A responsive organization is able to react rapidly to changes in its operating environment and is explored in the second video in PopTech/Microsoft Office Envisioning’s Future of Work series.
As old economic models moved slower, business success hinged on being reliable and consistent, on building trust with a stable product. This was a time of information scarcity, where efficiency was the core competency. You knew what you had to do, what to make, how many needed to be made. It was enough just to be efficient at production and then scale up.
Now things are faster and more interconnected, economies have information abundance at their core, instant feedback the norm. Previously remote locations and events can now affect your business, making the future more volatile, making business and product prediction more unstable and unpredictable.
“So you got to have adaptability to respond to changing conditions so organically. It has to be in the DNA of the organization so that it doesn’t have to come from top down directives that says, “Now we are going to produce a new version of this.” It allows the organisation to learn and adjust or adapt automatically.”
Gen Stanley McChrystal, McChrystal Group.
An example of adaptability can be seen in the Case Study highlighted in the video. Zara, the international fashion company, began to run its facilities at 75-80%. Why? It enabled the company to become responsive to trends in customer demand. Running their manufacturing at less than efficient levels, combined with distributed authority over design decisions created the space for flexibility, for responsiveness. They were able to get new product (or retooled product) to market over 6 months quicker than their competitors.
Generations of leaders have been taught to focus on methods that produce efficient results. Now ideas around experimentation, empowerment and transparency actively work against this traditional paradigm. As we saw in the first video, The Changing World of Work, organizations need to match their internal environments with their employees social expectations in order to drive engagement.
Similarly, organizations will need to internally realign to adapt to market expectations and consumer demands in a faster way. The speed of decision making needs to change, hierarchical response times are too ponderous, not reflexive enough to adapt to the uncertain, complex and unknowable future of the interconnected global business environment.
The Responsive Organization accepts this new reality and works towards improving mechanisms for responding to consumer demand and its ability to learn from its environment earlier than competitors.
Again we are left with many questions. How can this be done? What elements need to change, which resources to be re-aligned? How can leaders empower their people and structure their organization to become more adaptive?
The next video ‘Elements of Responsiveness’ will start to answer these questions and unpack important characteristics to watch for..