Is business ready to embrace the power of slow?

Managers and scholars have long been interested in how industry dynamics govern the creation and erosion of competitive advantage. As competitive advantages are temporary, especially in fast changing industries, a cover of Business Week asked “Is Your Company Fast Enough?” and we have popular business book and magazines with titles such as Fast Company, “Business @ the Speed of Thought”, and “The Age of Speed”.

A groundbreaking research article from Simon Fraser University, however, dispels the notion that the activities of firms must be uniformly high speed to attain business success. It explains that researchers or managers who simply characterize business environments as high or low speed overlook the fact that the velocity of an industry (the rate and direction of industry change) is composed of multiple dimensions, each with a distinct velocity. In other words, different speeds and directions of change are appropriate within organizations, and across industries, cultures and countries.

The article, entitled “A Multidimensional Conceptualization of Environmental Velocity,” was authored by SFU Business professors Ian McCarthy and Thomas Lawrence, research associate Brian Wixted, and PhD candidate Brian Gordon. It was recently published in the Academy of Management Review.

They argue that the focus on being uniformly fast may be misguided. The researchers point to the fashion industry, which has been characterized by slow growth in terms of sales, but also by “rapid-fire attempts to source the lowest-cost materials,” fickle and flighty customer demands, and constant shifts in the major centres of production.

Fashion is one example of an industry that operates at multiple speeds in multiple directions simultaneously – one that managers in a variety of industries should recognize and be willing to adjust to.

“It’s a cognitive cultural issue,” said McCarthy. “The notion of time is very different in people’s minds. And you require very different cognitive abilities to succeed in different velocity regimes.”

This is true for industries as well as for countries, according to McCarthy. “Time is not a universal constant around the world,” he said. “In terms of cultural and locational perspectives, people have very different interpretations of time. As a result, they have very different time management and time coordination approaches.”

Closer to Metro Vancouver, McCarthy points to British Columbia’s Gulf Islands – famous for their laid-back lifestyle and resistance to heavy commercialization. They are a growing draw for not only tourists but also entrepreneurs. “If you go to the Gulf Islands, you’ll see that customer service is slower – and the pace of life is much slower. Their residents live longer, they are healthier and happier.”

For firms, a more nuanced, multi-speed approach to business is required. “What’s important is determining your velocity regime – the multiple different rates and directions of change in your world – and then ensuring that business activities are organized and coordinated to be entrained to these different velocities”.