The last decade was a time full of surprises; SARS, the burst of the dot-com bubble, September 11, Chicken Flu, the 2004 Tsunami, the fall of the real estate sector in the US with following crisis of major global banks, the closing of the Suvarnabhumi airport, H1N1, and many other events have shaken the economic environment of companies in Thailand and across the globe. And this will not change in the future.

The last decade was a time full of surprises; SARS, the burst of the dot-com bubble, September 11, Chicken Flu, the 2004 Tsunami, the fall of the real estate sector in the US with following crisis of major global banks, the closing of the Suvarnabhumi airport, H1N1, and many other events have shaken the economic environment of companies in Thailand and across the globe. And this will not change in the future. The rapid emergence of disruptive technologies, increasing social pressure due to globalization and global warming will lead to further events in the future that can dramatically impact the business environment and may even change the rules of whole industries. And there will be no way to predict what will happen. We know today that things will happen, but we don’t know the what and when.

This brings CEO’s in a dilemma. Shareholders expect their commitment to three, five or even longer term growth strategies, but it’s already clear that the underlying assumptions will most likely not hold stand. Some revenue streams may completely fall apart during the next planning period, but in return new opportunities that are currently not visible may come up. Consequently, rather than trying to predict the detailed strategies how to grow in the next 3-5 years, CEO’s are well advised to spend their time achieving one things: Business Agility!

“Business agility is the ability of a business to adapt rapidly and cost efficiently in response to changes in the business environment. Agility is a concept that incorporates the ideas of flexibility, balance, adaptability, and coordination under one umbrella. In a business context, agility typically refers to the ability of an organization to rapidly adapt to market and environmental changes in productiv e and cost-effective ways. The agile enterprise is an extension of this concept, referring to an organization that utilizes key principles of complex adaptive systems and complexity science to achieve success.“ (Source: Wikipedia)

In other words, if a company is able to improve business agility, it will be able to react to any future change in the economic environment, e.g. avoid major revenue losses during a crisis and take advantage from new opportunities that we can’t see today. Achieving Business Agility will be in many industries a good way to go to still fulfill shareholder expectations even though the world becomes more and more unpredictable. The world is moving faster, hence successful companies will also have to accelerate.

Here some ideas how to improve Business Agility:

Business Insight: It all starts with understanding what’s going on and what really matters. Establishing all kinds of processes and tools that provide top management with sufficient information about the status of the business helps to not only act faster on issues, it also enables companies to anticipate future events and become proactive about it. Tools available are for instance data mining, executive management dashboards, employee and customer surveys, focus groups, etc.

Lean, lean and again lean - processes and organization structures tend to become more and more complicated over time. As companies add new products and services, complexity usually increases exponentially. Therefore, companies must continuously review their processes, organization structure, policy framework and performance measurement systems and seek for opportunities for simplification. An effective way to do this is to establish continuous improvement processes.

Flexible IT systems - highly customized IT systems can become a bottleneck in changing business processes and introducing new products or services. New technologies such as Service Oriented Architecture (SOA) and the use of standard software packages such as SAP or Oracle, help prevent that IT is not becoming a limitation for business agility. But careful - the principle of simple and lean also applies in the IT context.

Employee Engagement - Organizations live from their people. In an agile organization, the best process and computer systems can’t replace motivated people that are willing to work with and for the company. Without engaged people, any attempt to transform the organization will be slow and ineffective. Therefore, leaders must focus on reducing any source of disengagement so that people ‘want to’ achieve during their working hours. Engagement surveys and focus groups are a good tool to identify measures to keep people committed to the success of the company.

Innovation Culture - To be able to identify and utilize new market opportunities, companies must innovate their products and services and also their internal processes. It’s not enough any more to wait for ideas of the CEO only or just copy what competitors do. Innovation must come from within the company, driven by the organization. By enabling people in the organization to innovate, i.e. achieving high innovation capacity, chances of break-through revenue or cost saving ideas can be increased significantly. Areas to look at are for instance channels and opportunities to generate ideas, free-flow of information, flat hierarchies, and empowerment of people to try things out and do mistakes.

Companies that succeed to establish an agile organization will be in a much more comfortable position in the future as they can react to any market movement quite quickly. They are also more likely to take advantage from future upcoming market opportunities as they can implement new products and services much faster than traditional static organizations.