Leadership Buy-In Is Critical for Enterprises' Agile Journey in 2022
February 07, 2022

John Turley

Intensified by the last two years of the pandemic and the rapid changes it forced on businesses across industries, enterprises today are operating within a highly fluctuating environment. New customer behaviors, trends, and expectations have not only caused companies to adapt on the fly but to scale the experiences they offer as they fight new competition, increased financial pressure, and an ever-changing market.

But with the cloud, artificial intelligence, and a host of other emerging technologies enabling entirely new ways of doing business, there has perhaps never been a better time for enterprises to showcase their agility. After all, the pandemic placed speed of execution and adaptation at the core of competitive advantage. And as we hopefully accelerate into the post-Covid era for business in 2022, the importance of this skill is only set to grow.

Creating an agile enterprise however goes far beyond just purchasing and deploying new technologies. Effectively managing your organization's software value chain plays an integral role. But achieving agility also requires a cultural transformation — led by leadership — to drive enhanced business performance, employee engagement, and customer satisfaction. Only when company leaders show commitment to this type of systemic change can they achieve an organization-wide shift in mindset.

Yet, this is often the biggest stumbling block for companies looking to become more agile, as, without buy-in from the top, even the most minor changes become too challenging and modest goals unattainable.

Reconceptualizing Agility to Boost Long-Term Performance

McKinsey defines an agile enterprise as one that's "based on creating fluid organizations that continually evolve to capture market opportunities while highly engaging their employees." In fact, according to the consultancy firm, businesses that fit this bill boast a 20 to 30% boost in financial performance over their less agile peers. Those same businesses can also see a 30 to 50% improvement in operational performance, a customer satisfaction score boost of 10 to 30 points, and an increase in employee engagement to the tune of 20 to 30%.

Cross-functional teams, enhanced communication, continuous iteration, and flexible workflows — all of which are byproducts of agile workplaces — come with their bottom-line benefits. But the truth is, becoming an agile company is a step away from the traditional. And the fact that the development of the modern workplace is constantly reinventing the meaning of "agile", makes for a more challenging journey.

DevOps, for example — where software developers are on the same teams with production operations people and staff from the business units needing the applications — has introduced new cultural philosophies, practices, and tools to the workplace. Growing increasingly popular for its impact on product quality, problem-solving, and overall productivity, a rising number of enterprises are turning to DevOps as part of their agility journeys.

But adopting the principles of these agile practices presents a unique challenge for organizations, making buy-in from C-suites critical. To create an agile enterprise, disciplines with individual goals and cultural characteristics (like Marketing, HR, and Sales) must embrace a mindset where the creation of value for the customer is their primary tangible deliverable. This means shifting away from a culture where every department controls various moving parts that influence profit and performance to one where power is diffused, and everyone is constantly learning.

It's a change that requires a company-wide commitment to transformation as an educational journey, starting at the top with the executive team.

Removing Silos and Changing Company Dynamics with Technology

An agile enterprise utilizes its network of teams to increase company understanding and swiftly and confidently make critical decisions — something that's in stark contrast to traditional businesses that operate under a structural hierarchy where teams are siloed, and productivity is stagnant. With this in mind, the C-suite needs to inspire an agile journey, as it's ultimately a practice that requires them to relinquish control and empower people to act autonomously.

Of course, collaboration and communication are vital for achieving this, and technology is imperative for execution. In fact, you could even describe an agile enterprise as a company that leverages the flexibility of a software mentality to adapt to their ever-changing environments instead of using the more rigid "hard" lines of communication and organizations. After all, it's fair to say that every company is a technology company today, even if their customers' and employees' software interactions throughout their journey maps are independent of the final product or service that's delivered to them.

Therefore, one can compare software to the broadening concept of enterprise agility, designed to increase flexibility and reach and create value for stakeholders. Technology even facilitates a drastic change in organizational dynamics, speeding up execution across the business in the process. But the challenge in spreading the agile concept across the enterprise, into all operations, transcends just choosing the right tools. It's a leadership challenge focused on people and processes. And to realize the performance gains, those at the top must demonstrate their willingness to change the way power and communication flow in the organization.

A Management-Led Journey

Indeed maintaining hierarchical power structures and vertical lines of communication prohibits everything that an agile organization stands for. Yet, committing to an environment where power is decentralized and diffused is understandably a massive mindset shift — and one that must be undertaken at the top of the organization before they can achieve buy-in from the rest.

Which is why it's also important to remember that an overnight transformation to agile ways of working is impossible. Instead, it must be treated as an educational journey taking place in an undeniably complex and fast-changing landscape, where autonomy, quick feedback loops, and open communication help businesses create unrivaled value for their customers and achieve desirable returns on investment.

So as enterprises embark on this lengthy and iterative process, it's vital that senior leaders set the tone for the journey as they strive to create an agile culture that boosts business performance and optimizes customer and employee engagement.

John Turley is Senior Digital Transformation Consultant at Adaptavist
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