A Field Guide to the Agile Company

2. A Field Guide to the Agile Company
It was six o’clock on Friday evening and Charlie wanted to go home. It had been a long week. Make that
a long year. As the owner and CEO of his marketing company, he was responsible for the growth of his
organization and the performance of his two hundred employees. It was a position that he enjoyed and
gave him pride. The firm had done very well since he had founded it fifteen years ago, back in the days
when the Internet was more of a curiosity than a transforming force. Through the years he and his growing
staff had built the company, expanded their client list, created new operating divisions, penetrated new
markets, and made a name for themselves.
And yet at the beginning of a beautiful summer weekend, Charlie was behind his desk staring at a mountain
of paper. Reports, files, project schedules, forms – the documents seemed endless. When he looked at his
computer, with its jumble of files, his confusion only intensified. The contents of these files might have been
of only passing interest and their review easily put off until Monday, except for one unpleasant fact: Charlie’s
company was facing its fourth straight quarter of losses.
He could not blame the recession. It wasn’t for lack of potential accounts. His employees seemed to be
trying their best.
Charlie’s
company
was facing
its fourth
straight
quarter of
losses.
No, the problem was the worst kind.
It was undefinable.
After swallowing another antacid, Charlie shuffled through the stacks of papers. Somewhere, he knew there
was a report from the internet affiliates team. How were they doing on the new client acquisition effort?
And then, there was an update from the electronic media division. Was the big, new client on board?
Charlie’s attention wandered to the question of his vice president, who had just announced that she was
leaving. Had the headhunter been contacted by human resources?
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3. The hydra
monster was
While scanning his files Charlie came upon an ebook that a colleague had sent him. The file was called “A
Field Guide to the Agile Company.”
incapable of
making a quick
The title of the ebook made him pause. He sat back in his chair.
response...
“Agile,” thought Charlie. “That’s the last thing we are. I’d say we’re stuck in the mire. Up to our necks in
quicksand. Like a dinosaur trapped in the tar pits. Agile, we’re not. An ironic situation for a cutting-edge
marketing company.”
The problem, he realized, was that his company had gotten out of control. Not in the sense that, as the
owner and CEO, Charlie wanted to micromanage everything. Far from it! He would prefer to manage
less, not more. No, the problem was that his company had become a many-headed hydra, and none of
the heads knew what the others were doing. The hydra monster
was incapable of making a quick and unified response to either an
environmental change or an initiative from within.
Take the case of the Star Sales customer account. What should
have been a jewel in the company’s crown had quickly lost its
luster, and they were lucky that Star hadn’t bailed on them. The
goal seemed simple enough: position Star Sales as the premium
purveyor of consumer electronics in the college market. Young
people are first adapters, and will happily spend their cash on
new cell phones and sound systems. They quickly form brand
allegiances. They will stand in line in a hurricane to get the coolest
new gadget. But young people are nothing if not agile. The
competition for the college dollar is relentless, and one false move
can get you branded as yesterday’s news.
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4. Star Sales depended on Charlie’s company to stay on top of trends in order to
reach and hold this coveted market.
But that wasn’t happening. The MP3 player rollout had been a disaster, and Star’s
market share was stagnant. The attitude of Star’s execs towards Charlie was
becoming increasingly cool. Charlie had to come up with some answers fast.
It seemed to
Charlie that
instead of
being ahead
of the curve,
he was the
last guy to
know what
was going
on in his own
company.
He had tried to stay on top of the Star account. At the weekly managers’ meetings,
Charlie had demanded accurate reports and accountability. But all he got was
old data and finger-pointing. The website design guys blamed the art department
for being late. A key member of the media team was out on maternity leave and
no one had bothered to apportion her portfolio among other members of her staff. Two managers in
accounting disagreed over the company’s health care cost projections, so the issue kept getting kicked
down the road. The I.T. people insisted that the chronic network connectivity problems were the fault of the
national provider and they couldn’t do anything about it.
It seemed to Charlie that instead of being ahead of the curve, he was the last guy to know what was going
on in his own company. His clients, including Star, didn’t give a whit about his problems. They paid their
fees and they wanted results, not excuses.
