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building agile organizations: what to look for & how to do it?

March, 2019

The increasingly rapid pace of changing market trends, technology, regulations, and tastes has mainly favored the more agile organizations on the scene. The ability to quickly reconfigure a market’s strategy, structure, processes, people, and technology has been a trait adopted by all the current industry leaders. These firms are able to reorient their businesses as needed towards value-creating and value-protecting opportunities.

An agile business shifts from being merely machine operating to becoming a chameleon adapting to market changes. There are 5 main trademarks for a successfully agile company:

1. Mindset Shift

The adopted business model reimagines the process subjective to the target audience. Effective models are customer-centric, seeking to meet diverse needs with and for a wide range of stakeholders; such as employees, investors, partners, and communities. Such agile firms design distributed and flexible approaches to value creation, which include integrating external partners directly into the value creation system.

2. Network of Empowered Teams

Agile firms view their teams not as people who need to be provided with directions, but as highly engaged individuals who are able to reach creative solutions and deliver exceptional results when given clear responsibility and authority. While the top-level structure remains stable, the lower tier departments are replaced by a flexible, scalable network of teams. Their teams operate with high standards of alignment, accountability, expertise, transparency, and collaboration.

3. Rapid decision & Learning Cycles

A traditional business’ learning and decision cycles depend on the decision makers and their ability to define the direction of the firm, develop detailed plans, and minimize risks. The agile firm moves from that realm to one where uncertainty is embraced and innovation is the way to reach productivity. They work in rapid thought cycles that are closely aligned to their creative processes and deployed in design thinking, lean operations, agile development, and more.

4. Dynamic People Model

A successfully agile business does not depend on the leaders’ control and ability to direct work and steer employees to achieve desired outcomes. Instead, it empowers its employees to take full ownership and provides them with the space and trust to drive the organization toward its vision. Such firms invest in leadership that serves to empower and develop the employees and develops visionaries and guides that can build on each one’s talents.

5. Enabling Technology

Technology has ceased to simply be a supporting tool to deliver specific services, and to become seamlessly integrated and core to every part of the business, in order to unlock its values and facilitate quick reactions to changing needs. For agile firms, products are digitized or digitally-enabled to meet changing customer and competitive conditions, and operational processes are rapidly changing, requiring evolving technological architecture including real-time communication and work-management tools.

Agility is required in all industries, whether it’s FMCGs, telecommunications, oil & gas, or pharmaceuticals. Yet, many firms face numerous difficulties in building their agility because they do not yet have a handle on the fine balance needed between stability and dynamism. Dynamism allows companies to respond quickly and effectively to new opportunities and challenges, while stability builds reliability and efficiency through establishing constant backbone elements.

Firms need to incorporate stable practices to enhance their agility, which includes providing actionable strategic guidance, establishing a shared vision and purpose to which employees connect to personally and emotionally, as well as allowing people in their units to be entrepreneurial. These practices are balanced with dynamism through high levels of transparency on the entire process, from customers to financials, and rapid experimentation of new products through close interaction with customers.

The exact balance needed for each firm depends on where it lies on the spectrum of organizational development:

  1. Bureaucratic Units: While they are high in stability, they are relatively low in dynamism. Main hindrances that need to be overcome are their minimal use of viable products to test new ideas, and the lack of employee ownership over their work.
  2. Start-up Units: The opposite of bureaucratic units, they’re high on dynamism but low in stability. They lack discipline and systemic execution, which can be overcome through creating a solid backbone from stability practices.
  3. Trapped Units: These units lack in both fields, where they lack a stable backbone of actionable strategic goals, and an entrepreneurial drive, in addition to dynamic elements such as continuous learning and rapid iteration and experimentation of new ideas.

The rapidly changing market favors the agile, with only these businesses taking the lead in their industries. Transforming your firm into an agile business is ceasing to be an option and turning into a requirement. Depending on where your business is on the spectrum between stability and dynamism, the necessity to transform will differ.

Is your firm an agile organization? Get in touch with our experts now and find out how your firm can create its own stability and dynamism balance and turn into an agile leader in its industry.

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