Thursday, 20 March 2008
A Brief History of Time-Based Strategy.
The ‘speed thing’ - whether time-to-market, production cycle-times, or delivery lead-times, et al - isn’t new. It goes way back before it became vogue in late 20th century business strategy. Competition through swiftness goes back millennia in fact.
The Great Wall of China and Rome’s straight cobbled roads where constructed to deploy troops and ordnance at pace. Empires would fallen like dominos if it were not for these engineering super-highways.
When the first prototype model of the K5054 (Type 300) Spitfire was assembled in 1936 it took almost 28 days of 24 hour shifts. By the end of the Battle of Britain in October 1940 it took a mere 9 hours to put the Mark-V (type 331) Spitfire together…. And hay, who said the Japanese pioneered Kaizen type continuous improvement?
Lockheed (now merged as Lockheed-Martin) also as far back a the World-War-II and through the 1970s continued to amaze the Pentagon by the speed at which they designed and built advanced tactical jet aircraft. In fact, one-tenth of the time compared to the competition. The driving force behind this stupendous rate of productivity was one Clarence ‘Kelly’ Johnson. He set up an organisation with all the processes in one giant hanger to cut across red-tape to get things done without fuss. Two of his most celebrated projects was the U-2 and SR-71 (Blackbird) spy plans. They went from rough sketch to airborne prototype in under 21 weeks (that’s 144 days).
In 1979 a client of the Boston Consulting Group revealed the conclusions of a benchmarking programme he carried out between his US factories against his Japanese affiliate’s factories. The findings were stark. The Japanese plants had substantially higher productivity, better quality, less inventory, less space and much faster throughput times. However, they were baffled as to how they achieved such competitive advantages? And after the best part of a 4 year study the cause of these effects were delineated. ‘Time’ was at the essence.
During these investigations many closely held assumptions as to how costs and customers behave were altered. Instead of costs going up as run-lengths are reduced; instead of costs going up as greater investment in quality; instead of costs going up with increasing variety and quicker response times; costs came down. Further, instead of customer demand being only marginally affected by expanded choice and better responsiveness, it proved astoundingly sensitive to better service.
After these conclusions were drawn, they began to leak out into the technical media, and so time-based strategy began to take off. Throughout the 1980s and ‘90s speed became a big issue. In Japan Sony, Casio and Sharp adopted the temporal approach to new products. Six months for new platform digital watch, camera, phone, PDA, or forget it! State-side, the likes of Xerox, AT&T, H-P, Intel, and Motorola begun to see the benefit and implement time-based strategies and organisations. Eventually, in some cases, new product introduction went from many tardy years to months.
And so it was set. Manufacturing, and many a service industry was ablaze with buzz terms like ‘Simultaneous Engineering, ‘Integrated Design and Manufacturing,’ ‘Process Reengineering,‘ and ‘Time-to-Market.’
Today, arguable, Formular-1 racing hold the batten of speed across new product introduction and production cycle-times. Making use of ultra-fast design and manufacturing technologies, and highly talented, skilled and integrated teams of engineers and designers. Racecraft models go through significant adaptations week-to-week during race season.
Life Expectancy Revisited.
A friend just asked me if I had any data on the evolution of increasing human life expectancy.
‘Afraid not’ I said, and explained that expanding human life-expectancy has little to do with evolution at present, at least in the Darwinian sense. Genetically, and therefore anatomically speaking, humans (homo-sapiens) haven’t changed for about 130,000 years (modern humans appear in the fossil record in Africa about 130,000 B.C.).
But I do have data on the average human life expectancy which has increased as a result of improvements in technological culture.
The reason is that cultural developments operate many orders of magnitude faster than genetic evolution. Advances in medicine, diet, and labour productivity have happened in the blink of an eye, and have had dramatic impact in life spans.