Charlie closed the door to his office and opened “A Field Guide to the Agile Company.” What he read
came as a revelation.
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5. Recognize the Problem
Charlie learned that you cannot hope to improve a bad situation until you first recognize the problem. And
you cannot afford – as Charlie did – to let four quarters of mediocrity slip by before you wake up.
The opposite of “agile” is “rigid.” Like with the joints and muscles of humans, the onset of rigidity can
happen without warning. It starts deep within the organism and may not manifest itself for months or even
years. Over time, as people learn that mistakes are tolerated, inefficiencies accepted, missed deadlines
overlooked, and changes ignored, fatal rigidity grows and consumes more and more of the organization.
Even the best employees can be lulled into believing that the status quo is the way things should be done.
To a company in the cold grip of rigidity, it seems better to earn one dollar that’s guaranteed than to try to
earn two dollars that carries even a small risk. Stasis becomes the highest value. Exterior threats are better
ignored than confronted. What customers wanted last year is what they will want next year.
What are the signs of rigidity? Here are the key indicators:
Top-down management structure
If you think that it’s the CEO’s job to formulate policy
and pass orders down the chain of command the same
way the military operates, think again. A key element of Toyota’s takeover of the global auto market
was the company’s solicitation of ideas and input from the front lines: the workers on the assembly
lines, the engineers, the salespeople. In today’s complex and fast-moving business environment, no
CEO can afford to live in an ivory tower, and no CEO can afford to ignore the experiences and ideas
of the people on the front lines. By cutting yourself off from the employees in the trenches, you
deprive yourself and your company of consumer feedback, new trends at the street level, and ideas
formulated by your staff that can bring real value to the company.
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6. Blind adherence to tradition
There is a huge difference between a company’s traditions
and its values. A five-star hotel may strive to offer only the
finest in personal service to its upscale guests. That’s a company value that is deeply connected to
its brand. But if that same hotel refuses to put free wi-fi in each room because “that’s just not what
we do,” it’s digging its own grave. Superb customer service is an unchanging value, but that means
that you must make an effort to learn what your customers want and then provide it for them. This
attitude must inform the actions of every employee – at a hotel, that would include everyone from the
chambermaids and parking attendants to the CEO.
Misalignment of effort
Most companies have more than one department, and big
companies may have multiple divisions, each with dozens of
departments and hundreds of project teams. When rigidity sets in over time, teams and departments
become isolated. They exist in silos, separated from their neighbors. A project that requires the
coordinated efforts of multiple teams may suffer from delays and cost overruns because the teams
aren’t communicating and aren’t being held to the same performance standards. A project that is
critical to one team may be on the back burner for another. A delay experienced by one team – and
not corrected by swift action from upper management – can create frustration and anxiety across the
organization.
Fuzzy and late information
Founded in 1602, the Dutch East India Company grew to
become the world’s first multinational global corporation, with
commercial activities throughout Europe and Asia Pacific. In those days, the fastest way to get news
from Asia to the Netherlands was by ship. An event that took place in Japan would be reported six
months later by a sailing vessel docking in Amsterdam. For real-time business information, this was
as fast as you could hope for!
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7. Times have changed. If your desk is piled high with paper reports carrying yesterday’s date, you’re
dealing with old information. If you have weekly staff meetings where department managers dutifully
update you on their activities, you’re getting an old picture. If you need a committee to study a
problem for a month before making a recommendation, it’s likely that your competitors have already
begun a new initiative that will attack your market share. Slow communication fosters rigidity.
Turf tension
Why do employees defend their turf? Because they’re afraid. They’re
afraid of not getting credit. They’re afraid of becoming identified with a risky
idea that could fail. They’re afraid to risk their comfortable position. In any growing company, every
individual employee and manager needs to know exactly what they’re responsible for. This is called
accountability, and every organization needs it, but it must be flexible enough to allow for innovation.
It’s the job of the CEO to hire people who are smart and confident, and then let them shine. They
need to know that as long as the company thrives, they won’t get screwed by upper management.
It’s a team effort, and this must not be merely an empty slogan but a day-to-day reality that is backed
up by the full faith of the organization.
