Clockspeed is a term used by Charles H. Fine of MIT’s Sloan School of Management to describe the pace of business evolution inside industries. According to Fine, industries with faster clockspeeds have more market experimentation, increased competition, and frequent waves of innovation.
Industry Example. Booz & Co recently posted an interesting study in strategy + business on accelerated clockspeed as it applies to the health care industry. The authors noted: “the healthcare industry in the U.S. is on the brink of unprecedented change.” Hospitals are instituting wide-scale reforms in how they do business.
As the authors go on to suggest the change includes “an unprecedented investment in information technology. In fact, some estimates expect the health care IT market to experience a compound annual growth rate of 24 percent through 2014.”
All of these changes taken collectively significantly increase the “clockspeed” and consequently the buying dynamics of hospitals. Hospitals are changing what they buy, how the buy and how much they are willing to pay for it. This accelerated rate of change will be particularly telling for some suppliers who are accustomed to changes taking place at a slower pace. These suppliers will need to adopt a new set of strategies or be replaced by more agile competitors.
Implications for Sales. Across industries the clockspeed at many companies has been accelerated by new normal conditions. For their suppliers this means a business-as-usual strategy is no longer viable. From a sales force perspective an accelerated clockspeed means simply doing a better job doing what you are doing will not carry the day. If the speed of the buying clock is changing so must the speed of the selling clock.
For those of us in the sales training business, an accelerated clockspeed means creating new programs specifically designed to help sales people learn new skills and to apply their existing skills to a new buying environment. This requires more than adding a few new Powerpoints here and there to existing programs. It involves working with the client to design a new body of content and a flexible instructional design that can be easily updated – and, it probably requires a different type of business relationship with more cost-effective pricing models.
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