Clockspeed: Winning Industry Control In The Age Of Temporary Advantage [Hardcover]

Charles H. Fine (Author)

Book Description

Publication Date: September 22, 1998

In business today, all advantage is temporary. In order to survive-let alone thrive-companies must be able to anticipate and adapt to change, or face rapid, brutal extinction. In Clockspeed, Charles Fine draws on a decade’s worth of research at M.I.T.’s Sloan School of Management to introduce a new vocabulary for understanding the forces of competition and making strategic decisions that will determine the destiny of your company, as well as your industry.Taking inspiration from the world of biology, Fine argues that each industry has its own evolutionary life cycle (or “clockspeed”), measured by the rate at which it introduces new products, processes, and organizational structures. Just as geneticists study the fruit fly to gain insight into the evolutionary paths of all animals, managers in any industry can learn from the industrial fruit flies-such as Internet services, personal computers, and multimedia entertainment-which evolve through new generations at breakneck speed. Applying the lessons of the fruit flies to industries as diverse as bicycles, pharmaceuticals, and semiconductors, Fine illustrates how competitive advantage is lost or gained by how well a company manages dynamic web of relationships that run throughout its chain of suppliers, distributors, and alliance partners.Packed with revolutionary concepts and tools to help managers make key strategic decisions that affect current and future performance, Clockspeed shows, as no other book before it, how the ultimate core competency is mastering the art of supply chain design, carefully choosing which components and capabilities to keep in-house and which to purchase from outside.The consequences of faulty of visionary decisions can be enormous and dramatic. Witness the case of IBM in the early 1980s, when it outsourced key PC components to Microsoft and Intel, unleashing the “Intel Inside” phenomenon and a complete restructuring of the computer industry. Going further, Fine sees the personal computer as merely a component in the vast information-entertainment industry, which evolves at speeds unimagined a few years ago. He uses this “fruit fly” as well to peer into the future of industrial evolution and find practical advice for players in all industries, from automobiles to health care information systems.Clockspeed not only serves up some new “laws” of value chain dynamics, but it also offers recommendations for achieving industry leadership through simultaneous product, process, and supply chain design. In challenging managers to think like corporate geneticists Clockspeed contributes the next creative leap in business strategy.

Editorial Reviews

Amazon.com Review

Based on extensive research he conducted at M.I.T.'s Sloan School of Management, professor Charles H. Fine determined that fruit flies hold the key to the future of business. Not the insects themselves, actually, but the way geneticists study their extraordinarily condensed life spans to gain insight into the much more drawn-out human existence. In like manner, Fine suggests that industries with a very rapid evolutionary rate, or clockspeed, be examined for information that will benefit businesses of all kinds--as well as national economic systems, universities, and even religious institutions--although any edge that emerges may, without additional work, prove to be fleeting. In Clockspeed: Winning Industry Control in the Age of Temporary Advantage, Fine lays out his resultant theories of business genetics. He focuses on "fruit fly industries" such as personal computers and information-entertainment providers and the lessons he says can be learned by dissecting their internal processes, product development procedures, and organizational arrangements. He then proposes ways that other companies can utilize the positive patterns of industry structure that appear. Those whose eyes do not glaze over at the mere thought of calculating "capital equipment obsolesce rates" should find this absorbing and thought-provoking. --Howard Rothman

From Publishers Weekly

In propounding a "theory of business genetics," Fine, a professor of management at MIT, analyzes factors that determine corporate evolution, then outlines approaches to aid strategic decision making. For Fine, industries change at different rates, or "clockspeeds," depending on differing opportunities for innovation and competition, as is the case in the animal kingdom. Changing relationships and their causes often seem more apparent, he notes, in fast-clockspeed scenarios such as the current computer industry. However, "all advantage is temporary," Fine continues, "and the faster the clockspeed, the more temporary the advantage." Against that background, his main thesis is that design of the supply chain is "the ultimate core competency" for maintaining advantage in business. Fine advocates diligently and continuously studying its dynamics from the standpoints of organization, technology and capability. Citing the case of IBM as a cautionary tale, Fine notes the company's flawed decision to outsource its PC's microprocessor and operating system, with the result that customers are more concerned with the label "Intel Inside" than the actual makeup of their computer. Oriented primarily to specialists (and prospective clients) in the computer industry, Fine's theorizing suffers somewhat from management jargon yet is impressively well tuned.
Copyright 1998 Reed Business Information, Inc.

