'VUCA' DEMANDS AGILITY
Given the number of similar conversations we've had recently, we have distilled discussion to provide this guidance for enterprises to use in their decision making and planning for renewal and reorganization.
In January 2020 you were probably thinking about ‘Leadership in the Digital Age’ (LITDA) and your digital transformation strategy (DTS).
In February, the C-19 pandemic added another dimension to the already VUCA environment and accelerated uptake of new information and communication technologies (ICT).
VUCA Events (Post Pandemic) and Challenges Demand an Agile Enterprise
With the accelerated adoption of new ICT, working from home (WFH) will continue — whether or not a vaccine is created and social distancing eased. Time in the office will remain significantly reduced and leaders must use whatever collective time they have to best effect. Employee mobility is likely to increase, further testing organizations’ retention and succession planning. Accelerated digitalisation is delivering real-time actionable information and intelligent process automation; it is further ‘compressing time and space’, and increasing competition and the pace of change.
Organizational leaders are increasingly recognizing the urgency of embedding coherent, integrated, and durable policies, practices and processes that enable effective WFH in a distributed organization. These will provide the agility and resilience for the enterprise to thrive in a post C-19, post-BREXIT environment and through another ‘black swan’ turbulent event.
2020 Action Research Observations
Action research in remote team working across multiple businesses has shown that:
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‘Screen attention span’ is limited and meetings are shorter than before C-19, yet ‘complexity’ has increased. In teams where accuracy, brevity and clarity of communication is lacking and no check is made that a receiver’s interpretation is that which the sender intended, frustration increases markedly.
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Productivity has increased in teams with practices to align thinking and priorities, and with increased levels of decision-making authority; but has decreased in multi-disciplinary teams lacking effective frameworks for problem analysis and decision-making.
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Leaders need more clearly and concisely to articulate direction in meaningful terms, be ruthless in setting priorities of work and require enhanced ‘facilitation skills’ to focus dialogue. Meetings require more structured agendas issued earlier, with more preparatory, incisive ‘thinking’ by participants to optimise the use of screen time.
We can advise clients on the implications of this for leader and leadership development and strategy development and execution.
Fog and Friction
VUCA (created in part by C-19) creates the ‘fog’ which obfuscates and hinders decision-making. External ‘fog’ is compounded by internal ‘friction’. Friction in organizations is what makes the simple difficult; and the difficult seemingly impossible. It has both systemic (organizational) and individual sources which we would like the opportunity to discuss with you.
Systemic friction requires a systemic ‘lubricant’ and the challenge for leaders is to embed effective working practices now, before inefficient and ineffective or even dysfunctional practices become habitual.
Academic research and reflection on our practical client experience (which we can share with you) provides us with the basis of an adaptable, decentralised and dynamic approach to strategy development, execution and evolution which ensures the continuous alignment of thinking, priorities and processes to the organization’s vision and strategic objectives, while simultaneously building people’s emotional engagement in the task at hand. The research and our published case studies show such a system may be developed in enterprises (or in business units of them) and that it delivers measurable quantitative and qualitative value.
Embedding collective leadership agility means ensuring the coherence and integration of many foundation concepts, leadership practices and business processes. We have been doing this since 1995, not just since 2020, so have many insights to share.
Collective Agility: Agile Leadership, Agile Strategy, Agile Organization
Building collective agility involves three lines of activity.
1. Develop and Embed ‘Collective Leadership Agility’. A strategy execution system to integrate and ensure coherence between blue-sky thinking and strategic vision; and the reality of operational and tactical planning and delivery; and continuous change. This includes a system of distributed leaders responsible for people, outputs, and outcomes and creating the conditions for their team’s success (including psychological safety); and shared leadership to harness complementary differences, engage colleagues and ensure the full spectrum of ‘leadership work’ is undertaken within teams.
The approach to strategy development, execution and evolution must ensure people’s emotional engagement in the task at hand; and must also enable the alignment of thinking, priorities and processes to strategy, on a dynamic, systemic, collaborative, and remote basis.
VUCA may mean that strategy is emergent which necessitates planned experiments, acceptance of risk, and iterative ‘clarity creating’ leadership 'sprints'. This requires a dynamic, decentralised, systematic, yet time-effective method of appreciating problems to align thinking to strategic objectives, identify and compare viable options, and enable a decision on the preferred option.
Also required are practices and mechanisms to enable and support planning, briefing, coordination, ‘3D meaningful information’ sharing (up, down and sideways), progress tracking (leading indicators and measures), and external environment/competitor monitoring, integrated with plan reviews. We would welcome the opportunity to share our experience of developing leadership agility with you.
