Organizational Agility

Knowledge Center

What is Organizational Agility?

The term "Organizational Agility" can have two (confusing) meanings:

1. Broad, all-encompassing: The (overall) ability or capacity of an company or organization to quickly and consistently adapt to changes in the external environment, by identifying and capturing business opportunities in a more skillful way than its competitors. Also called: Enterprise agility.
2. Narrow: The ability or capacity of an company or organization to establish an adapting, flexible and offensive organization (as part of 1).

Agility has an active, offensive connotation, as opposed to Organizational Absorption which tries to deal with external circumstances via defensive mechanisms.

Agility is a concept that incorporates the ideas of flexibility, balance, adaptability, and coordination under one umbrella. In a business context, agility typically refers to the ability of an organization to rapidly adapt to changes in the external environment and/or market in a productive and cost-effective ways.

There are at least 3 forms of agility (Sull):

• Operational Agility
• Portfolio Agility
• Strategic Agility

See also: 5 types of Agility (Prasad)

Agile Teams

Rigby, Sutherland and Noble describe agile innovation teams as typically small, flexible, cross-functional teams working on innovation projects. Typically they enjoy a lot of organizational freedom and can be self-steering, bypassing usual layers of control and approval procedures, thereby speeding up work and improving the motivation of the team members.

They deploy prototyping and short feedback loops to (field) test solutions while constantly improving them. They are well suited for VUCA circumstances (Volatile, Uncertain, Complex and Ambiguous) in which problems are complex, solutions and project requirements are at first unclear and change frequently, collaboration with end-customers and internal customers as well as a lot of creativity and lateral thinking are needed.

From a Few to Many Agile Teams

After having launched and tested an initial set of agile teams, top management should be able to assess the operational and strategic costs and benefits of these agile teams and of increasing agility in general.

To scale up and roll out the approach of agile teams, Rigby c.s. recommend two essential tools:

1. CREATE A TAXONOMY OF TEAMS: Create a comprehensive list of all agile opportunities, categorizing them into customer experience, business process and technology projects. Such list typically contains hundreds of projects for a large organization. The reason for the taxonomy is that it helps to explore and develop a transformational vision while breaking up the strategic transformation into smaller chunks and steps. Also any obstacles, like a lack of people with agile experience are being revealed. The required hiring and training efforts become clear. The taxonomy also helps to avoid redundancy and duplication of efforts by showing who is working on what, and can contain links between the agile teams and the existing business units and product lines.
2. SEQUENCE THE TRANSITION: Prioritize and determine the order of projects to launch, considering criteria like strategic importance, availability of people, financial restrictions, return on investment, strategic risks, and interdependencies between projects/teams.

In scaling up their agile effort, companies should consider a major issue associated with going for easy wins in the form of deploying external business incubators. Business incubators do not provide the learning environment of the organizational changes that will be necessary to scale up organizational agility to hundreds of teams and even the entire organization.

Increasing Agility Across the Entire Corporation

Scaling up the amount of agile teams is a major accomplishment towards increasing enterprise agility. To involve the rest of the organization and make sure it is not hampering the strategic change effort by the agile teams, Rigby c.s. recommend companies make major updates to their:

• VALUES AND PRINCIPLES: Create a company-wide understanding of the need to change and adjust organizational values.
• OPERATING (IT) ARCHITECTURES: Modularize and define interfaces to increase the ability to accomodate very frequent changes in business processes without having to adapt complex backend systems. See Enterprise Architecture.
• ACQUISITION, MOTIVATION and DEVELOPMENT OF TALENT: Attract star performers and develop internal agile talent. Hire people willing and able to work in multidisciplinary teams. Adjust compensation systems.
• (ANNUAL) STRATEGY AND BUDGETING PROCESSES: Move towards more emergent strategy processes and fund strategic options.

