High Velocity Business

I had the pleasure to read Steven J. Spear's "Chasing the Rabbit" during my Summer vacation, in which he discusses the unique attributes of industry leading companies like Toyota and Alcoa. What Mr. Spears wanted to understand is why these companies have maintained and even extended their competitive advantage over their peers, even as these peers have learned from these leaders and themselves improved. Interestingly, what he singles out as unique about these companies is not that they apply methodologies such as Lean and Six Sigma, although they do, and very effectively, but the fact that they apply these methods in the context of a business culture which is focused on learning and improvement, from the 'highest' to the 'lowest', in everything they do.

What these companies do is simply to recognise that their businesses are complex systems which it is impossible to design perfectly from the outset. So instead of pretending that the system is perfect, and making do as best they can, they accept that there are going to be opportunities for improvement, and invest in their ability to spot, understand, address and learn from these opportunities. As a result, whereas their competitors come to work on a Tuesday at a similar level of performance as on Monday, and expecting to have to overcome most of the same problems as faced them on Monday, the High Velocity Business is coming to work having solved at least some of Mondays problems for ever, and therefore is starting the day at a higher level. These improvements quickly accumulate over time, propelling the High Velocity Business forward even as competitors repeatedly attempt to catch up.