Make your business run faster

Do you know this set of numbers: 3-6-1? These numbers are a true reflection of the harshness of the home electronics cycle. It takes 3 months to design a product and 6 months to sell it, and then the product will become a popular daily necessities, and finally the company has 1 month to sell the remaining inventory.

Because product cycles are so short, companies must act quickly -- develop products quickly, sell quickly, ship quickly, and respond quickly to market conditions. Fast companies are often successful, while slow companies face failure, especially when the product margins are already razor-thin.

Taiwan's high-tech company MiTAC is a typical example of the pursuit of "fastness". Its company website declares: "In today's era of low profit, high speed and cost control are the keys to business survival. Mio must do: the fastest design-to-delivery (D2D), timely service, rapid accumulation of experience, and immediate decision-making. And perfect internal information communication. Only in this way, Mio can respond quickly to the ever-changing business environment."

Many companies believe that the means of ensuring competitiveness is to provide greater value to customers. Others struggle to achieve success by controlling costs. In addition, there are companies like Mio that strive to win with speed and gain a competitive advantage. In other words, these businesses seek to provide the greatest value in the shortest time and at the lowest cost.

In his monograph Competing Against Time, management expert George Stalk, Jr. coined a new term for such speed-seeking businesses, calling them "speed-winning competitors." . He believes that these enterprises have the following characteristics:

● Take time consumption as the core indicator of enterprise management and strategic planning.

● Maintain close contact with customers through quick response and improve customers' dependence on the enterprise.

● Quickly adjust the company's value allocation system to attract the best customers and force competitors to turn to second-class customers.

● Leading the innovation trend in the industry.

Businesses that win with speed can reap many benefits. In this regard, management expert Arthur G. Davis summed it up as follows: "Customers are satisfied with the prompt receipt of orders, so the company's market share will increase; the increase in the speed of product delivery allows the finished product inventory to be At the same time, product quality has been improved---the pursuit of speed forces enterprises to ensure the production qualification rate of products; enterprises take speed as the core of improvement strategy, and can produce products at lower cost than competitors. , because the companies in which employees work are more responsive and successful, and the speed-oriented operation of the company allows employees to have greater flexibility and responsibility in their work, and thus higher employee satisfaction."

A recent global survey Enterprise surveys show that almost all enterprises prioritize speed competition strategies. The quest for speed is not limited to the home electronics industry, but extends to all industries that attract customers with quick responses.

Accelerate time to market

Product development is one of the key aspects of business acceleration. Many leading companies are looking for ways to shorten the time of product development, and strive to bring products to the market as quickly as possible.

To achieve this goal, Mitac uses two methods to shorten the product development period: computerization and program standardization. Companies use computers to manage component procurement and product testing: "In order to reduce the time-consuming process from product design to manufacturing, we must carry out computerized management of relatively difficult-to-operate links such as component procurement and product testing."

In addition, Mio has also worked hard to find procedures that can be standardized in the product design process: "In this way, many parts inspection problems can be quickly solved. Also, this standardized management system can shorten the time required for parts selection. "

The company found that a design problem could be resolved in three days if the company had strong testing capabilities, but it would take a month if the testing capabilities were insufficient. From the time it takes an enterprise to solve a design problem, it is possible to accurately determine how fast or slow an enterprise's products enter the market.

The best way to solve design problems early is to get input from enterprise customers, which is the second key in the race for speed. (For more on Mio's practice, see the Back Up to Speed article on the CEConlines website.)

Accelerating Customer Response

The best companies can respond instantly to their customers' comments. They have thus become a model of the "instant enterprise". According to the definition of market expert Regis McKenna, an "instant enterprise" must meet the following three conditions:

● Continuously analyze customer feedback, closely link customer opinions with business operations, and find its own shortcomings .

● Act proactively on customer feedback. This requires the realization of sufficient information sharing within the enterprise and the formation of dynamic collaboration between various departments of the enterprise, suppliers and customers.

● Closely supervise the company's response and actions to customer feedback to ensure the quality and speed of the response.

There are plenty of examples of businesses valuing and using customer feedback. Microsoft's Gates once said that 80% of the product innovation ideas of enterprises come from customer feedback. Quicken, a leading financial software company, closely combines customers' opinions with the development of new products, and develops and improves products to be launched next year according to customers' opinions.

Several Silicon Valley-based companies actively listen to their suppliers on product design, embodying this spirit of collaboration. Doing so helps businesses adapt their products to changing customer needs. This kind of collaboration can also be established between enterprises and customers. Federal Express (Federal Express) installs the PowerShip automatic service system on the computer of the customer's enterprise, and actively teaches the automatic service technology required by customers.

Business strategists David Bovet and Joseph Martha use fashion brand Zara as a model for companies to respond quickly to customer information. As we all know, because fashion companies have to predict future fashion trends in advance months before their clothing products enter the market, it is necessary to build buffer stocks in various places. A single mistake in forecasting can have catastrophic consequences for a business. But Zara has been able to turn fashion ideas into products and put them into the retail market faster than other companies, thus avoiding such catastrophic mistakes to the greatest extent possible.

What differentiates Zara from other fashion brand retailers is its vertically integrated business model that includes design, just-in-time production and marketing.

This business model is described on Zara's website: "Speed and quick response are the purpose and core of business operations. Designers can obtain daily sales data of each retail store through an extremely simple IT system, and Respond to the sales of various styles of clothing. The average time for the fashion industry to launch a new collection is 9 months, while Zara only needs 3 weeks. This time advantage makes the inventory of Zara brand fashion less than Other brands, while the clothing style changes more frequently, giving customers a sense of dominance. The managers of the Zara fashion store can use the PDA system to order new products twice a week."

