Agility - the solution how to manage digital change

 

Agility - the solution how to manage digital change

Only AGILITY enables companies to survive and win the digital driven change

Only agile enterprises will be able to adjust and reinvent themselves to match the changing market place. This agile-capability is vital to match the constant and important changes we will all be facing. The former 2 blogs covered  Digital revolution – how to deal with it  and  Digital change – 7 steps to bring you on the winners side . The key message was

1. Digital change will impact all of us

2. The change is coming faster and harder than we can imagine

3. Unprepared organisations risk to get severely hurt

This looming, unknown change can indeed be a bit scary. How can an organisation, a company, adjust themselves to the unknown? Who knows what technologies, products and services will be available next year, never mind in the next 5 to 10 years?

Enterprises will have to be in closer to the markets/customers to understand their underlying needs to present new products, services considering the technologies that will then be available. Hence rapid reaction to the surprising new is key and this requires – agility.

 

Agility is nothing new?

Fair point. Since the year 2000 I have – as most of us – worked in different versions on making organisations and processes agile. I had the opportunity to lead a 6 bn US$ organisation through the implementation of Lean Six Sigma, was then confronted and immerged into lean, lead restructurings of many companies and so on. And yes, all the time it was about understanding and implementing customer needs into attractive, profit making products. Flexibility became more and more important and continuous change became the norm. All of this was working on agility. As a matter of fact Lean is probably still the most effective way to get agility in repeating process such as transactional work and production processes.

The new element regarding agility today lies in its necessity and the speed that needs to be applied to implement it. The good news is that many companies are familiar with some of the basic concepts to get there. What needs to happen is that this is now truly and more fundamentally implemented.

Agility through for example Lean is now no longer a nice to have to tool that can help some products to be produced at lower cost and better quality, it now becomes necessary to get all its elements, flexibility included.

 

People act, decide, pull the organisation forward – get the people issue straight and you win

The key to make an organisation agile is the people, the structure in which the people act (see point 7 from the former blog – 7 steps…).

Agility is the movement and speed that drives organisations to satisfy customers best. It is based on the participation of the organisation, i.e. each employee. The customers observe and feel when a company is agile. They respond to it and ideally the exchange to and from the customer becomes an on going exchange that enables the organisation to grow.

The initiating spark to become agile needs to come from the CEO and needs to be fully supported by the management team. The word spark might be misleading. Change management is not an exothermal process that once started continues all by itself. Driving change is an on going effort. The good news is, what is tough for you is tough for others as well. Many companies start and fail for various reasons. So – maybe that there just might be the chance for your organisation?

 

What does it take for people and the organisation to become agile?

Actually we are all naturally spontaneous and agile when there is no time to reflect and think. Imagine a dangerous situation in traffic, slipping on a wet floor or on ice, pushing over a glass of water,… In these situations we react very rapidly. The success of our reaction is a different story. Successful reactions come from training. Successfully agile requires setting an environment where agility is practiced all the time. Permanent practice of agility allows people to develop agility reflexes. Problems are no longer an issue, just a request to understand and change. New customer requirements are welcomed and not pushed back, …

In Judo you learn how to fall without hurting yourself. The situation when you are forced or when you let yourself fall may have a lot of variety. The how to fall remains the same – it can be practiced until it becomes second nature.

In business-Agility we need to learn that change is not an enemy, but a friend. It is a friend because it helps the organisation to survive in this new highly dynamic environment. Learning new stuff and being out of the comfort zone is no longer a scary situation, rather a new way of working. The positive support in terms of training, encouragement from the leaders, tolerance for mishaps during the learning process is essential.

 

Leaders – the key element

This brings us to a key element – the leaders. Whilst agility is a challenge for the execution level, the challenge for the leaders is even larger. The more modern managers will just have to make sure that they really have enough time for their teams, i.e. get rid of some work they are doing themselves. However managers who manage by knowing better their teams jobs and lead by how instead of just what to do, these managers will have to change or will have to be replaced. In a situation of rapid change, the how changes rapidly as well and if managers get involved in that they will slow down their team in an unacceptable way. True leadership stands for declaring the direction/vison, setting expectations to the teams (goals and KPI’s ), support them where needed, eliminate obstacles in their ways and animate them to continuously improve.  

Agility in an organisation is hence first of all a challenge of leadership and change management .

