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You have probably heard of Agile methodology from your software development teams. What you might not know is that organizational agility will make the difference for your company, even beyond IT, between merely surviving and thriving.
Now, your company might survive just fine without the hard work it takes to become an agile organization. But, in my experience, the organizations that thrive in a fast-changing economy, where markets are created, destroyed and disrupted in a matter of weeks or days, are organizations that can move fast. Ready? To become nimble you will need to destroy most of what you understand about how your business works.
Why is agility so difficult to attain?
Organizational agility is talked about a lot. Indeed, in recognition that industries are changing fast, many organizations have agility in one form or another as a bullet in their corporate strategy. But if you look at most organizations, it just isn't making the huge difference that the pundits claim it will. Why is that? Business agility is hard to attain.
Before we go any further, let me define "agile organization."
If you are able to adapt to the changes in your business context (customers, technology, markets, and so on) as fast as, or faster than, they occur, you are an agile organization.
That means being able to answer the following questions:
- How fast are changes happening in your industry?
- How quickly are your competitors delivering new products and services or new features and functions?
- How quickly are your customers' needs changing?
- How quickly does your underlying technology change?
These elements are compounding. Meaning, if you have a change in market segmentation or new market creation and your underlying technology changes, your organization has to adapt to both changes simultaneously, compounding the complexity of the change and making it all the more important that your organization is nimble.
With this definition of organizational agility in mind, let's take a look at your business systems, focusing in this column strictly on product or service creation. (Maintenance and support of products and services are also impacted, but covering all that would make this a long article. We also will not cover finance and budgeting here, but they are impacted too.)
Here are six key areas of product creation that are impacted by the need to be nimble:
How you scope work
Most organizations conceive of work in large batches that are worked on for a long time and then delivered to their customers. But this is a huge risk when things change so quickly. What happens if you are in the middle of the creation of a product and your competitor comes out with an innovation that changes your market? What happens if your underlying technology changes mid-development and you are left developing on an outdated platform?
The contrary model is to conceive of your work in small increments with a direction in mind but with fast delivery of small, autonomous elements of your product or service, that provide value to your customers, but that may not be as "complete" as you normally would conceive of a product or service. Most often, your customers don't want or need all the complexity you build into your offerings. Create an offering that has the minimum necessary to provide the highest value to your customers and then gauge their feedback. This is a fundamental difference in how you think about work. It impacts how projects/products are created, it impacts governance, it impacts finance, it impacts team structure and it impacts delivery and marketing.
How you structure your teams
You probably have heard of the Tuckman model of team development. That is the one with the four stages: Forming, Storming, Norming and Performing. Teams, in one way or another, go through this process. To a small degree, they go through it whenever a team member is added or removed. When at least 30% of the team has changed, they definitely go through the cycle again. This process slows the delivery of work because people are focused on the social/team dynamic rather than the work. This is a delay that we would like to avoid.
There is another option. Many people phrase the contrast this way: The traditional approach is that we have work and we bring "the right people" to the work. To be nimble -- to have organizational agility -- we have to have great teams of people and bring the work to the team.
How you develop people
To support this approach of having great, long-lived teams and bringing the work to them, we need a slightly different approach to developing our people. Who you want is known as a T-shaped person. Yes, you want people who are experts in their area, but they also need to have broad expertise. They need to be able to pick up any work that needs to get done and help move the work along.
One client had a bench one deep, and that one person decided to retire. The next six months were a scramble to try to transfer 40 years of experience to a few people to support the system after that employee left. Don't be that organization.
Traditional models for staff development involve helping them deepen their expertise in their area of specialization. Think instead like a nimble startup. What do you want if you can only hire a few people? Do you want experts in small areas? No. You want people who can pick up the ball and run with it. You want to develop these T-shaped people. Cross-training in a number of areas is just as important as development of specialization.
How you lead and manage people
If your organization is going to be nimble, then leadership decisions need to be made as quickly as possible so that real action can be taken. This is a shift from a focus on making all the right decisions and reducing failure to making small, quick decisions, learning and adapting to quick failure. This scares so many executives. We have been trained since childhood to reduce failure. Our papers in school were graded once, and if you got it wrong, that was it; you had no second chance. It was really a focus on timing rather than learning. This was reinforced throughout school and in our jobs after college. Today in school, there is a greater focus on learning than on timing. My wife is a middle school teacher, and in her class, students can turn in a paper as many times as they like, making the grades as excellent as the students choose. She wants to give them quick feedback and then help them improve.
This same model applies to how you lead and manage people. You need to give them guidance and direction but then set them free to make quick decisions without asking you for approval on every decision.
Your delivery pipelines
To achieve organizational agility, your product and service delivery pipeline must be reconstructed to handle the increased cadence of change. So, if your change cycle in your industry and for clients is six months, but your delivery pipeline is 12 months, you have some work to do. What people don't recognize when they are faced with this kind of shift in timeline is that it comes with a commensurate change in scope. You will be delivering half as much product or service change. The impact on your customer is half. The impact on your support staff is half. The amount of customer documentation is half.
The simplest thing to do is to look at your current offering lineup and cut it in half. Don't do this arbitrarily; rather, attempt to deliver the most important things to your customers first. Put the less important things in the second delivery. This way you get the biggest bang for your buck.
Sales and marketing
If you are delivering faster, your marketing and sales teams also need to be working twice as fast. They need to be announcing new products and services twice as fast. They need to be updating their sales knowledge twice as fast. Marketing campaigns need to be modified. But again, remember that the new offering is only going to be half the scope that it was before, so marketing personnel doesn't need to communicate as many new features or options because there is only half as much change.
I have worked with a couple of marketing teams, and they were able to make this change, and it was just as complex as it was for the product development teams. Don't underestimate the impact on sales and marketing.
Becoming nimble -- becoming an agile organization -- isn't just an IT or software concern. Every organization today needs to assess if they are nimble enough to lead their market. Because organizational agility fundamentally changes how you conceive of your work, it impacts the whole organization, not just a delivery of a particular product. If your organization is not nimble enough to keep up with the market and your competitors, there is something you can do about it! It won't be easy, but it will be worth it.
About the author:
Joseph Flahiff is an internationally recognized leadership and organizational agility expert at Whitewater Projects Inc. He has worked with Fortune 50 and Fortune 500 companies, government agencies, startups and publicly traded firms, where he has been lauded by executives as an experienced, pragmatic and innovative adviser. He is the author of Being Agile in a Waterfall World: A practical guide for complex organizations. Learn more at www.whitewaterprojects.com; to contact Joseph send an email to [email protected]
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