Here’s the data:
Average Life Expectancy (Years)
Cro-Magnon Era: 18
Ancient Egypt: 25
1400 Europe: 30
1800 Europe: 37
1900 USA/Europe: 48
2008 USA/Europe/Japan: 79
If this exponential growth curve continues for even as little as the next 20 years, average life expectancy in the developed west will hit 98 by c.2030.
But, as my blog post of Tuesday, 6 November 2007 reports (blogsearch: 'de grey'), even this forecast is ultra-conservative.
18 Reasons for the Need for Speed.
In 1988 I was tasked to shrink the new product introduction cycle-time at the much acclaimed, design lead firm, Concord Lighting. 20 years later, now in 2008, time-based competition can still give strategic advantages. In fact, time compression has become an industry in itself. But why still the need for speed?
Here’s 18 reasons:
Leave Competitors Behind and Disadvantaged: Companies with relatively slow processes are by definition slower to change, and as such are left behind as faster competitors innovate new business models. When slower companies do respond they do so from a disadvantaged position, and so incur all the costs of becoming more responsive without securing many of the benefits.
Move Ahead of the Industry: If the competitive environment develops faster than a firm is developing, then the writing is on the wall. If a firm is developing ahead of the market, then that company will eventually breakthrough a competitive wall.
Time to Insight: As the number of competitors that recognise the same opportunity goes up, so the value of that opportunity fall to wards a commodity proportionally. Hence, the time it takes to recognise an opportunity is key to sustaining value.
Accelerated Learning: Shorter-cycles enable faster feedback for learning. This greater and deeper understanding at a faster rate facilitates better project control; delivers better quality outputs; and ultimately gives more advanced solutions ahead of the competition.
Risk Reduction: Such accelerated learning also reduces risk and uncertainty. Learning is number one route to reduce the risk of anything. The faster one learns, the faster one understands the details of a risk.
Time Value: Show me a market that doesn’t have collapsing windows of opportunity and I’ll name a dozen that do. Thus, in markets with shrinking life-cycles ‘value’ is not only finite, it is time dependent. In as much as the earlier a firm can launch a new product the more share of that finite value is gained.
Rapid Return On Investment: One of the most evident challenges for new product introduction is that there’s no residual value until the new product reaches break-even point in the market. This can be a strain on both a company’s capitalisation and cash-flow. In sum, get faster to the break-even point, and ROI comes back faster.
Rapid Attack: The traditional attack strategy is the cut-price/add capacity stance. However, a time-based attack is about surprise, as competitors often get confused, don’t understand what happening, and therefore cannot intelligently respond. Such a surprise can gain much market share. Surprise the competition with rapid introduction of radically innovative goods and services, super-fast delivery, then wow them by delivering more than expected faster.
Fast Following: Copying something that moves faster than a firm can copy isn’t a good business to be in. Faster-cycles than the competition enable a firm to track close behind the leader, but with the benefit of lowered risk.
Fashionising: It’s a fickle, down right ephemeral world. Cellphones, laptops, MP3 players, DAB radios, palm-top assistants, training shoes, and robopets aren’t just functional items anymore - they’re fashion accessories. Fast new product introduction cycles are a significant part of setting and leading trends.
Technological Leadership: It’s said that a slower pace of innovation allows for refinement of technologies. But there is counter point here. Whilst slower competitors hone their wares in the lab, faster competitors are learning in the real world with real products at two and more time the speed. But more, because learning happen twice as fast, technological development is compounded and thus the leader can pull away.
Market Preemption: Fast-cycles mean that you can get to market first. And that means that such a preemptive strike can allow you set the industry standard, in turn lead and gain greater market share.
Premium Prices: Leading the market whether through technological leadership, setting fashion trends, or being in a position to gain a preemptive strike means that your product or service will command a premium. First to market with a new product that satisfies customer demands above and beyond the competition will put a firm in a premium value position.