Sources:

Donald Sull, "How to Thrive in Turbulent Markets", HBR February 2009

Darell K. Rigby, Jeff Sutherland and Andy Noble, "Agile at Scale: How to Go from a Few Teams to Hundreds", HBR May-June 2018, pp. 88-96

Baba Prasad, "Nimble: Make Yourself and Your Company Resilient in the Age of Constant Change", TarcherPerigee (2018)

Forum Forum about Organizational Agility. The Scrum Approach The Scrum framework is one of the most popular and widely used methodologies within Agile project management. It outlines a set of values, principles, and practices followed by Scrum teams to deliver ... 16   8 comments Increasing the Agility of your Human Capital Human Capital agility is nowadays critical for organizational success. Organizational agility is the resultant effect of the various individuals agility or lack of agility. With certain agility instr... 12   4 comments What is Agile? History and Meaning The Agile Manifesto Historically, the "Agile Manifesto" was the foundation of the widely used agile framework and ways of working in use by many organizations in today's world. It was written in 2001... 10   6 comments Team of Teams In 2003 General Stanley McChrystal assumed command of the Joint Special Operations Task Force in Iraq. He and his staff were able to plan, execute, and debrief targeted raids conducted at greatly incr... 10   6 comments Beware of Fake Agility ('Fake Agile') In an increasingly volatile, uncertain, complex and ambiguous (VUCA) world, going agile is becoming an irreversible trend. But among the many organizations pursuing agile transformation, only a few ha... 9   5 comments 5 Cogs of Innovation (Appelo) Organizations are complex adaptive systems. They can maximize their innovation and adaptation at "the edge of chaos"— a delicate point between order and chaos. According to Appelo (2011) organizations... 7   2 comments The Need for Ruthless Prioritization in Agile Leadership One of the most essential aspects of agile working is ruthless prioritization. By focusing on the few things that matter most to the customers and the business, an organization can maximize its benefi... 5   Holacracy Many organizations are exploring innovative ways to enhance their organizational adaptability and responsiveness. One approach for that is Holacracy (HOL), an organizational management framework pione... 5   2 comments Rapid Response Management Rapid Response Management (RRM) is an organizational construct or mental model that enables the organization and its key partners to rapidly sense changes and respond accordingly--quickly. While it ma... 5   1 comments How to Become Agile in Organizational Change? Every organisation needs to be "change agile" if it is to realise its potential growth. Growth is about raising the bar beyond previous levels of performance and is based on continuous improvement. C... 5   Digital Business Agility Digital disruption is a threat feared by many industry leaders. To survive against such a disruptor, an organization needs to adapt and transform. According to Wade, successful digital transformation... 4   The 3D Agile Leader Model (Collet) The Three-Dimensional Agile Leader Model by Bruno Collet delineates the multi-facets of agile leadership and provides a practical framework for agile leadership development. It explains the three crit... 4   🔥 Scaled Agile Framework The Scaled Agile Framework (SAFe) is a comprehensive methodology designed to help large organizations scale up and implement agile practices across multiple teams and departments at an enterprise scal... 3   2 comments 5 Types of Agility (Prasad) The concept of strategy now changes from being plans of actions for the future to developing capabilities that can allow us to handle different situations that may evolve. If you don't have an agile a... 3   How to Become an Agile Employer? Trust is a fulcrum (Editor: ~ a supporting pillar) for managing business in agile way. So, how much trust should an employer have in its employees? How can it build and restore the trust between the... 3   What is Agility and Why is it Important? In common parlance, agility is nothing but being able to quickly adapt to changes. The 21st century is characterized by Volatility, Uncertainty, Complexity, and Ambiguity (acronym: VUCA). Combined, t... 2   Start a new topic about Organizational Agility Sign up for free

Courses about Organizational Agility. Beginners Course Advanced Course Course for Experts

Best Practices The best, top-rated topics about Organizational Agility. Here you will find the most valuable ideas and practical suggestions. 🥇 6 Principles to Create an Adaptive Organization (Reeves) According to Reeves, Lewin and Ueda, companies - similar to living organisms - are "COMPLEX ADAPTIVE SYSTEMS". They evolve in a complex manner, wherein individuals contribute towards shaping and alter... 19   14 comments 🥈 What is an Agile Mindset? Attributes of Personal Agility Lately we read a lot about organizational agility. To make organizations agile, we need agile people. An agile mind-set accepts everything as lessons, adjusts actions according to feedback or requirem... 18   11 comments 🥉 Leading in Challenging Times: Creating Agile Organizations This is a challenging time for leaders in charting a course for their organization. These times bring life to the ancient quote from Publilius Syrus that "Anyone can hold the helm when the sea is calm... 16   11 comments The Main Barriers to Building an Agile Organization Creating an agile enterprise is far from easy. Changing an existing organization into an agile one is even more difficult. It helps to at least know beforehand what are probably going to be the four k... 16   2 comments Structuring an Organization Using Value-Based Teams Changes in organization structure can be a critical part of an organization's agile transformation. One such change is the construction of value-based streams or teams rather than using traditional si... 11   11 comments 3 Laws of Agile Organizations In the age of agile, corporations must radically reinvent how they are organized and led and embrace a new management paradigm that involves new goals, principles and values and requires continuous co... 10   6 comments How to be an Agile Leader? To help organizations to succeed in agile transformation, leaders at all levels need to be role models to encourage agility, and focus on developing four main capabilities of agile leadership: learnin... 8   4 comments

