Competing in Time
Few wars are started by a cataclysmic event. Most, like World War I, begin with a minor episode that spins out of control. Fortunately, the U.S. Navy’s downing of an Iranian civilian aircraft on July 3, which might have been just such an event, has not led to Armageddon. But it does aptly illustrate a new, and frightening, phenomenon taking place on the military—and commercial—battlefield. The decision to attack, made by the beleaguered local commander, was based on an indecisive exchange of electronic signals during a period of just 180 seconds. I call that new phenomenon “competing in time.”
In the lead article in the premier (Summer 1988) issue of ChiefiInformation Officer Journal, Boston Consulting Group Vice President Rudyard Istvan contends that “time-based competition,” as he labels it, is the new, fourth dimension of business strategy, “beyond product, market, and cost competitiveness.”
Istvan provides the illustration of Honda, which in the early 1980s turned back a challenge from Yamaha by introducing 113 major model changes in 18 months, while Yamaha managed only 37 during that same period. Likewise, a March 14, 1988, Time magazine story on advances in manufacturing reports that, during the past five years, U.S. machine-tool maker Cross & Trecker cut average production lead times for complex parts from five months to five days. And a note I recently received from Tom Malone, president of Milliken & Co., included an update on the textile firm’s three year-old “Quick Response” program, which is targeted at, among other things, cutting the time to develop new products. One typical case: Production—and distribution—of a complicated new sample, a task which used to take months, was accomplished in just over a day.
Order-of-magnitude increases in speed of product development and in reduction of product delivery lead times are cropping up in almost every marketplace. And as turbulence, competition, market fragmentation, and product customization increase, the pressure for more haste will only accelerate.
Although companies are aware of the trend, most are dealing with it via technological quick fixes. But the few truly successful programs, which aim to make “competing in time” the chief plank in the enterprise’s strategy, are much more thoroughgoing. From studying the leaders, I’ve deduced that learning to compete in time requires a program consisting of the following five, mutually reinforcing components:
1. Use of leading-edge information technology. Merely keeping up with the Joneses in the application of information technology (IT) is not enough. One must be an IT pioneer. Inside manufacturing firm, for instance, this means making strategic information available to all, and using advanced computer-aided design/manufacturing/engineering and computer-integrated manufacturing systems to link everything to everything else. Beyond its walls, the firm must use IT to link up to vendors, at one end of the business system, and to every member of the distribution channel at the other.
2. Radical reorganization. Too many leap at the latest IT tools and largely overlook issues of organizational structure. Radical structural redesign must come first, or else one ends up, in the words of a respected industry consultant, “automating [your] worst mistakes.” In short, most of the hierarchy found in the traditional firm must be eliminated, and the walls between functional staffs must be destroyed. You can’t move fast, no matter how good the systems are, if turf fights among functions are the norm, and if even routine decisions must be processed through numerous layers of bureaucracy.
3. Replacement of adversarial relations with partnerships. Traditional adversarial dealings, inside the firm as well as outside, eat up hours which are not available when a company is forced to compete in time. In the future, product developers, marketers, operations people, and field service groups must become allies, if speedy innovation is to be achieved. But that’s not all: Vendors and distributors also must become full-scale participants in the firm’s strategic decision-making, and in day-to-day decisions on execution as well.
4. Training and autonomy. A paradox of the new organizational environment is that complex, apparently more centralized IT systems require much more front-line training (or my preferred term, continuous learning by everyone) and much more autonomy. To do battle with a firm like Milliken & Co., a competitor has no time to convene a committee to ponder a response to a new move. Systems and organization must be state of the art, but on a day-to-day basis, people who are on or very near the front line must have the requisite skills and be unequivocally empowered to act.
5. Leader as visionary and architect of flexible systems. The leader’s role must change drastically, too, in a marketplace in which the chief basis of competition is time. Behaving like head of a deliberative council of elders is no longer appropriate. Instead, the leader must be the chief architect of a constantly improving system, the principal goal of which is to be evermore quick. The leader also must present a vision that compels every person in the organization to embrace a new, heightened level of responsibility for taking timely action.
After centuries of competing on the basis of mass, organizations now are competing instead on the basis of time. We have no tried-and-true management tools to deal with such a profound change. While information technology is the undisputed engine of this transformation, nothing less than the full, five-part program I’ve outlined will increase the odds of success, in political or economic warfare.
(c) 1988 TPG Communications.
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