Achieve Results Faster by Increasing Your Company’s Clockspeed
The classic definition of clockspeed is the rate at which a processor can complete a processing cycle, typically measured in megahertz or gigahertz. More recently the term has been co-opted as a method for categorizing industries and companies. For companies, clockspeed can be used to guide dynamic business strategy. The clockspeed framework recommends that you master the ability to quickly and continually design, assemble, fortify and sustain chains of “competencies” that deliver value to your customers.
This belief is not a knee-jerk reaction to any structural shortcomings or systemic complacency exposed by the COVID-19 pandemic. After all, markets, technologies, and competitors move more quickly than five years ago and at light speed relative to 25 years ago. Before COVID, many observers including Logility noted the need for organizational robustness and agility in the face of economic turbulence. There are always disruptions — some bigger than others.
We agree that the overall health of your supply chains is where you need to concentrate in order to boost clockspeed. Let’s consider a couple of important ramifications of this. First, note that the four-walled corporation is no longer the appropriate unit of analysis, if it ever was. Attention must now be laser-focused on the extended organization: you, your supply network, your distribution network, alliance network, and customers.
Second, you must break free from the idea that the supply chain is a given, and your job is to just manage it. Yes, the stewardship and use of a network of organizations and assets to provide value to a market remains relevant. But don’t skip a step. Thorough consideration of supply chain design paves the way for success in the activities undertaken in supply chain management.
You should embrace this way of thinking. Your competitors will if they haven’t already. In many sectors of the economy, new players and new business models are disrupting tired ways of thinking and operating. Even if the business models of “digital disruptors” don’t immediately kill off incumbents, they set a new narrative and reset market expectations.
While each major industry has developed a legacy clockspeed driven by its capital intensity, R&D costs, brand spend and competitive landscape, we believe the next decade will produce in aggregate as much change as the previous century did. In less than five years, cognitive computing has advanced from science fiction to a commercialized means of problem-solving. In automotive, health care and in the high-tech sector, clockspeeds are accelerating on top of an already blistering pace of innovation.
We’ve discovered across thousands of implementations that what distinguishes the top-performing customers from the ordinary is the ability to build supply chains that better anticipate opportunities for growth and margin improvement and are resilient enough to handle the inevitable disruptions. Superior decision-making and forecasting abilities are critical. This is how you will thrive in the sectors where your flag is firmly planted while responding to new, unmet market needs for which venture-like experiments can be launched and new lines of businesses scaled.
So as you look ahead, know this: the next decade will undoubtedly present your company with expectations different from anything you’ve experienced before…become more agile and resilient, pivot with precision, seize opportunities to grow.
The good news for Logility customers is that your relationship with us means you’ve already invested in faster clockspeed!
2020 may end up looking like a shoulder shrug in the global industry annals, but don’t spend much time thinking about that. Instead, ask how bold your company is willing to be. Many companies are evolving and thriving by increasing their clockspeed. You should too.