2. Enhance Structural Agility. Organizational structures are decision-making systems for executing strategy, breaking ‘the big task’ into smaller parallel, layered, and sequential sub-tasks to be achieved. Structure can help or hinder how decisions are informed and made, and how collaboration across boundaries is enabled. The absence of 'role-relationship' clarity can result in duplication or gaps in assumed roles, as people are influenced by 'performance management systems' and 'politics' to make the system work to their best advantage. VUCA demands that organizations are agile enough quickly to reconfigure, improvise and adapt to meet rapidly changing operating environments and the need to operate in a more fluid and flexible 'plug and play' or modular matrix of activity and leadership.
Structural agility means crafting a set of ‘distributed organization principles’ to rapidly clarify roles and role-relationships, and to align accountability with authority (both vertically and laterally), both now and as roles and groupings change. This will remove the biggest single source of stress for most leaders (all the accountability but no authority), truly empower people, and optimise multi-disciplinary team working in ‘permanent’, ‘ad hoc’ and ‘plug and play’ structures. Team leaders should describe roles in terms of purpose, outcomes and outputs, rather than job descriptions of tasks to complete and fixed hours to work.
Combined with leadership agility and a strategy execution system, this creates ‘dynamic capability’; a capability which delivers ‘competitive advantage’.
3. Build Mutual Trust and Confidence. This is done through three channels. First, the systemic mechanisms of 1 and 2 above (we can explain how and why). Second, through individual leaders’ behaviour and ability to create a psychologically safe environment (which we help to address while introducing a co-created ‘strategy execution system’). Third, ensuring that the ‘behavioural consequences’ of wider policies and processes are aligned to desired culture.
Decision-Making: The Appreciation Wins Both Hearts and Minds
A problem is any situation with a requirement for a decision on the course of action to pursue. ‘Problems’ differ mainly in their complexity, degree of ambiguity, and downstream consequences; not in the key steps needed to solve them.
We will help you to embed a simple but robust, iterative and highly flexible leadership practice —The Appreciation for use at all levels, face to face, online or individually. It hinges on a time-efficient, dynamic, collaborative dialogue based on answering 'the big 5 questions', by combining insight and foresight, and attending to ‘biases’. The more complex the issue, the more iterative and non-linear the practice.
A strategic appreciation aligns thinking to vision and purpose, defines concurrent lines of activity with tasks and decision points sequenced and synchronised; identifies work to stop, start, continue or integrate with, and identifies and compares the different overall courses of action. It evolves strategy in the light of actual progress and changing context to deliver competitive advantage, increased productivity, and reduced effort and resource expenditure.
Most importantly, it builds confidence — in the decision makers themselves and among those to whom the decision rationale is explained.
Contingency Planning
Contingency planning means making a number of appreciations with ‘what if?’ stated assumptions. The resulting branches from and sequels to strategy are therefore only valid if and when the assumptions become fact. They provide a basis for quick adaptation and aid organizational agility and refocus. Contingency planning may include supply chain resilience, ICT ‘redundancy’ and cyber-attack, crisis communications activity, operations resilience and ’leadership’. Current risk management processes may still be valid; but may need to be reapplied to review risk in the envisaged scenarios. We can support you in this.
An Enterprise Intelligence System
An Enterprise Intelligence System integrated with decision-making and planning can minimise ‘information anarchy’, ‘horizon scan’ for threats (from competitors, disruption, climate change, and to supply chains, etc); and opportunities (including technology advantage, competitor weakness, and innovation.
Within the constraints of legal compliance, an intelligence system can use big data, data analytics, and artificial intelligence to integrate information across databases and to ‘scrape’ and collate ‘open source information’ about markets, competitors, risks, emergent technology etc. It will also integrate tactical intelligence (gained, for example, via your sales force). When all this information is collected, processed and interpreted, the resulting ‘intelligence products’ should be disseminated to inform decisions. We have ‘intelligence’ expertise.
Ensure and Assure Information Access and Integrity
Secure information access and information security needs to be ensured and assured while WFH. This includes physical security of hardware and documents, secure destruction of electronic and physical documents, ‘cyber essentials’, and ‘loose talk’ (Alexa, Siri, Cortana or the neighbours may be listening), and so on for both legal compliance and commercial confidentiality reasons.
Ongoing Customer Experience- Led Process ‘Leaning’
Ongoing internal and external ‘customer experience’ focused business process reviews (following the whole customer 'experience pathway') should eliminate non-value add work, improve output quality and cycle times, and link to role and structure reviews. While in some areas of ‘solo work’, productivity has increased, processes which require inputs from multiple people may now be less effective. In the light of new ICT, these may need review.