Why Next-Generation Organisations Must Be Consistently Agile

In 1965, the average tenure of companies on the S&P 500 was 33 years. By 1990, it was 20 years. It’s forecast to shrink to 14 years by 2026. What does this mean for organisations in India, and what are Aon Best Employer organisations doing about it?

Why Next-Generation Organisations Must Be Consistently Agile

8 Jun 2018 by  Yamini Maheshwari Sapra and Ashish Ambasta

Fortune 500 turnover is a proxy for agility at organisations. If you were to look closer at what is happening:

  1. The industry composition within the S&P index is varying dramatically, with new niche sectors coming in

  2. Geo-political forces are playing an important role in determining fortunes of sectors, and not just organisations

  3. Technology and digital changes are rapid

  4. Younger companies and start-ups have come into existence and they undergo IPOs relatively early in their years to raise money




A study by Aon India shows that CEOs at Aon Best Employer organisations, and in the market at large also, are all narrowing down on similar outcomes to drive their business. Client/customer service and product/service innovation are the top two long-term priorities to drive sustainable business performance.

 

2018

2017

 

Best Participants vs Market Average

Best Participants vs Market Average

Client / Customer Service

88% / 68%

67% / 60%

Product / Service Innovation

69% / 74%

61% / 48%

Product / Service Quality

38% / 48%

33% / 40%

Operational Efficiency

19% / 52%

39% / 48%

Growth Through Acquisition

6% / 25%

0% / 8%

Given that there is synergy in what organisations are aiming for to ensure sustainable business, it becomes imperative to not just ensure speed and responsiveness in the organisation, but also purpose and alignment across levels.

What does being agile mean?

It means the ability of the organisation to respond quickly to change with both speed and ability to change directions. Organisations focused on being agile need to focus on being agile while being consistent, and not just being one of those outcomes at the cost of the other.
They need to be agile and still be consistent (in delivering value) at the same time to meet the short-term and long-term-needs of different stakeholders. Hence, agility in current constructs is about “setting direction and not chasing a destination”.

Why is agility required?

Organisations are faced with demanding customers seeking continuous value in products/services. This coupled with the new generation of employees coming into workplaces has made the situation even more complex. This has instilled the need for organisations to be nimble-footed and agile to proactively deal with the ongoing changes, and at the same time move towards the long-term mission and purpose for which the organisation exists.

Making agility happen

For organisations to remain consistently agile, they need to remain agile not just in planning but also in execution, and therefore agility is an ‘always-on’ phenomenon. Most often organisations focus on creating the best possible outcomes without testing the market, and hence are not able to effectively execute. In today’s context, market doesn’t remain with a product/service even if it meets its demand because there is always a new/shinier/simpler offering which could do the work in an enhanced manner. Thus, in the current context, being agile will mean being perfect in delivering customer needs/wants in the present, and at the same time experimenting with what the changing and future needs could be.

It’s a mixture of what is now and here, and also what the future holds for the market in which the organisation operates.

To drive agility, organisations need to balance strategy with purpose, while leaders balance agility with consistency.

Supplementing ‘consistency’ with ‘conformity’ can be a recipe for disaster, and organisations need to understand what is core to them and how to ensure they stay true to their users’ current and future needs while expanding to be everything to everyone.

The Aon India study reveals that the realisation of the need for agility is universal. However, the thinking around agility seems to be scattered, tactical, and paradoxically, mostly unsustainable for long-term business success. The study findings bring together an understanding of what makes organisations effective and put forth a construct that will guide the pursuit of agility within organisations. It was discovered through empirical evidence and logic that this construct brings together everything that organisations are designing, executing, and communicating today under the broad banner of agility.

Being agile: Organisations need to be driven by a fundamental sense of purpose, clarity in vision, and a culture that helps actualise this.

The starting point for agility in the organisation context is aligning on the purpose and vision of the organisation. Senior leadership plays an important role in creating and communicating this with the internal and external stakeholders of the organisation.

Thinking agile: Organisations need to shape mindsets that will lend it to being challenged, curious, collaborative, and consistent.

Building for an agile organisation requires the complete organisation—the structure and mindset—to work in a way that lends the organisation to being fast and decisive in the real world. To be successful in creating a consistently agile organisation, it is imperative for organisations to spend disproportionate time in ‘thinking’ agile. Given agility is an ‘always-on’ phenomenon, organisations need to continuously build and foster an environment in which employees can be agile. This, therefore, requires enabling the right mindset through the right structure (team and organisation) and enabling infrastructure.

Doing agile: Organisations need to have the right ‘enablers’ (technology, resources, and processes) to create quick learning loops, fungible skill pools, and a doing culture.

While ‘being agile’ and ‘thinking agile’ address the ‘how and where to start’ for consistent agility, ‘doing’ decodes ‘what needs to be done’. The answer for ‘what’ lies in the vision which will provide direction into the implementation plan. Some organisations start small by prototyping changes in smaller parts before scaling them up; others make more foundational changes which impact the whole organisation. There is no right or wrong to a particular approach—the focus is on creating an ecosystem where agility thrives.

So, to drive agility, organisations need to balance strategy with purpose, while leaders balance agility with consistency. That said, organisations are in the nascent stage in figuring out the ‘doing’ part of the journey where alignment is more important than the practices.

In an ideal world, all three—being-thinking-doing—would be concentric circles on top of each other, but in the current context, organisations seek maximum overlap among the three to drive agility. While Best Employers have begun their journey to be agile in the right way to institutionalise the agile mindset, there is still time before they can call themselves ‘consistently agile’. The study clearly indicates that the biggest mistake that organisations make in the quest to be agile is to jump to ‘doing’ before ‘thinking’.

There are many examples among Aon Best Employer organisations to reinstate the importance of going from being to thinking to doing, step-by-step.

The full version of this article first appeared in YourStory (India).

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Yamini Maheshwari Sapra and Ashish Ambasta

Yamini Maheshwari Sapra is Consulting Director, Aon India, and the Lead for the Best Employer India Study. Ashish Ambasta is responsible for leading the overall Engagement business and team at Aon India.

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Yamini Maheshwari
Yamini Maheshwari Sapra
Mumbai, India
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Sandeep Chaudhary
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