The culture key

Giv­en the unprece­dent­ed glob­al events, it’s no sur­prise that the dra­mat­ic pace of change in the busi­ness envi­ron­ment has cre­at­ed a need for agili­ty in the ways com­pa­nies oper­ate, inno­vate and respond to cus­tomer demands. Attempt­ing to achieve this way of work­ing, which star­tups are typ­i­cal­ly born with, is expos­ing inher­ent inef­fi­cien­cies that exist in large, well-estab­lished organ­i­sa­tions.

These struc­tur­al inef­fi­cien­cies mean that when com­pa­nies try to respond and adjust to change, they face chal­lenges in sus­tain­ing oper­a­tional per­for­mance and a com­pet­i­tive edge in the mar­ket. It’s com­mon­place for com­pa­nies to have teams work­ing in silos, deci­sion-mak­ing slowed down by bureau­crat­ic approval pro­ce­dures and employ­ees fear­ful of chal­leng­ing archa­ic process­es.

This is nat­u­ral­ly result­ing in com­pa­nies rac­ing to trans­form and place agili­ty and oper­a­tional per­for­mance at their heart. How­ev­er, sev­en in ten oper­a­tional trans­for­ma­tion pro­grammes fail to gen­er­ate their expect­ed out­comes or lack the spe­cif­ic mix of ele­ments to sus­tain, accord­ing to Baringa Part­ners, a con­sul­tan­cy that helps busi­ness­es to oper­ate more effec­tive­ly, nav­i­gate indus­try shifts and reach new mar­kets.

“In times like these, most com­pa­nies will quick­ly piv­ot into revised oper­a­tional strate­gies and then jump straight to action before ful­ly under­stand­ing how they’re going to do it,” says Rob Maguire, peo­ple and process excel­lence lead part­ner at Baringa. “They are often mak­ing deci­sions based on gut feel and with­out good data. After the ini­tial knee-jerk, build­ing a sus­tain­able way of dai­ly work­ing in this new envi­ron­ment is cru­cial.”

Cre­at­ing a cul­ture for sus­tain­able change is vital to any suc­cess­ful trans­for­ma­tion. Agili­ty must be treat­ed as an entire­ly new way of work­ing, not a one-size-fits-all project with a defined start and end point. Lead­ers should adopt a ser­vant lead­er­ship mind­set where­by they empow­er their peo­ple to inno­vate, rather than rely on their own his­toric expe­ri­ence and learnt behav­iour.

To remain agile, lead­ers must bal­ance their desire for increased lev­els of con­trol and com­pli­ance while mov­ing deci­sion mak­ing to where the infor­ma­tion sits

Fur­ther­more, com­pa­nies should iden­ti­fy where they need to progress from tra­di­tion­al silos and hier­ar­chi­cal organ­i­sa­tion­al struc­tures to cre­ate dynam­ic teams able to deliv­er at pace for their cus­tomers.

Cen­tral to achiev­ing this empow­ered cul­ture is an under­ly­ing prin­ci­ple that employ­ees have the psy­cho­log­i­cal secu­ri­ty to fail fast and learn from mis­takes. Cul­tures of blame and tra­di­tion­al per­for­mance man­age­ment are fre­quent­ly entrenched in large organ­i­sa­tions, so lead­er­ship teams must seek to undo them and unlearn the under­ly­ing behav­iours.

To assist with this, Baringa works with client lead­er­ship teams to cre­ate busi­ness com­mu­ni­ties in which peo­ple have the free­dom and per­mis­sion to test and learn with­out the fear of fail­ure.

“It’s very lib­er­at­ing,” says Oli Bar­nett, peo­ple and process excel­lence part­ner at Baringa. “This requires sev­er­al ele­ments to be in place, includ­ing a high lev­el of insti­tu­tion­al trust, a man­date from senior lead­er­ship, clar­i­ty around the company’s pur­pose and a total­ly engrained vision so peo­ple know what suc­cess is and how to achieve it.”

Rather than see­ing oper­a­tional excel­lence and organ­i­sa­tion­al agili­ty as two sep­a­rate com­po­nents of a trans­for­ma­tion pro­gramme, Baringa encour­ages com­pa­nies to bring their under­ly­ing skillsets and capa­bil­i­ties togeth­er. Many organ­i­sa­tions will go about hir­ing a large improve­ment work­force, com­pris­ing of both oper­a­tional excel­lence and agile capa­bil­i­ty and knowl­edge, with­out real­is­ing that much of the skillset already exists in their busi­ness. By upskilling and repur­pos­ing their exist­ing tal­ent pool, organ­i­sa­tions can achieve faster and more sus­tain­able trans­for­ma­tion.

