The Secrets of Outcomes Agility

ARTICLE 

ABSTRACT
One of the biggest challenges enterprises encounter today is how to deal with disruptions caused by exponential change. Many organizations believed they could deal with the changes by getting their product development or IT teams to adopt an Agile framework, without realizing that enterprise agility goes much beyond agility in product development
and IT. 

This situation begs the question “what exactly does Enterprise Agility entail” and how could organizations consistently deliver outcomes, even when faced with exponential change. The answer to the question is Outcomes Agility, a key element of enterprise agility. 

This article attempts to provide an understanding of what Outcomes Agility is, and the capabilities an organization must build to enhance its Outcomes Agility.

 

KEYWORDS

Enterprise agility, outcomes agility, strategic agility, leadership agility, learning agility, strategic sensitivity, strategic response, collective capabilities, triple-loop learning

The Enterprise Agility University (EAU) recently launched its CCC® (Certified Change Consultant) certification program which is a unique program as compared to most others related to business agility or enterprise agility, in the sense that the CCC® program helps participants understand how cognitive neuroscience could be leveraged to facilitate effective change and enhance enterprise agility.

Cognitive neuroscience is one of the primary fields of neuroscience that focuses on the neural factors that underlie how the brain forms and controls thoughts, including but not limited to topics such as social cognition, consciousness, learning, memory etc.is one of the primary fields of neuroscience that focuses on the neural factors that underlie how the brain forms and controls thoughts, including but not limited to topics such as social cognition, consciousness, learning, memory etc.

The CCC® program equips the participants with a set of tools and models to facilitate lasting change so that each individual could choose to use one or more of those tools or models appropriate to the situation at hand. One such immensely useful model covered in the program is EAU’s Enterprise Agility Model which forms the foundation of the entire program, and is one that Change Consultants need to build a sound understanding of, to help infuse agility into the fabric of an organization.

The Enterprise Agility Model describes five types of agility that must be considered in order to holistically and sustainably build agility into an organization. One of them is Outcomes Agility that is the focus of this article. According to the EAU:

Outcomes Agility is about
delivering results
even during turbulent times
to respond to changing market conditions

Market conditions keep changing with time, whether times are turbulent or not. However, turbulent times, caused by events such as the recent COVID19 outbreak, serve as an acid test for organizations to demonstrate their agility to the world, and especially, to their customers. Organizations need to build Outcomes Agility in order to consistently deliver both customer as well as business outcomes, while maintaining or enhancing their organizational health, during turbulent times

Organizational health is about cultivating psychological safety and creating sustainable value in perpetuity
Enterprise Agility University

OUTCOMES AGILITY

I’d like to consider Outcomes Agility as a result of the interplay of 3 elements (see Figure 1 below) because they are closely intertwined with each other:

  1. Strategic Agility: The ability of an organization to align everyone in the entire business ecosystem to a single collectively defined vision, and to use it to purpose define and execute a strategy, that itself emerges over time through continually running market experiments to effectively adapt to changing customer needs [1]

     

  2. Leadership Agility: The ability to leverage collective intelligence to take wise and effective action amid complex, rapidly changing conditions [2][3]

     

  3. Learning Agility: The ability to learn from experience, and subsequently apply that learning to perform successfully under new or first-time conditions [4]
Figure 1. Outcomes Agility

Strategic agility itself is a result of 3 elements, which are again closely intertwined with each other:

  1. Collective Strategic Sensing [5]
    This is about continually “sensing” changes in the customer needs and business environment by defining strategic hypotheses, running market experiments, and capturing evidence to either validate or invalidate one or more strategic hypotheses.
    The term “collective” in the element name has special significance – it emphasizes that the responsibility for continually “sensing” changes in the business environment is taken on by all participants of the entire business ecosystem, rather than just one individual or group, such as the Executive Leadership team. The Leadership Team needs to foster “collective ownership” of the strategic vision and strategy, in addition to psychological safety, for this to happen. Another aspect of Collective Strategic Sensing is that it needs to be technology-enabled. Technologies such as artificial intelligence and big data can be leveraged to enhance the effectiveness and efficiency of Strategic Sensing.

