Shorten the distance or increase the speed

One of the first questions that I ask organisations when we’re beginning a consulting engagement is this: “How fast does information move from your customer, to your CEO, and back again?”

It’s a somewhat imprecise question that needs a little refining for each different client, but it gets people thinking. How fast does evidence of changing market conditions reach decision-makers who can do something about them? And how fast can they respond?

The answer is often measured in weeks, even months.

This is too slow. In a slow-moving market you might get by like this for years. In a fast-moving market this behaviour is an existential threat.

The solution can come in many forms. People’s natural instinct is to speed the flow of information. Invest in new technologies. This is often part of the answer. Working on the future finance function recently I saw stories of just how dramatic the effect can be for organisations when they can see their true financial position with a latency of just hours rather than weeks.

Managers also tend to look at the people involved in the communications chain. Long-established companies and public sector bodies often have information flow through multi-tiered committees before it is rubber-stamped and presented to managers to act on. Sometimes this improves the quality of the information, but often it is over-polished by people covering their own behinds. It loses some of its raw value the more it is cooked. The information flow is often speeded when these committees (and often the people who sit on them) are stripped away in cost-cutting exercises.

Perhaps the most effective way to improve responsiveness though is to shorten the distance the data has to travel before it reaches someone who can act on it. This makes many managers uncomfortable, delegating power out to the edges of the organisation. But done right, as it is for example by some e-commerce companies with their merchandisers, it is incredibly powerful. Merchandisers can pick up on social trends and news events and create rapid, responsive promotional campaigns for goods on their site, piggybacking on memes that would be un-catchable if they had to pass information up the chain and get authority back down it.

Ask your clients or colleagues: how fast does it take information to reach those with authority in your organisation? And how can you speed the response?

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Tom Cheesewright