As business continues to evolve, technology plays an increasingly important role in complex as well as small and mundane tasks. Technology brings not only efficiency but speed. As we move forward towards the future, one thing is certain, speed is becoming an important competitive attribute. Not only is speed becoming a strategic asset, but without it, it will become more difficult to compete.
How speed changed the business landscape
When the fax machine started being used in business, it cut down severely on the turnaround time of information. Before the fax machine, in order to prepare a quotation one had to call, and verbally move through a list of items, prices, quantities, and descriptions. Imagine calling a vendor, listing all the items you wanted to buy, having them read back all the prices, writing them on a piece of paper, and then using a calculator to factor in various costs to arrive at sell, writing those sells, compiling them into a quote and calling the customer to read those parts, descriptions, and sells. You can only turnaround a few per day, and in order to do more, you had to buy more labor. With the fax machine, you could now send that list over a telephone line rather than read each line. Quote time decreased, business activity increased, and customers began expecting more in less time.
Then spreadsheets and email infiltrated the workplace. Calculations became automatic, questions and files could be sent instantaneously over email. What used to take hours now took minutes. And those still operating under the old systems? Gone. Imagine sticking with the phone method of quoting in today's world? You wouldn't be able to keep up. In order to operate in the current world, you must adopt speed.
Speed allows you to conduct more business in less time, which translates to more money in a given year. It allows customers to get answers and iterate their plans in days not weeks. It provides for a company to make quick decisions, which increases the rate at which a company can grow, improve, and evolve. A company that can learn to move quickly, will evolve faster and hit much higher rates of growth
Not only has speed has become integrated with business, but culture. We, as consumers expect a quick response. As we expect it from companies, they expect it from suppliers, and the requirement flows downstream.
The evolution is not over
If phones were undone by the fax, and the fax by email and spreadsheets, then any forward-thinking individual can assume that there will be new technologies that allow companies to get faster. It is inescapable, speed is becoming more important as technology advances.
As a small example, consider the quick bots written to grab more favorable delivery times during the pandemic. The advantage did not go to the wealthiest, the most connected, or the incumbents... it went to the fastest. Think about firms who can beat your stock trade by milliseconds and make money off of your order flow or the manufacturing firm that uses AI to alter CAD designs in hours rather than weeks in order to make them cheaper to produce and more manufacturable. The speed revolution is only beginning.
As a small company, it is becoming more dangerous to be a late adopter of these technologies. Large customers invest and implement technology-assisted decision-making, allowing them to make more complicated analyses and decisions faster. They grow accustomed to this pace and begin to expect their suppliers to respond in kind. The speed expectations flow down and across industries. Small businesses without long-term investment mindsets will find the hurdle higher to jump in order to service these customers. In trying to make up the difference, they will hire more labor, pinching their margins, and causing them to lose out to competitors that are strategic in developing technologies and systems built around speed as a strategic asset.
Beyond the changing landscape, is a changing environment. The world is becoming more complex. As complexity increases in a system, so do the unintended consequences. We are seeing a world with more frequent tail-risk events, and at greater proportions. What used to occur once a century, now occurs once a decade. I do not believe this will slow or stop. This is what happens as we continue to move down the path we are traveling on. So having an agile operation, one that can assess, change, and respond quickly, is becoming more important.
The good news as a consumer is that the benefits large companies accrue from being the fastest, eventually benefit you. Speed in response times lead to better service, speed in delivery leads to less waiting and more satisfied consumers, and speed as a result of prediction mean soon shops will help you find and obtain what you want before you even have time to process the choice landscape. As companies get faster, our experience gets better.
Why speed is becoming more difficult to access
Those that understand that speed is becoming integral in business, and choose to stay ahead of that curve, will continue to compete in their spaces. However, the source of that speed is currently changing. Like any initial change, the first levels of speed were easy to access. Get email, telephone, and Microsoft office, and you were set. However, the complexity of higher-level customers is continuing to evolve and increases in speed are no longer as easy to access… or as cheap.
Moving forward, speed is going to come from machine learning and artificial intelligence solutions. Whether data augmentation or full-on automation, these will require larger investments, longer time horizons, and deeper expertise. Those who are not currently at least monitoring and building an understanding of the space may be months to years behind as these tools become the norm.
When building AI or data-centric systems, those with the data accrue the benefits. As early adopters to data-based automation implement and get more data, they will be able to service faster and more accurately. This in turn will allow them to get more customers and thus more data. Competitive advantages and eventually market share will accrue to the early adopters, making it much more difficult for laggards to catch up.
Many companies will find themselves underinvested and too far back on the learning curve to catch up. Small companies need to see the growing size of the hurdle for the next phase of the speed revolution and start considering how to cross it now.
All else being equal, the fastest company in any market will win - Dave Girouard
The future of the supply chain and the integration of intercompany data will change the landscape. Customers will demand inventory analysis within minutes, same hour demand plan shifts, daily scenario running, and other data-intensive activities. Building expertise and a strategy of "speed" should be part of all companies’ long-term strategic planning.
📖 Must Reads
Risk Management with Nasa - Ness Labs
🔎 Interesting Finds
Hash - An intelligent agent simulator for testing artificial intelligence in various environments. There are some neat order picking simulations, and other warehouse agents already built.
Saltbox - Warehousing meets WeWork. Saltbox is helping smaller companies be agile and access warehousing space before they are ready to commit to large leases and floor spaces. Saltbox allows quickly expandable and retractable warehousing and office space, available on a need basis
Hackaday - A new school for hardware hackers. Interested in building your own piece of hardware? Want to prototype an order picking robot? What about creating a drone to count inventory? Hardware skills are becoming more necessary in supply chain and manufacturing. Hackaday has created a great school for hardware hackers to upskill in the space.
Build A Four-Legged Robot - We have all seen the four-legged rover with uncanny agility from Boston Dynamics. There is now an open-source version made with mostly 3D printed parts.
Thank you for reading!
If you have thoughts or feedback, I would love to hear from you! I am always looking to meet new people in the space.
Reach out to me on Twitter.
I think-up, write, and build systems and technologies that help B2B businesses augment and automate their decisions (with a special bent toward supply chain and manufacturing 😉)