Reducing Time To Market vs. Improving Profits
X: We need to decrease the time to market for our new products.
Me: So, you want to decrease the time it takes to go from an idea to a commercialized product?
X: Yes.
Me: Okay. That’s pretty easy. Here’s my idea. Put some new stickers on the old product and relaunch it. If we change the stickers every month, we can relaunch the product every month. That will reduce the time to market to one month. The metrics will go through the roof and you’ll get promoted.
X: That won’t work. The customers will see right through that and we won’t sell more products and we won’t make more money.
Me: You never said anything about making more money. You said you wanted to reduce the time to market.
X: We want to make more money by reducing time to market.
Me: Hmm. So, you think reducing time to market is the best way to make more money?
X: Yes. Everyone knows that.
Me: Everyone? That’s a lot of people.
X: Are you going to help us make more money by reducing time to market?
Me: I won’t help you with both. If you had to choose between making more money and reducing time to market, which would you choose?
X: Making money, of course.
Me: Well, then why did you start this whole thing by asking me for help improving time to market?
X: I thought it was the best way to make more money.
Me: Can we agree that if we focus on making more money, we have a good chance of making more money?
X: Yes.
Me: Okay. Good. Do you agree we make more money when more customers buy more products from us?
X: Everyone knows that.
Me: Maybe not everyone, but let’s not split hairs because we’re on a roll here. Do you agree we make more money when customers pay more for our products?
X: Of course.
Me: There you have it. All we have to do is get more customers to buy more products and pay a higher price.
X: And you think that will work better than reducing time to market?
Me: Yes.
X: And you know how to do it?
Me: Sure do. We create new products that solve our customers’ most important problems.
X: That’s totally different than reducing time to market.
Me: Thankfully, yes. And far more profitable.
X: Will that also reduce the time to market?
Me: I thought you said you’d choose to make more money over reducing time to market. Why do you ask?
X: Well, my bonus is contingent on reducing time to market.
Me: Listen, if the previous new product development projects took two years, and you reduce the time to market to one and half years, there’s no way for you to decrease time to market by the end of the year to meet your year-end metrics and get your bonus.
X: So, the metrics for my bonus are wrong?
Me: Right.
X: What should I do?
Me: Let’s work together to launch products that solve important customer problems.
X: And what about my bonus?
Me: Let’s not worry about the bonus. Let’s worry about solving important customer problems, and the bonuses will take care of themselves.
Image credit — Quinn Dombrowski
X: Me: format stolen from @swardley. Thank you, Simon.