Organizational Agility for Excellence
Organizational Agility for Excellence
Organizational agility is the ability of the organization to manage continuous, rapid and sustainable change. It is the capacity and flexibility of the organization to be consistently adaptable to market and environmental changes with rapidness and speed. It is the efficiency with which the organization can respond to nonstop change. It is the organizational ability to exploit both revenue enhancing and cost cutting opportunities within its core business more quickly, effectively, and consistently than its competitors. It makes the organization to operate at the speed with which the opportunities are getting created. In the fast changing complex environment of the present day organizational agility is the key differentiator between organizations.
Organizational agility is achieved by enhancing the organizational capabilities to identify and respond quickly in an effective and efficient manner to the opportunities and threats. Agility makes the organizational processes flexible and the response time of the organization to the critical issues reduces to a great extent. Agile organization is quickly able to take advantage of the opportunities and protect itself against the threat. It believes in putting in place systems to gather and share the information required to spot opportunities and by building processes to translate organizational priorities into focused action. Agile organization manage the challenge of change effectively and efficiently without falling prey to either chaos and inertia.
Implementing organizational agility requires management to regard all areas of the organizational operations as potentially subject to change. It must recognise that changes come from the external world of customer demands, competitor influences, technological advances, regulatory changes, macro-economic shifts, change in political thinking and so on, and not simply as an internal activity. Management must also be able to use available resources in a timely, flexible, affordable and relevant manner, in order to respond to these changes effectively. The management is to understand that management of constant, integrated changes are far more effective and profitable / cost-efficient instead of considering changes as a series of disconnected projects.
An organisation is at a competitive disadvantage if it is not agile enough to anticipate fundamental marketplace shifts.
Internal barriers stall agile change efforts. Initiatives to improve fails to deliver the desired benefits if there are obstacles such as slow decision making, conflicting departmental goals and priorities, risk-averse cultures and silo-based information for improving the organizational responsiveness .
Technology plays an important supporting role in enabling an organization to become more agile. Technology functions as a change agent in the use and adoption of best in class knowledge sharing processes, so that the organization can improve its use of critical data.
An agile organization has a culture which is reflected in the following.
- Organization has intense customer and market focus with internal systems, structures and processes facilitating this culture
- There is anticipation of need, risk and opportunity in the organization
- Organizational management believes in speed of decision making and implementation
- There is flexibility in approach
- Organizational atmosphere which is conducive to experimentation, innovation and shared learning
- Management has faith in empowerment and participation of the employees
- Team/partnership is working across the boundaries of the organization
- Management works for continuous improvement and risk management
- Efficiency and effectiveness of the organization is clearly visible
The processes in an agile organization are aligned to serve the customer in best possible way by meeting his needs and demands. Agile organization display teamwork and there is partnering and working across the boundaries, learning and collaborating with other teams.
The organization has focused professionals with specific skills that can be drawn on throughout the organization. Along with distributed leadership at all levels, the style of top management, its alignment to strategy, strength and speed of decision making, clarity of communication and the degree to which the management is trusted, is key to the agility.
Human aspects of agility
There are six human aspects of organizational agility which are important in influencing the organizational success. These are given below.
- Leadership and management -It is the style of organizational leadership and its alignment to the organizational strategy, the strength and speed of decision-making, the clarity of communication and the degree to which it is trusted.
- Innovation -It is the degree to which the organization has a systematic approach for sharing insights and continually generating new ideas, as well as the degree to which it uses internal and external networks to share ideas.
- Strategy – It is the way in which strategy is developed, encouraging internal dialogue, and how clearly organizational strategic intent is communicated and the level of stretch imposed by the organization.
- Culture -It is the collective values and opinions that guide the behaviour of the employees. Culture has a considerable impact on the agility of the organization. Organizational culture can be influenced by the policies and practices of the organization.
- Learning and change – It is the degree to which the organization has a shared vision, has an appetite for change and the capability to enact the changes, and how it deals with the consequences of past decisions.
- Structure – It is the strength and robustness of operations and processes combined with the degree to which the employees have clear delegated decision making authority.
