THE JOURNAL OF LEADERSHIP APPLICATIONS
Vol. 2, No. 2
TIMING – THE RECIPE FOR STRATEGY SUCCESS
© 2003 By William A. Cohen, PhD, The Institute of Leader Arts, www.stuffofheroes.com
Adapted from a forthcoming book with the working title LEADING THE WAY TO TRIUMPH: 10 Essential Lessons of Competitive Strategy to be published by AMACOM 2004
An article in a leading business magazine entitled “Timing is Everything” advised, “No matter what size your business is, the best time to buy advertising is in the first quarter—always. The next best time is the third quarter. These are the months when most radio and TV stations are hungry and offer low rates and special packages to lure advertisers who may not otherwise bother to advertise . . ., and that spills over to print media.” The article goes on to say . . . “Inventory needs to be filled to make budgets, and the buyer is really in the driver’s seat. Rates can drop by half in the first quarter. . .”1
All true if you look only at “buying advertising.” However, if you are deciding when to advertise, the situation is much more “situational” and you have to consider whether your prospects will buy during that quarter, no matter your cost of advertising.
For example, if you sell snow shovels or Christmas ornaments, advertising in spring or summer would be ill advised, as would a sprinkler system in dead of winter in most parts of the United States. Robert Ramsay soon discovered that March is not a good time to run a direct-mail campaign to CPAs. After spending all his money and getting zero leads, he figured out that his prospects were all busy doing taxes. Moreover, Ramsay’s company, CXWeb was a Web design and hosting company. Later, he did spend his scarce resources to promote his service in the right month. However, most CPAs weren’t interested in being on the Web back in 1999. So, even when they had the time to read his advertising material, Ramsay lost money and failed again. This time he no longer had the resources left to keep going, and his business went under. He learned the lesson of timing, however, and today his advertising strategy with his new company, smallbizplanet.com, is more productive.2
Is The Amount of Money Spent Less Important Then When It is Spent?
To some, this may seem like a no-brainer. Many are convinced that it is the amount spent that is more important. The argument is that even if timing is more important in a few select areas, say, advertising, it is not generally true.
Well, let’s look at something entirely different like a simple strategy for motivating employees: reward them with money. Which is more important in this situation, how much you give them or when you do it? William T. Quinn Jr., owner of a publishing company in Somerset, New Jersey wanted to motivate his employees in this manner. He discovered that when handing out bonuses for extra or exemplary effort, it was timing, not the amount of money, that mattered most. The key was to dispense his motivational doallrs when his employees were most stressed, and to do so on the spot not to wait for some collective time to reward everyone together in the future.3
This finding is psychologically sound. If you want to motivate someone, the desired action and the motivator need to be as close together as possible. But what an insight that this timing is even more important that the amount used!
Timing is Always Important, but Sequencing is Also Timing
Planning and implementing a strategy is like preparing a recipe for a special dish or the formula for dynamite. Do something at the wrong time or put things together in the wrong sequence or and you could end up with a disaster even though the right things were done or the correct ingredients used. Certain of the lessons of strategy must be accomplished in a specific order to be effective. The objective must be fully defined and you must gain full commitment to it before you do anything else. Next, you must identify the decisive point and move to economize to mass at that point. Only then are you ready to take the indirect approach to actually accomplish this. Although you must exploit your success, this can only be done when you have real success to exploit.
Doing the Right Thing at the Wrong Time Can Cause a Disaster
While it may seem obvious that a company should not expand exponentially until it is ready, companies sometimes try to exploit their success before they have built the necessary base, or the time is right or they take the right steps, but in the wrong order.
A health food store in Los Angeles was so successful in building sales that the manager opened fourteen stores within eighteen months. However, with insufficient financial resources, a brand name not yet established, and having not yet mastered intricacies of the supply chain within the industry, he was bankrupt in the nineteenth month. Many e-commerce companies learned this same lesson, and like the health food store manager, also found that future potential didn’t count for very much if you couldn’t pay your bills in the present.
Webvan, the largest on-line grocer, went under despite 750,000 loyal customers, $800 million in investments and having acquired rival HomeGrocer in a $1.2 billion deal. In very simple terms, Webvan expanded exponentially without ever having established that the business was in a position to make money. It exploited its failure, not its success.
Aspects of Timing and Strategy
- There are several important aspects regarding timing and strategy within this lesson that we must consider. These are:
- When to take a specific action
- The sequence of the actions to be taken
- Whether the actions we take are continuous or discrete functions
- Whether the actions are to be repeated; and if so with what frequency and relative emphasis
Consider your timing an important part of your recipe for success.
1 Kathy J .Kobliski, “Timing Is Everything,” Entrepreneur.com (February 01, 2001) http://www.entrepreneur.com/Your_Business/YB_SegArticle/0,4621,286610,00.html
2 Kimberly McCall, “Crash and Learn,”Entrepreneur.com (October 2000) http://www.entrepreneur.com/Your_Business/YB_SegArticle/0,4621,279211,00.html
3 Inc. Staff, “Instant Gratification,” Inc Magazine (January 1989) http://www.inc.com/magazine/19890101/5500.html
THE LESSON: Timing is an important part of any strategy. Ignore it at extreme peril!