What are Agile and Resilient Organizations?
In today’s world, emergent technologies, COVID uncertainties, and socio-economical unrest are constantly disrupting the business environment. This has been especially true in the wholesale and distribution industry. Resilient Organizations with agile processes have shown better results when it comes to adaptation and recovery.
In this article, I will explain the difference between Agile and Resilient Organizations, what the benefits of each one are, and how to apply them to strengthen our operations.
What are Resilient Organizations?
Resilient organizations are those that rebound and prosper after business disruption because they’re adaptive, agile, and sustainable. Resilient Organizations have resilient leaders who see change as opportunities for continued growth rather than a source of anxiety and fear. Response, recovery, and contingencies are the basis of resilience. The concept of resilient organizations is becoming so relevant that ISO Organization issued a guideline to achieve resilience in its ISO 22316 directive.
Resilient Organizations may have the following benefits:
- Get more committed employees: An important part of a cultural implementation of resilience is to help your team understand what the business is about and how to plan things effectively to make sure that goals are met.
- Establish the right priorities: Unlike the stress management model that creates panic and distress, resilience teaches us to stay calm because we know we will get through the challenge.
- Promote positive and proactive attitudes: Negativity is toxic in the workplace and, while resilience will not eliminate it, it will encourage your people to take greater responsibility for what they can do.
- Ability to respond and adapt: Overcoming difficulties and changes has become the new normal. Your resilient team members roll with these challenges and recognize that this new reality is a part of their workplace.
- The learning perspective: Victories and failures happen. Resilience helps with both. Celebrating success is central to resilience strategies as it helps build confidence. Conversely, when a failure occurs, resilience helps your team accept it, and more importantly, analyze what could have been done differently.
What is an Agile Organization
Agile is a term initially used to describe software development management, emphasizing incremental delivery, team collaboration, and continuous planning and learning. The term was coined in 2001 in the Agile Manifesto. However, these principles have applications, not only in software development but in any type of organization.
Agile organizations are those capable of adapting and reacting quickly to changing circumstances in the market and workplace. They embrace a complex and unpredictable environment by adopting fast learning and decision cycles, and building a network of empowered teams and individuals. An organization that has incorporated the agile principles might expect the following benefits:
- Faster response to changing customer needs
While agile organizations maintain a traditional top-level hierarchical structure, the rest of the organization is essentially autonomous and have related team systems. They have a shared purpose and a vision focused on understanding the needs of their customers and organizing to respond to market changes regardless of their origin.
- Committed employees.
By investing in people’s development, agile companies build a strong community of empowered employees. Inspiring leadership and a people-centered organizational culture are key to connecting employees to a company’s vision and purpose.
- Open communication.
Adopting transparent and open communication methods makes it easier for teams and individuals to obtain the information needed to make correct decisions. This is done faster than they would in a system that enforces communication structures defined by detailed policies and protocols for each eventuality.
- Fast learning and decision cycles.
In order to respond quickly to an unpredictable and ever-changing environment, agile organizations have short learning and decision cycles. This allows them to make small, continuous, and focused changes that add value incrementally.
General Electric, Cargill, Adobe, and Accenture are examples of companies that have successfully made the transition to an Agile company.
Resilient Organizations vs Agile Companies
Resilience and agility are highly correlated concepts and essential to adapt to sudden and unexpected changes. But, by their very definition, we can see that they are not the same:
Resiliency: The capacity for resisting, absorbing, and responding to sudden changes.
Agility: The capacity for moving quickly, flexibly, and decisively.
Resilience is related to mind and cultural settings whereas Agility is related to physical response. A person or an organization can have all the possible combinations of these two traits:
- Neither resilient nor agile: these organizations are doomed since they are not prepared to adapt and respond quickly. For example, COVID regulations shut down our main source of income. We panic and don’t know what to do.
- Resilient but no agile: these companies will be able to recover from sudden changes but might lack the flexibility to do it at the required speed. In the same example, we activate a contingency plan to compensate for lost income and reduce costs; but the internal bureaucracy hinders a rapid deployment of the action plan.
- Agile but no resilient: They have the build to react quickly under changes, but might lack the organizational mindset to deal with the stress of change. Continuing with the same COVID example: we quickly reduce staff and set up a remote operation, but get stressed because we have no clue on how to cope with the negative impact of the situation.
- Resilient and agile: these are the true winners. They react at the speed required by the situation.
As you might see, they are not the same but they are quite complementary. The curious fact is that organizations blending both concepts are rarely seen.
Advantages of a Resilient and Agile Organization
Applying an agile methodology in the resilient distribution or wholesale operations has many benefits.
- Better visibility of the entire supply chain, allowing organizations to anticipate and prevent potential disrupting events before they become an issue.
- Improve time to react to changing customer demands.
- The organization will become more responsive and resilient to sudden changes.
- The increased visibility and shared responsibility intrinsic to Agile principles enable a continuous cycle of efficiency improvement.
Tips to build a resilient and agile organization
Effective leadership: One of the most important factors driving strong organizational culture is leadership. Resilient cultures begin with engaged leaders that understand and support employees. A lack of senior leadership support creates risks of a disengaged workforce and therefore weak company culture.
Transparency and communication: Communication is a powerful tool for driving behavior and creates open conversations on key topics. Corporate intranet platforms (for large organizations) and regular departmental meetings (for smaller companies) are two of the mechanisms used to promote transparent communications.
Soothing Workplace: The workplace can be a stressful and overwhelming place, especially when undergoing changes or disturbances. Employees are taught to separate work from their personal lives and check their feelings at the door. However, taking a closer look at remote workers, the thin line between family and work grows even thinner. Instead of encouraging employees to keep to themselves, build a more social and safer work environment.
There are various digital tools that can help HR and talent teams improve employee collaboration. You just have to choose the one that corresponds to the needs of your employees and can make them feel better in the workplace.
Complexity and accountability: Globalization is a typical challenge that tests the resilience of organizations almost every day. Today many businesses operate across multiple time zones, geographies, and departments. To function effectively at this level of organizational complexity, it is necessary to increase cooperation and information sharing, while establishing shared responsibilities across the whole team. Integrated software solutions such as ERP + Warehouse Management + Route Accounting, can provide the necessary tools to do this.
I hope this article has been helpful. I will continue to publish information related to Warehouse Management, distribution practices and trends, and the general economy. If you are interested in this article or want to learn more about Laceup Solutions, register to keep you updated on future articles.
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