Agile Organisations

Agility as it pertains to organisations is very much in vogue right now and we are finding some models and insights are resonating strongly with clients and helping them in their journey to become a more agile organisation. The idea of highly versatile teams with tribe like characteristics is well known from our military heritage and used to great effect in the life-sciences sector. Indeed, McKinsey reference this in their popular article*.

Who would not want to pursue the holy grail of disciplined process, clear responsibilities with speed and readiness to pivot? This has also been described as ‘mission-centric agile cells’ to deliver products, projects and activities. The concept of ‘tribe maps’ to stand up agile cross-functional delivery teams is spot on in our view, but we see significant headwinds in many of the large organisations we work with. These break down into 3 key areas:

1. Default organisational tendencies

Cross-functional agile teams are enthused with mission-critical purposes centred around delivery of big-bet projects. However, we often see that enthusiasm rapidly blunted as the ecosystem in which that cell is embedded is far from supportive. Generally, as the ask of the team gets bigger, the greater the removal of the team members from their traditional supportive structures. This is when they find the organisation that is setup for functional convenience creates many barriers when they try to marshal resources across those boundaries to support their mission.

Many of the processes that need realigning operate on far slower cycle times than an agile cell does, and are very distant to the influence levers the team have at their disposal. For example, the cascade of business priorities down to objective setting and individual performance appraisal typically operates on an annual cycle. Even if the agile cell members objectives and reward have been adjusted, often those that they need to influence immediately outside of their cell to deliver their mission are aligned to very different objectives.

2. Soft skill investments

The process freedom of an agile cell to relentlessly pursue their mission is a necessary, but not sufficient component of delivery, in Skarbek’s experience. The hard skills are necessary, but the soft skills and behavioural demands are much higher, especially in agile cells. Leadership without authority, effective communication, and accountability are all at a premium in this environment.

However, the majority of investment into these soft skills tends to flow down through the organisation’s hierarchy and concentrate in different areas. Formal line-managers, rather than cell or tribe leaders, will be the first to receive investment in their leadership capability, even if leadership with direct authority is an easier skill to master than that without. Senior teams will typically absorb most of the L&D funding for soft skills, such as communication and behaviours like driving accountability. Whilst the cells may be allocated agile coaches, the soft skills necessary to thrive in that environment can be neglected.

3. Tension between global teams and markets

In large organisations, there is typically a choice between the immediacy and alignment of activity close to the customer, and the efficiency of activities driven at global level intended to be deployed at scale locally. This creates a tension in the decisions around placement of agile cells on that spectrum between global and local level and the support and resources they need.

For agile cells closer to the heart of the global organisation, they tend to be well supported with resources, but require an excellent capability to gather the information they need to ensure the products, projects and activities they are driving will have relevance when deployed at market level.

For agile cells close to the customer, they may find their distance from the centre of the organisation leads to poor support, restricted resource allocation and slow decision making. Thus, the cell capability can be lower and lead to frustration as opportunities they can see on their doorstep are squandered. The trust and courage needed to empower these agile cells so distant from the centre of the organisation is rare in our experience.

Summary

While agile transformation can be sold as a mind-set change, there are significant implementation barriers that require careful consideration. McKinsey talk about this in the context of the supporting ‘backbone’. The danger is that pilots flounder quickly before the learnings, such as those above, are captured to create the right environment for agile cells to flourish. Access to the experience of what works in such situations to create the supporting ecosystem can make the difference between pilots being declared as failures, or successful action learning experiments that can drive bigger transformations.

*‘The Journey to an Agile Organisation’ (https://www.mckinsey.com/business-functions/organization/our-insights/the-journey-to-an-agile-organization).