Yet, for all this uncertainty, most discussion centers around this change or that transformation. We instead in this part of our Stratecution insight series posit that the discussion should be equally much about how organizations can build sufficient capability for continuous change. Our experience is that you must now be able to manage both a specific change, for example linked to an implementation while you build enduring muscles to handle ever faster continuous change at the same time.
Adaptability in the organization
If we want to achieve new things, we must also become something new. But in the rapidly changing and complex – raplex for short – world we live in today; we can seldom know what exactly we are changing into and even less the way to get there. Change is often viewed as going from A to B, however, the final B is rarely the B we think we see at the outset. Both because we learn more as we go along and because the world keeps changing. Thus, it is more like going from A to B or C or D, and then to E, F or G. The world is rarely binary and never still for long.
Organizations that thrive in this environment have figured out a way to not only keep up with the changing environment, but to stay ahead of it. Our experience shows that the organizations that do this successfully have built a very specific capability, the capability of continuous change – Adaptability.
The key is to secure both human and structural adaptability
We view change as fundamentally composed of two components. Change and Adaptability. A specific change or transformation, to realize a set of transformational goals in line with the strategy. And Adaptability, the capability of realizing change along specific dimensions. There is a mutually reinforcing relationship between these two factors. Any change creates a requirement for certain change capabilities. And adaptability creates the preconditions for change, either for a specific type of initiative or a meta-capability like learning or program management. The ideal is to create initiatives that have a positive payoff now – while also being an investment in our future capabilities.
The more an organization is likely to experience further change in the future or have the need to scale a certain transformation of their capabilities, the larger their need for building Adaptability in the organizational DNA – an institutionalization of the change capabilities. This should be done through both structural and cultural processes. Change is after all, not only an initiative but a mindset of constant adaptation and learning.
We have done this institutionalization, to secure adaptability, with clients in both the private and public sector. In projects such as building agenda-driven Academies for Financial Service organizations, embedding a customer-driven service culture at a facility management company, embedding process and capability ownership at private equity firms, establishing two-layer PMO:s that drive both projects and change in large Service organizations and Infrastructure providers. The key is to pay attention to both human and structural adaptability and ensure there is a strong ownership over securing this long-term capability.
Just like Alice, we have to figure out a way not only to stay in place, but to get ahead. Our prescription is this: Organizations must both act now and build capabilities for the potential futures.