CHAPTER | NINETEEN
Do the Right Thing at the Right Time
Marcus Junius Brutus, best known to us simply as Brutus, was the statesman who uttered the words: “There is a tide in the affairs of men, Which, taken at the flood, leads on to fortune.” At least, he did this in Shakespeare's play Julius Caesar. As events would later prove, Brutus may have been correct about the tide's existence, but he must have missed taking it “at the flood,” since his participation in the assassination of Caesar didn't lead to fortune, but to his eventual suicide a little over two years later. Drucker would have agreed completely that such a tide exists, and would probably have gone further to suggest that timing is mightily important even for, or maybe especially for, an assassination and in the management of the events that follow. So, too, are activities in modern times heavily dependent on doing the right thing at the right time.
Timing Can Be Wrong, for Different Reasons
Some years ago, an entrepreneur established a web design and hosting company. He understood the importance of marketing segmentation, and he decided that, owing to his background and experience, he knew independent CPAs best. Unfortunately, he had not assimilated either Shakespeare's or Drucker's lessons on timing. To his chagrin and loss of income, his timing selection of the middle of March to run a direct-mail campaign to sell something to CPAs was unfortunate. After spending lots of money and getting few leads for his business, this web entrepreneur finally figured out that, since his prospects were in the middle of tax season, they were too busy doing taxes to consider his proposition.
This was an example of trying to do something when the time was not right. The web designer reorganized his plans and spent his scarce remaining resources to promote his service to CPAs at a more favorable time of year. It was still the wrong time, for an entirely different reason this time around. Too few CPAs were familiar with web advertising; and it probably wouldn't have worked in attracting their customers either, since the explosion of online search engines was still early and many prospects were not yet online. So, even when his prospects had the time to read and consider his advertising material, the entrepreneurial web designer lost money again.1 Fortunately for him, he was able to re-relaunch his company shortly thereafter, poorer but wiser with the knowledge that timing is not an insignificant factor!
Drucker on the Importance of Timing
Drucker recognized that timing was everything for all management actions. There are two major problems in timing that he thought were unique to management. Both result in additional challenges for decision makers. The first is that the time for development is lengthening for many products that constitute completely new technologies. He pointed out that, in the 1880s, Thomas Edison spent no more than fifteen months from product conception to product introduction for many products that didn't exist previously. However, to develop similar products over a hundred years later—the lightbulb or the motion film projector, for example—might take fifteen years for a similar cycle of conception to introduction in the marketplace. Remember, it's not just thinking up and developing the product; if the market for it doesn't already exist because the public is not yet familiar with the product and its use, this can take much longer than you might expect. This is probably even more true of intellectual property.
I was once asked at an academic conference why it took more than thirty years before a common practice today—the routine preparation of a marketing plan—became institutionalized at most U.S. corporations. I pointed out that, assuming the marketing plan followed standard practice after the initial idea, it would first be applied and tested. Research would be conducted on its efficacy and submitted to one of the academic journals. To get published in such a journal commonly requires peer review—the opinion of experts—and often revision. This review and revision process can take several years. Unfortunately, these academic journals are read by few practitioners.
After publication in the journal, the next step is for that idea to be taken up by a textbook author in the field, who likes the idea and references it in a new edition. This, too, requires some years. When the textbook gets published, and assuming it is popular, it gains sufficient adoptions by professors around the country and then many students learn the process. However, these students are not yet in positions of responsibility. So, there's a minimum of another ten years before a new idea, such as routinely doing a marketing plan, becomes a popular concept. Of course, there are ways to shorten this process, but you get the general idea.
If the new product is one subject to regulation, such as drugs, government agencies are involved and that extends the trial period even longer. And today, not only drugs are regulated. As someone pointed out, even the Wright brothers might not have been allowed to fly their airplane without government approval, since the concept was unproven until they did it.
The second major problem in timing is that technological development is causing the obsolescence of products at a much faster pace. The electric handheld calculator was the size of a small brick when first introduced in 1972. It was a bargain at close to a hundred dollars, even though it had no memory function. Less than five years later, it had shrunk to the size of a credit card and was selling for less than five dollars—and today it is not infrequently given away as a promotional item. Additionally, the giveaway has a lot more functions than “the brick,” including a memory. The same is true with products introduced more recently. How many new smartphones, iPads, or other high-tech products do we go through in relatively short periods?
Example: An Almost Secret Birth and a Rapid Demise
Federal Express, or FedEx today, has had a number of highly successful services. Zapmail was not one of these. It was withdrawn even before it got warmed up. Zapmail was well named and did provide what was a valuable service at the time. It delivered faxed messages for business clients before the general availability of fax machines and when they were still pretty pricey. For high-volume users, there was an added option. FedEx would install its own fax machines on the client's premises with the electronic transmission being carried over the FedEx private network. The company's investment and the charges to the corporate customer were both relatively high, or would be considered so today. But FedEx believed in its investment and thought the cost was worth it for many customers to see their material delivered within hours rather than overnight. At the time it was conceived, this assumption was probably valid. In fact, at that time the project was so hot it was kept secret and carried the code name Gemini.2
However, quality problems caused delays. Even the loss of the space shuttle Challenger played a role, since it caused FedEx to abort the planned incorporation of final transmission by satellite. The clock was ticking. By the time these and other problems were resolved, the cost of fax machines had fallen considerably. Meanwhile, relatively few customers had signed on. When FedEx dropped the project only two years after its introduction, losses were in the neighborhood of $320 million.3 Again, timing, even if it's not the fault of the innovator, rules the endeavor.
