The Benefits Of A Faster And More Agile Organization
It is certainly true that larger, more established companies have many advantages over their small and medium-sized counterparts. Brand recognition, capital reserves, and mature infrastructures are three such competitive edges that a larger company boasts.
However, there are certainly some facets where a smaller organization has a leg up on their larger, more cumbersome competitors: these advantages deal with the speed and agility of smaller firms. Think about this concept for a moment: In the business world (and the real world), there are three fundamental ways to excel over the competition. The first is to possess something (which includes having knowledge) that your competition lacks. Number two: having the advantage when it comes to intelligence. This is sometimes a double-edged sword, since people have a knack for thinking they are smarter than they actually are. The third and final basic competitive advantage is speed — or more specifically, the ability to process and act on information quicker than the next person (or business). This is the premise behind the speed and agility advantage of smaller companies — their nimble ability to adapt and change on the fly can often be a game-changer.
What makes speed and agility so important in business?
For starters, being a dynamic, fluid enterprise allows for the implementation of new, innovative ideas. If the concept doesn’t produce the desired result, you can scrap it, and proceed with plan B, all in advance of your competition. Reaction time always has been an integral component of business operations, but has become even more pronounced given the digital age that we all live and work in. Although it is an extreme analogy, being fast enough and nimble enough with decisions is akin to utilizing a time machine.
For example, let’s examine day traders. You have various people of similar high intelligence levels, all with access to basically the same information at the same time. Any and all advantages that the traders operating in this sector can grab over their competitors, rest assured that they will exploit it. Because most of the variables are equal, the one area that often decides a winner or loser is the speed of the decision loops (how long it takes a trader to execute a transaction). In a revealing illustration of just how crucial speed is to these traders, in the last several years traders have actually constructed their own wireless networks. The sole purpose of these specially built networks is to take advantage of the fact that microwaves are 50% faster than the speed at which light can pulse through fiber optics. This translates into the traders being able to execute their transactions a split millisecond quicker. This is obviously an extreme example, but the advantages afforded an organization based on their speed and agility simply cannot be understated.
Larger companies copying the little guys
Given the fact that being quick to adapt and respond is integral to success in the business world, what kind of impact has this had on how the average company operates? Ironically, what has transpired is that larger, more established firms — the ones that supposedly have all of the advantages — are suddenly finding themselves trying to mimic the behaviors of smaller businesses. These behemoths are looking to reinvent themselves as startups. Unfortunately for them, they usually have an established hierarchy: full of rule, regulations, and procedures. Not surprisingly, this process has proven to be extremely challenging for said “industry titans”.
How about your company?
What about your enterprise’s end-to-end latency? What is the length of your decision loop, when juxtaposed to that of your competition? Most companies will find that by scrutinizing their operations, they can identify points where response times are able to be minimized, and other areas where processes are able to be tweaked to foster a higher degree of agility and responsiveness.
If you have any questions about ensuring that your company is operating in a swift, nimble manner, please feel free to reach out to us today!