It is imperative to make adjustments quickly when things are not working as planned. In an agile organization there is a successful management believing in change. The management tends to be very timely in making decisions, solving problems, removing roadblocks, and fighting the tyranny of the urgency. In organization which does not give importance to agility, there may be the wrong people in several places, there may be setting in of the analysis paralysis, or there are excessive meetings causing the efforts to stagnate. These types of situations often go unnoticed until the cumulative negative effect takes momentum out of the drive.
Agility in an organization is a systems based capacity, not an individual trait. It takes more than will, or an open mind, to be flexible. An agile organization brings together people, processes, and systems to manifest the mission and strategies of the organization. Organizational agility is a critical competence for any organization facing nonstop change and increased competition. Agility allows the organization to build into everyday practices an ability to rapidly respond to changing circumstances and take advantage of emerging opportunities. When the organization is agile, changes do not stress people or the system as this is a normal way of working. The level of fluidity and flexibility needed depends on the quantity and speed of changes to which the organization must respond.
Agility building interventions such as systems thinking or creative problem solving workshops at an individual or team level are helpful in building agility in the organization. If efforts to build agility across the organization are weak, then individual and team level efforts ultimately fail.
Leadership teams are in a unique position to oversee and ensure systemic changes that improve agility and position the organization for greater success. Agile organizations must have the staying power to drive operational performance over the long run and the ability to quickly shift its focus across the organization and teams.
There are three types of agility namely (i) focus agility, (ii) resource agility, and (iii) performance agility. To be optimally adaptable and rapid, an organization must endeavor to strengthen each type of agility and the systems and practices that support them. This agility model is shown in Fig 1.
Fig 1 Elements of an agility model for an organization
Focus agility is focusing the direction for the organization and is the degree that the organization can rapidly adjust its mission, strategies and goals to respond to new threats, opportunities, or market conditions. An agile organization reads its markets (current and potential customers, competitors, trends, regulatory environments, etc.), scans their external and internal environments, understands emerging opportunities, and quickly turns the information into a road map for action. To improve focus agility organizational systems and practices are to be designed to prompt management at all the levels to regularly recalibrate and adjust the focus of the organization. All the employees of the organization having focus agility are expected to, encouraged, and rewarded for keeping their eyes and ears open for the helpful information and sharing of the market intelligence.
Focus agility is most visible when applied to broad strategies but is also important on the departmental level. Departments which fail to adjust the direction of their team normally find it difficult to optimize results and performance.
Focus agility requires that the goals of the organization and the path to achieve them need to be reevaluated to ensure they represent the current needs of the organization and are not inadvertently in conflict with one another.
The primary systemic elements of resource of an organization are people (including all the costs associated with people), funds, operating and capital expenditures, outputs (used internally or sold externally), and brand elements etc.
Resource agility is achieved through a continual redeployment of people, processes, funds, capital and other organizational assets. For achieving resource agility, management is required to have systems in place that alerts it when a reallocation is needed and could better serve the mission and strategies of the organization. Agile organization does not leave the potential need for resource reallocations to chance nor does it tolerates an ad hoc approach to resource management.
Resource agility normally follows a change in focus (mission, strategies, goals). Resource agility may also be needed in the absence of a change in focus. Management of an agile organization measures the progress and use data to proactively reallocate resource for improving chances of achieving the goals. It is also to be noted that changes in performance agility impact the allocation and utilization of resources.
Performance agility is the most commonly practiced method . Organizations use various efficiency tools and practices to improve their processes and the ways of getting the work done.
In addition to creating agile processes, it is important to create agile people, teams, and cultures. Like is the case with operational processes, organization is required to continually adjust and align how people do their jobs and how people work together. It is not enough to ensure that people are accepting of changes, they need to advocate and initiate changes.
Work cultures are usually difficult to change. The agile organization, however, identifies core elements of its desired culture and quickly replaces obsolete notions, practices, and beliefs. Agile culture encourages employees to discuss and challenge operational practices, values, operating methods, and work processes as this is an important way that management get the information it requires to keep the organizational results on track for achieving the goals.
To measure, optimize, and improve the agility and performance of the systems the organization uses process improvement, measures, learning and development, culture development, technologies, collaboration, and other performance enhancing methods and practices.