Timing for the Present and the Future
A challenge that innovators always face in timing is that they must make decisions considering not just the present but also the future. Or, as Drucker put it, a management decision is hardly acceptable if it endangers the long-range health, if not the very existence, of the company. The dimensions of both present and future are to be considered in determining the critical balance between being too cautious and being too rash. While Drucker thought that far more problems were caused by being too cautious—he said that managers could neither eliminate nor avoid all risk—acting too quickly is a real and ever-present danger.
Example: Doing the Right Thing at the Wrong Time
You can do the right thing and still go awry if you introduce it at the wrong time. A few years ago, the New Jersey School Boards Association published the following regarding the expansion of K–8 education in the state:
Imagine you are either the governor or commissioner of education of a highly diverse northeastern state. Like most states, yours is saddled with the “achievement gap” and students who lag behind their peers academically. Then imagine you are offered a solution that academics, legislators, educators, and parents agree may hold the key to closing the “achievement gap.” Not only do you have all parties telling you that this is a success, but you actually have some proof that it works in the districts where it has been implemented. Wouldn't you jump at the opportunity to implement such a solution if you were governor or education commissioner? This is the type of program that makes history books and creates a positive legacy of your tenure. Now imagine that you commit to this program publicly.
Finally, imagine you find out that your state is broke and probably cannot afford to pay for this worthwhile legacy-making program. What do you do? That is the situation that Gov. Jon Corzine and Commissioner Lucille Davy find themselves in. They are like children who have received no presents on Christmas, and have their face pressed up against the window of FAO Schwartz [sic]. So close…yet so far away.4
Corzine pressed forward anyway, and though today New Jersey's pre–K education system passed and is considered positively, the general impression of spending during New Jersey's economic challenges helped to defeat Corzine and put Governor Chris Christie into office.
Other industries are immune. Even the movie industry screws up the timing, sometimes with great regularity. MGM released The Wizard of Oz in 1939, with Judy Garland in the starring role when negotiations with the hugely popular Shirley Temple failed to pan out. However, the film with Garland in the role was well executed and won screen awards, and the timing was right. The Wizard was a box-office success and has since become a film classic. In 1940, seeking to duplicate this success, competitor 20th Century Fox got Shirley Temple for a similar fantasy based on a children's fairy tale called The Bluebird. How could it fail? But by then The Wizard had taken the market. Moreover, World War II was in full swing, and people's minds were on other things. It didn't help that The Bluebird was based on a German folktale. The film bombed (no pun intended). The fairy tale concept with Shirley Temple was right. The timing was not.
Four Specific Timing Decisions
There are four important aspects to consider in regard to good timing and strategy. These are:
- When to take a specific action
- The sequence of the actions to be taken
- Whether the actions taken are continuous or discrete functions
- Whether the actions are to be repeated
Knowing when to take each action is the basic timing decision. Consider the introduction of a new technology. You may think that if you develop something new, you should rush to introduce it. But this is rarely the case. If your company is known for being first with cutting-edge technology, that may be your competitive advantage. If having this advantage is important in your industry, and you have the resources to support it and can take the risk involved, by all means introduce the technology as soon as you develop it. In this case, it makes sense to invest the resources necessary to ensure that you are the very first with the innovation and are responsible for introducing it into the marketplace.
However, if you haven't got the resources that will guarantee an immediate impact, maybe it's better to let someone else get in there first and make the mistakes so that you can learn from them. Then you can introduce your more advanced or perfected product with less risk and a lower resource commitment.
The fact is a leading-edge technology company can miss the boat and still come out ahead. IBM was the technology leader in computers when someone at IBM did the flawed market research that concluded development of a personal computer would yield a mere 1,000 customers a year. Of course, this was utter nonsense, which Steve Jobs proved in founding Apple and creating an industry in the process. However, as we all know, IBM finally did enter the market, with a technologically inferior product, and took over the field by capitalizing on the weaknesses in Apple's strict control over software for its hardware. Actually, IBM wasn't just late to market; it was very late, with a host of other companies getting to market first.
This doesn't mean that being late is always the thing to do, of course. It does, however, show that for industries in which the state of technology is not the big differentiator, hanging back may have advantages. First entry into the marketplace has both advantages and disadvantages; it's up to you to think through the timing and weigh the options.
A manager must conclude, as Drucker did, that it's not enough to do the right thing. The successful decision maker must do the right thing at the right time.