Overcoming the 5 obstacles to organizational agility
This post, part of a series, was adapted from APQC’s “Strategic Planning and Implementation Best Practices for Achieving Organizational Agility” best practices report. View an overview of the study findings or download the full report.
This post was written by Holly Lyke-Ho-Gland, a research program manager at member-based nonprofit APQC, the world’s foremost authority in benchmarking, best practices, process and performance improvement, and knowledge management.
As we have discussed throughout this series, organizational agility helps organizations address the ever-changing business environment by improving organization’s ability to quickly identify and execute initiatives for opportunities and risks that align with overall strategy.
However, managing the organization’s agility is not without its own intrinsic challenges, which lead to this question: What are the common roadblocks or challenges that deter agility?
Although all five obstacles are important, the first two obstacles -- operational silos and organizational resistance -- are common issues that organizations face during change activities. The last three obstacles -- slow decision-making, poor knowledge management, and unaligned business processes -- are more foundational in nature and correlated to lower organizational agility.
The rest of this article looks at each obstacle and how to address them.
In many non-agile organizations, employees are driven to meet individual, team, or functional objectives without understanding how this supports organizational objectives or even if there are similar or related initiatives running in parallel around the company. This approach ultimately results in overlooked efficiencies and a lack of cross-functional communication.
Move to cross-functional process thinking
There are many sources of operational silos. However, the most common sources include functional-focused thinking, unaligned or conflicting measures, and a lack of cross-functional communications.
It’s easy to understand why most organizations rely on functional thinking. It provides a specialized competency, and organizational performance measurement is relatively easy. But there are limitations to functional thinking, particularly a lack of focus on the complete value chain, which:
- makes it easy to lose sight end goals and impact on the customer
- increases the difficulty of implementation
- results inbplacing blame when things go wrong
On the other hand, process thinking and its focus on the value chain conceptualizes groups of activities as processes. This approach reveals how all of the processes (and consequently functions) in an organization collectively take inputs and produce products, services and profits. Process thinking also helps align measures across functions and focus measures on the long-term goals and objectives of the business.
There is the common adage that if there is no resistance, then there is probably no change. During any change effort, organizations will face some level of resistance; the goal is to minimalize the amount of resistance.
Use communications and engagement
As we discussed in the last article, engagement, incentives and communication plans help reduce the amount of organizational resistance and improve implementation. Organizations should integrate key communications and engagement best practices to develop buy-in and overcome resistance; such as:
- Provide leadership with the information it needs to communicate to direct reports and lead by example.
- Keep communications open and honest. Be transparent, even when conveying bad news.
- Be deliberate about the purpose and target of the communications. All information will not be relevant to everyone within an organization, and over-communication can result in people ignoring important information.
- Leverage peer catalysts. Identify and leverage natural centers of influence within an organization to renew focus on who are natural change agents.
- Close the loop. Always provide updates on what is done with people’s questions or feedback.
- Engage employees in the process. Use interactive communication tactics such as focus groups, war games, social media, crowdsourcing, and employee-led training.
Furthermore, organizations need to keep in mind that resistance can be used for risk mitigation, and that organizations need to acknowledge the fear or concerns that might be valid. Most organizations tend to push back and demand compliance.
If organizations instead take a step back and ask resistors why the new initiative won’t work, they can work with resistors to uncover identify unforeseen roadblocks. Furthermore, by engaging resistance, an organization has a chance to communicate the value of the changes and develop change champions to drive buy-in from the bottom.
Speed of decision-making
One of the main components of organizational agility is the ability to identify opportunities and risks and develop a plan of action quickly. However, the speed of decision-making in organizations is often tied to access to timely and reliable information, the layers of hierarchy involved and the presence of a risk-averse culture.
Improve speed by reducing risk aversion
To increase the speed of decision-making, organizations need to change the comfort level for potential risk through tools like predictive analysis and scenario planning, which help organizations think through potential options before they act or through changing the norms and behaviors tied to risk aversion.
