20 BASIC assumptions to make Business Agility a reality in organizations

If you have been following my work for some time, you may have noticed that I am very critical of the way the topic Business Agility has been approached by many professionals and companies. I don't want to be the owner of the truth, but talking about processes, frameworks, and tools as if we were talking about business is a big conceptual mistake. In the same way that talking about Business Agility without the involvement of business leaders is a management myopia and a risk to the business strategy.

I will start this article by highlighting some important points of my vision that I have presented in the previous ones:

• If Business Agility is the modus operandi of companies that succeed in the New Digital Economy, seeking to develop new organizational capabilities to accelerate growth and delight all stakeholders, it must be understood as a competitive advantage and a desired state of top business management.
• To make Business Agility a reality in organizations, we need business leaders who inspire change and catalyze organizational transformation. In other words, we need to develop the role of the Agile Business Owner in the organizational structure to make this transformation really happen at the business level.
• Therefore, we can think of Agile Business Ownership as the modus operandi of leaders and managers who act as catalysts of Business Agility, requiring the following five core competencies: Evolutionary Leadership, Exponential Strategy, Lean Portfolio Management, Agile Governance and Evolutive Execution.

If you believe this reasoning is correct, I ask the following question: How are the leaders and managers of your organization addressing the discussion of these themes in their strategic agendas? We need to make senior management aware that many companies are finding better ways to lead and manage business in the context of the New Digital Economy. For this reason, we need to decide if it is the company itself that will kill the existing business (evolution) or if it is the competition that will do it when faced with a big opportunity (decline).

But what is the desired state of those who decide to adopt Business Agility as the modus operandi of their companies? In my opinion, the accelerated growth of value generation from financial, customer, market, and social perspectives, all for the sake of a greater (and massive, in the terms of Exponential Organizations) transformational purpose. In other words, Business Agility is about making a business awesome, and Agile Business Owners need to be at the forefront of that mission, as I demonstrated in the article whose title makes this very point.

But what characterizes an awesome business? How is it possible to enable a sustainable exponential growth of a business? In the third article, I introduced a formula for making a business awesome and demonstrated the variables involved in this challenge: Results, Processes, Technologies, People, and Experiences.

In this fourth article, I will start building a new rationale that will demonstrate the desired mindset in leaders and managers who want to make their businesses awesome, that of a Business Driven Transformation. I will introduce the Business Agility Getting Real? model and its 20 basic management and leadership assumptions conceived to guide Agile Business Owners on the journey of developing Business Agility in their organizations.

(Not so) new assumptions for leaders and managers

So what is the big problem for change agents seeking to develop Business Agility in their companies? Can we summarize it down to transforming the organizational culture to the agile and digital mindset, a common goal in the corporate market in the face of the challenges imposed by the pandemic? If the failure rates of agile and digital transformation initiatives exceed the 70% mark, how then can we make BUSINESS Agility a serious thing in organizations?

As much as we see experienced professionals advising leaders and managers not to consider Agile methods as the silver bullet that will exterminate all organizational problems, the market has done the opposite. The concept of agility arrived at the top management of companies as a solution for all tactical-operational problems, without actually rising to the strategic level (with a few exceptions).

For me, this is a direct consequence of the "new agility" discourse, which promises to deliver high performance professionals and teams with infallible methods, generating an expectation that operational productivity will increase to unimaginable levels. I often say that we are living in the era of "Agile Taylorism," where the focus on delivery (efficiency in outputs) has surpassed that of discovery (effectiveness in outcomes), and this only harms the potential for corporate growth from a business perspective.

How then will it be possible to get out of this situation? To begin with, by taking to top management a discourse with fewer processes and tools and more capabilities and results. But this discourse must start with basic management and leadership assumptions that many professionals are unaware of or don't put into practice in their day-to-day work.

An assumption is a fact or an idea that serves to start the formulation of a reasoning. When I refer to basic assumptions in the context of Business Agility, I am talking about elementary principles of management and leadership that must be considered by those who will structure and carry out an organizational transformation.

10 Basic Assumptions to Structure the Journey

Let's start building our Business Agility Getting Real? model with 10 basic assumptions that will structure the leadership mindset for the Business Agility development journey:

1) Every organization needs to generate positive results to be sustainable (value to stakeholders).

2) We expect all employees (individuals) to engage with these results (value generation).

3) We do not engage with results, but with the experiences they can provide us (benefits).

