The future belongs to the adaptable
Deloitte Adaptable Organization 2.0
The adaptable organization is a fundamental shift from today’s operating and management philosophy. One that enables large-scale global organizations to align to the needs of their customers’ and exploit market opportunities on a continuous basis.
Welcome to the fourth industrial revolution
Moving forward in today’s digital age involves a complete shift in mindset, culture and management philosophy.
The collective immune system of many global businesses is increasingly fragile. They may easily crumble under the constant barrage of technological disruption, and rapidly shifting consumer expectations.
Compounding this challenge? Today's management systems, structures, and talent strategies tend to be outdated; designed for an era when size and enduring stability defined the competitive advantage.
Amidst these changes a new breed of organizations is emerging. One that is shifting away from command-and-control cultures.
In the fourth industrial revolution, successful organizations are transitioning to management practices that harness diverse crowds of people who are engaged and energized. People focused on surprising and delighting customers, unencumbered by excess bureaucracy, pursuing both personal and business goals with purpose.
Organizations that once benefited from a size and scale strategy have rapidly disappeared from the S&P 5001 and original Dow Jones index.
Today, just 14% of CxOs report a high degree of confidence in their ability to make the changes that the digital revolution requires.
Beyond the C suite, employees’ trust and confidence in business and government is at the lowest levels in decades.
The Adaptable Organization
Adaptable organizations exist in purpose-driven ecosystems.
In these unpredictable times, organizational survival relies on the understanding that organizations do not exist in a vacuum. They exist within a broader external ecosystem; united by a specific customer-centric purpose that is constantly evolving in order to remain relevant.
To be adaptable, organizations must consider the full ecosystem of partners. This includes the mix of partners and how they interact, along with critical contract parameters that need to be synchronized.
Adaptable Ecosystems:
- Leverage external communities partnerships and alliances
- Empower employees to respond to customer needs
- Able to respond to demands with a scalable workforce
- Are positioned to do new stuff, quickly and flexibly
Adaptable organizations center their organizational design around value and how people actually work.
When change is predictable, stable organizational hierarchies can support order, clear decision-making, and functional silos to ensure maximum efficiency. However, in an era of exponential change, traditional organization models cannot keep up.
Layers of the Adaptable Organization
- Stable Core
- Mission Led Middle
- Agile Outer Shell
Traditional Organizations:
- Aren’t positioned for flexibility in an evolving organization
- Don’t capture informal behaviours and interactions
- Don’t involve the larger external ecosystem
Adaptable Organizations:
- Prioritize informal relationships and networks
- Center around the customer
- Put the team over hierarchy
- Flexible, incremental changes
Adaptable organizations balance adaptability and efficiency through team design.
Conventional wisdom believes that high-performing individuals deliver organizational performance. Adaptable Organizations place greater emphasis on the team and unlock individual performance through team composition and new ways of working.
Adaptable Teams:
- Move from formal hierarchies to a network
- Have as much freedom and accountability as possible
- Get faster feedback and increased ability to collaborate
- Find it easy to get the right input and advice from SMEs
Adaptable organizations unlock resilient individuals through adaptive talent programs.
Individual resilience is at the core of the adaptable organization. In order for the organization to become adaptable, individuals must first become resilient, be comfortable with navigating uncertainty, and embrace change as the new normal.
Adaptable Workers:
- Have a global mindset
- Utilize design thinking
- Thrive on challenge
- Seek diverse perspective
Adaptable organizations set out to reimagine the digital workplace.
The workplace is no longer a single location separated from home. It now involves digital experiences, informed by four key factors: worker, work, workplace, and work-tech.
Adaptable Workplaces:
- Understand relationships individuals have with their work
- Start with the desired business outcomes
- Identify personas needed to accomplish outcomes
- Map technology capabilities to deliver workforce experience
Personalized & intuitive
- Reduces complexity and makes it easy to complete work
- Delivers personalized content to people at just the right moment
- Provides bite-sized, curated information in the flow of work
People focused
- Responds with agility to changing needs that affect well-being
- Inspires two-way dialogue so people can improve their sense of belonging and connection to the mission
- Instantly resolves issues and enables self-service to easily get work done
Continuous innovation
- Informs decision-making and drives connectedness to the mission
- Undergoes regular, iterative testing of designs for continuous improvement based on user feedback to increase a sense of belonging
- Aims for quick releases across the organization and iteration rather than perfection
Connected
- Provides up-to-date, relevant content to strengthen people’s productivity and provide growth opportunities
- Creates opportunities to connect at work
- Collects actionable data and next-best actions to foster growth and well-being
Workforce-centric service
- Provides the workforce with solutions when, where, and how they need them – a secure, mobile first, omni-channel experience
- Provides people-centric, personalized support
- Embeds well-being into the work environment
Proactive and intelligent
- Transitions experiences from reactive, to proactive, to predictive
- Supports users by providing nudges and recommendations on unknown needs about their work
- Automates repetitive tasks so worker can focus more time on well-being and growth opportunities
In times of disruption, we can look to the past for inspiration.
Put yourself in the shoes of a business leader in the early 19th century. In the span of two decades, people and businesses had to adapt to a world turned upside down by the advent of flight, the lightbulb, telephone, and automobile.
In the midst of this radical change, some businesses not only survived… they thrived. Leading to the rise of new industries in finance, transportation, telecommunications, and energy.
Now, more than a century later, those businesses are in the cross hairs of large-scale disruption. Add to that continuously dropping levels of employee and customer engagement, and you have a perfect storm of externally-imposed change. Often followed by a lack of internal readiness to deal with it.
Today, we debate the same set of issues ad nauseum: enterprise agility, customer connection, being purpose driven, or simply breaking out of old hierarchical patterns.
And while global businesses are triangulating around a common target (ultimately aiming to increase their relevance to both their employees and their customers), very few organizations are doing something about it. And even fewer are becoming truly adaptable.
If history has taught us anything, it’s that those who adapt can carve new paths, build new legacies, and truly flourish.
Disruption is redefining strategy at a pace we’ve never seen before. Now we are reorganizing to keep up
An organizational redesign is political and personal – robust facts, as-is analysis, and data-driven objective processes are critical to overcome this. Most organizational reviews lack a systems orientation. Too much of the focus is on getting structure right, without looking at leadership, ways of working, and process.
How to design for the future. Journey through the adaptable organization.
Adaptability in organization design is about operating at multiple speeds. It boils down to building a strong/stable core, while introducing “an adaptable edge” that drives experimentation and new ways of working. Over time, the edge inspires the core. A big shift is underway as Organizations are increasingly judged based on relationships with workers, customers, and communities. Social capital is achieving new-found status, with 65% of CEOs rating “inclusive growth” as a top three priority.
55%
of global companies are functionally oriented.
75%
have some form of matrix management.
These models are slow moving and not responsive to change.
92%
of business leaders say getting a redesign right is a top priority for them.
50%
are in the middle of reorganizing how they work but need more support.
11%
feel confident in their ability to get it right with speed and scale.
71%
have seen some improvement in performance from their transition to a network-based organization.
In Deloitte’s survey of 10,000 business execs last year;
65%
However, say that most work is still organized along hierarchical functional lines.
In Deloitte’s survey of 10,000 business execs last year;