A Note to Our Readers: In this installment, my Quantum Leaders colleague, Gregg Gallagher, contributes another post from our Quantum Thinking blog which continues our “Strategic Planning is Dead” dialogue. Gregg talks more about the Real Time Execution Wave in this posting, and how it is linked to innovation and product development.
In his previous posting, Norman wrote about the importance of setting the Context field based Strategic Compass™ to accelerate an organization’s strategy execution. A strong Strategic Compass™ leads to alignment, the directed and focused efforts towards achieving the objectives. The organization responds with the speed and fluidity of a racer in “the zone”.
The frequency of the Real Time Execution Wave™ increases when alignment is optimized. This increases the speed of execution in product creation activities and positively impacts innovation.
It is commonly accepted that speed has become a key competitive weapon. All too often existing formal and informal processes stand in the way of a company’s ability to accelerate new product introduction. Yet being ahead of the competition and within the window of opportunity is central to marketplace success.
Although we implicitly understand that speed is important, what are the specific payoffs from speed?
The most obvious ones are:
1) Speed yields higher profitability – by decreasing time to market, a firm realizes higher revenues from sales being attained earlier and longer within the overall product life cycle.
2) Speed means fewer surprises – by reducing the likelihood that market conditions will dramatically change during a protracted development period.
3) Speed yields competitive advantage – via the ability of the company to respond to customers’ needs faster than their competition.
The Real Time Execution Wave™ framework shortens the time between the decision-making elements of observation-decision-action-evaluation. Contrast this to the time it takes in the traditional approaches to planning and product development such as the “waterfall” framework. Achieve fast and fluid execution by practicing Real Time Execution Wave™ decision-making in a structured and self-aware manner.
It is in the realm of comparative competitive advantage via disruptive innovation that we can see the dramatic impact that speed of decision-making and execution can achieve. The military refers to this as “getting within the decision loop of the enemy”, and can be visualized in the Real Time Execution Wave™ framework as follows:
As you can see, Company Black is executing along a faster cycle than Company Red. It is evaluating its first generation product results and observing the marketplace – planning its 2nd generation – while Company Red is still executing on it’s first generation product. Conversely, Company Red will likely be deciding and acting on its 2nd generation product long after Company Black has already started planning towards its 3rd generation.
In this scenario, Company Black’s ability to innovate and execute at a higher frequency than Company Red leads to significant competitive advantage.
Apple has achieved this dynamic with the iPod/iPhone product platform, and is now striving for yet another disruptive innovation leap by extending that mobile platform into the re-emergent tablet category via the iPad. While firms such as Google (with Android) and Microsoft (with Windows Phone 7) are currently reacting to iPhone 3.x, Apple has leapt ahead via both the iPad hardware platform and the recently previewed iPhone/iPad OS 4. Competitors such as Microsoft and Hewlett-Packard appear to be in the process of reassessing their own product strategies in this space, and are clearly in reactive mode. Apple has gained the initiative, at least for the time being.
Do you see this dynamic within your own industry? Is your company the Black or the Red one in this model?
To learn more about the Real-Time Execution Wave, part of The Living Organization business model, and the role of Innovation, download our white papers.