mba 8225: organizational agility...© ceprin (2007) mba 8220 #3 organizational agility 5 …and...
TRANSCRIPT
© Richard Welke 2002
Mike Gallivan Lars MathiassenRichard Welke
Dane Truex
MBA 8225:Organizational Agility
© CEPRIN (2007) MBA 8220 #3 Organizational Agility 2
Agenda
The agility challengeSense-and-respondResponse ability
© CEPRIN (2007) MBA 8220 #3 Organizational Agility 3
Topic one
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Agility in Football“I don’t just want to know what everybody has to do; I want to know
why. When you know why, you know more … You play faster”Marshall Faulk, Running back, St. Louis Rams
Resources, e.g. the players, should know-how & know-whyProcesses, e.g. practiced patterns of play, contribute to know-howValues, e.g. priorities and outcomes, contribute to know-why
The challenge of the players is to respond in-flight to oppositionmoves and conditions of play. This requires swift interpretation ofnow, optimal execution of practiced playing capabilities, andcapability to improvise.The challenge of the coach is to create and maintain anenvironment in which players become empowered to execute. Thisrequires continuous practicing of individual and collective patternsof play combined with cultivation of individual and collectivecapabilities to adapt.
© CEPRIN (2007) MBA 8220 #3 Organizational Agility 5
…and Other Sports
“I skate to where the puck is going to be”
Wayne Gretzky
“I get the rebound before the shot istaken”
Bill Russell
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What drives agility?“There is no singular agile organization design. Each organization must
design itself to be appropriately agile in response to a unique set ofexternal and internal forces”
EconomicEconomicforcesforces
BusinessBusinessforcesforces
OrganizationaOrganizationall
forcesforces
ITITforcesforces
WorkWorkforcesforces
GlobalizationGlobalization
EmergingEmergingMarketsMarkets
EmploymentEmploymentunrestunrest
CostCostReductionReduction
SharedSharedProcessesProcesses
DistributedDistributedbuyersbuyers
SourcingSourcingoptionsoptionsFundingFundingmodelsmodels
ChangingChangingCompetencieCompetencie
ssLeadershipLeadershipDistributedDistributed
decisiondecisionmakingmaking
EnterpriseEnterpriseArchitectureArchitecture
Real-timeReal-timeInfrastructureInfrastructure
PriorityPriorityprojectsprojects
DistanceDistanceCollaborationCollaboration
VirtualVirtuallearninglearning
GlobalGlobaldiversitydiversity
Ambrose & Morello, Designing the Agile Organization, Gartner 2004
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What Enables Agility?
Provide continual feedbackProvide continual feedbackBuild contextual orientationBuild contextual orientationCommunicate meaningfullyCommunicate meaningfullyInvest in knowledge networksInvest in knowledge networks
AwarenessAwarenessDo people know thatDo people know thatsignificant change issignificant change is
afoot and the impact itafoot and the impact itwill have?will have?
Encourage reassignmentEncourage reassignmentDevelop new competenciesDevelop new competenciesAssemble diverse teamsAssemble diverse teamsUse multiple service providersUse multiple service providers
FlexibilityFlexibilityAre people equipped toAre people equipped to
respond to a wide varietyrespond to a wide varietyof business conditions?of business conditions?
Reward collaborationReward collaborationBuild learning portfoliosBuild learning portfoliosExpand decision-makingExpand decision-makingAdopt consistent processesAdopt consistent processes
ProductivityProductivityCan people operateCan people operate
effectively and efficientlyeffectively and efficientlyas conditions change?as conditions change?
Organization Organization agilityagility
Ambrose & Morello,Designing the AgileOrganization, Gartner 2004
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How to design agility?Executives as architectsSystems design complementsprocess design
A system is a collection ofelements that interact toproduce an effect thatcannot be produced byany subset of the elements
1. Top-down2. Synergy3. Relationships4. Environment5. Event-driven
Plan-driven Event-driven
Firm forward Customer back
Predict &optimize
Know early &improvise
Know-how Know-why
Best practice Next practice
Activity focus Outcome focus
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Topic two
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Sense-and-Respond Organizations
Processes that learn.
Responsive governance.
Dynamic commitments.
Modular processes and outcomes.