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Product Details

• Hardcover: 288 pages
• Publisher: Basic Books (September 22, 1998)
• Language: English
• ISBN-10: 0738200018
• ISBN-13: 978-0738200019
• Product Dimensions: 9 x 6.3 x 0.9 inches
• Shipping Weight: 1.3 pounds
• Average Customer Review: 4.5 out of 5 stars  See all reviews (20 customer reviews)
• Amazon Best Sellers Rank: #1,226,885 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

9 of 9 people found the following review helpful:

5.0 out of 5 stars Crucial for anyone in supply chain field, July 16, 2001

By 

Daniel T. Crocker (San Mateo, CA United States) - See all my reviews

This review is from: Clockspeed : Winning Industry Control in the Age of Temporary Advantage (Paperback)

It would be a mistake to be employed in some supply chain capacity and *not* read this book. I believe that it offers an intriguing set of solid examples of how incorporating supply chain management into strategy discussions has helped some companies profit at the expense of others.

Some commenters have noted that examples seem anecdotal. I tend to think that Fine's approach here, in going into depth with just a few examples, is a richer basis upon which to draw conclusions. You don't necessarily need a statistically significant sample set in order to gain insights into how to conduct strategy.

I would also take issue with one reviewer's note that it is overly geared towards manufacturing, rather than services. Managing supply chains and conducting make-buy decisions are clearly the province of operations. But shouldn't consulting services develop precisely those areas of expertise in order to assist their biggest clients?

A note of disclosure: I took Fine's course on this subject while at MIT. While I wouldn't trade having been in that graduate seminar for 100 books, if you can't take the course, at least read the book! Doing so brought back the pleasure for me of being in his class.

6 of 6 people found the following review helpful:

5.0 out of 5 stars This book should be in every bookshelf., February 6, 1999

By A Customer

This review is from: Clockspeed: Winning Industry Control In The Age Of Temporary Advantage (Hardcover)

I enjoyed this book and found it useful. The concepts in this book are widely applicable to a variety of situations. The book addresses many cases in large institutions; however, many of the concepts also can be applied at the project or start-up level. Several concepts in the book are applicable to common situations: 1) Virtual Company: This framework allows one to assess whether a company has enough capability to remain a virtual company or eventually become a "hollow" company. By using the 3-d and the key characteristics frameworks, Prof. Fine provides a good understanding of which areas of the value chain to keep under control. Of course, to retain a very small asset base initially, one could potentially outsource areas where the company does not have the capacity or capability, but should be looking to bring in-house those functions that have been outsourced for capability. 2) Combining the clockspeed concept and the double helix with the "innovator's dilemma" and marketspace concepts generates some useful insights. When the helix starts turning, from a integral solution to a modular form, that is an optimum time to be forming an entrepreneurial company. When the helix is switching back to vertically integrated industry structure, that implies a mature market with consolidation that is not as inducive to entrepreneurship. At the switch from integral to modular, you will see many growing markets. Though the entire market may not grow, the actual marketspaces will grow tremendously and create new value propositions. This is the middle of the classic "S" curve where the venture capitalists tend to invest, and it is the time where "clunky" upstarts begin their innovations - similar to the electric cars in the innovator's dilemma.

This morning I was listening to a lecture from Brad Geagley of Disney Imagineering describing their new retail theme parks "DisneyQuest." Just as Disney always does, they are applying the latest technology to entertainment. Mr. Geagley described how Disney has to keep certain elements of its attractions upgradeable because the technology is changing at different rates. The mechanical aspects (head-mounted displays, etc.) are designed in-house with lengthy half-lives. Other parts, like the software and animation technology, are changing every few months. Some technologies are outsourced (Silicon Graphics), while other aspects such as the animation are proprietary and done in-house. All of these made me immediately think that these guys should get a copy of this book. They would feel much more in control of the process.

Thanks Prof. Fine.

6 of 7 people found the following review helpful:

5.0 out of 5 stars Read every page, April 20, 2000

By 

Jamie Flinchbaugh (Michigan USA) - See all my reviews

This review is from: Clockspeed : Winning Industry Control in the Age of Temporary Advantage (Paperback)

This book has some really interesting threads around supply chain design competency, clockspeed, and learning from industry fruit flies, but the real value of the book is in between all of that. For years, there have been wonderful insights into technology strategy, product architecture, manufacturing strategy, etc. etc. roaming around the halls of MIT and throughout journal articles. The only way to really tap this depth of knowledge is by being there. Charlie has woven these thoughts, ideas, and concepts throughout the book rather seemlessly. If you read the book carefully, and think very hard about some of the nuggets throughout the book, I'm sure it will be worth your time.