Conscious Business Agility. Helio Borges
How to Make a Successful Enterprise-Wide Business Agility Transformation
Conscious Business Agility is the capacity to align leadership, culture, and business processes to be agile in strategy and execution, sensing the complex reality, adapting to it, and enacting the best future possibilities in the now.
The current disruptive conditions of the market force companies to change or to lose competitiveness. Therefore, they invest heavily in transforming their business processes but often need help to align those changes with their leadership, organizational culture, and structure. I explore that issue in a series of four articles, of which this is the last (Read the Spanish version here: Agilidad Empresarial Consciente). While the first three articles explored the Why of business agility transformations, Conscious Business Agility is concerned with the How.
The Why of Business Agility
#1. Business Agility for Complex Times. In the first article, I leaned on the research made by Forbes and the Agile Alliance to show that a Business Agility transformation is a process that involves traveling a complex journey, making choices that require conscious leadership, deliberate action, resource allocation, and the commitment of the whole organization to embrace agility from strategy to execution, and enterprise-wide.
The report differentiates leaders from laggards in agile transformations.
While Leaders define themselves as “We are Agile in both strategy and execution” and “culture is definitely an asset to achieving agility,” Laggards see themselves as, “We are not agile in both strategy and execution, and culture is an obstacle to achieving agility.”
Consequently, we highlighted the key elements differentiating successful business transformations from failed ones: Leadership and Culture.
#2. Cracking the Business Agility Nut. In this article, I presented some basic facts about Business Agility.
- Organizations are Complex Adaptive Systems (C.A.S.).
- Complex Adaptive Systems have Complicated and Complex challenges.
- While Business Processes are complicated, Leadership and Corporate Culture are complex challenges.
- Most organizations sail swiftly through transforming their Business Processes with Agile tools and approaches. On the contrary, they hit a wall when trying to change their Leadership Practices and Corporate Culture.
- Therefore, using Agile approaches alone as a change tool to transform complex organizational challenges is using the wrong tool for the job to be done.
#3. The Business Agility Stumbling Blocks. I explained in this article how to turn Complexity, Leadership Practices, and Corporate Culture, from stumbling blocks to stepping stones of the Agile Transformation.
- Complexity. Use Agile approaches to solve Complicated challenges, like Business processes. “Complicated challenges have straight-line, step-by-step solutions that experts can implement with the necessary skills and experience. You would generally refer to a complicated challenge as ‘technical”. Dave Benjamin.
- Leadership practices. To change Leadership Practices, you need to illuminate the blind spot of leadership — the internal place where the leader’s decisions originate.“We are blind to the deeper dimension of leadership and transformational change.” Otto Scharmer.
- Corporate Culture. Recognize the inadequacy of rigid, vertical organizational structures and traditional management practices to empower cross-functional teams engaged in discovering and delivering customer value. “Culture eats Strategy for breakfast.” Peter Drucker.
The How of Business Agility
Most organizations know why it is necessary to accomplish higher business agility. Nevertheless, they only succeed in doing one part of the job — transforming complicated challenges like Business Processes.
Indeed, why do global corporations spend $ 10 B annually on change management efforts? According to the Boston Consulting Group Henderson Institute, “in our evolve-or-perish environment, organizations cannot afford to stay still.” Nevertheless, only 25% of large-scale change programs capture long-term value.
Those relatively few organizations know HOW TO transform their rigid corporate structures and traditional management to empower cross-functional teams and reach more significant degrees of business agility from strategy to execution. As Dr. John Vervaeke says, “This is not a matter of knowing that you have to go outside the box; it’s a matter of how to go outside the box.”
If Agile approaches won’t get the job done in most cases, how can organizations achieve Business Agility “from strategy to execution and enterprise-wide”? Paraphrasing Dr. Vervaeke; how do they go outside the box? First, it is convenient to understand the stages of a business transformation and the mindset of most leaders when they face any of those stages.
The Three T´s of Business Agility
@Malte Kumleh is a SAFe® Fellow, PMP, and Director of SAP Business Agility Advisory at Project and Team Inc. He and I have had conversations on the systemic integration of Theory U and Agile. Lately, he invited me to participate in the SAFe® Leadership Transformation Mastery project at the Presencing Institute’s u.lab2x program. He has developed a reference framework for this integration, called The Three T’s of Business Agility. I am honored that he has authorized me to share his model.
“I see an evolution in systems from the mere technical implementation to the more complex framework of Transformation. Because any Transformation requires that the system sees and senses itself, this is not happening at the CEO level anymore; the transformation takes place at the level of the people on the ground, the hundreds of people in Solution Trains who get the job done.”
Three T´s of Business Agility
- Translate: “It has a negative Business Impact. Think and do the same as before, just with new names. A very high % of Agile Transformations fail as they remain only Agile Translations.”
- Transition: “It is the Liminal Space. The space in between. Somewhat like the Presencing moment in Theory U. Here is where “breakthrough” innovation takes place, a new culture can emerge that heals wounds and lays the foundation for trust.”
- Transform: “It is if the mind, heart, and will have set on a path to transform the culture and operating models, generating the high trust required for high-performance organizations.”
“If you want to Translate your current operating model, your current processes, your current structures into something else, you can do that. If you want to make a Transition, Theory U becomes very important. If you want to Transform, Theory U becomes even more important because it makes a difference in how people see themselves and each other. For me, it makes all the difference because that is the foundation of Trust, which is vital in a technical environment. As a result, with Transformation, trust becomes part of the system.” Malte Kumleh.
Malte practices awareness-based systems change when he integrates Theory U into the change projects in which he participates.
Theory U
Theory U (Fig. 3) is an Awareness-Based Systems Change methodology developed by Otto Scharmer at MIT to make systems see and sense themselves, a quality that allows organizations to accomplish more complex transformation processes.
