by George Stalk and Thomas M. Hout
Problem
The conventional wisdom in business is that cost, quality, and service are the primary drivers of competitiveness. However, this perspective fails to recognize the crucial role of time in gaining a competitive edge. By not managing time effectively, companies risk inefficiency, customer dissatisfaction, and lost opportunities.
Promise
“Competing Against Time” argues that time is a critical, often overlooked, element in business strategy. By understanding and optimizing time in their operations, organizations can significantly improve their competitiveness and customer service while reducing costs.
Perspective
“Time is the next frontier in business competition. Optimizing its use can revolutionize your organization’s productivity, customer satisfaction, and bottom line.”
Précis
“Competing Against Time” by George Stalk and Thomas M. Hout introduces the concept of time-based competition, arguing that companies can gain a significant advantage by focusing on reducing time within their business processes. The book uses a range of case studies to illustrate the impact of time on productivity, customer satisfaction, and financial performance.
Stalk and Hout suggest that reducing the time taken in processes such as product development, manufacturing, and distribution can not only decrease costs but also increase the quality of products and services. They explain how the idea of cycle time, the total time from the beginning to the end of your process, is key to understanding and improving your business’s performance.
The authors also highlight the importance of time in customer service. In today’s fast-paced world, customers value quick and reliable service. Companies that can meet these expectations gain a competitive advantage and increase customer loyalty.
Moreover, “Competing Against Time” discusses how time can be a source of innovation. By reducing time waste and improving efficiency, companies can free up resources to invest in creative problem-solving and innovation. This can result in the development of new products, services, or processes that further enhance competitiveness.
Overall, the book presents a compelling case for viewing time as a strategic asset and offers practical advice on how to incorporate time-based competition into business strategy.
Playbook
- Evaluate your company’s cycle time: Measure the time it takes for a product or service to go from conception to delivery. For instance, Toyota’s Just-In-Time manufacturing approach is a prime example of minimizing cycle time.
- Identify time waste: Look for areas in your business processes where time is wasted. This could be due to inefficient practices, unnecessary bureaucracy, or outdated technology.
- Implement time-saving measures: Once you’ve identified areas of waste, find ways to improve efficiency. This might involve streamlining processes, adopting new technologies, or reorganizing your team or workflow.
- Prioritize customer service speed: Understand your customers’ expectations regarding service speed and make it a priority to meet or exceed these expectations. Zara, for example, has famously used fast fashion cycles to keep its stores stocked with the latest trends.
- Encourage innovation: Use the resources freed up by improved efficiency to foster innovation. 3M, known for products like Post-it Notes and Scotch tape, is renowned for fostering a culture of innovation by giving employees time to work on their own projects.
Prompt
Consider the current cycle time for your main product or service. How could this be reduced, and what impact might this have on cost, quality, and customer satisfaction?