Developing Your Agile Mindset
Agile has permeated the software development and project management realms. After all, the practices of agile are rich with methods for ensuring that as user needs evolve or unexpected events occur, the development team can pivot quickly to understand and address new requirements.
Operational agility has also picked up as organizations have adjusted production methods in response to fluctuating consumer preferences. Operational agility means “making the existing products better, faster, cheaper and so on for existing customers,” says management consultant Steve Denning in Forbes.
But what about creating new markets with new products to reach new customers? Accomplishing that requires a new IT mindset, applying the precepts of agile not just in software development or operations but to the larger organization. Those who adopt this mindset will be best positioned to lead in business or government, no matter what’s coming next.
The Use of Agile for Strategic Planning
It only makes sense that the concept of agile would also percolate in a company’s strategic planning.
At the executive level, strategic planning has traditionally tackled competitive positioning — how a company is organized and structured and what types of opportunities it’s going to address or exploit. Strategic agility, on the other hand, is what enabled Apple to make that giant leap to take on design, development and production of a phone when it had never done so before. Or for Amazon to realize that the technology underpinning its book-selling services could be used to sell other products — including use of the technology itself through Amazon Web Services. Those two companies are far from the only examples.
“Industry boundaries are disappearing rapidly in many settings,” says Virginia Tech Professor David Townsend. “You may have companies that you never expected to compete with directly that find unanticipated opportunities in your space.”
Townsend teaches courses in entrepreneurship, including a course on strategic leadership in the university’s online Master of Information Technology. How a firm organizes itself — its business model — has become perhaps the most potent source of innovation, says Townsend. “It’s not just that your products that are innovative, not just your advertising strategy — it’s everything,” he says.
What’s also changed, Townsend adds, is where the top business leaders are coming from within the organization. “It used to be corporate finance or marketing were the primary routes to the C-suite,” he says. “Now what you’re finding is that it’s people with a strong understanding of technology.”
There’s a good reason for that. “It’s not just the CEO who has to think about competitive positioning and business model design. It’s the IT folks,” Townsend says. Those with technical understanding are situated to build the robust systems making up the “digital platform” that can drive an organization’s competitive advantages. As a result, this can open whole new avenues for the business.
Agile Project Management Versus Strategic Agility
What’s the difference between strategic agility and agile, the project management methodology? Virginia Tech’s David Townsend clears up the confusion.
Strategic agility aims to make an organization nimble and fluid, so it can respond properly to changes in its market. “Agile strategy involves the design of flexible organizational structures and processes to create adaptive strategic positions that can respond effectively to emerging opportunities and threats,” Townsend says.
Agile project management, on the other hand, is a sub-category of agile strategy. Townsend says the focus of this approach “is to engage customers and stakeholders, through an iterative design process, so they can co-create the value proposition of products and services.”
Amazon and the Chinese company Tencent Holdings, for instance, both compete in numerous markets, “enabled by a core set of technological capabilities [that could be applied] in so many different places,” Townsend notes. This upends the traditional business model in which you find your sweet spot — the thing you do extraordinarily well— and then take over that market space. Now, with the right digital platform, a company doesn’t need to focus on just one thing anymore, he says, because “it’s able to leverage that [platform] in so many different places.”
Where Strategic Agility Does (and Doesn’t) Excel
Retail isn’t the only place where strategic agility can play a role. With the right software infrastructure in place, healthcare organizations can provide in-home post-surgery care. Practitioners can use wearables to track patient progress and adjust treatment at a distance. Such an approach stretches the concept of the traditional hospital.
In education, strategic agility can help instructors do iterative planning for new, untested courses that involve a lot of stakeholders, including students and partners from industry. This can help expand beyond faculty influence in setting academic direction.
Of course, strategic agility doesn’t fit in every environment, Townsend observes, especially where predictability is an advantage. “If you’re trying to coordinate the actions of 200,000 employees, bureaucratic processes [provide] an air of predictability around that organization,” he says.
Imagine that every time an employee entered a timesheet, the steps had changed. In that case, locked down processes provide a definite benefit.
But even within those environments, strategic agility can play a role in addressing complexity. Take a government agency — these are often viewed as slow-moving, all powerful behemoths designed to accomplish a range of activities. The city’s planning department issues building permits; state departments of motor vehicles issue driver’s licenses; the National Oceanic and Atmospheric Administration works to understand and predict changes in climate, weather, oceans and coasts.
What if you could view these as providers of services that a variety of outside organizations can then link to and implement in a very robust way, Townsend says. Government becomes an ecosystem then. He speculates: “Let’s set up a strategy to allow a wide variety of nonprofits or other private entities to innovate around us by connecting to our ecosystem. We provide them with a stable platform, resources, connections — whatever it is.”
As an example, perhaps a government entity maintains the data, handles the financial transactions and provides oversight while the outside entities do the outreach and deliver the services. Does the term “bureaucracy” (with its negative connotations) really apply in such a scenario?
Those who are trained in strategic agility can use it “like stepping stones to move through very complex, uncertain environments,” says Townsend. Students of the practice have learned how to use constant feedback to guide continual iteration in intentional and direct ways to solve specific problems. They gain the ability to “address the ‘unknown unknowns’” — all the things they can’t know and can’t anticipate when they begin a new endeavor. Importantly, he adds, this ability doesn’t trickle down from the executive suite; any employee can learn it.
This topic is a major focus in one of the courses Townsend teaches in the VT-MIT online program.
Organizations is a core class that even uses an agile process to define its direction. “There are different opinions, different perspectives about how strategy should be taught, and everybody has a different world view,” he observes. That level of participation and influence among participants makes for an “extraordinarily high” level of engagement among students and allows them to gain insight about how to apply the lessons of strategic agility in their own organizations (which happen to represent a really interesting mix of work environments, he says).
The world is changing rapidly, and it’s redefining IT practices. It’s no longer enough to learn new technical skills to excel in a career, Townsend says.
“People also need to change how they think about business. The old way we used to make decisions is no longer fully relevant,” he says. “You need to upgrade your ability to navigate within a new digital environment. That requires a new way of thinking, a new set of skills to complement the technical skills. This is thinking about how to lead companies into the future.”
Written by SmartBrief Education