Expert Tips Advanced insights about Organizational Agility. Here you will find professional advices by experts. Consultancy Tips Teaching Tips Practical Implementation Tips How to Become a Self-tuning Enterprise: Advanced Experimenters Organizational Agility, Strategic Agility, Real Options, Emergent Strategy In an HBR article of June 2015, Reeves, Zeng and Venjara argue there's a new way to apply algorithmic principles that en... Effective Top Management Teams in Multinationals. Requirements and Characteristics Board of Directors, Leadership Teams, Multinationals, Top Team Management There are three requirements for effective top team management in large, multinational enterprises: 1. Clear charter an... 4 Changes in HR Roles and HR Responsibilities Due to Agility Recruitment, Job Definition, Performance Evaluation, Leadership Development When an organization is going Agile, it requires different ways of talent management to facilitate its transformation. I... Process Steps for Organizational Agility Organizational Agility, Enterprise Agility, Corporate Agility Organizations that strive for enterprise agility will need to go to various steps in order to achieve it. Korn ferry (20... Components of Learning Agility Organizational Agility, Organizational Learning, Knowledge Management One of the critical factors for achieving organizational agility is learning agility, which refers to the ability and ea... Bureaucratic Organizations versus Dynamic Organizations Organizational Development, Organizational Agility Nowadays, many organizations recognize the importance of being dynamic so as to quickly adapt to external changes. Howev...

Information Sources Various sources of information regarding Organizational Agility. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops. Learning Agility and Enterprise Agility Organizational Agility This presentation provides insights into the usage of organizational agility in your organization. The presentation incl... Organizational Agility and the Role of Information Systems Organizational Agility Presentation about Agility, specifically focusing on the role of IT. The presentation includes the following sections: ... Organizational Agility: 8 Building Blocks Agile Organization, Adaptive Organization, Organizational Adaptability, Organizational Flexibility Henriette Rothschild of Hay Group explains eight 'building blocks' of agile organizations: A: HOW THE ORGANIZATION THIN... 5 KSFs of a Truly Agile Business Business Agility, Corporate Agility, Organizational Agility, Firm Agility Brief explanation of the 5 key success factors for agile business organizations from a Accenture research -- Traits of T... Corporate Diversity and Inclusion Cross Functional Team, Organizational Culture, Globalization, Organizational Change, HRM, Cultural Dimensions In this introduction video, top managers of Skanska share their vision on Diversity and Inclusion and the strategic impo... How Businesses can Use Information Technology (IT) in Strategic Ways Strategic Management, Information Technology This presentation looks at Information Technology from a strategic point of view. In other words, it discusses in what w... Knowledge Management, Organizational Learning and Intellectual Capital Intellectual Capital, Knowledge Management, Organizational Learning Presentation about organizational knowledge, learning and intellectual capital. The presentation includes the following ... Introduction to Network Organizations Organizational Forms, Network Organization, Virtual Organization, Communities of Practice Presentation about Network Organizations. The presentations explains its importance, its supporting factors and compares... The Essense of Organizational Agility Organizational Agility, Strategic Agility Giora Morein defines Organizational Agility as an organization's leaderships ability to take advantage of changing condi... Introduction to Business Continuity Management Understanding of the Need to Have a Business Continuity Plan, Organizational Resilience Organizations have to be prepared to deal immediately with events everywhere around the world (from natural disasters to...

Tools Useful tools regarding Organizational Agility. News Videos Presentations   Books Academic More

Compare with: Dynamic Capabilities  |  Organizational Absorption  |  Agile Absorption  |  Crisis Management  |  Strategic Risk Management  |  Scenario Planning  |  Game Theory  |  Real Options  |  First-mover Advantage

Return to Management Hub: Change & Organization  |  Human Resources  |  Strategy & Innovation

More on Management  |  Return to Management Dictionary

This ends our Organizational Agility summary and forum.