And doing both well usually wins the day.
This is one of those arguable insights, where both sides win. Dell is a great example of emphasis upon fast, creating a customized computer in 48 hours or less, bringing in assemblies and components just-in-time to make the assembly line. However, if Dell quality were poor and returns high, the company surely would not have survived on speed of response alone. If someone were to ask, “What is the secret sauce, Michael Dell?” Dell’s response would be something like “Quality custom computers more quickly than the competition.” And in this company example, both quality and speed are the critical factors in competitive advantage.
Think of McDonalds. Its reputation is based upon fast food in a minute, with quality that is acceptable but not discernibly above the competition. Or one of the instant auto service companies where an oil change is fast and inexpensive, but the number of inspection points far fewer than at a dealer location. Speed above quality. We have become a society not used to paying even a little extra for speed, but willing to pay much more for quality. How about the $14 hamburger at a restaurant, compared to fast food? We pay for the quality of product and service, happily defining our own tolerance for cost versus quality and speed.
So in planning for your niche to defend, one of the first decisions is between quality and speed. We will soon examine the entire gamut of pricing structures, but start with this one. It is fair to repeat that quality and speed together are the winners in this contest, not one alone.