Agility is a good characteristic for companies to have, particularly in today’s uncertain market. Companies that can move quickly to adapt to changing market conditions have a competitive advantage over those that can’t.
Unfortunately, agility is often perceived as a luxury. Too often, we think of agility in terms of final-state: complete interoperability of elegant systems and processes – requiring years of work and significant investment. In reality, the optimal level of agility for your company in today’s environment may be closer than you think.
Consider the average person’s approach to physical agility and general fitness. We all need regular exercise and a healthy diet, but many of us struggle when we think about the lifestyle change required to be in great shape. We hear that we need 60 minutes of exercise a day, five days a week, with a mix of cardio and strength training. We hear that we should eat only whole grains, cut out processed food, and we’re told that a “serving” of anything is about a third of the size of what most of us consider a normal portion. If you are not following these and other guidelines, the changes you’d need to make to be in optimal health can seem overwhelming – and prohibitive. As a result, many folks end up taking no action at all.
It’s too bad, because there is value in even 10 minutes of exercise a day, or in simply cutting out sugary drinks, or in a variety of other small changes. Small lifestyle tweaks like these can improve how we feel and how we function day to day. Similarly, improvement in a company’s agility need not require a massive business and technology transformation. Many improvements can be achieved without significant cost or disruption.
The most important step is to identify the goals of your agility play. I am a fan of Michael Hugos’ high-level approach described in this post with his formula for determining business agility — he speaks of agility in terms of profitability. If your company can consistently earn profits that are two to four percent higher than market average, the assumption is that your company is adapting quickly to changing customer demands and market factors.
For example, if your company plans to maximize profitability by focusing on high-margin offerings to your customers, you need to build a capability to support an ever-changing portfolio of high-margin products as the market evolves and the margins shift. So what needs to happen in your environment in support of this capability? You might charter a cross-functional team to identify and update constraining technology and processes, or you might spin up a project or two to reduce prohibitive complexity in the foundation of your IT environment, or you might offer streamlined collaboration tools.
While there are many options to consider, remember that not all processes will need to be rationalized, and not all technology complexity will need to be removed from your environment before your agility increases – baby steps optimized to support the relatively narrow task at hand will allow you to be agile in the way your company requires to maximize profits as the market shifts.
It’s the corporate equivalent of committing to 10 pushups a day during tank-top season.
Think about where small changes and investments can make a big difference to your corporate agility, and I’ll do the same. Let me know if you've got other suggestions that worked at your company.
Meanwhile, I’m going to lace up my walking shoes and take a few trips around the block.