Reduces Rework: Lengthy cycle-times can give way to loss of information, as data, ideas and learnt knowledge is lost in the drawn out gap between start and finish. This, in turn, may increase error rates and rework. Fast cycles give faster communication feedback, thus less gets lost, and hence less rework.
Increase Productivity: As time-to-market or production cycle-times get faster, throughput naturally increases. But more, accelerating cycle-times mean more time for process performance improvement, so setting up virtuous circle of increasing productivity.
Increased Customer Responsiveness: Speed gets a firm closer to the customer, in turn, customers become more dependent on the firm. Fixing a problem quick is close to the customer. Fastest and reliable delivery leadtimes is even closer.
Increase Variety Whilst Reducing Costs: Time’s money of course. Traditionally, the costs of an organisation, whether it be a product or service business, can be very sensitive to the amount of variety that company is attempting to manage. On-the-other-hand, speed subverts the rising cost dilemma. Rapid cycle-times enables a firm to increase product variety, whilst at the same time lower overheads and indirect costs.
Increasing Returns. Who is first with most, gets! You don’t even have to be the best technologically speaking. Recall the old Sony Betamax Vs VHS video cassette tape war. VHS won because VHS were out in the market earlier with more product in the market, even though Sony’s system was better! Today, Sony have learnt that lesson, and have won the Blue Laser CD as standard competition for exactly the same reason. Who is first with most, gets.
Breakthrough Technologies for Peering into the Brain.
Temporal and spatial resolution of brain - tomographic - scanning technologies are doubling each year.
What was a pipedream a mere 15 years ago - scanning and seeing the brain at the mol level - is in fast becoming eclipsed by even more sensitive instruments today.
New breakthroughs in scanning technologies now enable reduction of mol drift and noise in the apparatus to such an extent that such kit can see the tiniest motions of brain molecules and their connections to a distance less than the molecules own diameter.
Here’s the chronology:
In 1970 the best available scanning resolution was 2.0000mm in 1000 second graphical rendering, via Magnetic Resonance Imaging (MRI).
By 1980 it was 1.2000mm in 80 second graphical rendering, via Functional Magnetic Resonance Imaging (fMRI).
By 1990 it was 0.7000mm in 8 seconds graphical rendering, via Positron Emission Tomography (PET).
By 2000 it was 0.1000mm in 0.01 seconds graphical rendering, via Magnetoencephalograpy (MEG).
And by 2006 the best available scanning resolution was 0.0200mm in 0.004 seconds graphical rendering, via more advanced MEG.
Today, at the beginning of 2008, a breakthrough at the University of Pennsylvania Neuroengineering Research Laboratory is enabling spatial resolution high enough to image individual neurons, at 1 millisecond time resolution. This is a dramatic leap forward, as this is sufficient to record the firing of each neuron (a designation for the technology has not been announced yet).
As for the near future, there’s much excitement and activity.
One approach called ‘two-photon laser scanning microscopy (TPLSM).’ This creates a single point focus in 3D space which detects intracellular activation of individual synaptic receptors and dendritic spines at one millionth of a billionth of a second (10-15).
This steady march toward nano scale resolution (spatial and temporal) means greater elucidation of such dreadful neurological problems as Parkinson’s disease, Alzheimer’s, and stroke.
Tuesday, 18 March 2008
'The public at large are blind to what's happening at the cusp of technological innovation... Governments are even worse... But what frightens me is that the average engineer working on the front line, doesn't have clue to what's happening at the edges of science and technology either...
On my walkabouts around US and EU factories I ask what on the CEO's mind. Mostly it's procedure, organisation charts, and next quarters financial report and cash-flow... I ask questions about quantum computing, nano-scale engineering, and what radical projects are being worked on?; and it usually draws a blank...
This is what's at the centre of the economic down turn. The average CEO has forgoten how to radically think.'
Bill Gates (pissed off) @ Davos, January 2008.
A neckband that translates thought into speech by picking up nerve signals has been used to demonstrate a "voiceless" phone call for the first time.
