Disruption is everywhere. Workplaces are going hybrid, new technology is soaring, customer needs are shifting by the day. In order to stay on top of new demands and technologies, companies must be alert, nimble and reactive. The days of stubbornly sticking to your business model, regardless of what’s happening around you, are decisively in the past.
All these factors can explain the importance of organizational agility and why the strategic imperative has become a buzzword of late. Let’s take a closer look at what organizational agility is and why your company needs it to drive growth and build competitive advantage.
What is Organizational Agility?
McKinsey offers a good analogy for considering the difference between agile and non-agile organizations. In the past, successful companies were thought of as well-oiled machines, equipped with tried-and-true systems that ensured quality control and consistency. They had set ways of doing things, and these approaches were rarely challenged. The machine could be reprogrammed, but that reprogramming would be the result of a clear and intentional mandate, arrived at after lengthy deliberation, and requiring alignment from everyone in charge.
Today, successful businesses are more like living organisms, their feelers out on the pulse of the times. These companies strive to absorb new input and respond instinctively to customer and market stimuli. They react to change and shifting customer needs in a much more immediate way. New ideas aren’t subjected to endless red tape and negotiation; they ripple swiftly through a company, able to effect change right away.
To put it more succinctly, an agile organization is one that, according to McKinsey, can “renew itself, adapt, change quickly, and succeed in a rapidly changing, ambiguous, turbulent environment.”
What Traits Do Agile Companies Have in Common?
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They’re Non-Hierarchical.
Elon Musk allegedly told everyone at Tesla that they could email him directly if that was the fastest way to solve a problem. Agile companies prioritize speed and efficiency over old-fashioned deference to the chain of command. They empower teams to function as networks who collaborate regularly and they encourage managers to fight hard against the siloing of departments. They embrace the attitude that everyone is equally responsible for the company’s success.
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They’re Able to Overcome Obstacles.
Agile companies don’t beat around the bush when there’s a problem. Boasting cultures of candor and openness, these organizations look their obstacles in the face and quickly align to get past them. With barriers between rank and department removed, people are able to collaborate and work together toward timely solutions.
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They Embrace a Learning Mentality.
Agile companies have skilled employees. But these employees boast more than just great resumes; they’re also open to learning more every day. Unlike legacy companies that rely exclusively on people with established expertise, agile companies embrace interdisciplinary learning and upskilling. They subscribe to the idea that a talented employee has undeveloped potential that will benefit a range of projects.
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They’re Customer-Centric.
Focusing on your customer is a great strategy for a host of reasons. Not only are customer-centric companies more profitable than companies with other priorities, but they’re also more nimble and reactive. Customer-centricity creates an operational framework where flexibility and responsiveness are key. A clear objective and common goal emerges across departments, further facilitating collaboration.
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At its heart, organizational agility is the ability to react to change and swiftly establish new initiatives. Over the course of the next blog posts, we’ll be exploring the business benefits of organizational agility and how human-centered design can build this key strategic imperative internally.
Interested in the other strategic imperatives for success? Read our recent post: How Design Thinking Drives Today’s 6 Key Business Imperatives.