THE FUTURE WILL BE DETERMINED by the beliefs and actions of various individuals, organizations, and institutions. The future, therefore, is susceptible to modification and change by these entities. Thus, the future can best be projected by examining the stated and implied goals of various decision-makers and trend setters, by evaluating the extent to which each can affect future trends and events, and by evaluating what the long-term results of their actions.
Like competition itself, competitive advantage is a constantly moving target. For any company in any industry, the key is not to get stuck with a single simple notion of its source of advantage. The best competitors, the most successful ones, know how to keep moving and always stay on the cutting edge. Today, time is on the cutting edge. . . . In fact, as a strategic weapon, time is the equivalent of money, productivity, quality, and innovation."
There's no doubt that, in the past, competing on time created performance differentials. But as real as those differentials were, they usually improved things only 20% or 30%. When you move into the information world, you attach a supercharger to speed as a competitive weapon. The difference between those who get it and those who don't is no longer incremental -- it's a quantum leap. And once that disparity becomes apparent to some consumers, word spreads to others.
Speed allows you to navigate through that complexity on your own terms. speed shrinks the distance between the information and the decision. It gives you a new ease with which to navigate the multifaceted task of juggling your life. As a result, consumers can shift their desire from simply completing a transaction to getting the most out of each transaction that they do.
Another unanticipated consequence of informational speed: Consumers option themselves up, not down. They buy more, and what they buy has a higher margin. Often, when consumers are dealing with complexity and choice, they run out of time, they run out of patience, and they run out of trust. They don't believe that service representatives are really interested in helping them. Digital sales takes all that uncertainty away by enabling rapid responses to "what if" questions.
Speed is about de-averaging competitive advantage.
A company that manages its business through averages is a company waiting to be hammered. Let's say that a vice president reports an 8% return on sales. If I'm his company's competitor, I just lick my chops! And if I'm on his team, I get very worried. What the VP means is that parts of the company had a 30% return on sales and other parts had a minus 20% return on sales -- and that he doesn't know, or doesn't want to talk about, which part is which.
As speed fractures markets, customer groups, and distribution channels, averages give you an increasingly inaccurate picture of your business performance. The areas in which you have an advantage become obscured by the areas in which you are disadvantaged. And because you can't tell the difference, you don't know how to respond, how to build on strengths, or how to jettison your weaknesses. You need to de-average everything: the market, competitors, technology, and costs.
Speed is all about information. Ultimately, competitors must be able to tell the difference between creating valuable information and just creating information. There's money in almost every business situation today: in using a car's own electronics to improve how it's serviced; in managing credit-card transactions; in dealing with maintenance cycles in the airline industry. In any industry, a company that can harness the output of information to speed up its operations is going to outperform competitors, create new standards, and generate significant profits.
