| To stay competitive and to continue to produce profits, corporations are shortening most processes, products, and services—everything in sight. They have shortened product life cycles and aim to introduce products quicker than their competitors. Manufacturers are striving to lower costs and increase market share by implementing just-in-time inventory control. Faster product development is essential, for speed kills the competition. In the automobile industry, new cars took used to take years to get to the marketplace—now they take months. When a customer orders a new car, instead of weeks, it is delivered in days. In the semiconductor industry, chips are produced and manufactured, then delivered in days. Other corporate examples of legendary speed in business include: -
In the late 1990s, Citibank completely recreated its procedures for approving home mortgage loans, moving from being an also-ran to a market leader. The company reasoned that consumers would want to do business with a lending institution that gave them fast turnaround of a loan application. Citibank's new mortgage approval procedure went from a lengthy turnaround time of 45 days to just under 15 days. -
Federal Express started out by promising overnight delivery of a letter or package by noon the next day. Later, came the promise overnight delivery by 10:30 a.m., Priority Delivery. After FedEx had captured significant market share with fast, dependable service, it developed real-time computerized tracking of any package in the FedEx system and gave customers a choice of two classes of delivery: Priority Overnight and Standard Overnight. FedEx has consistently developed new products that enable it to achieve and maintain a prominent position in the marketplace. -
In 1993, Marriott opened up the Courtyard hotels, its version of a moderately priced hotel chain. When it went after this niche opportunity, Marriott did a good job of identifying customer needs and wants. It empowered a cross-functional team to develop the new product, which first appeared as a prototype hotel in Gaithersburg, Maryland. After a successful test marketing of the new hotels in Atlanta, Courtyard has become an important addition to the Marriott product line, with more than 200 units around the country. Countless other examples exist; including Black & Decker, IBM, Hewlett-Packard, Honda, and Motorola, to illustrate how real companies must act quickly to meet the needs of the demanding customer. The message is clear to all senior business managers—act fast and adapt or die. "Business as Usual" is a phrase that many companies will never use. It deserves to be tossed on the scrap heap of history due to the rapid pace of technology. Business will NEVER be usual again. The new motto is "Business Unusual." There is one fundamental enabling factor in all this fast product development and implementation—the computer. Without adaptable, flexible computer systems that manage and produce these products, speed is not possible. New terms in our vocabulary have evolved which describe the speed at which we work—"Internet speed" is one example and "Warp speed" is another. It is now estimated that the knowledge we have for any given technology doubles every 12 to 18 months. Moore's Law should now relate to technology in general rather than just transistors on a chip. The effect on the economy with this approach is dramatic and anti-inflationary. Alan Greenspan, longstanding chairman of the U.S. Federal Reserve, made the observation that inflation in the United States would have increased one percent more if it had not been for the widespread use of IT technology.[2] Just a few days prior to Mr. Greenspan's comments, the U.S. Department of Commerce issued a report noting that although the information technology industry accounts for only about 8 percent of America's gross domestic product, it generated more than one-third of the nation's economic growth from 1995 to 1998. Meanwhile, the technology industry showed dramatic increases in productivity: an average of 10.4 percent annually from 1990 to 1997, compared with less than one percent outside the technology sector.[3] |