Characteristics of the Agile Organization
Knowing how to recognize a rigid organization is the first step. The next steps are to understand the
characteristics of the agile organization, and how to make the changes necessary to become one.
An agile organization is simply an entity – any entity – that behaves as a singular individual rather than as
a collection of parts. An agile organization is one that collects information, processes that information, and
then responds with no time wasted.
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8. Consider an example that nearly everyone can identify with: the pro football quarterback (choose your
personal favorite). The NFL quarterback has many responsibilities and can execute many plays, but the one
with the highest stakes is the forward pass. When attempting a forward pass, from the moment the ball is
snapped, the job of the quarterback includes:
1. Hurry back to a safe position away from the line of scrimmage.
2. Scan the field for your receivers. Chances are you have two or three receivers heading down field
simultaneously.
3. Monitor the progress of the attacking defensive linemen. These are huge men who, given enough
time (about three or four seconds is all they need to break through your offensive line), will slam
into you with enough force to cause serious personal injury.
4. See which receiver is in the clear. This may not be obvious. You have to know where your
receivers are going to be when the ball reaches them, which on a long pass can be up to one
second from now.
5. If necessary, dodge and weave away from the attacking defensive linemen and get to a safe spot.
6. Throw the football ahead of the chosen receiver.
7. Have faith that the gigantic defenseman running toward you will choose to avoid a penalty and not
flatten you after you’ve released the ball.
8. Option: If after a few seconds have elapsed and you both A) see no open receivers and B) see an
opening in the line, you can elect to run the ball yourself.
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9. If there is one quality that a pro quarterback needs, it’s extreme physical and mental agility. These seven or
eight steps take place within a period of less than five seconds. Within this short timeframe, the quarterback
needs to do exactly what you do on a daily, weekly, and quarterly basis: take advantage of opportunities,
assess internal strengths and weaknesses, and respond to external threats.
Another key to agility – and success on the playing field – are the contributions of the other ten players
on the field. No quarterback can do it alone. The success of each individual play, repeated over and over
again over the duration of the game, depends upon the seamless interaction between the players. This
seamless interaction extends to the coaching staff on the sidelines and right up into the owner’s box. A
business, no matter how large, is no different.
As the play unfolds, with split-second timing, every member of the team must both have a clear idea of the
mechanics of the play (where to run, whom to block) and respond instantly to real-time information (the
movement of all of the players on the field).
Many concepts of agile management apply during the kinetic action of a football play, but perhaps the
most salient one is the necessity to react quickly to real-time data and information. Information about
changing conditions must be both accurate and actionable. If the primary receiver can’t get open, then the
quarterback must shift his assets – his forward pass – to the receiver who is open. If no one is open, there
must be a default choice to either create a new initiative (run the ball) or protect the team’s field position
(throw the ball out of bounds). Business is no different. If you own a pizza company and you introduce
a new pizza topping and sales are dismal, you need to figure out the problem and fix it quickly. This will
require input from everyone from the kitchen staff to your marketing team.
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10. It may go without saying that, as a general
rule, the larger the organization the more effort
needs to be put into achieving a state of agility.
But even with thousands of employees, the key
is to start local – at the individual level.
Every employee, from the boardroom to the
mailroom, needs to feel valued, empowered,
and that his or her performance makes a
difference. These agile employees will then
populate agile teams, which in turn will create
agile departments and then divisions.
At its most fundamental level, all business
consists of individual person-to-person
interactions, taking place one at time, over and
over again. If each and every interaction is
agile, then the organization itself will become a
unified living organism, capable of both quick
response and directed action.
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11. About Kapta Kapta provides executives with a cloud-based system to clearly
communicate company goals, track every employee’s expected contribution and review overall status through a real-time dashboard. Headquartered in Boulder, Colorado, and founded in
2011, Kapta gives executives a clear line of sight into each team member’s performance and the
system’s easy-to-use alignment tools keep employees on track in less than five minutes each week.
Kapta’s intuitive input process virtually eliminates “work about work” and instead provides employee
alignment and executive feedback to successfully scale your business.
For more information, please visit
kaptasystems.com