To change the comfort level, organizations need to embed new behavioral norms. Overcoming risk aversion is typically a multisided problem because employees are not comfortable going outside of their role and there is a negative connotation with failure. Hence, organizations need to take multiple approaches to embrace risk, such as:
- Establish a safe environment to take risk. When employees feel secure, they are more likely to be comfortable taking risks.
- Reward those who take risks. Acknowledge people who take risks (to make decisions and try new ideas) and provide opportunities to try new things.
- Promote a culture of continuous learning. Make it acceptable to fail. Promote the idea that people will learn from their failures and get better; part of this includes not publically chastising people for their failures.
Simply put, organizations have to ensure employees feel comfortable with risk, can fail fast and learn from mistakes. Innovation and agility requires employees complete a task quickly, make a decision and move on. Mistakes are going to happen; but if the environment focuses on the efforts and the learning aspect of failure, employees will feel comfortable with experimentation and try again.
Unaligned business processes
Business-process alignment refers to how well an organization’s objectives link to its process management. Strategy and process management activities should intertwine and inform each other. Process-management activities and measures help decision-makers track progress toward goals and determine where to make strategic changes.
Align processes to the organization's strategy
Best-practice organizations understand that the business model should describe and support an organization’s purpose, identify what’s important and feed into how work gets accomplished.
To achieve this, best-practice organizations ensure that their strategic plans link to business and operational plans. Furthermore, best-practice organizations make line managers play a key role in strategy creation and do not limit strategic planning to the corporate level. As a result, best-practice organizations have well-defined and well-executed strategic processes at the business-unit level that align with the enterprise level.
Organizations that conduct frequent internal and external assessments are also less likely to cite unaligned business processes as an obstacle to organizational agility. Organizations that monitor and measure the performance of their processes are more likely to understand improvement needs and operational strengths.
Poor knowledge management
Knowledge management is the application of a structured process to help information and knowledge flow to the right people at the right time so they can act more efficiently and effectively to find, understand, share and use knowledge to create value.
Without effective knowledge management, organizations may not know what information is important or have a strategy that ensures people can access the information they need when they need it.
Develop a strategy and put knowledge in the flow
To ensure effective knowledge management, organizations have to create a strategy to manage the capture of, ensure accessibility to and engage employees in using the captured knowledge. There are several best practices that organizations can consider when improving their knowledge management capabilities.
The first consideration is the best way to engage an organization and set up a plan to manage knowledge capture. APQC’s "Engagement and Participation for Knowledge Sharing and Collaboration" found that organizations with a well-defined business need and value proposition have more successful knowledge-management programs.
Common value propositions for knowledge management include: improving productivity, establishing objectivity through data and insights, retaining at-risk or critical knowledge, and supporting a collaborative and innovative culture. Once the purpose is outlined, an organization can develop its engagement plan and structure its knowledge management program around that value.
Another key lesson is that content has to be embedded in the flow of work. It’s important to deliver information when, where, and how employees need it.
To accomplish this goal, organizations need to focus on the needs of the users and think about how to put knowledge in the path -- or business process -- of the users. Demand-side knowledge management focuses on the end user and is similar to a kiosk.
Users go to the kiosk, enter what they are “trying to accomplish,” and receive an outline of the process and a list of necessary tools and content and their locations. Content is organized by process, so users only have to know what they are trying to accomplish and can get a map to guide them.
In other words, this approach focuses on who the users are, where they are, and what they are doing.
Ultimately, organizations that have an innovative, collaborative culture, a strong process foundation, and well-established knowledge-management practices are better equipped to overcome the obstacles to organizational agility and are less likely to face them in the first place.
To address the last three obstacles, organizations should consider:
- Addressing risk aversion. Encourage employees to take risks and fail fast in order to hasten decision-making.
- Developing a firm foundation of process and knowledge management practices. These two disciplines help organizations overcome other challenges such as operational siloes. They also incorporate the mechanisms organizations need to adapt or change quickly change how work is accomplished and ensure the adoption of new practices throughout an organization.
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