In the face of uncertainty around the world, companies need to be in a position to react quickly to conditions in flux. They need agility.
A primary ingredient of agility is the ability to respond quickly to challenges in the environment. Constant adaptation is one way to make that happen. In terms of how to
achieve constant adaptation, there are two ways to consider: frequent planning cycles and the corporate concierge.
Frequent Planning Cycles: Established financial planning is time consuming, costly and largely obsolete in today’s fast-moving world, where the window available to make crucial decisions is compressed. Focusing on performance goals that are months or years away creates tunnel
vision, making it impossible to respond to important signals from the market. Agility entails a fast, flexible response to the external environment.
The Indian automaker Mahindra & Mahindra is an organization that takes frequent planning to new heights. They have honed their capability to change on the fly because they have compressed their planning cycles into a monthly exercise. This is not the way GM, Ford or even
Toyota is set up to operate. But at Mahindra & Mahindra, constant adaptation (not just a readjustment of a five-year plan) is a way to respond to a changing world. They compress
the time from idea to action.
The Corporate Concierge: Without a way to capture ideas and trends, organizations that are large and dispersed can suffer when information escapes without a trace because there is no existing process to capture it.
The corporate concierge — a compression tool that optimizes relationships with external partners (customers, suppliers and vendors) — puts more power into each interaction by centralizing knowledge and channeling it up the chain of command. Creating a corporate concierge— a single point of interaction for dealing with outside companies and analyzing key intelligence — improves competitiveness by channeling important information to the right places. It is also a powerful catalyst for cross-pollination, helping to create synergies between business units and building bridges across silos.
Strategy has traditionally been a process driven from the top down. A few senior executives in the strategy department are charged with looking into the future and developing a plan. Everyone else sees the plan in its polished form when it’s past the point of no return. But it is people who witness the specter of change (and experience it firsthand) who are best equipped to plan a response.These people often reside at the lower tiers in the organization— closest to the front line.
When was the last time you heard a CEO present a new strategy and finish like this: “Now tell me everything you think is wrong with this. Help me poke holes in it.” This seldom occurs in the West because designing strategy is considered to be a reflection of a CEO’s intellect, and it
becomes a measure of his or her success. Thus, a challenge to strategic direction is taken as a personal affront.
Yet in many rapidly changing environments around the world, the exact opposite occurs. In Dubai, for example, this type of sentiment is common: “We know this strategy is about 90 percent correct, now let’s share it within the company and get some feedback.” They know from experience that getting a strategy right on their own will take twice as long — and the market will have moved on. It is built into their process to get input from the employees
who are closest to front-line customers.
Bottom-up strategy is an expansion tool. It calls for empowering many more people to get involved in strategy creation, and it opens up new options.