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What is Leadership’s Role in Aligning an Agile Organizational Culture?

I often encounter work-related initiatives to improve a client’s product development and delivery. One is the agile or lean approach. I was invited to speak to the Agile Leadership Network of DC by my friend Manjit Singh, who is also the co-author of The Lean Playbook. While I am not an expert in all things agile, I spoke to the group about the importance of understanding the context in which they work, that is, the organizational culture.

It takes a disciplined and creative mind-set to adopt and promote agile or lean processes, but key to success is working within an organization that values inclusive and purposeful communications that is able to manage change and ambiguity, and consistently demonstrate commitment to quality and integrity as core characteristics. It means more than adapting new practices, and includes building one’s emotional intelligence, and moving from models of how to do work to how we value work.

Business agility is “distinct qualities that allow organizations to respond rapidly to changes in the internal and external environment without losing momentum or vision. Adaptability, flexibility, and balance are three qualities essential to long-term business agility.” Of course, part of this is the capacity to use data and technology to quickly and flexibly respond to new market information, hence AGILITY. The LEAN organization uses fewer resources, teams (preferably small), and timelines to get results.

Duena Blomstrom says that “To be agile is a transformative new way of looking at how we do things. We are asking humans who have been indoctrinated in a very different way of work to forgo what they have learned and used before with varying degrees of success and understand there is a vastly different way of doing things that will enable them to do more, faster.”

This tracks with our work in organizational change and change management, which is about enabling people to adapt new behaviors related to their work, in dealing with others both internally and externally, and to implementing more efficient and effective work and communications protocols.

 It all begins with clearly defining the company’s vision and strategy, and this is where leadership is vital. This simple illustration shows the relationships among the various components of an organization’s culture.

A company’s culture reflects the vision/mission, strategy, values, cultural norms, and behaviors of the company; while the employees bring along the sum total of their idiosyncratic, professional, and life values that define them. Integrating all of these within the context of an agile initiative is challenging and complex.

It is my contention that agility is critical for the collection and feedback that enables this model to be sustainable and innovative. If the work is not sustainable, then why adopt it? This is where the role of leadership begins and continues.

It is not uncommon that a company’s culture is perceived as the main obstacle to introducing and managing change, in this case the utilization of agility principles. This is culture beyond ethic, national, gender, and other stereotypes. It is how people feel about the work and their expectations.

Ira Kaufman, the guru behind entwine digital, first introduced me to the notion of the transformational mindset, which begins with purposeful leadership, that quality of recognizing that digital transformation begins at the top and incorporates values, behaviors, and a strong sense of community, both internally and externally. The central role of values is evident throughout his work, and emphasizes collaboration, empathy, good will, shared purpose, clarity, consistency, and commitment to change, values that MUST be modeled by the organization’s leadership.

It is apparent that without leadership at all levels committed to the transformation of business practices, agility will not drive the changes in processes, production, consumer relations, and quality control that enable the agile eco-system to thrive. This is as true for business and industrial entities as for agencies, NGOs, and any group that serves a client/customer/membership base. Those who have not yet adopted this approach to managing change often lack access to the data that drives teams looking for solutions.

Thoughtful leadership knows, as Peter Drucker is alleged to have said, that “Culture eats strategy for breakfast.” Leaders who ignore building a dynamic culture will fall back on acronyms, electronic messaging, and the overuse of consultants as substitutes for appreciating how a diverse organization nurtures and sustains deliberate and inclusive change strategies.

I used the word sustainable before, a term not common in the agile literature. Yet, it is essential. To succeed, beyond being perceived as another development tool, the agile mind-set, internalized in the company’s DNA, encourages traits that are desirable in any setting: collaboration, focus on results, short-term delivery, and customer focus. The agile approach is sustainable.

The key understanding is the connection between being agile as a tool and attitude, how it translates into an organization’s communications protocols, and how it is expressed as a function of the organization’s culture. Leadership is essential to enabling and awarding agile teams so that the culture supports a sustained practice of being agile. It starts at the top.

 

Leading in an Agile World – Can We Usefully Redefine Leadership?

