Agility is the buzzword when it comes to today’s organizational structures.
But what does agility actually mean? The original phrase has been watered down over time and is used as a synonym for flat hierarchies, flexibility and innovative management methods.
Dr. Andreas Romberg, senior partner at Staufen AG, explains how companies benefit from taking an agile approach.
People are quick to embrace the topic of agility, often without knowing what it really means. Could it be that we’re just dealing with a new kind of hype?
It’s bound to be hype, but there’s a good reason why. Companies have come to realize that in these days of increasingly dynamic markets and customer specifications, their classic methods of production-process work will no longer fit the bill. Most companies have a hierarchical approach that is unable to handle this new complexity. Staufen‘s real strength happens to be Lean management, but isn‘t that a hierarchical approach too? No, we have to make a distinction between management and leadership. When managers call the shots, at the beginning of the year they announce the key performance indicators and targets that have to be met by the end of the year. To put it coarsely, managers define the goals and aren‘t especially interested in how their employees get there. But leadership takes an entirely different tack. When you take the Lean approach, managers are integrated into the value chain: they support processes instead of just delegating goals. Agility is a logical complement to Lean. If everyone in a team knows what they are responsible for, then they have to be able to respond appropriately. Old-school organizational structures have a great amount of waste in their processes, and that‘s just part of their nature – their procedural channels, functional distinctions, and so on. And that, for example, means there‘s no way of achieving shorter lead times.
Old-school organizational structures
have a great amount of waste in their processes
Long decision-making processes in particular are problematic. Wouldn‘t the best idea be to simply give employees more autonomy in making decisions?
That‘s usually not enough: we have to start at a much more basic level. Companies are often structured into strictly separated functional silos. But we want to work towards an interdisciplinary kind of work across the value-stream orientation. You cannot continue transforming a company with agile teams until you have achieved that first step. Different roles have to be represented in these teams, and each has to have tasks, competences and responsibilities. The teams recruit their members on a product- or problem-oriented basis and feature a wide range of different abilities. In other words, agile organizations adapt to the respective tasks they face. Another key issue is the option of letting teams prioritize tasks independently, and that is not a brand-new approach either. But we determined quite a while ago that there is a great lack of transparency, especially in the back-office areas, and that clear systems for prioritization were not present. With our approach to shopfloor management, we enable the people in charge to organize adaptively along prioritization guidelines.
You mentioned back-office functions in particular. But is an agile approach possible in the heart of added value – in production?
We have to make a distinction here: in paced serial production such as the kind they have in the automotive industry, agile work does not make sense. But it’s something else altogether when the task is to manufacture a race car; in this case, experts from a broad range of different fields work together to develop their product to perfection. A less exotic example is constructing special machines, and agile methods are certainly applicable here. Generally speaking, the approach is well suited to production whenever small batches with many variants are manufactured.
It’s not possible to motivate employees:
they have to be intrinsically motivated themselves
Agile work demands a lot of the employees as well: they need new competences, make their own decisions and have to think independently. Aren‘t there many who think that is all too much?
I don’t think anything is as demotivating as working in a Taylorism system. It’s not possible to motivate employees: they have to be intrinsically motivated themselves, which is to say you have to give them a motivating environment. And to do that, you have to create working conditions which have meaning, offer space for creative freedom and let them have the competence to organize their work.
The challenge that management faces is much greater. An agile organization has to be maintained; you can’t keep it alive with only lip service. For many decision makers, the difference between managing and leading means relinquishing a major part of their “power.”
I don’t think anything is as demotivating as working in a Taylorism system.dr. andreas romberg, partner, staufen.ag