Go to POV #5

Zero Latency: The Fast Path to 
Opportunity and Problem Detection

Go to POV #4:

Elegant Simplicity: Applying the Concept to IT

Go to POV #3:

Elegant Simplicity:  Keeping Complexity Under Control

Go to POV #2:

eBusiness is Business as eUsual 

Go to POV #1:

Let's Stop the Plate Spinning:  Going Slow to Go Fast

 Zero Latency: The Fast Path to
Opportunity and Problem Detection

With the NASDAQ putting it’s worst year in history to rest, it’s important not to lose sight of success stories, particularly in the ravaged dot.com space.  While their stock prices have dropped back to near-sensible levels, supply chain competitors Aribba, I2, CommerceOne and Agile Technologies have demonstrated that “soft-wiring” the virtual organization generates business value.  Though they each attack the problem differently, all seek to reduce the time from information exists to when it’s available and acted upon by the right person in the right place.  In short, they reduce latency.

Speed depends on two key elements:  How fast can you detect problems or opportunity and how fast can you act on it.  While there’s always room for improvement, most companies do a far better job correcting than detecting.  The longer a problem is resident without action, the more problems it creates.  The longer an opportunity sits unaddressed, the greater the chance someone will act before you.

Reducing latency has always created competitive advantage.  In the classic movie “Sting,” hoodlums scam one another by placing bets after they have the race results.  Program traders use real time information and high speed computers to take advantage of temporal anomalies between buy and sell side.  We experience latency anytime a web page loads slowly because of Internet congestion or when our car hesitates after pressing the accelerator.

The above-mentioned firms focus on reducing information latency in the supply chain.  Using the Internet, they soft-wire a real-time connection manufacturers, suppliers, and sometimes customers.  They create a network of visibility between all stakeholders, enabling each to synchronize with each other.  The reduced latency reduces the time to detect and address supply and demand imbalances while minimizing unproductive and costly inventory.  For example, should one supplier run into a problem, the network can quickly shift the responsibility to another.  Not only are problems instantly visible, so are resolution paths.  In contrast the traditional hub and spoke model where the manufacturer orchestrates interactions between stakeholders, these new tools enable individual stakeholders to work directly with each other. 

SatMetrix is a new firm that reduces the latency between companies and their customers.  Using technology that enables real-time customer satisfaction measurement, SatMetrix transforms annual or bi-annual customer satisfaction surveys into a continuous real-time pulsing.  SatMetrix can measure each transaction and roll that data increment into an ongoing index.  Additionally, they use alarms to trigger exceptional high or low scores.  They apply the same technology to specific segments such as corporate accounts or internal employee surveys.

Bottomline:  The time to detect problems has far more potential for improvement than the time to correct. Look at your firm’s strategy and objectives and identify where reduced latency would create significant value.  Start with the supply chain for that’s most visible and the technology is further developed but don’t stop there.  Build a connection between you and your customers and look inside for latency reduction opportunities.  As Sachel Paige is reported to have said, “It’s not what you know that hurts you, it’s what you know that just ain’t so.”