You don’t have to look far to uncover the many risks facing businesses today. From the threat of a global recession to data privacy concerns and persistent political instability, the challenges facing businesses stretch far and wide.
But difficult times can bring out the best in your workers—if you have the ability to see how they’re currently deployed, spin up new teams or even organizations as needed, and gather insight into the skills they have and those they’ll need to meet the challenges ahead. In this context, the ability to adapt to change is no longer an advantage, it’s an imperative.
Our global survey of 998 executives, titled “Organizational Agility at Scale: The Key to Driving Digital Growth,” finds leading businesses are resilient in the face of uncertainty. There are a number of reasons for this resiliency—we found five attributes of organizational agility in our survey—but the adoption of fluid structures and flexible processes helps companies quickly adapt to changing market conditions and new opportunities for digital innovation.
In short, adaptable organizations can put talent where it’s needed and build the business processes to support those people. And they can do it quickly.
Sixty-seven percent of organizations are able to redeploy resources and talent at speed to take advantage of emerging opportunities. Yet only a minority of businesses—15 percent of those surveyed—have made good progress in building adaptability into teams, processes, and technology infrastructure.
“I think what’s going to happen is that new organizational models will evolve,” says Andre Heinz, global head of human resources, Siemens Healthineers. “We’re experimenting, for example, with agile working methods across various parts of the business; methods that help us to react more quickly to the demands of the market.”
Read on to see what’s blocking organizations from being resilient, and how leading businesses have overcome these barriers to roll with change.
“We’re experimenting with agile working methods across various parts of the business; methods that help us to react more quickly to the demands of the market.”Andre Heinz global head of human resources, Siemens Healthineers
Against a constantly changing business landscape, inflexible legacy technologies (29 percent) and a lack of appetite to move away from these ageing systems (27 percent) are two of the major barriers preventing businesses becoming more adaptable. Likewise, only one in five organizations says their technology and processes are completely fluid between their back, middle, and front offices.
One explanation for this are remnants from a simpler time, such as bureaucratic processes and hierarchical structures, that continue to hold businesses back. These include a lack of decision-making ability, the prevalence of paperwork and red tape, and outdated and inflexible policies and procedures. In fact, 32 percent of organizations name bureaucratic culture as a top barrier to updating business processes.
Despite this, the majority have made at least some progress establishing a flexible approach to managing people skills across their organization. Seven in ten (72 percent) organizations have a system in place to measure skills and skills gaps, and two-thirds (67 percent) are able to reallocate talent to where their skills are needed when demand dictates.
Together, these capabilities are critical to organizational agility; as new opportunities arise, adaptable businesses can quickly find employees with the right skills and move them to where they are most needed.
CEOs are optimistic about their organizations’ ability to redeploy talent—38 percent say they can reallocate people quickly to where their skills are needed. By contrast, this number drops to 11 percent among CIOs and COOs.
While most C-suite leaders in our survey named inflexible legacy technologies as the top barrier to updating business processes, nearly half of CIOs and COOs—the two roles most often tasked with overseeing the implementation of new technologies—cite bureaucratic organizational culture as the key barrier.
While the move to greater agility and flexibility is an imperative, it also demands a degree of caution, says Siemens Healthineer’s Heinz. “Agility should not be a euphemism for chaos. This way of working requires real discipline and a mindset of true collaboration across entities to bring different viewpoints in sync.”
To adopt resilience, organizations must:
By addressing these three areas, organizations are more resilient in their ability to pivot to new opportunities when they arise.
Get an overview of “Organizational Agility at Scale: The Key to Driving Digital Growth” findings or download the full report.