Haeckel, Adaptive Enterprise Design: The Sense-and-Respond Model, Planning Review 1995
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Learning
Missionand Policy
Command& Control
Management system
Structurefunctionalhierarchy
Strategy• Objective• Plan
ContextPurpose and BoundsAdaptive structure
A closed system
ExternalSignals
InternalFeedback
COMMAND-AND-CONROLCOMMAND-AND-CONROLAssumption:Assumption:
Predictable changePredictable changeGoal:Goal:
Efficient enterpriseEfficient enterprise
SENSE-AND-RESPONDSENSE-AND-RESPONDAssumption:Assumption:Unpredictable changeUnpredictable changeGoal:Goal:Adaptive enterpriseAdaptive enterprise
Coordinationof capabilities
Commitmentmanagement
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Command-Control vs. Sense-RespondMindsetMindset Command-ControlCommand-Control Sense-RespondSense-Respond
ContextContext Efficient system in a semi-stableenvironment
Adaptive system in an unpredictableenvironment
Know-howKnow-how Embedded in processes Embedded in people & processes
ProcessProcess Mass production Modular customization
PerformancePerformance Efficiency and predictability Flexibility and responsiveness
ProfitProfit Margins on products ROI and economies of reuse inmodularization and response
OrganizationOrganization Functional and sequential activity Networked and parallel activity
InformationInformation Functionally managed and optimizedvertical views
Focused on information needed torespond to requests
MarketMarket Sustain share of market Sustain individual customers
ExecutionExecution Strategy executed through plan Strategy executed through adaptivebusiness design
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People inRoles
Accountable for
Outcomes
Processes that Learn
Sense
Decide
Act Interpret
•What does each of ourexternal customersneed?
•What does each of ourinternal customersneed?
•What are the emergingmarket opportunitiesand needs?
•Which technologicalinnovations areavailable?
•How is the competitionchanging?
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Responsive GovernanceEnsure local autonomyFacilitate overallcoordinationProvide a context forbusiness behavior (Know-why)
Share organization’s“Reason for Being”Share governingprinciples
What will wealways doWhat will be neverdo
•Autonomy to respondto external and internalcustomer requests
•Shared strategy acrossprocesses
•Explicit will do and willnever do to supportprocess execution
•Coordinationmechanisms acrossprocesses
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Dynamic CommitmentsThe organizationmust know howto effectivelyexecute its coreprocessesThe organizationmust dynamicallymanage who doeswhat when inresponse to itsenvironment
•Processes thatrespond to external andinternal customerrequests
•Processes thatimprove corecapabilities
•Dynamic resourceallocation acrossprocesses
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Modular Processes and OutcomesProducts andservices must bemodular tofacilitate swiftcustomizationand innovationProcesses mustbe adaptable tosuit differentcontexts andneeds
•A component-basedarchitecture of coreproducts and services
•Customized solutionsto external and internalcustomers
•Dynamic configurationmanagement
•A minimal set ofshared core processes
•Complementaryprocesses forcollaboration with keycustomers
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Assess business and process agilityWhat kind of sense-and-respond mechanisms arein place to address environmental changes?
Do these mechanisms effectively address predictable aswell as unpredictable changes?
What kinds of governance mechanisms are in placeto ensure process performance, coordination withpartners and other processes
Capability to identify process innovation opportunities?How are commitments managed and adjusted toaccommodate process performance and change?To what extent are processes and outcomesdesigned to allow for local adjustments and easyreconfiguration?
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Topic three
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Response ability
Knowledge portfolio management (KPM) +Collaborative Learning Facilitation (CLF) KnowledgeManagement (KM)
Change Proficiency (CP) + Reusable and reconfigurableStructure (RRS) Response-ability (RA)
RA + KM Agility
Dove: Response Ability: The Language, Structureand Culture of the Agile Enterprise, Wiley, 2001
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Change proficiencyMeasured by: elapsed time to change, cost, predictivequality, latitude for change (scope)
InnovativeFragile
AgileOpportunistic
Response-ability States
Proactive proficiency(Leadership)
Rea
ctiv
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rofi
cien
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Via
bil
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MaturityMaturityStageStage
GeneralGeneralCharacteristicsCharacteristics
Example: HRExample: HR
Accidental Stumble throughchange
Hires what’savailable; hopethey work out
Repeatable Set of rules forachieving changeemerge
Common hiringritual to get newskills
Defined Rules broadened;metrics in place
Knowledge-based recruitand screen
Managed Objectives clarified,rules refined,accountability
Individualizedemployeedevelopmentprogram
Mastered No longer rule-based; actions byprinciples
Environmentenables self-development
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Reusable-reconfigurable-scalableAgility is accentuated or inhibited by the design ofkey enterprise systemsBalance between rigidity (where nothing happens inresponse to change) and chaos (where changes arenot discriminated)Ten RRS principles:
Self-contained units (separable, self-sufficient)Plug compatibility (share defined interaction)Facilitated re-useFlat interaction (peer-to-peer communication)Distributed control (directed by objective, not method)Deferred commitment (commitment late-binding)Evolving standards (standardized inter-component interact)Redundancy and diversity (duplication for capacity;failsafe)Elastic capability (component population can be incr/decr)
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Collaborative learning mechanismsDisagreement Others can challenge concepts and
conclusions individuals take for granted
Alternatives Others will offer alternative concepts andconclusions to individual perceptions
Explanation Externalizing internal thought transformstacit knowledge into explicit knowledge
Internalization Participative dialog conveys concepts thatintegrate with internal knowledge
Appropriation How one’s concepts are adopted by othersputs the concepts in new perspectives
Shared load Multiple levels of thought are explored andintegrated simultaneously
Regulation Consistency is monitored and discussedfrom multiple viewpoints
Synchronicity People tend to help each other achieve amutual level of understanding
Indi
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