This article was first published in Computer Weekly.
Most organisations now accept there is a need for greater business agility – to be able to respond to change in an effective and dynamic way, to increase the level of experimentation to trial new offerings more easily and to unlock their employees’ potential. However, organisational inertia is significant. The bureaucratic burden of established control mechanisms and governance all too often gets in the way and stifles the innovation potential.
Changing the way works gets done in an organisation and improving levels of agility requires systemic change to mindset, processes and, ultimately, culture. Such systemic change requires significant leadership commitment from the very top.
However, many leaders who successfully progressed to a position of power in current structures often lack the knowledge of how to effect such a significant cultural and transformational change. And even where leaders do have the knowhow, do they have the disruptive remit and the time alongside their “business as usual” activities to deliver a transformational change?
We are familiar with the case for introducing a disruptive influencer in the boardroom to drive significant change. Take the example of the chief digital officer (CDO) – a now familiar role on the board of many organisations. They are often recruited when a chief executive officer (CEO) realises the organisation does not have what it takes to transform with its current capability and structures.
However, the CDO, with a primary focus on the digitisation of an organisation’s products and services, is not the same as delivering business agility. After all, many organisations deliver effective externally facing digital offerings designed and built by the metaphorical “digital garage” bolted on to the side of the organisational “house”. Frequently, the rest of the organisation (the house) remains battling with legacy working practices and technologies. Put another way, improving time to market for products and services depends on offline processes, governance practices and organisational structures just as much as digital solutions.
The same applies to the chief information officer (CIO)/chief technology officer (CTO) – with a remit to deliver technology change and IT system stability. However, this role does not have the mandate to change broader governance processes and the way work gets done in an organisation, and risks relegating agile to be an IT thing focusing on agile software methods.
So perhaps it should be the chief operating officer’s (COO’s) remit? After all, the COO should have the responsibility for systemically driving improvement to operations. The Harvard Business Review highlighted in 2006 in an article entitled “Second in command: the misunderstood role of the chief operating officer” that the COO is a diverse role with no standard set of responsibilities. Mostly, however, the role has accountability for executing day-to-day line-of-business responsibilities on behalf of the CEO – the role is less so about transformation.
So how does an organisation become more agile if it isn’t the CDO, CIO/CTO or COO’s remit?
For many organisations, this responsibility should be embodied within a new entrant to the board – the chief agility officer (here called CAO for brevity, but not to be confused within the chief administration officer).
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The CAO would be solely responsibility for transforming the way work gets done, not what work gets done. Therefore the heads of service lines/business units and the COO maintain all their focus on executing against operational objectives and strategy. The CAO takes accountability for measuring the way work gets done, identifying systemic improvements and agreeing with her or his peers on the board how these improvements should be delivered. The remit is intentionally broad and can include:
Improving levels of business agility requires culture change and commitment.
Any organisation wanting to transform needs a CAO to provide this leadership from the very top of the organisation. Organisation culture is shaped by its leaders, and a CAO, operating at board level, is required to shape the management team to adopt the right culture.
Crucially, business agility is a continuous focus. Just as Toyota is still trying to make itself leaner (five decades after implementing the Toyota Management System), so should all organisations relentlessly continue their focus on improving their levels of business agility.
Simon Masters and Tess Bregman are business agility experts at PA Consulting Group.