Why Organizational Agility is Crucial for Business Growth?

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Vikash Punia

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Dec 04, 2024

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Organisational agility is the organisational capacity to adapt to certain features and succeed in a rapidly changing environment. This is an interesting capability where you need to succeed by renewing your resources and changing the operational style. 

Therefore, one of the crucial reasons to opt for organisational agility is that you need to be flexible and adapt to industry changes rapidly. However, whatever I just explained is the tip of the iceberg itself, there is more. 

So I am writing this to make sure you are getting all the concepts properly. 

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The Definition of Organisational Agility 

Organisational agility is defined as the ability of an organisation to respond quickly to market changes or customer demands. The main aspect of such a design is to be creative and adapt to the specific challenges that you have recognised as well. 

With such a higher degree of agility, you can easily make sure that your organisational performance as a whole is increasing daily. The importance of such agility is needed as it can help you adapt to failures and manage your losses effectively. 

Thus, I hope that I can define organisational agility for your understanding. However, there are multiple nuances that we need to address; they are mentioned below.

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Importance of Organisational Agility for Business

There are several reasons behind the improved functionality of the organisational functionality. Some of the notable importance that urges for such improved functionality are as follows: 

1. Improving Customer Experience 

One of the important aspects of organisational agility is to meet different customer demands. When you are able to address customer demands, it helps you in driving toward success as well. Thus, one of the important factors that can help your business or organisation to be agile in its truest sense is to focus on customers. 

In the case of internal teams, you must focus on your teams to be agile, as it can meet the customer expectations. Always try to maintain a favourable balance between the working and standard operating procedures of the team. 

2. Employee Engagement 

Another area where agility in the enterprise is most required is noticeable employee engagement. Agile organisations help ensure that your teams and employees are making accurate decisions. 

This way, it helps make sure that you have a collaborative internal team that supports productivity and ensures everything is working perfectly. Empowering a team to make decisions themselves also helps remove the bottlenecks and contribute to organisational agility. 

3. Increased Flexibility for Organization

In the case of agile enterprises, agile teams are known to focus on newer priorities as well. As the agile teams already have operating infrastructure ready, it helps make the process more straightforward as well. Thus, as I have already mentioned, an agile environment can be created only when the organisations are flexible. 

Ultimately, this flexible setup completely justifies the organisational agility meaning. Moreover, the teams are also able to get more success when they work as per the framework of organisational agility. 

4. Increased Resilience to Sustain Operations 

Another example of organisational agility is that it helps in sustaining operations effectively. Such an agile environment also makes sure that leaders can effectively make decisions based on the true representation of the situation. This might be a little complex to understand, so let us take an example. 

You are working with a team of 12 members, and you have recently encountered some bottlenecks. Naturally, if you are suffering the bottleneck as a team, your leader might find a way out. As the decision is customised as per your problem, it directly falls under the agile setup. 

5. Productivity Increase 

Another important feature of an agile working environment is a continuous flow of deliverables. Let me give you an example of a factory working to produce glass wine bottles. In a single production line, everyone has an equal share of responsibilities to develop the bottle.

Someone melts the raw glasses, another shapes them, and ultimately someone screws in the cap. This is the same setup in a software development lifecycle as well. Here a person develops the initial code from scratch and refines it as per project needs. 

After the codes are developed, they go through conditional and specific tests to see their quality. If they pass, the deliverable is sent to the agent who schedules and performs the delivery. 

Benefits of Organisational Agility 

There is always a need for organisations to stay agile for perfectly functioning. I am going to specifically point out some problems that organisations have if they are not maintaining organisational agility. Some of them are as follows: 

1. Budgetary Risks 

This usually happens when the cost of development of a product inside a project is not maintained properly. With organisational agility, you are constantly maintaining such budget updates using LEAN principles. Using rolling wave planning might also help to make sure that all the numbers regarding costs are added after clearly updating the requirements. 

2. Changes in Scope

In many circumstances, there is also a risk regarding the changes in the scope of a project. Organisational agility helps to maintain project timelines and scopes intact by ensuring a constant unidirectional scope is maintained. If the scope is to make application transfer payments, the end scope should not become only receiving payments. 

3. Providing Less Focus on Agile Principles 

This is an important consideration, where if you are not maintaining agility, the software development might be obstructed. This usually happens when the teams are not practising effective sprints; it risks the delivery deadlines. Ultimately, it is necessary for a person to incorporate agile principles onboard and stick to them effectively. 

4. Technical Errors

This usually happens when a team does not have a complete idea of functionality using a specific system. If you are using a multi-team dashboard, as an example, you must know how to control your teams. Without proper changes in status or mismanaged production line activation, it might cause huge levels of problems. 

These are some of the common risks that are associated with when organisational agility is compromised. 

The Key Elements of Organisational Agility 

Many key elements are involved in improving the agile working of the business or organisations. Here I will be answering the 4 key elements of organisational agility; some of them are as follows: 

1. Leadership Agility 

Leading a team is one of the important aspects of any business organisation. A team can be helpful for the company as well as lead to its losses as well. For example, if you are a team leader, it is your responsibility to share your vision with the team, inspire them, etc. Organisational agility is maintained when the leaders are supportive and not ego-driven individuals. Good leaders are not punishers but people who nurture a supportive environment for their team. 

2. Cultural Agility 

Cultural agility is important as a business or commercial space is a melting pot of cultures. You might not know the different people who are working together as a team and promoting a better work environment. In simple words, these cultural boundaries might be problematic; one must only opt for an open work environment. 

