The Agile Organization

by Cathy Farley and Walter Gossage


In the sporting domain, physiologists call it SAQ training: speed, agility, quickness. Essentially, world-class athletes use specialized sets of exercises to increase strength, flexibility and the ability to apply maximum force in sports requiring long-term activity and short-term bursts of energy.
 
In the business domain, more varied kinds of muscle movements are also becoming highly prized by executives as they seek to build the workforce and organizational capabilities that can best respond to continued economic uncertainty. In other words, companies want greater organizational agility.
 
The choice of words here is important. Agility is adaptability plus speed. Just as an effective triathlete must bring multiple kinds of athletic skills together in a single effort, agile organizations must excel across different kinds of activities. They must have the staying power to drive their core businesses over the long run and the ability to shift focus fast in multiple business portfolios and to execute quickly when the time is right to pull ahead of competitors.
 
So how does an organization imitate the multiskilled triathlete? There is no single training regimen. Improving a company's agility requires focused initiatives that cross multiple areas, including strategy, workforce capabilities and culture. Attention to these multiple organizational dimensions can help a company improve its responsiveness to market conditions, its ability to serve customers and its capacity to change, innovate and grow.
 
A Nimble Human Capital Strategy
 
Taking a global enterprise in a new direction is a bit like turning a large cargo vessel. Because of its size and momentum, the ship may be many miles downriver before it can be stopped and redirected.
 
With companies, that slow response is often caused by turning attention to the workforce too late in a strategic or technological change. Organizations set strategies in motion or implement new technologies, and only then do they establish programs to help the workforce execute in the new environment. An agile organization, by contrast, has more strategic insight into human capital strategy and the workforce capabilities needed to execute strategy rapidly and effectively. Here, talent leaders will proactively consider what capabilities they need - and in what workforce numbers - to execute business strategy.
 
For example, an effective human capital strategy has been critical to improve the efficiency and agility of Piramal Healthcare Ltd., a large, India-based pharmaceutical company. Piramal's growth strategy over the past decade has been largely based on acquisitions. Because business was booming and growth was robust, the company did not take the time to plan for an optimally sized and skilled workforce.
 
To change that, Piramal followed a comprehensive planning process that produced a blueprint for a phased sizing of staff according to performance and strategic fit. It also created more efficient and effective processes and structures to harmonize the way the newly reshaped staff would perform. The company carefully managed potentially negative effects on morale by redeploying employees to other areas of the company if their positions were eliminated during restructuring.
 
"By making staff decisions based on performance, we improved our employees' commitment to execution," said N. Santhanam, Piramal's chief operating officer. "All our employees now feel they are doing a job for which they are qualified, and that adds clear value to the company."
 
An Adaptive Workforce
 
If a company is to respond faster to market events, it must be able to create relevant sets of workforce capabilities when and where they are needed. That's a far cry from traditional thinking, where employees in certain roles perform fairly static jobs for long periods of time. An agile organization can assemble an appropriate combination of employees and capabilities for a particular need, then disband them and reassemble another set of skills for the next need.
 
Creating a more adaptive workforce can mean using appropriate collaboration technologies to bring people with the right skills together at the right time. It's also a matter of empowering every person to contribute to the overall knowledge of the organization and to find relevant information and experience whenever it's needed to meet a current challenge.
 
New social learning or learning 2.0 technologies and approaches support that kind of flexible empowerment, enabling workers to share their specialized knowledge and successes, and help them find and pull that information when they need it using advanced search functionality.
 
U.K. telecommunications giant BT's Dare2Share platform leverages Microsoft Sharepoint to enable employees to create, find and view learning segments, such as videos, podcasts, documents and links, and also discuss and debate the content being created. The free-form environment encourages people to experiment, innovate, collaborate, communicate and share their experiences and knowledge in engaging ways.
 
Through Dare2Share, employees can share their knowledge and experience or search for peer insights, all organized by user-generated tags and topics. People and their content are linked to one another through team sites, instant messaging, blogs and discussion threads. Material is also rated by peers during the sharing process according to quality and applicability.
 
A Change-Capable Culture
 
If talent leaders want an agile organization, they have to create a culture that embraces change and knows how to deal with it. That ability to anticipate economic, marketplace and competitive change, and to respond quickly, is now so central to any company's success that talent management leadership must work closely with the C-suite to establish a change capability within the organization. This requires focused initiatives along several critical dimensions.
 
1. Establish change expertise. 

Change experts aren't created by sending employees to a two-day management program. An agile, change-capable company has to have centers and networks of expertise. A centralized center of excellence can house academically trained and deeply experienced resources, in whatever numbers are appropriate for a company's budget and needs. At the same time, change experts also are needed closer to where the action is. That requires a change network that uses internal and part-time external experts, as well as change champions or sponsors, to encourage major initiatives.
 
The network also should be supported by a shared set of consistent and comprehensive change management practices, tools and templates. These need to be adopted by and accessible to all employees and managers at all levels and used in every project and program in a consistent way.
 
Some companies find they need a dedicated learning approach to build change management competencies. For example, EDF Energy Networks in the United Kingdom established a dedicated change management academy to ensure the capability and delivery of change will support its business units' efforts.
 
2. Create effective change leaders.

Managing change effectively requires specific kinds of leadership attitudes and behaviors, and these are now understood much more precisely and even scientifically than they once were. Based in part on knowledge of the specific competencies needed to manage change, companies must have dedicated programs in place to develop the right leadership behaviors and then incentivize those accordingly.
 
Getting a handle on the current executive team's competency to manage change can be tough. Most executives would say they are effective change leaders, but are they really? Companies that are serious about understanding and encouraging the distinctive traits of good change leaders should perform assessments of their current executives and managers - perhaps the top 10 or 20 people on the leadership team who wield the most influence within an organization.
 
By combining a personality and leadership profile - which measures more than 40 different personality traits and states correlated with executive performance - with a traditional 360-degree feedback tool, companies can get a clearer assessment of their leadership teams. This assessment provides an objective understanding of each person's potential strengths and weaknesses that could influence their effectiveness as a leader, along with tangible suggestions to improve performance.
 
In addition to helping individuals improve their change management skills, this assessment also can help companies balance the mix of competencies needed in a good leadership team. A good team doesn't include people with all the same skills. Visionary evangelicals are needed, but so are good program managers and relationship builders. By understanding each person's particular aptitude in different areas, more diverse and effective teams can be assembled.
 
3. Track, measure and align change initiatives.

Effective change programs requires rigorous, ongoing processes and scorecards to define expected benefits, measure progress and hold leaders accountable for results. New measurement tools are being developed that improve a company's ability to measure the adoption of complex efforts such as the aforementioned large-scale change programs. With these tools, companies can be more scientific in their efforts to track progress toward developing an agile culture.
 
For example, the change acceptance predictive model assessment methodology enables companies to better predict how workforces in different geographies will embrace the kinds of changes needed to be more agile.
 
The model helped one public-sector organization - with more than 250 locations in over 150 countries - support a major IT implementation. The new system was not being embraced uniformly across all locations, so the predictive model helped the organization tailor its change acceptance work to different cultures and mindsets.
 
Given the new dynamics of a fast-changing and less predictable global economy, a number of competitive assumptions are changing. One of the most important changes is that the new business environment will favor those companies that have good ideas and sound strategies and can execute them faster.
 
The distinctive capabilities of agile organizations ultimately are rooted in their ability to manage strategy, technology and human capital in a way that helps them execute at speed.


[About the Authors: Cathy Farley is managing director of Accenture's talent and organization performance practice in North America. Walter Gossage is executive director of change management for Accenture's talent and organization performance practice.]