The cornerstone of competitive advantage and performance is the design of an organization. No matter how incisive and cunning your strategic plan is, an organization’s ability to reach its potential is jeopardized if the design, culture, and structure are not aligned.
The alignment challenge is ongoing because of two issues: the consistently increasing complexity, unpredictability, and instability of the external environment, and how our organization is structured for innovative thinking, pragmatic action, accountability, and resilience. An organization design needs to perform efficiently today while embodying flexibility for the long-term unforeseen future. This is not an easy evolution or place to plateau and rest.
We have been researching and studying the components of sustainable high performance and share some observations for you to consider as you evaluate practices to evolve your organization for ongoing success.
Traditional strategic planning focuses on creating stability in the conditions among an organization’s customers, suppliers, competitors, and distributors or delivery channels. An agility framework is designed and constructed differently; each element and feature embeds flexibility as the foundational practice. The pieces are then aligned to support long-term adaptability with high performance. Unfortunately, most of our thinking is entrenched in the past, frozen in the current environment, and fearful and trepidatious of the future.
The agile organization has three common elements:
1. A robust strategy produces results regardless of the environment
- Take advantage of momentary opportunities with the assumption that one single opportunity will not last forever, yet the profit generated exceeds the cost of change.
- A robust strategy does not minimize the organization’s enduring traits and dynamics; it fully leverages them for an advantage. Striving for this level of leverage requires a different momentum and leadership, and often, perhaps, new leadership.
- The agile organization moves quickly and elegantly as its board and CEO approve and orchestrate the change. A board that does not renew impairs the organization’s success, and a CEO who does not expect the board or leadership team to be high performing is culpable for supporting stagnation and suffocation.
- The elements needed are a relevant range of products and services supported with passion, urgency, enthusiasm, and engagement and a compelling competitive advantage in offerings, quality, service, and support.
- Critically important is generating commitment from the employee base that every action they take every day supports the organization’s vision and strategic direction.
2. An adaptable organization design features maximum surface area, transparency in information flow, relevant and deft recruitment and talent management and rewards systems, and fluid decision-making
- Promote a shared perspective on motivating and engaging employees.
- Implement clear and open information-sharing practices and processes for real-time communication.
- Use multiple reward and bonus practices aligned with the strategy and expectations. Each person understands how his or her contribution is meaningful to the vision and is appropriately rewarded.
- Recruit employees who are quick learners and appreciate the change.
- Ensure employees are self-accountable and conduct frequent goal-setting reviews.
- Use a talent management strategy wherein the employment contract states change is an expectation and a condition of employment.
3. Shared leadership and organization identity with the understanding that any change effort requires more than a single leader and an aligned organization identity.
- Leadership is an organizational capacity rather than an individual expectation, thereby maximizing the surface area.
- Share knowledge and spread power, empowerment, and accountability throughout the organization.
- Minimize with intent as well as top-down direction and decision-making.
- Create organizational identity with intention. Integrate internal culture and external brand, image, and reputation.
- Proactively promote value-creating capacity and capabilities. Ongoing learning, including double-loop learning, generates current and future value.
- Integrate critical thinking, competency building, and capacity.
Transforming an organization to make it agile is not easy in the short term. People will readily accept some of the changes and resist others.
If successful, employees will feel purposeful and excited about understanding how their contribution connects to an objective, and their rewards are tied to individual performance and the expectation to be self-accountable. However, getting to that excitement and understanding is a challenge. On the other side of the transformation, the new practices are worthwhile in sustaining an organization in a complex environment. Leadership alignment is an essential success factor in thought, words, and actions. The alternative is a slow stagnation and suffocation.
