It used to be said that the only two certainties in life were death and taxes. In business life there is a third certainty: change. And CEOs are increasingly aware that an organisation's success is partially determined by its ability to adapt and respond to change in a quick, agile and appropriate manner.
Organisational agility is achieved by being alert to both internal and environmental changes - opportunities as well as challenges - and the ability to use available resources in a timely, flexible, affordable and relevant manner, in order to respond to those changes effectively.
An agile organisation embraces change by moving quickly, decisively and effectively to anticipate, initiate and take advantage of change, yet remains robust enough to absorb any set-backs. But agility is not just about being fast: it also implies the capacity to remain in touch with customer needs.
Six dimensions of agility:
If we examine more closely the human aspects of organisational agility and how each dimension influences business success, we start to see a new order emerging in the way that leading organisations operate.
1. Leadership & Management: The style of your leadership and its alignment to your strategy, the strength and speed of decision-making, the clarity of communication and the degree to which it is trusted.
2. Innovation: The degree to which an organisation 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.
3. Strategy: The way in which strategy is developed, encouraging internal dialogue, and how clearly your strategic intent is communicated and the level of stretch you impose.
4. Culture: The way your employees' collective values and opinions guide behaviour will impact on how agile your organisation can be. This culture can be influenced by your policies and practices.
5. Learning & Change: The degree to which the organisation 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.
6. Structure: The strength and robustness of operations and processes combined with the degree to which your managers have clear delegated decision-making authority.
A New Model of Leadership
Traditional thinking in this area is based on the Hierarchical Principal (where each level has a clear and defined role in a top down strategic process) and the Linear Principle (a logical chain starting with strategic thinking, then organisational design, finishing with the development of management).
But the current level of business complexity, plus the need to respond quickly to change, is challenging this way of thinking and forcing the development of capabilities in the six dimensions outlined above.
Building a new leadership model where management focuses on "acting in time" rather than "being right" will require a change in mindset.
Key to achieving this shift is the notion of value-based leadership i.e. ensuring that management behaviour is consistent with the organisation's core values. As Steve Jobs put it, "the only thing that works is management by values".
It isn't just leadership competencies that will need to change to achieve this shift. Throughout the organisation, employees goals will need to shift and stretch.
The idea here is to set targets that cannot be reached through 'business as usual'. Employees need to feel that they are being challenged to innovate and drive change. However - and this is the difficult bit - employees must be convinced that they will not be perceived as failures if they are unable to reach any extreme objective.
Goals need to be stretched, too, if the organisations are to reawaken their powers of innovation and build stronger, more collaborative ways of working - both internally and through their external networks.
So the building blocks of organisational agility are not complex. Accelerate the pace of strategic renewal, make innovation everyone's job, every day and create an engaging, inspiring working environment and agility will follow - bringing with it the confidence and skills needed to steer your organisation through troubled waters.