With the rise of automa­tion-based tech­nolo­gies, such as intel­li­gent process automa­tion, now often a firm fix­ture in busi­ness oper­a­tions, it’s also impor­tant com­pa­nies build a hybrid work­force that treats dig­i­tal work­ers cul­tur­al­ly as an exten­sion of the team while con­tin­u­ing to incen­tivise human staff. Baringa has devel­oped dig­i­tal work­ers that mim­ic human behav­iour by greet­ing col­leagues in the morn­ing, cre­at­ing dig­i­tal per­sonas that mix in with the human tal­ent.

“Organ­i­sa­tions need to recog­nise that dig­i­tal work­ers need sup­port as much as human work­ers,” says Maguire. “If you con­sid­er the speed of change and agili­ty in how busi­ness­es are evolv­ing, as a per­son you need to be con­stant­ly updat­ed in the new ways of work­ing and it’s the same for your dig­i­tal work­force. It can’t just be fire and for­get.”

To sup­port its clients under­go­ing trans­for­ma­tion jour­neys, Baringa has devel­oped an oper­a­tional resilience frame­work focused on data, dai­ly ways of work­ing and remote capa­bil­i­ty build­ing to deliv­er rapid, sus­tain­able results. Its 3D Trans­for­ma­tion Frame­work cen­tres around three core dimen­sions for achiev­ing oper­a­tional resilience: end to end, team by team and again and again. The unique propo­si­tion chal­lenges the think­ing of many tra­di­tion­al respons­es by devel­op­ing a sus­tain­able link between ben­e­fits cer­tain­ty and cul­tur­al advan­tage.

Rather than rely­ing on two or three “sil­ver bul­lets” to dri­ve through change, Baringa believes that instill­ing oper­a­tional resilience requires organ­i­sa­tions to embed 50 “sil­ver pel­lets” across the busi­ness. As such, the most suc­cess­ful trans­for­ma­tion pro­grammes utilise a range of levers to realise their ben­e­fits pro­file and Baringa’s research shows that many of these levers are cul­tur­al. Exam­ples include lead­ers fos­ter­ing a learn­ing envi­ron­ment by giv­ing intent to their peo­ple rather than issu­ing orders, which is out­lined in L. David Marquet’s book Turn the Ship Around.

Sec­ond­ly, while finan­cial results should be seen as an inevitable improve­ment out­come, it should not be the sole pur­pose for trans­for­ma­tion. A com­mon mis­take that many glob­al organ­i­sa­tions make is focus­ing only on pounds and not also con­sid­er­ing their cus­tomers and employ­ees. By cen­tring on this triple win, organ­i­sa­tions cre­ate a sus­tain­able and com­pet­i­tive advan­tage that unlocks long-term incre­men­tal val­ue.

Much has been writ­ten on the pow­er of a growth mind­set, how­ev­er this can­not be over­stat­ed. Lead­ers who have a mind­set of embrac­ing chal­lenges with a greater per­sis­tence, see­ing effort as the path to mas­tery and stay­ing curi­ous through­out the trans­for­ma­tion jour­ney, will ensure a high­er propen­si­ty for suc­cess.

Engaged employ­ees look for­ward to build­ing com­mu­ni­ties and feel­ing con­nect­ed to the company’s mis­sion. Employ­ee engage­ment indices (EEI) are key mea­sures for organ­i­sa­tions to gauge future suc­cess. Employ­ee engage­ment leads to improved per­for­mance in the work­place and organ­i­sa­tions in the top quar­tile of engage­ment have sig­nif­i­cant­ly high­er prof­itabil­i­ty and cus­tomer rat­ings, less turnover and absen­teeism, and few­er safe­ty inci­dents than those in the bot­tom quar­tile.

“Volatil­i­ty isn’t new, but today’s veloc­i­ty and uncer­tain­ty is,” says Bar­nett. “Organ­i­sa­tions that are engaged, agile and can trans­form in a way that doesn’t require the cost of rebuild­ing their inter­nal change capa­bil­i­ty, hold the key for short and long-term suc­cess. They have a DNA engrained in their cul­ture where nat­u­ral­ly they are empow­ered to adapt and improve.”

For more infor­ma­tion on Baringa’s approach to oper­a­tional excel­lence or how we can help your organ­i­sa­tion with its oper­a­tional response to COVID-19, please con­tact [email protected]