4) Our experiences stimulate the practices (behaviors) that will determine our results.

5) Our work experiences are a reflection of our organizational culture (beliefs and values).

6) Organizational culture is a reflection of management models (ways of doing things).

7) Management models are determined by the leadership models (way of being).

8) We need to evolve our organizational culture to transform our organization (Make Business Awesome).

9) We cannot fix our culture, but we can evolve our management models (Business Agility).

10) To evolve our management models, we need to change our leadership models (Agile Business Ownership).

If you are a leader or manager who has the responsibility to make Business Agility happen in the company, it is important to understand and adopt these assumptions before developing any transformation strategy. They have not been proposed at random, but rather identified in the cause-effect relationships that I consider determinant for a business-oriented approach.

Therefore, I will invite you to read again each of the above assumptions after understanding a few more elements that I also consider important for their interpretation:

• Items 1 and 2 seem obvious, since they are directly related to the need for any company to be sustainable and generate value for its stakeholders, requiring employees to commit to these intentions.
• However, items 3 to 5 are not so obvious, since they state that commitment only happens when there is some associated personal benefit (positive intention for the individual). Since our results depend on our behaviors and these are reflections of our beliefs and values, it is not enough to say that we are committed to better results, we need to have evolving beliefs that support the process that will achieve them.
• Items 6 and 7 define two cause-effect relationships still unknown to many leaders and managers: It is the management model that determines the organizational culture! Eliyahu M. Goldratt, author of the Theory of Constraints, said in the 80's: "Tell me how you will measure me, and then I will tell you how I will behave". This is a famous quote from business management that points to the cause-effect relationship between management and behavior (the most elementary aspect of an organizational culture). But the definition of performance evaluation is in the management model, and the one who defines this model is the leadership. So change the leadership model to determine the new management model that will foster the new organizational culture.
• Items 8 to 10 point to the big problem that must be addressed by top management: Developing a culture of acceleration and growth from new management models and organizational leadership.

I have tirelessly repeated that approaching the theme Business Agility without being from the business perspective is a big conceptual and also strategic leadership mistake. Maybe I'm wrong, but the agile world consolidated the Product Owner and Product Manager roles when it started to discover better ways to develop software products. Today, we are discovering better ways to develop business in an increasingly VUCA and digital world. Therefore, it will be a natural trend to consolidate the roles of Agile Business Owner and Agile Business Leader in our organizations if we want to develop a true Business Agility.

But how many managers do you see acting consistently based on these assumptions? How much do leadership courses promote these topics in their content? How has academia addressed these topics in its business management education programs? How do YOU address these assumptions in the roles you play in your organization?

Notice that I started with the basics and even then you can already see a gap between what is done versus what is needed to make a business truly awesome. I don't know if you disagree with one or more of the above assumptions, but I think you will agree with me that IT IS THE RESPONSIBILITY OF THE TOP MANAGEMENT to want to make the business awesome and to make this dream to become a reality. Do you even agree with that?

The figure below illustrates the core structure we designed to represent these 10 basic assumptions in the Business Agility Getting Real? model. Note the arrows indicating the causal relationships between the elements, as well as the two magazine covers that inspired us in identifying items 8 and 9.

10 Basic Assumptions to Make the Journey

Now, if you understood that the previous 10 assumptions are the basic beliefs we use to structure our business-oriented transformation journey, the next 10 assumptions are the basic beliefs we use to ensure its completion:

11) We delight all stakeholders by the awesome results we achieve and the positive impacts we make.

12) Awesome results result from the awesome practices we promote in all aspects of the organization.

13) Awesome practices are stimulated by the awesome experiences we want to provide.

14) Awesome experiences can be intensified by the achievement of personal fulfillment.

15) Our employees must sustain a culture of awesome experiences.

16) Our managers must encourage a management model with awesome practices.

17) Our leaders must inspire an evolution that transcends the organization itself.

18) Our strategy (business and market) must stimulate an evolution in the long-term horizon.

19) Our portfolio (projects and products) must enable the evolution in the mid-term horizon.

20) Our operations (processes and services) must guarantee the evolution in the short term horizon.