This business model This allows Zara to keep up with fashion trends, while reducing the risk of slow sales of new products. It can generally launch 11,000 new fashion sets a year. Many styles are often replaced by newer products within weeks of being on the market, the company said.

Increasing the Speed of Operations

For many businesses, removing non-value-added aspects of operations is an effective way to increase speed. Of the total time spent in manufacturing and delivering the product to customers, less than 5% of the time is substantial, while the remaining 95% is non-value-added time.

How to solve these dead times is another key to speed competition: to eliminate the loss of dead time as much as possible, to ensure the continuity of the operation process, and to maximize the time occupied by value-added links. This way, businesses can process product orders more quickly and thus respond more quickly to customers. At the same time, shipping finished products more quickly and efficiently also greatly reduces product inventory.

Another approach to speeding up working procedures is "Constraint Theory". Eli Goldratt, author of the best-selling book The Goal, made the theory even more famous. The content of the theory is that the weakest link in the management procedure, that is, the "bottleneck" of management, should be found and solved first.

Almost all production processes consist of a series of work groups. The most serious constraints should be identified in each working group and focused on their removal. As long as the operating procedures are continuously streamlined, the operating cycle can be continuously shortened.

Gil Amelio, the former president of Apple Computer, has always followed this principle. He once said: "I don't like to sit there thinking: 'There are so many things to improve, which one should I do first?' Actively addressing the worst problems not only simplifies the work, but reduces the A waste of time."

Enterprise Acceleration: Stop Wasting Time

There are many time-wasting jobs in every business. To speed up the operation of the business, it is necessary to identify these problems and try to eliminate or simplify.

The key to problem solving is that you must first find the link that is causing the backlog of products and services, such as production, shipping, or customer response. "In an enterprise's value delivery system, time spent on products and services is largely wasted waiting," says Stoker Jr.

Delays can occur for a variety of reasons. As long as these factors are eliminated, the speed of business development will be accelerated:

● Cumbersome procedures. Bureaucracy in a business creates many obstacles, including scheduling and authority. The solution: reduce cumbersome official articles.

●Approval process. The approval process is one of the most protracted of many cumbersome official articles. Carefully investigate how many internal approvals a product or service has to go through before it finally reaches the customer. Solution: Create a product approval process table, and then cut out all unnecessary links.

●Problems during manufacture and service. If there are quality problems in the production of the company, then the products and services need to be reworked, and the entire production process will be slowed down. Solution: Develop higher quality standards. When you get quality you get speed.

● Structural barriers. The main problem is the organizational structure of the enterprise, including complicated product and information processes, overlapping functional departments, and scattered related facilities.

●The progress is uncertain. The production schedule must be deterministic. Managers must make it clear that delays in progress will not be tolerated unless a catastrophic event occurs. Motorola successfully designed a new automated factory in half the normal time. The key to its success is setting clear deadlines and sticking to deadlines.

● Batch work system. The so-called batch work system refers to a work method in which one group of people completes a job and then transfers it to the next group of people to continue processing. This method will cause huge waste. The secret to the success of Toyota's famous production system is to break the batch work system and ensure the continuity of the work process.

People Acceleration: Shifting Corporate Culture

The quest for speed requires a corresponding shift in corporate culture. The culture of Chiron Corporation, a leader in bioengineering, is based on speed. Ed Penhoet, former CEO of Chiron, said: "We measure speed by the time it takes for a new idea to reach the market. Our business is unique in identifying opportunities early, seizing them, and then using It operates in an extremely positive way."

At the heart of Chiron's corporate culture is the speed of commoditization, while Honda's corporate culture is one of quick thinking and quick turnaround. Soichiro Honda, the founder of Honda, once said: "For me, success can only be achieved through constant failure and self-reflection. In fact, only after 99% of failures can we finally achieve the 1% of success. "One of the ways Honda has shaped its corporate culture is by sending the company's engineering staff to race in Formula 1 cars. By rotating into Formula 1 teams, Honda has instilled a competitive spirit in the company's employees -- every second counts, and any omission in the car and the team can lead to failure.

Management expert Tom Peters suggests that building this "speed-oriented" culture should encourage "quick summaries of failure." He believes that it is necessary to "learn from each failure; and quickly take new corrective measures." In this way, "learn from failures so that you can immediately take smarter steps to move forward."

The corporate culture is It's one thing, and the organizational structure of a business is another. In addition to establishing a speed-oriented corporate culture, Honda has also built a cross-functional team. This allows the company to develop new models as quickly as any other business. Honda has adopted an organizational structure called the SED system (ie Sales, Engineering and Development). This team, made up of people from three departments, is jointly responsible for assessing customer needs, designing models and planning production.

Like Honda, most successful speed companies have formed such cross-functional teams. Compared with the traditional enterprise structure, this team model reduces a lot of communication and decision-making links, so it is more efficient.

In this regard, Stoke Jr. took a household product manufacturing company as an example. The company set up several product development teams and asked them to shorten the company's product development cycle from the original three years to less than one year. The teams found many ways to increase speed. "For example, they found that months of valuable time could be saved by transferring certain product performance tests from the company's central laboratory to the design team," Stoke Jr. wrote. As these improvements were implemented , the enterprise is successfully moving towards its goal."

Jet Magsaysay is the consultant of this magazine, translated by Zhu Xiaofan.

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