In a volatile and rapidly changing world, agile organisations are the most likely to emerge as winners. What essential characteristics do they all share?
Key information:
Successful organisations share five essential characteristics that allow them to embed agility in their operating model.
Agile organisations are best placed to capitalise on opportunities and respond to threats in the new reality.
Agility is a must-have if organisations are to thrive in a dynamic and rapidly changing world.
Research by iHelm has found that the organisations that embed agility within their core business processes are best placed to capitalise on opportunities and respond effectively to threats. Not only can they successfully outmanoeuvre and outperform their competition, they position themselves to thrive in the new reality of a dynamic and rapidly changing world.
Organisational agility can be created in private and public sector organisations when the right leadership is combined with key elements in the organisation’s operating model. When all the elements are in place, an ‘operating rhythm’ is achieved that can deliver exceptionally agile performance. In the mayhem of 2022, there are game changing opportunities for the nimble, smart and brave.
How can agility be embedded in your organisation’s leadership and operating rhythm, and how can you make it the centrepiece of your organisation’s business strategy?
The five essential attributes
Agility is the ability of an organisation to change direction quickly and effectively in response to, or in anticipation of, material opportunities and threats.
While aspects of agility may differ from company to company, industry to industry, and government to government, agile organisations are characteristically nimble, flexible, innovative and inventive. Agility allows organisations to move quickly and effectively to extract value from any invention, innovation or improvement and to rapidly adapt to changing market dynamics.
iHelm interviewed non-executive directors (NEDs), CEOs, CFOs and COOs across Europe and the Asia-Pacific region and found that leadership capability is essential for achieving organisational agility. Forward-thinking, strategically focused leadership that can set the tone of an organisation and allow it to fully capitalise on opportunities is a central requirement for creating an agile organisation.
In addition to leadership capability, iHelm found that agile organisations all have five essential characteristics in common:
1. A vibrant people culture. Agile organisations create an environment in which experimentation is expected and encouraged, a culture of learning exists, and employees are engaged, empowered and outcome-focused.
2. Effective core business processes. Agile organisations find a balance between satisfying customer needs, community interests and pursuing profitable outcomes. They extract value from collaboration, can shift their focus from risk management to the management of opportunities, and have the capacity to store agility within different elements of their operating model.
3. Efficient operational infrastructure and technology. Agility is made possible by robust and efficient systems and platforms. Standardisation, consistency and simplification of this infrastructure is crucial to create organisational agility.
4. Flexible organisational structures, governance and risk controls. Agility implies a high degree of flexibility in decision making and governance, but without undermining the control environment. There needs to be a balance between the speed and quality of decision making, alignment with the organisation’s purpose and values, and levels of engagement and buy-in from employees at all levels.
5. Targeted performance measures and incentives. For an organisation to become and remain agile, it must incentivise agile behaviour in its workforce. Agility needs to be encouraged, identified and rewarded at all levels within the organisation and performance measures need to be designed that focus on, and promote, agility.
“People are key to agility, but organisations must also create a culture in which agility is nurtured until it becomes the norm.” — CEO, Global Investment Manager
Why agility needs to be central to your business strategy
2022 looks set to offer huge challenges for the business community unlike any we have seen before. Many industries are at an inflection point and disruption caused by the pandemic and geopolitics is creating both opportunities and threats. Against the rapid changes taking place in the world, promoting agility in your organisation offers a way to capitalise on those opportunities, mitigate those threats, and develop and sustain a competitive advantage.
What’s clear is that executive teams in both the private and public sectors need to radically reimagine their businesses to accelerate the move from coping to thriving in the new reality.
Is your organisation nimble, flexible, innovative and inventive? Do you know how to create and embed agility in your business’s leadership operating model? And does your business strategy reflect the imperative to become truly agile?
iHelm can help organisations outmanoeuvre their competitors and capitalise on the opportunities presented by global changes in the market. To learn more about this insightful research information, contact Martin Blake at martin.blake@ihelm.com.au
Excellent article. Given paradigm shifts seem to happen regularly embedded agility is mission critical. Great insights.