  2. Tactical Response [5]
    This is about continually “adapting” the strategy to the changes in the customer needs and business environment, in response to the sensing; that is, the results of the experiments conducted and hypotheses validation.

  3. Collective Capabilities [5]
    By “capability” is meant “business capability”. Collective Capabilities is about continually identifying and closing the business capability gaps that prevent the strategy from being realized.

The elements Strategic Sensitivity and Tactical Response emphasize that “adaptive strategy” requires continual “strategic discovery” cycles rather than traditional strategy planning. There’s a major difference between the two, and understanding the difference requires a wholesale mindset shift, especially where the Executive Leadership team is concerned. 

 

A business capability represents “what” a business does, or specifically, a particular ability or capacity that a business may possess or exchange to achieve a specific business purpose or outcome.
Prasad Kamath

That’s where Leadership Agility comes in. Strategic sensitivity through hypotheses validation, followed by appropriate tactical responses essentially requires “triple-loop learning”, the essence of which is ascertaining “is our strategy itself still valid”. This is closely associated with the mindset shift alluded to above because most organizations are known to implement singe-loop learning, and occasionally, double-loop learning.

Implementing triple-loop learning effectively to enhance Outcomes Agility requires a major cultural shift, as well as Learning Agility. This is because in most circumstances, the Executive Leadership team believes that they “know” what the “right” strategy is, without being cognizant of the fact that in today’s dynamic and complex business environment, the “right” strategy continually shifts. 

This leads them to believe that they are responsible for strategy planning” which is interestingly considered to be an annual event, which when completed, the Execution teams must “take over”. This makes the strategy approach strictly top-down, without any provision to use market evidence from the Execution teams for triple-loop learning. That’s where Learning Agility comes in!

Without Learning Agility, the willingness of the Leadership team to allow (bottom-up) feedback from the Execution teams, and to use it to continually revise one or more elements of the strategy would be non-existent, thereby severely impacting Outcomes Agility

Without Learning Agility, leadership cannot be agile. In fact, Learning Agility is the foundation on which both Strategic Agility and Leadership Agility rest (see Figure 1). The Collective Capabilities element is probably relatively the most important because without the required business capabilities to realize strategy, even the best of strategies would remain only on paper. Organizations invest (or must invest) most time and effort in identifying business capability gaps, and closing them through multiple initiatives.

Doing this requires a clear “line-of-sight” from the organization’s strategic vision, through to the initiatives the organization undertakes. Without this line-of-sight, it would be impossible for organizations to figure out whether and how the business capability gaps have changed as different elements of the strategy change to adapt to changes in the business environment.

In summary, Strategic Agility, Leadership Agility and Learning Agility strongly support each other, and the strategic outcomes would be directly and severely impacted if any of them is missing or at a sub-optimal level.

 

WHY IS THIS IMPORTANT TO AGILE PRACTITIONERS, COACHES AND CONSULTANTS?  
Most agile practitioners, coaches and consultants possess skills to effectively operate only at the team level, and have never forayed beyond agile for IT or product development.

However, organizations have come to realize that unless they look at agility holistically, it would not possible for them to reap the benefits of agility. Additionally, an astronomical number of agile transformations have been failing because organizations fail to understand that transformations require more of a cultural shift than anything else, to be successful,
and hence, must be centered around people.

What organizations need is professionals trained and skilled in facilitating lasting change, and it’s no surprise that there’s a severe dearth of such professionals in the industry.
That’s the gap that the Enterprise Agility University intends to fill, with its focus onenterprise agility, and enterprise change facilitation. The Certified Change Consultant certification course (and Certified Strategic Leadership on Enterprise Agility certification) equips professionals with the skills essential to facilitate lasting change towards enhancement of enterprise agility.

REFERENCE

[1] Adapted from Lean-Agile Strategy: An Introduction by Lawrence Cooper
[2] Leadership Agility by Lawrence Cooper 
[3] Leadership Agility by Bill Joiner, Stephen Josephs
[4] FYI for Learning Agility, Korn Ferry International
[5] “Collective Strategic Sensing”, “Tactical Response” and “Collective Capabilities” are terms used in the official material for the EAU-CCC® and the EAU-CSL® certifications.

LAST SPACES AVAILABLE