Time-based competition

One measure of competition is response time or speed of response. Blackburn [6] and Stalk [86] describe firms that compete on delivery speed. One example is Atlas Door, an industrial door company that coordinated its supply chain to offer custom door delivery (for reactors or furnaces) within two weeks, when the industry standard was over four months. Atlas performed at this level by coordinating order quotation and scheduling production, excess capacity, and tools, synchronizing all components so that a complete kit was delivered to the construction site. Atlas s market share increased rapidly to 80% of the industry volume within five years, with a 15% price premium. 

Similarly, quick response programs in the apparel industry focused on decreasing apparel delivery lead time. The competitive benefit of lead-time reduction has been estimated to be equivalent to the profit associated with a 40% demand increase. In short, time can generate money for the supply chain. 

Customers in all markets, industrial or consumer, are increasingly time-sensitive. In other words they value time and this is reflected in their purchasing behaviour. Thus, for example, in industrial markets buyers tend to source from suppliers with the shortest lead times who can meet their quality specification. In consumer markets customers make their choice from amongst the brands available at the time hence if the preferred brand is out of stock it is quite likely that a substitute brand will be purchased instead. 

Customers in all markets, industrial or consumer, are increasingly time-sensitive, 

There are many pressures leading to the growth of time-sensitive markets, but perhaps the most significant are  

3 Volatile markets making reliance on forecasts dangerous 

A feature of the last few decades has been the shortening of these life cycles. Take as an example the case of the typewriter. The early mechanical typewriter had a life cycle of about 30 years - meaning that an individual model would be little changed during that period. These mechanical typewriters were replaced by the electro-mechanical typewriter, which had a life cycle of approximately ten years. The electro-mechanical typewriter gave way to the electronic typewriter with a four-year life cycle. Now personal computers have taken over with a life cycle of one year or less  

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Through concurrent engineering and other approaches, lean product development has achieved astonishing results, requiring only one half or less of the time and human resources traditionally needed to develop a new car. Accordingly, it has become a cornerstone of time-based competition. Further means for improvement lie in the fuU exploitation of information technologies. In particular. 

Stalk, G., and Hout, T. M. (1990), Competing against Time Time-Based Competition is Reshaping Global Markets, Eree Press, New York. 

Whether approached on a strategic level or shorter-term tactical and operational levels, transportation management, using new technology, is trimming time and cost. And time, according to most experts, is one of the most precious commodities in today s supply chains. Shortened product life cycles necessitate time-based competition throughout the supply chains (Michel 1997). 

Handheld, R. (1991), The Role of Materials Management in Developing Time-Based Competition, International Journal of Purchasing and Materials Management, Vol. 29, No. 4, pp. 2-10. 

Blackburn, J.D. Time-Based Competition The Next Battleground in American Manufacturing. Homewood, IL McGraw-HiU Professional Series, 1990. 

Competing on response time became a popular management practice in the 1990 s (see Blackburn, 1990, Chamey, 1991, Schmenner, 1988, Stalk and Hout, 1990, Thomas, 1990 for discussions of the virtues and practices of time based competition). This trend motivated researchers in operations management to develop models to understand leadtimes and how to shorten them (see Karmarkar, 1993, for a review). 

Blackburn, Joseph. 1990. Time Based Competition. Irwin, Burr-Ridge, Illinois. 

Zeng, A. Z. 1998. Single or multiple sourcing an integrated optimization framework for sustaining time-based competitiveness. Journal of Marketing Theory and Practice. 6(4) 10-25. 

Re-engineering The engine that drives Time-Based Competition. To gain speed, firms must apply the principles of re-engineering to rethink and redesign every process and move it closer to the customer. 

Time-based competition is an idea that will be returned to many times in later chapters. Time compression has become a critical management issue. Product life cycles are shorter than ever, customers and distributors require just-in-time deliveries and end users are ever more willing to accept a substitute product if their first choice is not instantly available. 

The basic idea behind quick response (QR) is that in order to reap the advantages of time-based competition it is necessary to deveiop systems that are responsive and fast. 

Key issue What is time-based competition, how does it link to other initiatives, and what is the purpose of it ... 

The second key element of time-based competition is to reduce cost and therefore improve productivity through the elimination of non-value-added time in processes. This means that wasted lead time and unnecessary tasks that are not actually adding any value in the customer s eyes should be identified and eliminated. Stopping unnecessary tasks and removing wasted time from those that remain lowers cost by ... 

As a company embraces time-based competition then success in the marketplace will increase demand for products and services that the customer really values. To make way for these means that space will be at a premium in the company. This is just the driver needed to replace the old with the new. 

When Time-based competition is only as relevant as the customer perceives it to be. Speed for the sake of speed can create unnecessary costs, and can cut corners, leading to poor quality. 

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