27 Mar Why organisations will need to adapt to an ‘agile’ world
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Digital ecosystems, hyper-competition and hyper-disruption will change the way companies need to operate over the next decade. As a new era of business dawns, we will see the smartest companies change their organisation structures in order to remain competitive, execute more quickly, and ultimately become more nimble. In this new ‘Agile Age’, companies who fail to adapt will struggle to innovate and maintain growth.
The problem with conventional resourcing strategies
Historically, we have seen companies seek to build expertise and agility using specialised teams from outside the company. More often than not, this model was based on ‘corporate consultants’ advising ‘corporate clients’, resulting in a fairly narrow perspective of innovation that had little impact on the internal culture of a company. In more recent times, we have seen a more creative and integrated approach, where internal teams are built around ‘knowledge clusters’ and external innovation incubators came together to drive change. Today, this is still very much the standard approach but one that will not fair so well over the next decade as companies struggle to keep up with a hyper-disruption and competition. For those working with multiple specialist consultants or working in disparate teams, the challenges of conventional resourcing strategies will come as no surprise.
Inefficient team structures.
The transfer of knowledge between teams and specialist groups is fraught with inefficiency, bias and endless miscommunication. If you take a specialised technical development company and combine them with a specialised creative agency, you do not always make a step change in the efficiency of communications or valuable innovation. The more likely outcome will be two polarised groups of people trying to combine a set of very specialised skills. The other issues created here is that we maintain a degree of segmentation between innovation and operational teams, resulting in confusion and a lack of cultural change across an organisation.
Recruiting multiple specialist skills or suppliers is expensive. Given that many careers are still built with a specialised focus on a specific industry or function, we see an increased number of resources needed to cover the broad range of skills and perspectives needed to successfully innovate. Outsourcing specialist capabilities or operating external innovation hubs was once a very popular option in business, but there was again an inefficiency in communications, increase in cost and a lack of internal ownership. The continued use of ‘innovation’ and ‘digital’ advisors, not seasoned entrepreneurs, also maintained a convention of high fees with limited provable value. In an environment where companies can no longer rely on ‘cash-cows’ and traditional ways of doing business to survive, the conventional approach to innovation and agility is still causing escalating costs and profit reduction.
A lack of execution skills from senior employees and advisors.
The hierarchal nature of company structures has for a long time promoted an up-flow of power, but also an outflow of operational skills. As people move upwards in their career, there is a tendency to loose operational skills and replace them with managerial or strategic skills. In the worst cases, the entire concept of cross-disciplinary learning and the honing of front-line skills vanish with seniority. The resulting organisation contains expensive resources that don’t have the skills to dig deep and get things done when crisis or disruption occurs. This does not distract from the importance of strategic or leadership skills, but it does highlight the wastage and inefficiency that happens when deep business skills are left behind as people rise up the career ladder. The use of lofty advisory services and consultants can also cause similar issues if they often lack the ground-up experience to execute new ideas from scratch. As agility becomes more critical to business survival, companies will need to flatten their structures and ensure that at every level of the company, from external consultants to internal staff, each resource has the skills to play a direct role in solving problems and executing ideas.
Digital-innovation bias and a lack of ‘value innovation’.
In the face of continued market disruption, we have seen c-suites across the globe increase their appetite for rapid innovation. It is also true that we see the majority innovation directed towards technological and digital change. One reason for this is that many advisors and innovation hubs are following the hype built around digital innovation without a well-rounded perspective on the value it can (and can not) bring. There is an ongoing risk that advisors with a self-interest in digital propagate myths about the value digital innovation before considering its real ability to make a step change for the clients they work for. If not managed correctly, this rather narrow focus on innovation can cause problems for the companies it is meant to be helping.
We have seen many occasions where digital hype clouds smarter innovations that could deliver cheaper, quicker and more valuable innovation. We have certainly seen shareholder money spent on poorly thought-out mobile applications that lose traction almost immediately as they are soon made redundant by venture-backed startups. Another problem we see is when new technological innovation is proposed even when it has limited applicability to a given industry. When resources are scarce, and cultural change is paramount, overly complicating innovation can make it harder for employees to embrace. This sadly reduces one of the key objectives for many executives; to embed innovation within the culture of an organisation.
The problem with placing hype before consumer or business logic is not only seen within innovation labs and advisory companies, but also in the Venture Capital space. A bias towards trends and the fear of missing out sends billions of dollars flowing into dubious business models and saturated markets. Take the view of Tim Culpan in his recent article on the questionable logic involved in the $450m investments given to bike-sharing startup Ofo. Time will tell if this investment comes back to haunt them, but in any event, a lack of rational decision making is all too evident. It is important for every organisation and every business leader today to remove bias towards hype so that innovation has a better chance of succeeding.
