Change. Chapter 3. Defining attributes for exceptional organisations.

  1. Align around a very clear motivating purpose
  2. Enable the right styles of leadership
  3. Work on psychological safety, transparency, and honesty every day
  4. Restructure with the big picture in mind but act locally
  5. Apply the right constraints, governance, and autonomy
  6. Distribute decision-making
  7. Use iterative planning with feedback cycles
  8. Experiment and measure results

Iterative strategy with execution

Strategy cannot be done on its own. Strategy and execution go hand in hand. It requires an iterative approach with execution and not a big upfront planning session.

Experiments are the engine of change

Very clear motivating purpose

Leaders who enable

In exceptional organisations, leadership styles move from being directive, predicting and controlling to creating the right environments and enabling employees to deliver customer value.

Safety, Support, and Challenge.

Building the right environments for thinking work requires the safety to try things out to see if they work and adjust if the results are not what was expected. The best way to encourage and support this process is to build in reviews around managing risk first and then expertise and results.

  • How well are they considering the impact of their decisions by consulting and working with the people who will be most affected by those decisions before they are implemented?
Asymmetric payoff vs the cost of non-viable solutions

Restructure with a holistic view but act locally

Prior to the 1990s organisations had a hierarchical top-down approach to structure, communication, and decision-making. During the late ’90s and early 2000s many organisations moved to a matrix type reporting structure for more flexibility in recognition that work and relationships are not linear in nature but more like a matrix or web.

  1. Flattening of hierarchy. — As leaders support more and decisions are distributed effectively and risk appropriately, the coordination efforts of mid-level managers are no longer required in such numbers and the levels of management are reduced. This reduces cost. It also speeds up decision-making even further and allows faster customer flow and feedback, which in turn lowers risk.
  2. Moving to networked teams. — Entrepreneurial Product Owners are enabled to make commercial decisions and the teams are able to deliver real value quickly with much lower work in progress and risk.
  3. Micro-businesses — The organisation operates a set of micro-businesses that all have their own budgets and ability to direct themselves appropriately for the customers and markets they serve.

Constraints, governance, and autonomy

No organisation or society can work on policy or law alone. Contracts, documents, and processes are great for guidance and to reduce risk, however, the majority of decisions are made minute by minute as people make their own judgements and do what they believe is right. Trying to control and enforce every detail does not make sense for 99% of the daily decisions that employees make.

Distributed decision-making

Staff can only make good decisions if they have the right information at hand. Therefore, transparency and information sharing is a key part in decentralising decision-making. This is often one of the ‘acts of faith’ that leaders have to go through in moving towards an exceptional organisation.

Distributed decision-making is an important element on the road to agility. — Image source: https://sketchplanations.com/authority-to-information

Iterative planning with prioritization based on feedback

Once we have a network of teams that are largely independent of each other, we can properly prioritize work. We cannot effectively prioritise work until we have whole product ownership by the teams. Whole product ownership means that we do not pass unfinished work from one team to the next.

Experimenting and delivering results

Staff must be looked after. Exceptional organisations cultivate an entrepreneurial attitude with a high level of transparency of the work they’re doing. They need feedback from customers in order to focus on the flow of value to the customer.

Putting it all together

These building blocks form the basis for exceptional organisations. They can only be implemented in an incremental approach that takes into account the cultural, emotional and mental states of those involved. This is what the AWA Playbook for organisational change is for.

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Simon Powers

Simon Powers

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CEO and Founder of the community of practice, training, and coaching company: Adventures with Agile.