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HOME >> OPINIONS

Forget Time-to-Market: It’s All About Time-to-Money

By Susan Kunz

August 15, 2006 — (Page 1 of 3)
The popular business school metric time-to-market (TTM) is of little value to software development projects. And, even worse, it consistently offers incentives for counterproductive economic behavior. The problem is that time-to-market measures the ability of an organization to get a new product out the door whether or not that product will be successful in the marketplace.

A better way to measure performance would be to focus product efforts on time-to-money (TT$), defined as the time it takes to deliver a product into the marketplace and achieve sustainable positive economic returns to its maker.

We’ve all participated in meetings where delivering a software product to meet a time-to-market goal was the metric tied to bonuses. Software developers know that any software train can arrive on time, if you don’t care how many cars it has and if what were supposed to be Pullman sleepers turn out to be boxcars with faulty air brakes.

Users are smart. They keenly feel disappointment when software doesn’t do what marketers promised, or behaves in unexpected and even dangerous ways. They tell their friends and clients. The sales pipeline dries up. And increasingly, wronged customers share their woes with product liability lawyers.

Billions in Waste
Based on reports from the National Institute of Standards and Technology (NIST) and the Sustainable Computing Consortium, the total cost of software defects will reach an estimated US$300 billion this year. This compares with an overall software investment of around $600 billion. So, half of every dollar spent on software goes down the tubes as cost-of-defects.

But what if software development teams had to meet a different goal: time-to-money? Consider how the incentive structure would change if software teams were chartered to reduce the time between when product development begins and when products start to generate positive cash flow?

Products designed to shorten time-to-money would arrive to market with clearly differentiated features and benefits. They would delight customers and impress influencers. The product makers would face lower field support and return costs, and software suppliers would avoid the embarrassing, negative impact of poor quality on reputation and brand.

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