An article by Fabio Caversan originally posted at Forbes here.
Agility is a business buzzword you hear more and more often these days. While the term may be somewhat overused, its proliferation reflects the growing understanding that a company’s ability to operate flexibly, to pivot to new processes or priorities to reflect market or consumer shifts, and to make smarter and more strategic decisions quickly and efficiently is absolutely essential in today’s competitive marketplace.
In business, as on sports fields, agility doesn’t just confer a competitive advantage; it can make the difference between wins and losses.
In recent years, the proliferation of new digital tools and technologies (collectively categorized under the catchall term Industry 4.0) has made previously unimaginable levels of operational agility attainable across a broad spectrum of brands and businesses. Powered by enhanced connectivity and extraordinary new data gathering and data management capabilities, companies are able to leverage real-time information and new insights into more informed decision-making and swift and seamless operational/production changes.
As important and as valuable as it may be, agility should not be the end goal. Agility enables your organization to react swiftly to changing market conditions and helps leadership focus on strategic decision-making. As such, it is a key ingredient for a successful digital transformation.
High Stakes
The kind of foundational changes that take place during the digital transformation process are inherently risky efforts. The rewards for a successful transformation are significant, but the risks are formidable. Big changes and new processes come with uncertainty and ambiguity. This is why an agile approach is the de facto vehicle for taking a digital transformation from concept to reality.
An agile methodology can help you manage and mitigate those risks, limit your exposure and have more certainty about outcomes — all without compromising the collaboration and cocreation that are so pivotal to sustainable organizational success.
The bottom line is agile methodologies can help:
- Manage uncertainty.
- Mitigate risk.
- Target and achieve specific outcomes.
- Clearly define responsibility and accountability.
Here’s what that looks like:
Bite-Sized Chunks
Successful digital transformations require comprehensive planning. That planning process should be a collaborative exercise (and can be helped along even further through the insight and input of a trusted partner with proven expertise in planning and executing digital transformations). Even more important than the contents of the plan, however, is the structure of the plan.
Digital transformations are disruptive, and it’s important to navigate them in short-duration increments. A series of two- to four-week sprints is ideal. Breaking the process up like this allows maximum accountability and leads, through an ongoing process of testing and troubleshooting, to more successful outcomes.
If smart, incremental planning is a prerequisite, successful execution of those plans is equally critical.
Execution Excellence
Contrary to what might feel intuitive, execution excellence isn’t about getting it right the first time. Perfection is unattainable, and striving for it can actually be counterproductive, compromising your company’s agile footing by limiting your options and making it difficult to recover quickly from missteps. The path to success is a winding road. There will inevitably be bumps in that road, but the goal is to fail fast, minimizing rework, limiting losses, and learning and building as you go.
A well-designed digital transformation process proceeds in small bites, with companies either validating what works or quickly recognizing there’s a better way forward. If you can learn and adapt quickly without getting sidetracked or wasting too many resources, you should be able to gradually and continuously increase velocity and productivity throughout the digital transformation process.
Risky Business
While greater flexibility, connectivity and agility are the end goal, the bedrock across which that journey takes place is built on reducing risk. Disruptive projects that change the way your business works and/or the way you interact with your customers or professional partners are, quite literally, tricky business. Integrating AI and machine learning tools and technologies involves complex processes and projects, and these are almost never cookie-cutter solutions.
But agile methodologies can reveal not only pain points and challenges but also exciting new opportunities. They can enable a global automotive brand to rapidly roll out a prototype and generate a quick validation of workability and added business value. For a competitor looking to get to that place, the agile digital transformation might take several years.
But with collaborative planning, short-duration evaluation cycles and a well-executed transformation process (that includes constant and periodic measurement of performance against that plan), a more agile, flexible and capable future is achievable.
