1. MBA 8220: Organizational Agility
Mike Gallivan
Lars Mathiassen
Richard Welke

2. Agenda
The agility challenge
Sense-and-respond
Response ability

3. Topic one
The agility challenge

4. 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-why
Processes, e.g. practiced patterns of play, contribute to know-how
Values, e.g. priorities and outcomes, contribute to know-why
The challenge of the players is to respond in-flight to opposition moves and conditions of play. This requires swift interpretation of now, optimal execution of practiced playing capabilities, and capability to improvise.
The challenge of the coach is to create and maintain an environment in which players become empowered to execute. This requires continuous practicing of individual and collective patterns of play combined with cultivation of individual and collective capabilities to adapt.

5. …and Other Sports “I skate to where the puck is going to be”
Wayne Gretzky
“I get the rebound before the shot is taken”
Bill Russell

6. Changing Competencies Distributed decision making
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 of external and internal forces”
Economic
forces
Business
Organizational IT
Work
Globalization
Emerging
Markets
Employment
unrest
Cost
Reduction
Shared
Processes
Distributed
buyers
Sourcing options
Funding models
Changing Competencies
Leadership
Distributed decision making
Enterprise
Architecture
Real-time
Infrastructure
Priority
projects
Distance
Collaboration
Virtual learning
Global
diversity
Ambrose & Morello, Designing the Agile Organization, Gartner 2004

7. Can people operate effectively and efficiently as conditions change?
What Enables Agility?
Provide continual feedback
Build contextual orientation
Communicate meaningfully
Invest in knowledge networks
Awareness
Do people know that significant change is afoot and the impact it will have?
Encourage reassignment
Develop new competencies
Assemble diverse teams
Use multiple service providers
Flexibility
Are people equipped to respond to a wide variety of business conditions?
Reward collaboration
Build learning portfolios
Expand decision-making
Adopt consistent processes
Productivity
Can people operate effectively and efficiently as conditions change?
Organization
agility
Ambrose & Morello, Designing the Agile Organization, Gartner 2004

8. How to design agility? Plan-driven Event-driven
Executives as architects
Systems design complements process design
A system is a collection of elements that interact to produce an effect that cannot be produced by any subset of the elements
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
Top-down
Synergy
Relationships
Environment
Event-driven

9. Topic two
Sense-and-respond

10. 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

11. Coordination of capabilities
Learning
COMMAND-AND-CONROL
Assumption:
Predictable change
Goal:
Efficient enterprise
SENSE-AND-RESPOND
Assumption:
Unpredictable change
Goal:
Adaptive enterprise
Mission and Policy
Context Purpose and Bounds
Adaptive structure
Coordination of capabilities
Commitment management
Command& Control
Management system
Strategy
Objective
Plan
Adapting
A closed system
Structure
functional
hierarchy
Internal Feedback
External Signals

12. Command-Control vs. Sense-Respond
Mindset
Command-Control
Sense-Respond
Context
Efficient system in a semi-stable environment
Adaptive system in an unpredictable environment
Know-how
Embedded in processes
Embedded in people & processes
Process
Mass production
Modular customization
Performance
Efficiency and predictability
Flexibility and responsiveness
Profit
Margins on products
ROI and economies of reuse in modularization and response
Organization
Functional and sequential activity
Networked and parallel activity
Information
Functionally managed and optimized vertical views
Focused on information needed to respond to requests
Market
Sustain share of market
Sustain individual customers
Execution
Strategy executed through plan
Strategy executed through adaptive business design

13. People in Roles Accountable for Outcomes
Processes that Learn
What does each of our external customers need?
What does each of our internal customers need?
What are the emerging market opportunities and needs?
Which technological innovations are available?
How is the competition changing?
Sense
People in Roles Accountable for Outcomes
Act
Interpret
Decide

14. Responsive Governance
Ensure local autonomy
Facilitate overall coordination
Provide a context for business behavior (Know-why)
Share organization’s “Reason for Being”
Share governing principles
What will we always do
What will be never do
Autonomy to respond to external and internal customer requests
Shared strategy across processes
Explicit will do and will never do to support process execution
Coordination mechanisms across processes

15. Dynamic Commitments
The organization must know how to effectively execute its core processes
The organization must dynamically manage who does what when in response to its environment
Processes that respond to external and internal customer requests
Processes that improve core capabilities
Dynamic resource allocation across processes

16. Modular Processes and Outcomes
Products and services must be modular to facilitate swift customization and innovation
Processes must be adaptable to suit different contexts and needs
A component-based architecture of core products and services
Customized solutions to external and internal customers
Dynamic configuration management
A minimal set of shared core processes
Complementary processes for collaboration with key customers

17. Assess business and process agility
What kind of sense-and-respond mechanisms are in place to address environmental changes?
Do these mechanisms effectively address predictable as well as unpredictable changes?
What kinds of governance mechanisms are in place to ensure process performance, coordination with partners and other processes
Capability to identify process innovation opportunities?
How are commitments managed and adjusted to accommodate process performance and change?
To what extent are processes and outcomes designed to allow for local adjustments and easy reconfiguration?

18. Topic three
Response ability

19. Response ability
Knowledge portfolio management (KPM) + Collaborative Learning Facilitation (CLF)  Knowledge Management (KM)
Change Proficiency (CP) + Reusable and reconfigurable Structure (RRS)  Response-ability (RA)
RA + KM  Agility
Dove: Response Ability: The Language, Structure and Culture of the Agile Enterprise, Wiley, 2001

20. Change proficiency
Measured by: elapsed time to change, cost, predictive quality, latitude for change (scope)
Maturity Stage
General Characteristics
Example: HR
Accidental
Stumble through change
Hires what’s available; hope they work out
Repeatable
Set of rules for achieving change emerge
Common hiring ritual to get new skills
Defined
Rules broadened; metrics in place
Knowledge-based recruit and screen
Managed
Objectives clarified, rules refined, accountability
Individualized employee development program
Mastered
No longer rule-based; actions by principles
Environment enables self-development
Innovative
Fragile
Agile
Opportunistic
Response-ability States
Proactive proficiency (Leadership)
Reactive proficiency (Viability)

21. Reusable-reconfigurable-scalable
Agility is accentuated or inhibited by the design of key enterprise systems
Balance between rigidity (where nothing happens in response to change) and chaos (where changes are not discriminated)
Ten RRS principles:
Self-contained units (separable, self-sufficient)
Plug compatibility (share defined interaction)
Facilitated re-use
Flat 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)

22. Collaborative learning mechanisms
Disagreement
Others can challenge concepts and conclusions individuals take for granted
Alternatives
Others will offer alternative concepts and conclusions to individual perceptions
Explanation
Externalizing internal thought transforms tacit knowledge into explicit knowledge
Internalization
Participative dialog conveys concepts that integrate with internal knowledge
Appropriation
How one’s concepts are adopted by others puts the concepts in new perspectives
Shared load
Multiple levels of thought are explored and integrated simultaneously
Regulation
Consistency is monitored and discussed from multiple viewpoints
Synchronicity
People tend to help each other achieve a mutual level of understanding
Individual
Collective