A colleague of mine recently circulated an email asking several of us to respond to his juxtaposition of leadership and catalyzing, reflecting the notion that the former is passé and the future is ‘catalyzing’ as the key concept. The response was quick and definitive…although “Concepts of leadership are evolving to keep pace with the disruption, transformation, and agility demands of today’s organizations,” as I noted in my last blog, most respondents believe that leaders still need skills grounded in experience while integrating catalyzing skills  for existing and future challenges.

This I believe is the core of agility: recognizing, mobilizing, enabling, empowering, and sharing leadership throughout the organization so that the culture reflects a blend of human and digital capacity geared toward innovation and collaboration. Now the challenge comes in several forms: the first is that not all companies are equal, in size, complexity, structure, and business model. Some are client or customer centric and have high brand recognition. Others offer specialty products that require strong R&D components to be competitive; while others are service-providers to emerging niche markets. Mixtures of bricks and mortar and virtual POS and distribution are not uncommon.

So while the structures and operational priorities may be dissimilar, the missions and goals can be reduced to “make money, keep customers happy,  stay happy.” This core of profitability and satisfaction are at the center of how leadership, whatever styles are effective, is exercised. Why “styles?” We learned ages ago that leadership defined by functions can range from directing and evangelizing to coaching and coercing, and at least a dozen more characteristics.

Leadership is a shortcut to conflate those traits that enable leaders in whatever context to lean forward, lead from behind, and construct and organizational culture that emphasizes continual innovation, adaptation, and a competitive edge, mirroring Jack Welch, former CEO of GE’s mantra of change leadership.

Michael Hamman and Michale K. Spayd put it this way in their White Paper, “The Agile Leader.” “An organization’s agility is not a function of “‘scaling’ current team-based delivery practices…Simply put, agile leadership entails a move from driving to results to creating environments that generate results.

Agile leadership is no accident. There is a clear methodology for enacting agile leadership.” They use the phrase ‘enterprise agility’ to express their assumption that “At the heart of sustainable enterprise agility is an adaptive, agile leadership.”

To value leadership in both its complexity and its simplicity, it is vital to remember that at the heart of leadership principles are, at least for now, human beings who make assumptions every day about how to succeed in a fluid and competitive environment. Back to Hamman and Spayd, “Fundamentally, it is as much about the interior—of individuals, of organizations—as it is about the exterior. It is as much about developing people as it is about building systems. It is as much about creating an agile culture as it is about adapting structures and processes.”

Catalyzing in this context is about aligning talent, resources, systems, objectives, and expectations to support agility, so that a catalyzing leader is an agile leader dedicated to mobilizing a coherent, consistent spirit of innovation shared by company teams that have transparent, respectful, reliable, and valued communications with their counterparts in- and outside the organization.

One could argue that because of the impact of technology and the yet to be understood tsunami called ‘AI’ that leadership is more difficult in today’s environment. On the other hand, it is also reasonable to point out that leadership in the past did not have the data, modelling options, robust algorithms, and highly developed technologies as learning aides. The uncertainty, complexity, and fluidity of today’s competitive environments, at all levels, demand a differently tuned skill set, which is why sometimes the strong survive, and sometimes they don’t. Change management has to begin within the individual, which is why companies have to seriously invest in driving agility throughout their organization and its processes and relationships.

The difference I believe is enabling the agility of leaders, teams, policies, communications, and the workforce to recognize, embrace, and capture change capabilities in order to survive and thrive. For success, mindsets need to be rewired to accept the inevitability of change and the acquisition of skills required to master its impact. These skill sets must extend beyond their particular silos and empower staff to collaborate across boundaries – and be rewarded for it. As employees recognize and accept agility as a means to mobilize and execute, they then become team members whose communications with others both assume and reflect the cultural values of the organization.

So for me, this is the role of leadership at all levels: to build consensus and collaboration around company strategies and communications that build agility internally and in its external relations.

 

Leadership in an Agile World

Concepts of leadership are evolving to keep pace with the disruption, transformation, and agility demands of today’s organizations. I can remember working in the early 70s on executive leadership programs at the Institute for Training and Development at GSPIA at the University of Pittsburgh, where we always began with McGregor’s X&Y theories of leadership and Contingency Theory.

