Agile organizations: How companies can become agile through effective organizational design
Companies are currently facing many challenges. The many crises require regular and rapid adjustments to maintain their ongoing business. This is because digital transformation has contributed to the fact that economic rules and framework conditions considered safe for many years are now only valid to a limited extent. Agile companies enjoy the advantage of reacting quickly and flexibly to new circumstances and goals within a short period due to their organisational structure and culture. The concept of organisational design can be a practical guide in this process. But how exactly does it work? A corporate design is based on the requirements of the company and team to function in the respective context of the organisation. This is because the same principles apply to organisational development as to products: The requirements and the environment are constantly changing – thus, the transformation process to an agile organisation should be elegant.
First and foremost, there must be a willingness to change the organisational structure and, thus, the corporate culture. This concerns management and executives as well as all employees. Therefore, the process of organisational design addresses all stakeholders in a company.
Success is much more likely if the entire organisation becomes agile and all roles communicate with each other and across teams in this way. The organisational design defines which areas, levels and functions exist in the company and which rules will be used to work together in the future—the company's size - whether a big player or a start-up - is irrelevant. Fast-transforming companies overtake those that adapt too slowly to the ever faster-changing market conditions. Examples like Nokia or Blackberry show: Market leadership in a particular segment no longer protects against losing relevance. But implementing agile methods in the workflow can be challenging. The basis for this is a framework that defines which patterns and principles will apply to the organisation in the future.
Agile transformation is possible in every department
Although the agile methodology is often used in software development, it can also be applied in many other areas, such as marketing, finance and human resources. But what characterises agility in the first place? The core idea is that an agile team works in incremental steps to realise a project. In the process, customers regularly seek feedback to ensure that the end product meets their requirements. Unlike traditional project management, there is no linear process with phases such as planning, design, development, testing and deployment - and there is no fixed completion date with a finished product at that exact time.
Spoilt for choice of method
While the Waterfall method requires extensive planning at the beginning, an agile team following the idea of organisational design regularly reviews and adjusts the planning. Collaboration between staff and departments is also usually different: while Waterfall project teams are predominantly more hierarchical and rely on separate departments, in the agile approach, cross-functional, self-organised teams work together to achieve a common goal. The essential project management methods include Scrum, Kanban, Extreme Programming or Lean. Which set of rules is best suited in each case depends, among other things, on a company's corporate culture and working methods, the composition of an agile team and the employees' affinity for agility. Scalability requirements and other parameters and factors, such as industry-specific compliance requirements, can also speak for or against specific frameworks. The best-known agile frameworks include SAFe (Scaled Agile Framework), Nexus, LeSS (Large Scale Scrum) and the Spotify model. These allow agile transformation to be implemented at a more significant organisational level. The main differences are in scaling, structure and understanding of roles and integration. The main differences between these frameworks are how the work is organised and carried out, the roles and responsibilities of the employees, and, last but not least, the specific applied practices.
Fixed or individual framework?
Companies that want to set themselves up as an agile organisation can rely on an established framework or combine several. In this way, they create an individual framework that is adapted to their own needs. It is important that the decision for one of these models must be made at the beginning of the agile transformation in order for agile working to succeed.
An external view is helpful
So much for the theory - but what about implementation? Many providers accompany companies in the selection of a framework. These offers are usually characterised by the fact that they are designed to last several weeks. We at diconium, on the other hand, offer a lean solution: In four days, we work with the companies to develop the organisational patterns of the future agile organisation and how they will arrive at this corporate form. For this purpose, we have developed the Adaptive Organisation Design Sprint (AODS). This is a fast sprint of 4 days of 4 hours each, which helps to achieve results quickly and to define the pattern designs of the future agile organisation as effectively as possible. Our Adaptive Organisation Design Sprint - after the corresponding preparatory work and clarification of all relevant framework conditions - runs over four days with four hours each. The process is facilitated by a person who knows the standard agile models and frameworks and understands both the business (model) and the operations of the company and the industry. The four days build on each other, so all participants should be involved.