Just as I did in the previous assumptions, I will invite you to read again each of the above items after you understand what is behind these evolutionary beliefs:

• Items 11 to 14 are directly related to the primary need of any change process: to define the desired future state. Remember that we want to make our business awesome through Business Agility. For this reason, we need to expand the elements on the right side of the model, converging on Awesome Results, Awesome Practices, Awesome Experiences, and Personal Achievement.
• Items 15 to 17 are directly related to the role of leaders, managers, and employees in the organizational transformation process. They directly impact the organizational culture at different levels of abstraction and responsibility in business management: behaviors, capabilities, beliefs and values, identity and mission, higher purpose. I will talk more about these levels in the next article.
• Finally, items 18 to 20 define the three horizons for analyzing and planning organizational transformation from the operational, tactical, and strategic views of the company. As obvious as these three assumptions may be, we see that many organizations are suffering from the inability to direct the energy of each of these management levels toward organizational growth. The immediatism for short-term results has made top management step down to the tactical level, this one to the operational level, and this last one to the task level, without any criticism of the way things are done. And this definitely does not characterize an awesome business ...

The figure below illustrates the structure we have designed to represent the 20 basic assumptions of the Business Agility Getting Real? model:

The 20 Basic Assumptions in Practice

Now that you have learned the 20 basic assumptions that structure the thinking of leaders and managers with the Business Agility Getting Real? model, I will close this article with some practical considerations.

The left side of the model represents the current state of any organization, with a management model that fosters the culture that determines the behavior of its employees and stakeholders. The right side is our ambition to make the business awesome, the desired future state of top management to delight all stakeholders.

We can start the transformation at the operational level, seeking short-term results with efficiency, effectiveness, and compliance capabilities. If our changes are effective, we will generate value for the business, but hardly accelerate organizational growth, keeping our condition far from the desired future scenario. After all, the operations level sustains the current business and is unlikely to make radical changes that compromise its stability. This is the level where we see the focus of most agile initiatives happening: on Operational Agility.

If we advance the transformation to the level of product portfolio and strategic projects, we can think about business acceleration capabilities. However, the effectiveness of the initiatives at this level depends on the correct orchestration of all the initiatives and the teams responsible for the solutions. It is at this point that we see the greatest suffering of companies with agile transformation programs based on Organizational Agility or Agility at Scale, because there is no clarity in strategy and objectivity in communicating the desired scenario. It is at this point that we need top management taking responsibility for realizing the right side of the model.

Acting at the strategic level in a way that inspires change and guides organizational transformation is top management's responsibility, except that this is not dependent on the evolution of agile and digital transformation initiatives at the tactical and operational levels. Senior management needs to understand that it is past time to evolve that old model of annual strategic planning into a new model of strategy management that supports the continuous discovery and delivery of value to the business. And it must do this in short (quarterly) strategy review cycles better suited to the VUCA and digital nature of the world we live in.

Finally, we can go beyond the goals of our own organization and think about the positive impact of our presence in the community or society. Modern companies explore the abundance of opportunities in the New Digital Economy with broader thinking across the entire organizational ecosystem. But to do this, we need to develop New Digital Economy leaders and managers with the ability to inspire organizational transformation from a genuine transformational purpose. We know that a company can deliver incredible results at the strategy level, but it is at this level of exponential leadership that we will deliver great experiences for all stakeholders.

To think about ...

I have presented in this article the 20 basic management and leadership assumptions of the Business Agility Getting Real? model. They were conceived to structure the mindset of the Agile Business Owner at the beginning of his/her organizational transformation journey towards Business Agility.

I hope it has become clear in this content that Business Agility demands much more than spreading the values and principles of the Agile Manifesto throughout the organization. To make Business Agility happen in companies, it is necessary to reinvent the way of thinking of leadership and evolve the modus operandi of management systems from the business perspective. I believe this is the only way we will enable Business Agility as the desired future state of our organizational transformation.

For those who already operate under the discourse of Lean-Agile approaches, these assumptions will make perfect sense and will enter the repertoire of an inspiring discourse catalyzing change. For others, who still hold limiting beliefs attached to management principles of the last century (even in environments that call themselves "Agile"), these 20 assumptions are mere theory, which is why they will continue to demand increased productivity from their teams and perpetuate failure rates above 70% in agile and digital transformation. But it is everyone's right to keep on doing business the same way they have been doing for years ...

I will continue the construction of the reasoning in the next article, presenting the 20 ADVANCED assumptions of this model, completing the diagram with the 12 elements that are missing in the horizons of management and leadership from the perspectives of culture and the individual.