There have been numerous attempts since then to blend the attitudinal and behavioral characteristics of leadership in an inclusive concept. For example, a quick Google toggle gave me: [https://www.google.com/search?q=leadership+theories&ie=utf-8&oe=utf-8&client=firefox-b-1]

  • Great Man Theory
  • Trait Theory
  • Behavioral Theories, Role Theory
  • Participative Leadership, Lewin’s leadership styles
  • Situational Leadership, Hersey and Blanchard’s Situational Leadership
  • Contingency Theories, Fiedler’s Least Preferred Co-worker (LPC) Theory
  • Transactional Leadership
  • Transformational Leadership

And these styles:

  • Coercive
  • Authoritative
  • Affiliative
  • Democratic
  • Coaching
  • Pacesetting

So has this made us any wiser in terms of promoting a single leadership concept and style? Jack Welch, former CEO of GE and business savant, has much to say about core issues related to corporate culture, from leadership and strategy, to processes and metrics. Most of his statements can be found at Jack Welch College of Business, Sacred Heart University, Fairfield, CN [https://www.sacredheart.edu/academics/jackwelchcollegeofbusiness/aboutthecollege/ , and theJack Welch Management Institute at Strayer University [https://jackwelch.strayer.edu/ ].

First off, as some observers have pointed out, GE is no longer the leading conglomerate it once was as that model of aggregating unrelated businesses did not survived the last century. So listening to his take on what makes a leader great needs to be taken in the context of the environment in which that leadership is exercised [https://www.youtube.com/watch?v=ojkOs8Gatsg&t=142s ]. Bottom line, it’s about people, regardless of the impact of AI on the workforce, it’s still about your human capital.

Welch says that a leader must be the chief “meaning” officer, clearly explaining where the organization is heading, why it is going there, and what the benefits are for all the stakeholder/employees. He noted that “people hate change,” and that is why clarifying the vision, mission, and strategy of the company is job #1. He then goes on to say that it’s important not to get rid of all the clutter because these linkages help breakdown silos and it’s more important to “broom away” the stuff that is in the way rather than the stuff that employees see as relevant to their everyday activities.

Finally, he talks about the importance of the “generosity gene” that celebrates when anyone accomplishes something. This includes having fun and celebrating all the little victories, not just the big ones.

Another perspective on leadership comes from an India-based consultancy http://thoughtleadership.in/.

From their experience, leadership is central to managing change. “A key leadership challenge is to initiate and lead systemic changes that will set the organization up for success in future. Indeed, nothing else perhaps sums up why we need a leader in the first place.”

In this regard, they emphasize the complexity and uncertainty in which leaders operate, “There are no guarantees that the chosen direction and pace will lead to a better situation, for the changes are too complex for anyone to understand and discern, let alone predict and assure.” One of the key demands on leaders is their ability to motivate and excite team members to embrace change and make it happen.

They identify 5 Key Behaviors that characterize a winning organization. It has a Growth Mindset, seeking new challenges that stretch their physical or cognitive skills; Staff have T-Shaped Skills reflecting both their expert knowledge and their ability to collaborate across boundaries. This leads to a willingness to help others create value, which builds a sense of reciprocity, which supports the development of winning teams that adapt as needed, with a core value of taking initiative.

How these notions come together in an agile organization is the topic of my next blog.

 

Global business in emerging markets: Transformational partnerships

At a recent corporate presentation in the Maghreb on the potential transformational effect of foreign direct investment (FDI), I focused on two points: the notion of impact investing and the corollary dynamic of how FDI impacts human development beyond the benefits of economic growth.

The discussants were company leaders and employees discussing how to build a globally competitive company culture integrating local sensibilities and priorities with technologies and industrial know-how developed abroad.  The initial discussions, following the usual pattern of strategic planning sessions, concentrated on building a common vision and purpose among the participants. The vision that coalesced was then defined in a series of core values and principles that would become the “brand” of the emerging company culture.

As I listened to insightful and well-presented points of view, it became apparent that as the new company drills down from values and principles to behaviors, it is critical that both sides examine the scope of their assumptions and expectations. While there was a strong consensus around the vision and principles, agreement was not so clear on the behaviors that would then follow. It reminded me of the iceberg metaphor in cross-cultural communications, where the core values, principles, attitudes, and beliefs are unseen below the waterline, while the behaviors, which are visible above the surface, are subject to interpretation by the other party who cannot see below the waterline. The lesson: we make judgments about others based on what we see, rather than what we know lies beneath the surface.

