Jeff Bezos, the CEO of Amazon who is also the world’s richest man with over $114 billion in net worth was asked about his secrets to his fast rise. He summarised it in two words, “cycle time”. Jeff skyrocketed his revenue simply by improving on something simple, something we all should do in our business “response time and cycle time per transaction.”
So, today’s article is more of a question: How long does it take for your product to reach the end customer, with utmost satisfaction?
Jeff Bezos rose from being the 19th richest man on earth with a net worth of $25 billion just in 2013 to his current worth. Just how did this happen? This happened simply by his firm optimising the response time in delivering product by 62 percent. Really, time is money. Jeff once earned a whopping $3.3 billion in 24 hours by reducing the time it takes to deliver end to end on a transaction.
In a world that can’t wait, queues shouldn’t be normal as we master cycle time reduction. Cycle time reduction is the strategy of lowering the time it takes to perform a process in order to improve productivity. The process that requires the reduction of cycle time could be around production, marketing, sales, service etc. In addition, cycle time reduction often improves quality when done right in line with the triple constraints of time, cost and scope.
To increase your firm’s transaction’s cycle time, attempt these: Develop a process map (document and flowchart your processes. Create a precedence-based work breakdown structure for each major task).
Secondly, become more data driven. In other words, collect data that helps you understand the customer’s preferences so it can be reused when next they come to use your service. Even before they come in, give your customers a means to begin their transaction before getting close to the servers through fast tracking. Just like you can get your boarding pass while you’re on your way to the airport, find out how you can initiate transactions even before a sale. This will reduce the time used to collect their information with the servers as they arrive in.
Also, study the customer demand profile and trend. That way you can engage them better. If customers must wait distract them by engaging them in something exciting while they are on queue.
You should study the supply profile; manage your supply chain and automate your logistics. Apply JIT (Just in Time) methodologies to reduce the delay from warehousing.
In addition, increase service rate. You can do this by adding more severs to reduce queue. You can train current servers to apply the principle of specialisation to each role. With division of labour, each person becomes a master of their own role in line with the big picture. Set average mean time per transaction or customers and ensure service rate is within that range. For example, define how many completed services per hour must be achieved without error or variation. Strengthen supervision for each cluster of servers. Create penalties for delayed work or queues.
Finally, identify waste that can be eliminated.
In terms of creating a better customer experience, you should be able to answer the question, “what are you doing right now to reduce your cycle time, what are you doing right now to improve customers’ experience with you , what are you doing to stay valuable tomorrow, and in 10 years?”
The golden rule of creating exceptional customer experience is to engage each customer with an assumption that all customers are extremely lazy, crazy and busy!
It will save you stress to know this. It’s the new dynamics of consumer behaviour in the 21st century. You can’t blame this generation, we invented social media and we express things in 180 characters or less, our attention span is about a minute like our Instagram is. Our generation (baby boomers, millennials and centennials) all have entitlement mentality. We think we should get more. We are digital natives, we want things, and we want it now!
If all customers seem lazy, busy and crazy, then to provide an antidote for that is to have a competitive advantage. For their laziness- provide convenience. For their busyness – provide time saving. For their craziness, provide excitement!
This is about experiential design and efficiency through a smart framework with smart people. The truth is that in building a smart system, managing people is actually the hardest part of it. And most CEOs have been reduced to mere supervisors of their staff as against their two main roles, strategy and networking for revenue and expansion. In other words, most CEO and top-level executives now major in what is minor.
Organisational dynamics has to change to be able to provide smarter workflow. It starts from redefining the type of people you may need in your organisation. It’s by immersing them into a culture of efficiency, else they’d major in the minor things till competition puts them into oblivion.
The best firms aren’t the most hardworking but the most productively smart working ones. It’s a universal law that is no different from the corporate world. We see this in Biology, through Darwin’s law of natural selection. Even in the animal farm, a lion sleeps 18 hours in a day while a donkey works 18 hours in a day? If it’s by hard work, the donkey should be the king of the jungle.
I am crude talent manager; I look out for good people and I add value to them while around me. And over the years, I have come to grade them into four categories and each of them has their pros and cons: dumb and lazy, smart and lazy, dumb and ambitious, smart and ambitious.
Let me break down just two relevant to this article:
Dumb and lazy (unambitious)This set of people will drain you. The good news is, if given simple, clearly stated directions, they will perform day-to-day routine tasks well enough, but not in perfection. Usually because they are not ambitious, they will be content with token raises and will be among your most loyal employees.
Smart and lazy, they must be continually prodded and they will produce. Because they are lazy but smart, they will find shortcuts to what must be done. So, they bring innovation. They have high potential energy but low kinetic energy. With this kind, he lacks the inner fire to turn his brains into personal power, but he has the brains to do well as an advisor. This kind of people can be extremely useful.
Process improvement requires staying steady and continuous in similar but progressive circle, just like riding a bicycle, to keep your balance you must keep cycling. And the more the cycle, the more balance and faster you’d get.
Keep getting better, for if you’re not getting better, then you’re getting worse! I look forward to helping you create a more efficient system.
EIZU UWAOMA
