Post on 04-Aug-2020
transcript
© Richard Welke 2002
Mike Gallivan
Lars Mathiassen Richard Welke Duane Truex
MIT 8699: Organizational Agility
© CEPRIN (2007) MBA 8125 Organizational Agility 2
Agenda ! The agility challenge ! Sense-and-respond ! Response ability
© CEPRIN (2007) MBA 8125 Organizational Agility 3
Topic one
© CEPRIN (2007) MBA 8125 Organizational Agility
Why do we need agility?
4
Art: Jamcracker
© CEPRIN (2007) MBA 8125 Organizational Agility 5
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.
© CEPRIN (2007) MBA 8125 Organizational Agility 6
…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
© CEPRIN (2007) MBA 8125 Organizational Agility
! An operating strategy? ! An embedded culture? ! A business-engineering discipline? ! An IS development methodology? ! A business-systems architecture? ! A broad competency across the enterprise?
! Agility is Risk Management: decreasing vulnerability and risk by increasing options and predictability
What Is Agility?
From Dove
© CEPRIN (2007) MBA 8125 Organizational Agility
Cats are the icon of agility
We agree that cats are agile. Why?
Aware, Nimble, Focused on value.
But on a hot tin roof they're out of control. Why?
- Info overload. - Lost awareness. - Inability to create options.
Up a tree they're catatonic. Why?
- Paralyzed with fear. - Lost awareness. - Inability to create options.
From Dove
© CEPRIN (2007) MBA 8125 Organizational Agility 9
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 forces
Organizational forces
IT forces
Work forces
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
© CEPRIN (2007) MBA 8125 Organizational Agility 10
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
© CEPRIN (2007) MBA 8125 Organizational Agility 11
How to design agility? ! 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
1. Top-down 2. Synergy 3. Relationships 4. Environment 5. 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
© CEPRIN (2007) MBA 8125 Organizational Agility 12
Topic two
© CEPRIN (2007) MBA 8125 Organizational Agility 13
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
© CEPRIN (2007) MBA 8125 Organizational Agility 14
Learning
Mission and Policy
Command& Control
Management system
Structure functional hierarchy
Strategy • Objective • Plan
Context Purpose and Bounds Adaptive structure
A closed system
External Signals
Internal Feedback
COMMAND-AND-CONTROL Assumption: Predictable change
Goal: Efficient enterprise
SENSE-AND-RESPOND Assumption: Unpredictable change Goal: Adaptive enterprise
Coordination of capabilities
Commitment management
© CEPRIN (2007) MBA 8125 Organizational Agility 15
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
© CEPRIN (2007) MBA 8125 Organizational Agility 16
People in Roles
Accountable for
Outcomes
Processes that Learn
Sense
Decide
Act Interpret
• 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?
© CEPRIN (2007) MBA 8125 Organizational Agility 17
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
© CEPRIN (2007) MBA 8125 Organizational Agility 18
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
© CEPRIN (2007) MBA 8125 Organizational Agility 19
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
© CEPRIN (2007) MBA 8125 Organizational Agility 20
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?
© CEPRIN (2007) MBA 8125 Organizational Agility 21
Topic three
© CEPRIN (2007) MBA 8125 Organizational Agility 22
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
© CEPRIN (2007) MBA 8125 Organizational Agility
Agility
Knowledge Management
consists of practices and processes for
to have awareness to enable response
Concepts That Enable Agility
Response Ability
• in time to select actions • of what markets (will) need and why • of what customers (will) value and why • of what partners (will) value and why • of what you (will) need and why • of your capabilities/competencies/talents • of what has to be learned/unlearned • of who needs to learn/unlearn something • of the risks • of the dynamics • of reality and how it bites • ... KM fuels effective decisions
Enterprise Agility
From Dove 2005
Value Propositioning
to select actions
© CEPRIN (2007) MBA 8125 Organizational Agility
Agility
Knowledge Management
consists of practices and processes for
to have awareness to enable response
Concepts That Enable Agility
Value Propositioning
to select actions
Response Ability
• in time to respond effectively • establish/change value targets • establish/change excellence definitions • build new business processes • evolve business process framework • which standards to adopt • seek/abandon/align with new partner • seek/abandon/align with new market • assemble new configuration • prioritize/reprioritize development • how to mitigate risks • ... VP-ing fuels effective response
Enterprise Agility
From Dove 2005
© CEPRIN (2007) MBA 8125 Organizational Agility
Agility
Knowledge Management
consists of practices and processes for
to have awareness to enable response
Concepts That Enable Agility
Value Propositioning
to select actions
Response Ability
• in time to innovate and react • in systems that have to respond • to the unexpected • to the anticipated • to internal situations • to external situations • with systems designed for response • with systems managed for response • ... RA fuels viability and leadership
Enterprise Agility
From Dove 2005
© CEPRIN (2007) MBA 8125 Organizational Agility 26
Change proficiency ! Measured by: elapsed time to change, cost, predictive
quality, latitude for change (scope)
Innovative Fragile
Agile Opportunistic
Response-ability States
Proactive proficiency (Leadership)
Rea
ctiv
e pr
ofic
ienc
y (V
iabi
lity)
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
© CEPRIN (2007) MBA 8125 Organizational Agility 27
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)
© CEPRIN (2007) MBA 8125 Organizational Agility 28
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
Indi
vidu
al
Col
lect
ive
© CEPRIN (2007) MBA 8125 Organizational Agility 29
Intelligent Enterprise System Framework
An Intelligent Enterprise … exhibits goal seeking behavior, exercising its potential for agility by understanding the business situation it is faced with, learning and adapting continuously as the situation changes, and demonstrating sustained achievement of purpose.
Systemic Goals• Recognize opportunity• Take advantage of opportunity• Recognize threat• Minimize impact of threat
Key Principles/Concepts• Knowledge management• Response ability• Reactive and proactive• Dynamic integrity
Key Subsystems• Change proficiency• Adaptable structure• Knowledge portfolio• Collaborative learning• Decisive action• Competency and talent
Intelligence is related to the volume of the pyramid. The depicted framework is influencing the strategies developing at Silterra, a new semiconductor foundry. Intelligent Enterprise is being investigated by The INTENT Alliance (INTelligent ENTerprise, www.intentalliance.net) starting in 2002. Those interested in participation may contact Jack Ring at jring@amug.org
ResponseAbility
DynamicIntegrity
Reactive andProactive Balance
Competencyand Talent
CollaborativeLearning
DecisiveAction
Resource Portfolio Chang
e Prof
icien
cyAdaptable Structure
KnowledgeManagement