Given this observation, I asked the group to consider a broader perspective, moving above their particular iceberg to consider the implications of the new partnership beyond the terms of the company’s goals and objectives. I began with what I know best—defining the mission of the new company and how training impacts its brand.

The Arab uprisings pointed out the need for rapid economic growth to stimulate broad and meaningful employment and drive education relevant to the marketplace. This is not a simple task; it is not merely about providing skills training to enhance work opportunities; it is about the core aspirations of people and what this means to their country. Employees and employers are not the only beneficiaries of FDI; all of the country benefits from a more capable and effective workforce.  The workforce that is emerging will have better technical capabilities, operational sensibilities, and soft skills that enable them to define options and make choices about their futures.

In the MENA countries that I have surveyed in terms of technical and vocational training needs, soft skills are defined as more than communications and teamwork; they include the capabilities to pursue a career and anticipate and grasp needed learning opportunities. This involves creativity, innovation, and judgment. Thus, these enhanced soft skills are more complex and encourage what is called “global dexterity,” blending awareness and knowledge that lead to effective behaviors in the workplace while securing one’s core values.

The Arab uprisings remind us that there is a related issue that needs attention: that what we are dealing with is more than better training, education, and employment; Arabs are redefining the social contract that existed between regimes and their people. At the heart of it all are the issues of identity and the basis of legitimacy of the governments: political, religious, ethnic, cultural, etc.

Historically, the social contract was an exchange between a government that provided order, stability, and a bit of prosperity to citizens who felt protected and secure enough to have sustainable livelihoods.  That balance has, in many countries, been shaken to a large degree by demographics, the global economy, technology, more gender equality, a reduction in social distance, and education, which are providing the ingredients and tools for reshaping and recalibrating social contracts. So it is this redefining of the social contract that is at the heart of the struggle for political legitimacy and national identity.

In this context, skills training and professional development enable employees to access careers and benefits that equip them to be part of a generational and transformational shift. These empowered employees become capable participants with tools to achieve aspirations for themselves, their families, and their children. This confluence of skills and knowledge has the capacity to impact the debate on the social contract, which has implications for the MENA region. This may sound a bit grandiose, but it is a historical lesson that economic development and human development go hand in hand. What was once considered a business relationship has the potential, in today’s highly connected and able public space, to be a link between global markets and local human development.

By raising the performance of employees to better engage the global economy, we build a platform for moving beyond issues of economic growth as both employees and employers seek growth opportunities that require more effective governance and use of human capital. People become internal change agents that provide the role models, mentors, and early adaptors missing from the broad business landscape in the MENA countries. These local transformation agents link with others throughout the region and larger markets to promote global dexterity – adaptive behaviors built around core values.

And what is the external partner’s role in this? The concept is “impact investing,” which focuses on projects that have social and environmental benefits and generate profits. At its core, impact investing reflects business models that are sustainable, advance human capital, provide opportunities for community development, and have results that are attractive to long term relationships with the private sector. The key consideration is to move beyond social and community outreach that is beneficial in the short-term but does not significantly alter the future prospects of the communities touched. By promoting an investment perspective that recognizes that broader and deeper FDI requires long-term returns, countries and companies make mutual cause for mutual benefit. Governments have their role to play but no more than is usually needed to attract serious FDI, ranging from needed infrastructure to incentives for training, use of local materials, and similar inputs.

There are several revolutions going on in the MENA and elsewhere, some messy and unwieldy while others are barely perceptible. The role of workforce development in crafting solutions should not be overlooked or minimized as simply giving people jobs. Companies exist for a purpose, to be profitable and grow. Employees share these goals, to profit from their employment by acquiring skills that free them to know and exploit opportunities for themselves and their families. Partnerships between local and international private sectors that are emerging will, in many respects, help governments in their mission to build a new social contract with their citizens by greatly reducing demands for counterproductive government intervention in the economy. Good business making better jobs and great citizens and governments is a goal worth pursuing.