We would all agree that digital innovation should still feature high on the executive agenda, yet what is needed is a broader perspective of innovation that moves away from popularised bias. More often than not, it is better to focus on consumer and business value and then see how digital innovation can support this, not the other way around.
A new approach to resourcing
Companies should now consider moving away from general consultants and more towards proven entrepreneurs. They will benefit from recruiting staff and engaging external suppliers that bring a broader range of perspectives based on ground-up experience, not theory. The most ambitious companies should reduce the use of multiple specialist resources, but instead, find those who can flex more easily as business priorities change.
In the next era of business, this organisational change will be lead by a new type of worker at every level of the company. We will see the rise of those who can bring creativity yet apply this across disparate industries and execute change using deep operational skills. Using the analogy of a hair comb, with a wide horizontal spine with deep vertical teeth, the next generation of super employees will be what we refer to as ‘comb-creatives’.
They will bring it all together.
If we look at the skills needed to launch a new product idea, it would likely include a number of areas from financing and recruitment to branding and user engagement. If separate people (or external advisors) were engaged to execute a new idea, there will be limited efficiency gains and no explicit reason that communications between each group will result in more cost-effective and improved execution. Comb-creatives will remove these problems. The very fabric of comb-creatives means they are rarely beholden to blinkered thinking. They will bring a broad knowledge of disciplines yet with deep skills to deliver. Instead of inefficiency and increased cost, comb-creatives will create efficiencies through a mashup of skills, experience, and creativity across different industries, cultures, and knowledge. The more comb-creatives that exist inside and outside an organisation, the fewer resources and time will be needed to achieve innovation.
They will embrace disruption and drive ecosystem growth.
In a globalised and digital world, where companies and consumers increasingly cover many segments and geographies, comb-creatives will use a broad understanding of consumers and environments to help companies grow. As companies pivot and control whole ecosystems of products, comb-creatives will be the leaders of disruption and the resources that fit across multiple verticals. A new wave of companies will increasingly expand into multiple verticals. Uber is both a food delivery, ride-sharing company to chauffeur service. WeChat is both chat app, bank and almost everything else you can imagine. Traditional business will increasingly innovate outside their comfort zones, building more digital products and services in unfamiliar areas.
They will move beyond job titles to deliver innovative execution at every level.
Comb-creatives will not only bring creativity. They will be business people, designers, coders and leaders all in one. They will have the skills to get something done on their own and also lead a team to new heights. They will instil a new culture of effective innovation within an organisation. At more senior levels, comb-creatives will no longer sit back as a dictatorial CEO or Manager, they will get stuck in and still drive visionary change. Already companies such as the Swedish firm Crisp are actually operating without a specific CEO role at all. For early-stage companies, it will be hugely valuable and cost effective to have a leader who can execute tasks themselves. No longer will a job title determine value, comb-creatives will transcend a job title to work across many areas. It will not only be start-ups and the new age companies that will benefit from comb-creatives, traditional corporates will unleash their untapped value to become more agile and progressive.
They will remain relevant as workforce requirements and industries change.
With increasing competition and business disruption, comes increasing pressure to change resources and adapt. Start-ups and early stage companies are more becoming more prevalent and their very nature is changeable. Corporates are also changing at a rapid rate. In all situations, having resources that are able to flex and maneuver as priorities change will be a key element to reduce costs and stay ahead of the game. Instead of facing redundancy costs and increasing recruitment bills, comb-creatives will be able to weather the storm as they connect, innovate and add value across multiple functions.
They will bring unbiased, unconventional and value-based thinking
For companies to adapt to a broader perspective on innovation, a cultural change will be needed at every level of an organisation. This will require a focus on each employee embracing a more entrepreneurial mindset from multiple industries and consumer markets. We will see Comb-creatives apply lessons from both startups and large enterprise, to deliver unconventional innovation.
Comb-creatives will all step out industry walls and bring a more holistic appreciation for all types of business. Their attitude to continuous learning and data-driven thinking will remove industry bias and myopic thinking. In a world where a chat app can become a trillion dollar banking institution, as with WeChat, thinking out of traditional industry verticals is paramount. In addition to thinking outside of industry verticals, Comb-creatives will also naturally move away from hype and trends. This will produce a stronger focus on value-innovation instead of technically complex innovation. A new mindset on innovation will help all companies innovate more effectively. If a bank was to think outside of the FinTec trend, there may be more room to deliver real consumer value and break away from what everyone else is doing. This approach is not only logical, but it will likely result in ideas that are easier to execute and that deliver more opportunity for ‘competition-beating’ disruption.
Latest posts by Stephen Barling. MD and Chief Creative @ Greyspace (see all)
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