 

What to do with employees, managers that do not support the organisation to become agile?

Most of the time the reluctance of employees to passively or even actively block the change is a personal issue and not a hostile attitude towards the organisation. These individuals are hence not enemies, rather they are more people who are scared, feel overwhelmed, insecure, lost. I agree that their behaviour can be unfriendly, abrasive, aggressive and it is obvious that an organisation can not tolerate that. The understanding is hence not an attempt to minimise the issue, it is to explain it. Understanding the problem allows to think of the proper measures, actions to address the issue.

It is most likely that the concerns these people feel can be removed, resolved. What is not obvious is the amount of time/effort this will take. I believe that a company has the right to do its subjective math of return over effort to decide if such as person shall be supported or not.

As we are now looking at a person who needs help, the least that can be done is to have a friendly conversation by the boss to try to understand what the issue can be, to offer support when the person is leaving his or her comfort zone. Sometimes this already does it ! This time is well invested as you have saved the company a valuable employee and helped a person overcome an obstacle.

If the discussion does not give the necessary result, then Coaching is a good next step. Based on my experience 2 to 4 meetings at 1.5 h each will be sufficient for many leaders. Should this prove not to be sufficient, the coach would suggest a next level of support and the company will decide if they want to take that next step.

 

Resolving the blockage of people is hence mostly a matter of time and effort. Time of leaders is a scarce commodity. Leaders tell me that they would like to spend more time with some of their direct reports that need more support but they just do not have the time. Time to help direct reports make the next step is therefore often outsourced to external coaches. The company decides how much effort makes sense to invest in a person. Typically the cost of coaching is a very small fraction of what it costs to remove and replace a good person.

 

Where does coaching make sense?

There is a kind of “acid test” if someone should be coached or not. I often ask that question before I take on a mandate. “Why don’t you fire the person” is the question I ask when they list the shortcomings of the to be coachee. If the person is respected and considered to be valuable to the organisation this question is quickly cleared. No, he/she is actually a very valuable asset to us, it is only…..  Other times the organisation tells me that indeed they are thinking about letting the person go. In this case I suggest to make up their minds first. It is not just about the coaching cost – it is also about the negative effect it has when in the middle of the coaching, when the coachee starts to improve he or she gets made redundant.

For good people coaching is always a great thing. It helps them grow and overcome obstacles that may have made them defensive towards supporting – in this case – agility.

 

Agile structure – organisation charts

The organisational form will have to adapt to the demands of agility. It is very unlikely that the existing organisational setup will be able to support agility.

The speed of change and execution requires a lot of rapid, hence decentralised decisions. Decentralised decisions will require that competences have to be reviewed. For smaller organisations this will require some adjustments that are maybe not always easy but manageable.

Large groups have a much larger challenge. They have been built to have the strategic advantage of size. Now that the criteria of speed becomes for most businesses the key success factor, size can be a disadvantage. Groups have changed in the past and so they also can in the future. Just a few questions that come up when setting up a structure that supports agility:

  • What is the ideal size of each operational entity to be able to react in an optimal way to their markets?
  • What is the role of the central functional services
  • How can decisional power be delegated to where it needs to go to be agile, without loosing control?
  • What kind of control to we need anyway?
  • What does this mean for topics such as risk management, IT, …
  • What will this mean for our organisational design, our reporting…?
  • How can we test new organisational structures to learn?
  • What kind of leader talent will we need for such structures?
  • How on earth can all this be explained to investors, shareholders, stakeholders in general?

 

Summary

  • Organisations should face the digital change now
  • Discover and get comfortable with the uncertainty of the future market
  • Agility, rapid, professional reaction, adjustment to win in the changing environment
  • Agility is achieved through agile employees
  • Leaders, employees that block the attempt to become agile have to be addressed with the appropriate measures, support, coaching, removing from the existing role,…
  • Agility is continuously practiced by individuals and organisations
  • Ideally change is considered normal by individuals and organisations, a part of the normal professional life
  • Leadership requests agility from the organisation and the individuals. Leadership supports and takes obstacles out of the way, supports individuals to overcome limitations to become agile
  • The organisational structure has to be adjusted to support agility
ABB
Carrefour
Credit Suisse
Eurotech
LandQuart
Novelis
Oyma
Sulzer