In a world where markets and industries transform at a faster rate than ever before, adaptability is a crucial skill for any business to succeed. Predicting future trends is one matter but knowing how to act in response to an ever-changing world, i.e., business agility, can make all the difference in uncertain times. When the entire business: IT, legal, financial, marketing, security and even the business leaders are able to work together using Agile practices, they have the potential to gain an advantage over their competitors.
Socio-economic tech scholar Carlota Perez once wrote that every generation experiences a revolution that completely alters the state of the market and economic state of society. For example, the industrial revolution in the eighteenth century, the adoption of oil and mass production systems in the early twentieth century, and the rise of the internet and modern technology in the late twentieth/early twenty first century. Each revolution consists of three stages:
Installation period – Financial capital and emergent technology lead to a boom in new market participants.
Turning point – The midpoint, where business either thrive by using the new technology or fail and fall by the wayside.
Deployment period – Newer business that emerged due to the rise in technological standards begin to supersede existing businesses, prompting societal change.
For the information age, the installation period began with the conception of the world wide web in the 1970s. In 2021, we have already seen business that owe their fortune to the internet – Amazon, Google, Apple etc, overtaking business that predate the internet. At the very least, we are at the turning point of this particular revolution, or perhaps even the deployment period. Either way, business who are unable to adopt and take advantage of the internet and modern software are almost doomed to fail in today’s climate.
How do smaller businesses evolve into large, successful corporations?
John P Kotter once wrote about how lucrative businesses don’t start as a massive enterprises, but as smaller, fluid collections of hardworking people working together in order to achieve a common role. In a business’ early stage, roles are dynamic and team members collaborate and share knowledge and resources while identifying the needs of the customer.
The “entrepreneurial network” reaches its targets and starts to evolve. Team members are given specific roles and responsibilities in order for the company to function like a well-oiled machine. This means hiring more staff, dividing the company into departments with their own hierarchies, and cutting costs to ensure more long-term gain, At the same time, the network looks for new ways to deliver value.
As the networks grows even larger and at a faster rate than before, so does its need to maintain its internal structure. The hierarchy built through years of expansion clashes with the entrepreneurial network until the latter is destroyed, no longer able to sustain both sides of the business, which also means an end for customer centricity.
At the point, the enterprise may be able to survive using its stored revenue, and could even continue to grow. But if the company is unable to respond to a disruption in the market or a new competitor, its legacy and profits could be all for naught if it is unable to thrive in new and uncertain conditions.
The systems used for running organizations have been largely unchanged for the last 50 years, but they could be improved to save the entrepreneurial network. Kotte wrote that “The solution is not to trash what we know and start over but instead to reintroduce a second system.” He called this the ‘dual operating system,’ which includes the efficiency and forward-thinking of the entrepreneurial network as well as the security and robust structure of the hierarchal system.
Incorporating business agility with SAFe
The Scaled Agile Framework (SAFe) enables business to utilise the second operating system and focus on customer centricity and innovation. SAFe uses tried and tested Lean and Agile methods as its foundation, meaning it can be modified depending on a business’ given needs; offering true business agility.
To sum up, the era of the internet and technology can be a cause of worry for many businesses who are unable to adapt or evolve with the times. The same methods that worked in the past may not be enough to save a company who cannot keep up with their competition in this day and age. To thrive, not just survive, a business should aim to adopt a dual operating system where the traditional business hierarchy is supported by Lean and Agile practices that enhance and augment each team members’ maximum productivity while focusing on the experience of the customer.
To see how you can use the dual operating system to boost your company’s production, contact Arvind at The Agile Works at arvind@theagileworks.com.
(Sourced from SAFe Distilled: Achieving Business Agility With the Scaled Agile Framework by Knaster & Leffingwell)
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