Speed has long been held up as the essential competitive ingredient for successful businesses to thrive in a world that seems to be governed by the clock. After all, those who get to market fastest, who carve out a position as an early leader, who invent the next wave of cool, stay ahead of the game for at least some period of time. The idea of speed, in this regard, is one that reaches business leaders at a primal level.

Leader after leader cries about the “need for speed,” and its new role as the single most important condition of future business success. But there is some flawed logic floating around the business community.

It’s no wonder. Vince Poscente, writing in The Age of Speed, says we’re continuously placing an “an ever-increasing demand for speed on others.” We want our food, money, music and movies at the instant that we think of them. We loathe congestion on our highways, in our airports and at checkout counters. We want people who repair, install and maintain our gadgets and toys, to return calls immediately, and to start work as soon as we’ve decided we are ready. We want I-Dream-of-Jeanie-like powers to produce what we want in the blink of an eye.

Poscente pulls us back from this daydream with the reminder that every tug we make on the demand side of speed to get things faster, there is an equal and opposite tug on the supply side for us to produce things faster. We love speed when we are on the receiving end of the equation, and despise it when it pushes us to work faster.

Technology is addressing our need for speed through a continual flow of new innovations. We download songs and movies as fast as we can hit the “Enter” key on our laptops. An astute car buyer spends a few hours online to find a used car with the exact features, mileage and price point he wants at a dealership thousands of miles away. He then signs an online contract in seconds and waits for the car to arrive a few days later on a flatbed truck. At a Moscow airport, a vending machine squeezes whole oranges to produce fresh-squeezed juice for fast-moving travelers.

Many leaders see the consumer’s demand for speed as their last opportunity for a competitive advantage. They are racing the clock to capture market share in emerging economies, or to wrap value-adding services around products with shrinking margins. They believe speed is essential as they untangle elaborate business infrastructures to create the leaner enterprises they’ll need to compete against faster, cheaper upstarts who’ve built their businesses from the ground up on new technologies that rip waste from outdated processes. The nimble newbies are turning once successful business models into dinosaurs, and the old guys are racing to stay off the endangered species list.

Escape Commoditization?

Some leaders even think speed will help them escape commoditization traps. If they produce a regular stream of even fractional product improvements, they’ll perhaps be able to charge pennies more than the dozens of competitors with equivalent products and services. While this exercise might help them hang in there for the short term, many of the copiers have lower cost structures giving them better positions to win the long game. The misguided focus on speed almost seems like a veil that prevents leaders from seeing their own hamster wheels.

But in many ways, speed is Industrial Age stuff. Leaders need to recognize that while it’s a condition for success, it’s not the cornerstone to long-term sustainability.

While technology ably installed itself as the competitive differentiator of the 1990s, it was like table stakes in a poker game by the time the calendar turned over a new millennium. Speed may have an even shorter runway to improve business results. Its greatest hopes are for those who can quickly move into countries like Brazil, Russia, India and China (known as the BRICs) where they are experiencing unprecedented growth in their middle class populations, and their markets are ripe for the picking. Other than for the few who are positioned to move into these economies now, and can smartly adapt their products to meet local needs, speed is just the new ante to stay in the game.

What is the secret, and how do we get leaders ready? Stay tuned. You’re in for a great ride into the future of what leaders must do to drive long-term business success.

Be Sociable, Share!