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Senn Delaney CEO Jim Hart discusses creating an agile culture in new video

CEOs must closely examine how agile their organizations are and take steps to eliminate barriers to agility if they are to compete in today's turbulent market place, states Senn Delaney CEO Jim Hart in a new thought leadership video, part of a series of best-practice videos on organizational culture.

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The following interview with Hart examines why agility matters to today's organizations and CEOs.

What is organizational agility?
The best definition I have seen on organizational agility by Cornell University ILR School/Center for Advanced Human Resource Studies really sums it up: “Organizational agility is the capacity to be infinitely adaptable without having to change.” Being infinitely adaptable is the key here. Agile organizations strive to develop a built-in capacity to shift, flex, and adjust, either alone or with alliance partners, as circumstances change.

Why should CEOs focus on creating an agile culture?

There are two major reasons CEO should be focused on agility: One, change is happening too rapidly for long-term planning and is forcing companies to become more agile or lose ground to competitors. And second, organizational agility is linked to increased growth, profit and performance. A 2012 study by the Project Management Institute suggests that agile firms grow revenue 37% faster and generate 30% higher profits than non-agile companies.

Nearly 90% of nearly 400 senior executives surveyed globally in a 2009 report by the Economist Intelligence Unit, Organizational Agility: How Businesses Can Survive and Thrive in Turbulent Times, believe that organizational agility is critical for business success. Yet, most companies admitted they were not agile enough to mobilize quickly, respond positively and change to compete successfully. We see this as a constant top challenge among our clients today.

How is being agile different than being adaptable as a company?
Agile organizations are optimistic in the face of challenge, never rest on their success, and regularly seek to improve even when they are successful. They embrace failure as a learning opportunity, have a strong purpose, a vitality, and a learning mindset. There is alignment and clarity around the mission, and vision, and values. Rapid decision making happens not just during a crisis, but every day. There is a strong ability to execute, high levels of accountability, customer-centric thinking and strong cross-organizational synergy.

Being adaptable is far different. I think this describes companies that are responding to disruptive change in the marketplace by making radical but predictable changes, such as changing CEOs and leadership teams, shifting strategies, rolling out new product lines, amping up innovation, cutting costs, restructuring. These are all good and necessary things to do to react to change, but it is treating the symptoms of a chronic illness without curing the underlying cause. It is the adaptive CEO who may be missing out on the most important strategy of all: creating a culture of agility that keeps them focused on the horizon, rather than adjusting to sudden change.

What are some barriers to agility?
CEOs should consider these questions: Are we changing as fast as the world around us? Is our culture enabling us to be agile or impeding us? Internal barriers – the culture — prevent organizations from being agile. The barriers include poor leadership behaviors, such as hubris, organizational complacency and resistance to change, poor decision-making, lack of alignment around strategies, vision and values, risk-averse mindsets, siloed thinking and turf wars.

What are common traits of agile organizations?

Agile organizations are optimistic in the face of challenge, never rest on their success, and regularly seek to improve even when they are successful. They embrace failure as a learning opportunity, have a strong purpose, a vitality, and a learning mindset. There is alignment and clarity around the mission, and vision, and values. Rapid decision making happens not just during a crisis, but every day. There is a strong ability to execute, high levels of accountability, customer-centric thinking and strong cross-organizational synergy.

Most notably, they are more financially successful. Research in 2009 by MIT Sloan School of Management found that agile companies not only grow at a faster pace than their peers, but they also exhibit consistently greater returns than those of their direct competitors

Can you create a culture of agility?
Creating a culture of agility is possible and should be the first strategic priority of the CEO and senior leadership team because it is the culture that spawns an organization's ability to adjust in any direction and execute any strategy.

Transforming the culture requires a comprehensive approach and a focus on four key principles: purposeful leadership, personal change, broad engagement, with energy, mass and momentum, and focused sustainability. A comprehensive diagnostic survey of the cultural traits of their company is the best way to get a true picture of this and a good start at determining next steps.
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