Agile organizations are resilient, and resilience is critical to organizational success in a world where disruption can happen with little notice. The transformation process to achieving true agility is a step process, impacting everything in the organization, from operational systems to utilization of technologies.
What is an agile organization? It is a non-hierarchal organization comprised of empowered teams working with operating procedures that enable the ability to quickly respond to changes in the business environment. It can make decisions rapidly, while maintaining operational alignment with business goals. It relies on team collaboration, has a flat organization structure, functions with leadership trained to support agility in teams, and implements technologies that enable cost savings while supporting cross-functional communication. The overriding goal is to meet customer needs through customized offerings, which is why the transformation process is called customer-centric. Transforming to an agile organization from a hierarchal one does not happen overnight, because it involves major changes in everything, including leadership style, operational systems, and technology.
RECOGNIZING THE DEPTH OF CHANGE NEEDED
The hierarchal organization with top-down leadership decision-making remains a common structure and governance system today. But this is proving to be a poor fit in a business environment where change in the marketplace and operating environment is continuous. The effort to respond to events such as the pandemic and supply chain disruptions has demonstrated that many organizations are too rigid in structure and decision-making. Also to incorporate major technologies such as artificial intelligence or machine learning to automate customer services and standardize routine operations. The ability to pivot in response to change requires a change in mindset at every organizational level.
Initiating the transformation to an agile organization has to begin, then, with helping leadership and employees understand the end goal so they understand the need to change. People must be willing to change before an organization can achieve agility. In addition, there must be an understanding that all functions are included in the transformation, and technology is the driver.
TAKING STEPS TOWARDS BUSINESS AGILITY
ISG is a global technology research and advisory firm, and they identified five steps to build an agile customer-centric delivery model. The first step is aligning technology to business capabilities, identifying how technology is used throughout the business and establishing governance and performance frameworks. The second step is identifying the business and technology leaders for each product and conducting value stream mapping. Product objectives are established across business, development and operational metrics.
The third step is starting with a product team, and then launching new teams as the process expands. Fourth, engaging and coaching each of the teams to help them develop minimum agile capabilities, continually assessing skill gaps by team, to achieve team improvement. The fifth step is continually improving the governance model by establishing standards, defining new team best practices, improving the product team model, and coaching teams in the best practices as they evolve. The fourth and fifth steps are circular, in that continuous improvement in teams and team government is sought.
From a people standpoint, the agility transformation is based on delivering work early and continuously. To do so, large projects are broken down into smaller tasks, enabling the adoption of changing requirements as the project advances. The smaller tasks or incremental product releases are called “sprints.”
The process for becoming an agile organization is a continuous and iterative one. As Accenture says, “In a truly agile organization, every aspect of business operations is engaged in an ongoing cyclical process of discover and evaluate, prioritize, build and operate, analyze and repeat. Experimentation, collaboration, iteration, and a focus on the customer are key themes throughout the process.” Organizational systems are revised to support team agility, and new capabilities are built.
EMBRACING ADVANCING TECHNOLOGIES AND AGILE BEHAVIORS
Technology plays one of the most important roles in the transformation process, specifically digital technology. Entrepreneur Sam Goodner outlined 10 principles for implementing technology to support the transformation to an agile organization. The first is that technology should be strategic to support strategic business objectives. There should also be a commitment to constantly explore technology advancements and become an early adopter, by embracing those that contribute to agility and a competitive advantage, such as artificial intelligence, robotics, machine learning, the Internet of Things, the cloud, etc.
Continuing with Goodner’s advice, another principle is to digitize all organizational information and give everyone access to the company information, except for the most confidential information such as payroll information. Access to the information should be possible from anywhere and on all devices, including laptops, tablets, and smartphones. Standards should be established for governing technology usage, to facilitate interaction and communication between teams, addressing things such as meeting formats, common language, and social-networking.
Communication is moved to the cloud, to ensure all employees use the same tools and systems. Team decision-making is empowered by providing real-time visibility into data. Every implemented technology should work in the future, through processes such as automatic updates that do not require IT management. Employees should always be current on cybersecurity. Finally, the whole organization must embrace agility. These 10 principles can guide any organization pursuing agility.
Of course, people must be willing to learn agile behaviors. Scaling and improving depends on rolling out pilot teams and people moving into new roles. Leaders must be strongly committed to developing the agile organization. The leader of an agile organization encourages an entrepreneurial workforce, invites diverse contributions, supports challenges to the status quo, encourages risk taking within defined norms, delegates decision-making to the lowest organizational level, and coaches employees. The agile leader also recruits and fosters development of diverse talent needed for organizational capabilities essential to meeting the company’s mission and fulfilling strategies.
VOLATILITY IS THE NORM
The global economy is expected to remain volatile well into the future. There will be technology advances, social upheaval, impacts on resources availability due to climate change, political changes, a continued tight labor market and skills shortages, and increased competition. Becoming an agile organization means reimagining everything, from the organizational culture to employee engagement, to operational systems, to technology utilization. Everything must be aligned to strive for agility. It is a major commitment, but necessary to remain competitive in the labor market and stay in business now and into the future.