Theory U incorporates the State of the Arts of Systems Thinking, which is the blending of Systems Thinking and Systems Sensing to open our awareness to perceive the current reality. Next, it uses an unprecedented capacity called Presencing to sense the system’s best possible future possibility. Afterward, the Emerging Future is actualized with Vertical Prototyping, leading to the Evolution of the system so that it causes an ecosystem impact.
Leading From “The Source”
The success of an intervention depends on the internal condition of the intervener. Bill O´Brien.
With Theory U, a radical new leadership paradigm is enacted, Leading From “The Source,” which is the internal condition of the intervener.
When the people who form the organizational culture develop Presencing, aligning leadership, culture, and business processes, becomes a natural process, not a forced one, allowing the organizational silos that accommodated command and control systems to give way to flatter structures that allow fluidity in the work of cross-functional teams. Consequently, the whole organization becomes agile from strategy to execution. That is the asset the leaders of the Forbes-Agile Alliance report mention; the use of leadership and culture as the engines of the agile transformation.
“Culture is key to supporting an Agile enterprise: 65% of survey respondents agree that their culture is an asset to the organization, and 66% consider agility an essential part of their company’s DNA”. Forbes-Agile Alliance
David Benjamin describes how an Agile Transformation should work:
“For complex challenges, you need a ‘we-are-the-experts approach’ that engages all the right people from inside and around your organization in co-creating a solution they know will work.
When they are in the act of finding solutions, give them direct access to each other and equip them to effectively and efficiently reach a shared understanding of the challenge and how to overcome it. And when they’ve found their solution, they will know what needs to be done and what needs to be tried, and they will be mobilized to act.”
In Leading From “The Source,” The conditions of origin (internal condition of individuals) give rise to the quality of the relationship (patterns of thought, conversation, and organization), which constitute the Corporate Culture, which generates the practical results, in this case, changes in Business Processes. (See figure 2). Consequently, Leading from “The Source” transforms Corporate Culture, which changes Business Processes, enabling the organization to function with “Conscious Business Agility.”
Conscious Business Agility
Conscious Business Agility is how you transform the Leadership Mindset and Corporate Culture into engines of business agility transformation.
Conscious Business Agility is the capacity to align leadership, culture, and business processes to be agile in strategy and execution, sensing the complex reality, adapting to it, and enacting the best future possibilities in the now.
Conscious Business Agility results from the integration of Theory U, an Awareness Based Systems Change methodology, with Agile approaches. The integration is done so that the latter, Agile processes, incorporate Theory U’s methods and tools into their current practices.
Research in Progress
In 2021 and 2022, I participated in three research projects carried out by different groups of international change-makers to explore the possibility of integrating Theory U and Agile for business transformation purposes. The projects were developed under the Presencing Institute’s u.lab 2x | From Prototype to Eco-System Impact systems accelerator program. In 2021, twelve change-makers from 6 countries met online from February to May in the Slow Agile project. Similarly, during the same months of 2022, I co-led the Teoría U y agilidad team. I was also invited to participate in the project U.Lab 2x — SAFe® Leadership Transformation Mastery as a member of the extended team. The three projects reached similar conclusions, independently of the countries of origin of the participants and the size and type of organizations where they work. They can be briefly summarized as follows:
The integration of Theory U and Agile implies being present, focusing on the challenge, reflecting, and observing the person, the teams, and the system as a whole that continuously improves with a new level of awareness, giving the organization a strategic vision and sense of direction in behalf of the stakeholder’s best future possibilities.
The convergence of mind, heart, and will gives the organization the capacity of reflection in action from strategy to execution, allowing everyone to operate daily under uncertainty, thanks to Presencing — a fundamental collective ability to innovate in complex times.
Conclusion
“Enterprise-wide agility is at the heart of what separates today’s leaders from laggards.” Forbes Insight
Business Agility transformations are complex, multiyear, company-wide efforts. Hence, it is fundamental to have an exemplary leadership mindset that can use the corporate culture as a lever to carry out the transformation regardless of the ups and downs of operating a business under complexity.
Business Agility requires deliberate action and resource allocation to achieve constant innovation. Nevertheless, resistance to change begets self-sabotaging patterns, mainly in the organization’s vertical command and control structures.
While 81% of all survey respondents consider Business Agility the essential characteristic of a successful organization, less than half, 47%, see a competitive advantage in committing their organization to the transformation effort. In other words, 53% of leaders fail to perceive the potential that an Agile transformation could bring to their companies.
It is essential to clarify the concept of missed opportunity. The so-called “digital transformations” are only the first step of an agile transformation, as they are equivalent to the “Translation” referred to by Malte Kumleh, which has an overall negative business impact. However, they give organizations a unique opportunity to align their leadership and culture to “Transform” by making “the entire enterprise agile in strategy and execution, using culture as an engine to drive agility.”
The problem with “digital transformations” is that they don’t give your organization an advantage because all your competitors are doing the same, “Translating,” meaning “Think and do the same as before, just with new names.”
The rewards of a successful Business Agility transformation are great, and so are the risks. Nevertheless, the introduction of Conscious Business Agility in the transformation process will help turn the company’s leadership and corporate culture from being reluctant to change elements to becoming engines of the transformation effort.
We are specialists in turning leadership and organizational culture into engines of innovation. So, we would be honored to converse with you about how to do this in your organization.
Please send me a DM on LinkedIn or write me at helio.borges.consulting@gmail.com
(1)THE ELUSIVE AGILE ENTERPRISE: How the Right Leadership Mindset, Workforce, and Culture Can Transform Your Organization. Forbes-Agile Alliance.
