Barnes and Noble. Nokia. Yahoo. There are tons of examples of companies that took all the right decisions – but at the wrong time. They were off by a few days, months or—in some cases—a few years in taking critical decisions. If you look around in the business world, you’ll find many that decisions aren’t bad decisions in themselves. It’s just that their timing is wrong. Why does this happen? At least in some cases, the real culprit is the company’s method of telling time. Let me explain.
There are two ideas of time we all follow—knowingly or otherwise. One idea is calendar time and the other is event time. You can think of these two ideas as two clocks we refer to as we go about business.
Calendar time is what we commonly follow in our routines. We take weekly offs, make payroll every two weeks, tally monthly sales, hold quarterly board meetings, produce annual financial statements, and reward employees who reach five or ten-year service milestones. Calendar time is simple and straightforward. It disciplines us by introducing a temporal rhythm in our work. Nothing remains neglected for too long, and we feel a sense of being on top of things.
Event time is also equally evident in our routines. To illustrate event time, let’s take the example of replacing car tires. You need to replace your tires every 35,000 miles, irrespective of whether it takes six months or six years to put that many miles. So, you tell the time in miles, not months. To use another example, let’s say we throw a party for the product team after every major release, whether the release occurs after one month or two years. Here again, the time is told not in days, weeks, months, or years. Instead, it is told events that could occur after varying time intervals.
From Event Time to Calendar Time
Most start-ups initially function on event time. Actions are triggered based on events that happen, rather than by a formal schedule. If a prospective client calls you in for a meeting, you drop everything and work on preparing for that meeting: That item becomes the top priority. In general, this ad-hoc style of working suits that stage of business. It forces you to keep your eyes open and be in touch with the emerging opportunity 24 x 7.
As the organization grows, however, founders eventually reach a point where there are too many things to do. There is a growing team to manage. There are multiple priorities to juggle. That’s when you feel the need to put a calendar in place. It helps you bring in a bit of structure.
Everything sounds good up to this point. And then, before you know, the calendar begins to dictate your actions. For instance, you think, “The board meeting isn’t scheduled until the month after next, so I don’t need to think about strategy just now.” That’s the first sign you might be mixing up the two clocks. Maybe you need to act strategically in the moment, rather than at a predetermined time. In short, you mess up your decision timing when you become slave to a calendar.
Be Mindful of Both Clocks
So where does that leave us? It’s not really a choice between calendar time and event time. We need both. A combination is what probably works best. Let’s see how.
Using Calendar Time: Establishing a Rhythm
For all its pitfalls, using calendar time to structure tasks has plenty of obvious benefits; especially for tasks that may not be timebound or urgent, but have long-term ramifications.
When you tie tasks to calendar time, pay attention to frequency.
For instance, an extensive annual customer satisfaction survey is great, but it might be far more valuable to pick up the phone and speak to two customers every other week to get some feedback. Depending on what you hear from these customers, you might decide to speak to ten more customers on the same day too, even if it’s not part of the schedule. That’s an example of mixing in tasks that are triggered by event-time.
Using Event Time: What Event Triggers Action?
The biggest downside to being a slave to calendar time is that it can have a serious impact on your decision timing. Why? Because calendar-based, internal temporal patterns sometimes drown out signals emanating from the external environment.
The reverse is true about event time. For example, in my blog on opportunities, there was a discussion on how Paytm, an Indian mobile e-commerce tech company, capitalized on India’s demonetization announcement by, almost immediately, going on a massive marketing and PR blitzkrieg talking about how its mobile wallets were an ideal solution to India’s cash problem. In a matter of days, the company touched a record five million transactions a day with a 700 percent increase in overall traffic.
You can use event time to act in a way that is tied into the changing reality. For example, instead of planning to hire three people by March end, you can set a more event based plan: Hire when we sign up a new customer. There are plenty of examples of using event time. You can say: When a competitor matches our price, we will announce a special. Or you can go: As soon as we see an uptick in sales, we will go full steam ahead with production.
Every entrepreneur juggles many priorities with limited resources. One such resource is time, and there are two clocks that tell time. Recognize how to read both clocks, and you will have a way to get closer to timely decisions.