Creating Sustainable Change – How to create and sustain change?
Who doesn’t like change and who doesn’t want to change? These are certainly truisms in the 21st century landscape where businesses proclaim their commitment to change and exhort their employees to “Be the change you want to see”. However, having a vision and mission statement that commits to change is different from actualizing the change. […]
Why is Market Risk Management Important?
The concept of market risk has always been around ever since financial markets have existed. However, the measurement and management of market risk is fairly new and has come up only in the last three to four decades. The recent past has seen a proliferation of theories and models which have been used to measure […]
Components of Communication Process
Communication is a process of exchanging verbal and non verbal messages. It is a continuous process. Pre-requisite of communication is a message. This message must be conveyed through some medium to the recipient. It is essential that this message must be understood by the recipient in same terms as intended by the sender. He must […]
Talent Agility A Systematic Approach to Business Agility
Well, until a few years ago, talent management was just a function of HRD. And even the largest of the organizations didn’t focus much on managing and developing their talent. However, with increasing challenges and extreme volatility in business environment, companies are now realizing that they cannot just rely on their capital and automated systems. […]
Factors Influencing Retention Ratio In Reinsurance
In the previous article, we have already studied what retention is and why it is important for many insurances as well as reinsurance companies. We are now also aware of the fact that some insurance companies tend to retain more risks on their balance sheet whereas there are others who pass on more risks from […]
Volatility is most likely to remain constant and so is change. The market turbulence has posed challenges to most businesses around the world. But it has also played an important role in the emergence of new and non-traditional businesses – businesses that know how to respond quickly to the changing environment; businesses that have ability to turn information into insights; businesses that how to operate at the edge of chaos.
Business agility is a core differentiator and most companies agree that agility helps them engage a wider audience and generate more revenues. However, at the same time, they also agree that they have not been agile enough to foresee fundamental market shifts. Actually, they experience mixed readiness when it comes to agility.
Business agility is a mind-set. It’s a behavior. It’s the way an individual or organization responds to a stimulus at any given point. It’s the ability to sense change and willingness to respond to it. A stimulus can be financial, technological, social, economical or political. If you’re willing to eliminate resistance to change and are ready to respond to various stimuli, begin with fundamentals. In the previous article, we had discussed the characteristics that an agile business exhibits. Here we study the basic principles basis which an organization achieve those characteristics. Take a look:
Yes, lean management results in quick management. In today’s tumultuous business environment, it’s important to cut down on what is unnecessary to ensure quick execution. Chain of command needs to be shorter and simpler, so that the decisions are taken swiftly. In the digital economy when speed plays an important role, businesses need to cut the hassles and time involved in the approval process.
Wondering what lean management is? It is:
Flexibility is one of the most important fundamentals of organizational agility. The business processes should be simple enough to accommodate change at any stage. However, at the same time standardization is essential because it allows employees to straightaway get into an action, without spending much time in thinking. They need not reinvent the wheel every time they need to use it.
So, what’s the way out? Standardization and dynamism, in such a scenario, go hand in hand. It’s like operating in the middle of chaos and consistency. And how is this done? By defining the processes in such a way that they have scope for flexibility! And this can happen only when the processes are simple. Complexity doesn’t make a space for dynamism. But there are no hard and fast rules. What suits one company may not suit the other. How to balance fluidity and standardization completely depends on the objectives of an organization, nature of business and challenges it faces.
An interdisciplinary team is a group of experts from different fields/ areas of specialty working towards a common goal. It helps businesses benefit from multiple skill-sets and diverse areas of expertise to solve complex problems. Though it’s a coordinated effort but encourages free flow of ideas and information among team members.
Highly agile organizations have multiple interdisciplinary teams as they place more value in human intellect. They encourage their staff to brainstorm, generate ideas and work on them. Serial experimentation and execution is a culture.
People see uncertainty beyond their control and feel terrified with the very idea of it. It puts them in a situation where they feel almost paralyzed to make decisions. And when a crisis happens, they give up most likely. Companies often forget to integrate the agile thinking at middle and lower levels of management. Agility is not a responsibility of top management. It’s important to introduce and promote culture of agility throughout the organization. It’s a combined effort and collective action.
To respond effectively to changes, top management must have a process in place so that everyone from top to bottom can be involved in it. While doing this, it’s important to not let communication lapse. If possible, share the vision with the employees. By this, they become more attentive and extend full cooperation.
Disperse the functions and power away from a central authority. Moderate to highly agile companies take a rather flat approach. They believe in horizontal management rather than vertical management. The accountability to run processes, perform business functions and the power to make decisions is dispersed across the teams, allowing them to manage on their own. Decentralization or flat management is linked to massive participation of employees, which leads to management by results. It ensures:
What stops a company to respond to change is - the inability of its employees to participate in the change management process. Top management ignores the fact that the employees are not ready to change their mind-sets and adapt to the shifting trends. In such a scenario, nimbleness and agility don’t make much sense.
To integrate agility thoroughly, it’s essential to identify the gap at the root level. The true power lies in incorporating an agile mindset. Yes, it’s all in the mind. It begins here and ends here. Businesses must remember that it’s a continuous process.
Conclusion: Given the myriad factors that help organizations become agile, it can be said that an agile mind-set is more required than any other characteristics or traits. Organizations need to strategically implement it and manifest agility all its business processes. They not only need to manage change but must master change management.
Also, agility cannot be achieved overnight. It takes time and effort from employees from top to bottom. Agility is a strategic transformation. In a volatile business environment, only resolve to respond to change can keep organizations at the forefront of competition. And this is what has been keeping companies like Apple, Facebook and Google ahead of their competitors.
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