3. Business Agility 

Business agility is just the soul of organisational agility, where it helps organisations innovate and rapidly meet the business objectives as well. Business agility also helps organisations to respond to quickly changing environments properly. Ultimately, it saves you from disruptions and gives you an overall competitive edge. 

4. Career Agility 

A strong business-centric organisation is also known to help employees learn throughout their careers. Many organisations are also known to support adaptable talent and performance systems. On-the-job training is also another aspect that many organisations indulge in so as to help them get a stable and precise career. 

Measures to Improve Organisational Agility 

Some of the ways to improve organisational agility are as follows: 

  • Always foster a learning environment for the teams and employees

  • Start adopting agile practices, which start by streamlining the process of working

  • Embrace a digital culture where innovation and continuous improvement are heavily prioritised as well. 

  • Experimentation on the pilot scale is also great to see the effects of specific process improvement processes on certain aspects of development. 

  • Promote the usage of logical thinking and purpose-driven decision-making to facilitate process improvement. 

  • Always promote a culture of collaboration and transparency for managing the teams. 

These steps are useful for helping organisations chase the required agility for functioning efficiently. 

Measuring Organisational Agility 

Improving organisational agility must take on a measurable approach as well. I will always value data and see the statistics properly before taking any action. Some of the top measurement processes to step into agile transformation are as follows: 

1. Cycle Time or Speed of Process 

One of the main aspects of organisational agility, meaning, requires understanding the process time. It is generally calculated by taking the task cycle time, which can be calculated as per the following: 

Task Cycle Time (TCT) = Task End Date - Task Start Date + 1

1 is used to account for the items that start and finish on the same date. 

2. Efficiency of the Process

The efficiency of the process of any agile setup must be calculated and perfected as per the requirements. The efficiency of the workflow must be calculated in a way that reflects the ratio between the time and progress of work; let me show the formula as well: 

Task Efficiency of the Process (TES) = Task in Progress (Days)/ (Task in Progress + waiting days)

Team efficiency score = Sum of all TES /No.of Tasks 

3. Velocity Per Task 

Another way to see organisational agility is to see the velocity of the tasks present. If the velocity of the task is high, it means that an organisation is more agile in terms of success. The agile metric is also essential for determining the amount of value of a team. 

If the teams are producing output at a rapid pace and deadlines or deliveries are streamlined, then they are supposed to be the backbone of the agile systems. 

Average Process Improvement Achieved with Agile Frameworks 

There are multiple advantages of the agile framework in the working of the organisation. Let me introduce a few aspects of organisational agility that might help with the process improvement of the overall system: 

  • The Agile environment is known to help with process simplification and improve overall transparency. 

  • Agility in working is also known to increase the collaboration efforts for the clients. Thus, it helps with taking proactive steps and benefits the overall process of working. 

  • Organisational agility also helps ensure that you are connecting with potential clients and streamlining their needs easily. 

Overall, an agile framework is able to make sure that an organisation performs up to its level best without facing bottlenecks. Ultimately, this is a great way to ensure that you are perfectly aligning your organisation as per the agile working framework. 

Industrial Examples of Successful Agile Implementation

There are multiple examples that showcase agile transformation for the organisation; however, I have made a specific observation that I am going to share here. 

Cargill is one of the popular food distribution organisations that have noticed a seismic shift in performance. Cargill as a whole embraces the concept of agile organisations, and it introduced 4 principles of agile working: 

  • Feedback should always be continuous, and it must not be performance-heavy 

  • Daily activities and practices act as predictors for quality and performance management as a whole. 

  • Managers are asked to be supportive. 

  • Systems must remain flexible throughout the process, with emphasis on agile business needs. 

As per Cargill, the results were seen to be impressive, and 69% of the employees have stated the increase in their motivation. After introducing the agile system, 70% of the employees in Cargill stated that they felt motivated to complete the work. Overall, from the standpoint of performance, it is observable that organisational agility improves the performance of agile systems. 

Conclusion 

Organisational agility is one of the effective improvements that help organisations with their agile framework. Moreover, such systems are also known to make sure that you understand all the aspects of the work perfectly. Overall, this is an interesting technique where the stability and vitality of any organisation tend to increase regularly.

With StarAgile, you can get comprehensive SAFe training that helps understand the basic aspects of the Scaled Agile Framework. Moreover, with an appropriate SAFe Agile certification, you can get employed in some of the best MNCs that rely on an agile framework. 

Frequently Asked Questions 

1. How to make your organisation agile? 

To embrace organisational agility, it is always important to check for steps that amplify production. Understand the bottlenecks and take steps to remove them from the framework. Therefore, an organisation needs to take effective remedial measures and justify the outcome effectively. 

2. What do you mean by the three A's of organisational agility?

Three A's denote the formula that organisations use to adapt to changes and ensure flexibility. The three A's denote anticipation, adaptability, and Acting- taking these as common steps that are taken in response to some problems or bottlenecks during system operations. 

3. What do you mean by agility tool?

Agility solution defines the ability of an organisation to adapt to changes using specific sets of instructions. These instructions usually come from a project manager or higher-level officials involved with the project through a workflow dashboard. This dashboard works as per the principles of agile, which can be Kanban or Scrum. Depending on the chosen principle an organisation can map their entire process and deliver appropriate instructions or streamline deliverables. 

 

 

 

 

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