How does time to value define the basic metric for cycle time?

GISTICS’ research of the economic gains from new technology and disruptive innovations reveals a baseline metric: cycle time returns or time to value.

Time to Value Metric Spans the Value Creation Process

The figure above depicts how we quantify the economic value of new technologies and disruptive innovations, correlating the individual facets of higher productivity to strategic values: process improvements, cost reductions, increased market coverage, greater number of selling days (the result of faster time to market), and positive changes to the balance sheet.

The value-creation process emphasizes the five basic phases in which firms create markets and products, find and serve customers, and prepare for the next round of development. Faster transit of these phases without compromising quality can translate into new value creation and competitive advantage.

Major launches constitute one of the most important and visible events for marketing: first evidence of whether an investment in marketing produced a return or not. Synchronizing event-marketing debuts and reducing time to market for major launches can produce huge boosts in incremental sales.

Higher productivity of staff and trade partners results from the automation of manual processes, elimination of redundant activities, and sharper insights about how to improve end-to-end processes of marketing.

Strategic value suggests that higher productivity and faster time to market may produce process improvements, reduction of fixed and variable costs, greater overall market coverage from the same level of marketing expenses, and incremental sales from faster and more complete product launches. Outsourcing and software as a service can also enhance the corporate balance sheet through a combination of fixed-cost reduction and higher asset utilization rates.