however, can be worse than useless if the company does not change in the right direction. Managers are under constant pressure to "do something," but what that "something" is often remains unclear or depends on the buzzword of the month. Time and time again, we have observed managers who fail to implement change programs because they don't have a clear understanding of what their organizations are changing into-or why. The purpose of this book is to provide you with a framework for analyzing how your organization can adapt to the realities of the twenty-first century. The concepts underlying this work reflect insights that were gleaned from our consulting experience, applied research, case studies, numerous interviews with managers of leading companies, and two comprehensive worldwide surveys.

At the heart of the book is our concept of Organizational IQ, a quantifiable measure of how organizations assimilate information and put together their decision and information architectures. Because the clockspeed of business processes is increasing dramatically and information is prevalent in quantities that were unheard of ten years ago, the Organizational IQ has a strong effect on a company's financial performance and on its chances of survival for the new millenium.

We found dramatic differences between the financial performance of Low-IQ and High-IQ companies: High-IQ companies grew much faster and were more profitable than their Low-IQ peers (see Research). Not only were High-IQ companies performing better than their Low-IQ peers, but the gap between the two groups had also increased substantially. The results strongly indicate that Low-IQ companies have a low chance of survival in the twenty-first century. In fact, several of the Low-IQ companies we studied have vanished by the time we put this book together.

Encouraged by the clear-cut results of our research, we also conducted a number of consulting studies in which we helped companies apply our concepts. At these companies we used a systematic process to increase their Organizational IQ - which subsequently improved their financial performance. Chances are that you realize your organization also needs to change to meet the demands of the twenty-first century. You want to determine how your company, division or group is doing at present, what needs to change and how this can be done. This book is designed to help you accomplish these objectives.
(From “What this book is about,“ in Survival of the Smartest, Mendelson and Ziegler, Wiley, New York, 1999.)

Endorsements

• Eric Benhamou, CEO, 3Com
  "Survival of the Smartest is a practical and action-oriented roadmap for managing in the Information Age. It can save you much pain by tapping into the experience of managers who have done it before." Guenter Mooshammer, Senior VP, Vishay Semiconductor ."Most executives acknowledge that they need to prepare their organizations for the challenges of the 21st century. But how do you know where you stand and what are the most important levers for improvement? Survival of the Smartest is a must read for any manager who is looking for answers to these questions."

• Jerry Porras, Lane Professor of Organizational Behavior, Stanford Business School, and co-author of Built to Last
  "Mendelson and Ziegler brilliantly capture the character of organizations smart enough to function successfully in a turbulent world. Loaded with powerful concepts and how companies have successfully applied them, Survival of the Smartest will teach you how to create a "High-IQ" company and avoid the traps that make good companies mediocre."

• Charles Fine, Professor, Sloan School of Management, MIT, and author of Clockspeed: Winning Industry Control in the Age of Temporary Advantage
  "Professor Mendelson and Dr. Ziegler make it abundantly clear that if your organization is not on the path to becoming a high-IQ company, then it is probably on the road to extinction. This book packs a lot of wisdom that is eminently useful to companies large and small, hi-tech and low-tech. With a solid research base at Stanford Business School and loads of real-world experience, Survival of the Smartest captures essential truths for management in the Information Age."

• Scott Cook, Co-founder, Intuit Inc.
  "This book shows how winning information-age firms can turn speed from a potential problem into a weapon and turn a flood of information into a competitive advantage."

• John McHugh, General Manager, Hewlett-Packard ProCurve Networking Business
  "Survival of the Smartest is a comprehensive set of tools for measuring the IQ of your organization and systematically improving an organization's ability to learn. I found the book to be both a pragmatic and practical way to hone the competitiveness of any company."