With careful training a person can send nerve signals to their vocal cords without making a sound. These signals are picked up by the neckband and relayed wirelessly to a computer that converts them into words spoken by a computerised voice.
A video (click on above title) shows the system being used to place the first public voiceless phone call on stage at a recent conference held by microchip manufacturer Texas Instruments. Michael Callahan, co-founder of Ambient Corporation, which developed the neckband, demonstrates the device, called the Audeo.
Users needn't worry about that the system voicing their inner thoughts though. Callahan says producing signals for the Audeo to decipher requires "a level above thinking". Users must think specifically about voicing words for them to be picked up by the equipment.
The system demonstrated at the TI conference can recognise only a limited set of about 150 words and phrases, similar to the early days of speech recognition software.
At the end of the year Ambient plans to release an improved version, without a vocabulary limit. Instead of recognising whole words or phrases, it should identify the individual phonemes that make up complete words.
Monday, 17 March 2008
How to Accelerate Your New Product Processes in 5 Easy Steps.
Believe it or not, you don’t have to employ a £2000 an hour management consultant to reengineer you new product processes to get faster to market.
Here’s 5 things you can 'begin' do this quarter to get significant gains without upsetting the apple cart (to much).
Eliminate Bottlenecks: Where’s the number 1 bottleneck in your process? Obviously, look for the longest job queue. The reason for such a tailback is that there’s a linear and quite often single sub-process on the critical path to cope with a multitude of sub-projects waiting in series (e.g: one piece of major test kit, or lone mould M/C, etc). The solution? Multiply into a number of smaller pieces of kit, so that each project or sub-process can take place in parallel.
Reduce the number of projects by a half: This is about ‘results over time.’ Although there are less projects being worked on at any one time, the focus enables more projects to hit the market in much less time. The other issue here is what’s known as the ‘Bird Cage Effect.’ If there’s a heavy load of projects, the weaker projects (less perceived value or status of the engineer) will fall to the bottom of the cage. Half the number of projects and watch productivity boom.
Work a on small number of sub-systems at a time: Furthermore, working on a umpteen projects simultaneously will increase aggregate complexity. The danger here, is that this seemingly flexible approach is very wasteful and misleading. Why?… 2 reasons: First it causes so-called ‘Organisational Entropy.’ A multitude of people working on multiple projects, attacking several issues, sets up high and unnecessary levels of turbulence. Second - and as a result of the first - is something called the ‘Wait-State Trap.’ An endless string of stop/go situations. And a project on stop, is project on stop. Take all the wait-states situations and total organisational entropy, and it ends up in gross project time delays. The secret? Work on a small number of sub-system projects at a time, bring them up to specification, then move on to the next. In the long run, it’s is faster and more efficient.
Reduce the size of the team: Large organisations cause their own problems. We know that. Furthermore, product innovation is not a linear process, like counting the number of books in a library. Here, for every agent added (people counting the books) the faster the books are counted. However, product innovation is an acutely uncertain and highly interactive process. Where for every agent added, so the number of communication passes there are, in turn slowing the proces, that it was intended to speed up. QED: Small team are faster, more nimble, and efficient.
Give senior engineers multiple hats (but train in the skills): I know a very major hand tool OEM where senior engineers are designers, engineers, prototypers, testers, marketers and customer supporters all at one and the same time! And here’s the test. Have you seen the raft of innovative tools in the shops of late? Go look, you'll be surprised.
Watch Out for Internet TV Sets.
Apple Computers and Microsoft are joining the Hyperinnovation game, interconnecting the PC & TV set. For example, the ‘Windows Media Centre Internet TV’ is a living-room-ready system capable of playing DVDs, accessing websites, downloading internet data like digital movies and including a digital TV tuner all-in-one box.
Broadband access to homes is now a widespread reality, the problem that Apple and MS are attacking is the use of internet technology to deliver high-definition video to TV.