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Speed is the lifeblood of business.
THE SPEED OF BUSINESS

Why organizations need speedometers

Ben Waber
By Ben Waber

Co-founder and president, Humanyze

Earlier this year I was sitting in a boardroom with more than a dozen top executives from a global Fortune 1000 company. The CEO sat directly across from me, flanked by his top lieutenants. Over a few hours, we delved into our respective long-term strategies, points of intersection, and how we could start working together. As we were wrapping up, the CEO surveyed his colleagues around the room.

“So, we’re ready to do this, right? There’s no reason for us to not start this next week, right?” he asked. Murmurs of “we’re ready” and “sounds good” echoed across the room.

We shook hands, exchanged some small talk for a few minutes, and then designated point people to get things rolling.

Reader, things did not get rolling.

We were not up and running the next week, as the CEO proposed. Or the next month. In fact, even after months of prep work before that meeting and months after it, we still haven’t formalized our relationship.

It’s not huge disagreements, but small points of friction, that slow decisions like this to a snail’s pace. Every stakeholder needs to meet with us individually to give their blessing. Small changes in contractual language need to be run by everyone again. Each meeting can take weeks to schedule, and random events can further delay each step.

This is the norm in large corporations. It also makes no sense. We have mutually wasted months doing busywork. In the end, this contract will get signed. But only after expending dozens of hours in meetings and losing valuable time in working together to create something valuable.

Speed is the lifeblood of business. If you can evolve faster than competitors, you’re more likely than not to beat them in the marketplace. Not because you’re smarter or have better processes, but because you can learn more quickly and figure out what works better than they can.

Speed has long been quantitatively measurable in pockets of organizations. Sales can measure time-o-sale, supply chain can measure time-to-fulfillment, and HR can measure time-to-hire.

The speed of the entire organization can be measured by response time. How fast do people respond to emails? To chat messages? How quickly do people schedule their next meetings? If efforts to increase speed don’t reduce this time, they’re unlikely to have an impact.

Companies need to work to identify the small points of friction that slow them down and work to remove them. As an example, in my company employees previously needed to go through the procurement department for all purchases. This means that employees had to reach out to procurement and then wait for the department to review and approve the request before finally the purchase can be made. This can take days. Now instead of this time-consuming process, we’re moving to providing not just each department and team with a budget, but each person. They can spend from that freely.

The cost is that there will be some waste. If, for example, someone buys an individual license for a piece of software that we have a group license for in another part of the business, we’re losing some money. But given how much we pay employees, I can immediately justify that increased waste in money with the decreased waste of the person’s time, which is much more expensive. And of course it  also makes us faster.

This is just one example. There are many more that we’re continually working on across the company. Every little bit helps.

Ben Waber is the president and CEO of Humanyze.