Changing Priorities

In part 1 of this article we looked at what it means to be antifragile and emphasised the need for organisations to engineer themselves towards being antifragile. In this part we map important parts of an organisation’s identity to antifragility.

It might come as little surprise that what we thought were priorities before the pandemic, are largely still the same priorities. The exception being social distancing and improved hygiene. What the pandemic has shown us is that we can implement great ideas in a fraction of the time we had previously allowed for them. Sometimes these were intentional, sometimes these manifested naturally out of necessity. As framework for this discussion we will borrow a simple generic framework, by answering the following three questions:

1. Who are we?
2. How do we operate (or win)?
3. How do we grow?

Who are we?

Organisations that pull through crises have a strong sense of belonging, they rally around a clear common purpose or goal. Naturally, the pursuit of a purpose or goal needs to align with the personal values of the individuals making up the organisation. This brings to the foreground the importance of the organisation’s culture. Behaviours and practices are evidence of an organisation’s culture. If, for instance, an organisation understands that experimentation or agility requires a coaching and learning culture, it must be absolutely and unwaveringly intentional about it. No boss-lady or boss-man should be allowed to call out a loyal subject for failing to prove a hypothesis for which they ran an experiment, but rather allow for the learning to take place and follow up experiments to be conducted.

Another factor is the appreciation and respect for the people in the organisation. When COVID19 hit, some companies needed to make big scale changes almost overnight and could either replace their people or reskill them. Think of a simple example: In South Africa, the sale of alcohol is banned under level 5 and level 4 lock-down restrictions. Several craft distilleries have been able to convert their liquor manufacturing to producing and delivering sanitizing products in less than a week, opening new markets and rendering themselves essential services. Was there time to bring in professional hand sanitiser manufacturers? Maybe, yet most did the necessary research and reskilling of the people on the floor to make new product, energising them with the ability to learn something new, and contributing to the greater good. Notice how acceptance of the new normal was quickly converted into action? That is one of the hallmarks of an antifragile organisation.

How do we operate?

Decision making at the right level of the organisation has proven to be a successful principle throughout business improvement history. This principle still stands and has been amplified throughout this current pandemic. Decisions often need to be made with incomplete data and although there are times when a “hunch” or “gut feel” might prove to drive results, it is good to test decisions with a few “sanity checks”:

• How quickly does this decision need to be made? Keeping in mind that the decision to delay a decision is a choice that could adversely affect the outcome and have a ripple effect on other decisions.
• Is there data to support this decision? Do we have the capabilities to produce or provide the data and information required to make an informed decision?
• What happens if the decision is wrong? Can it be broken down to be risk optimal? This question magnifies the reason to be a truly agile organisation.
• “If it was simple, what would it look like?” Never underestimate the power of a “one pager”. Simplicity means more focused communication and wider understanding.
• Do we have the right talent to execute on this decision? Especially in a service industry – what is often the biggest expense in your income statement? Salaries. This places a spotlight on the need for effective HR processes throughout the talent lifecycle, from recruitment right through to separation. Organisations pay for people. Fickle, difficult people. But also, intensely creative, smart, and passionate people – pick them right, give them a safe environment to creatively thrive in and continue keeping them on the leading edge.

How will we grow?

One day this pandemic will pass, but undoubtedly it will not be the last we will face. There is the looming climate crisis with global reaction (overreaction or not – it is happening) that will change the competitive landscape. There might be more surprises like mutated viruses, runaway fires, runaway inflation. Lessons from previous crises will help us survive and thrive post the current and future crises. A few lessons:

1. Think of your entire supply chain as a living ecosystem, with suppliers and customers integral to the partnership that allows you to provide value. Consider the following symbiotic partnership between Google and it’s technology providers. To increase the Android operating system’s market share, an important strategy is the manufacture and roll-out of the Google Nexus phone, the flagship Android device. Google does not manufacture this phone themselves, rather they partner with other manufacturers and collaborate on the design, manufacture, and supply. And here is the kicker – they keep partnering with different technology providers (they have partnered with HTC, LG, Samsung, and Huawei). This is intentional – the partner companies get to learn Android in depth and the Google engineers get to understand hardware capabilities and limitations, enabling a cycle of continuous learning and improvement for all parties.
2. Invest in data technology. Organisations need to know what is happening with the shortest delay possible. The days of seeing only the monthly report is over. The underlying architecture, the data systems, and the methods to report and visualise it needs to be quick, seamless, and fully integrated. This will also reduce the burden on skilled line managers to extract data and produce reports. These skills can now be redirected to making sense of data and converting it to insights.
3. Focus on becoming a learning, innovative organisation. Learning is good and failure is a necessary part thereof. As an engineer I can 100% guarantee that theory alone will not get one to an optimal result. Optimal results are realised through experimentation and continuous learning. Invest in innovation. Research shows that organisations typically reallocate between 2 and 3% of their budgets to the resources and infrastructure to be agile, innovative, and flexible. More successful transformations see organisations committing between 8 and 10%, creating more value and the capability to adapt to market shocks.

To quote RJD2: “Who knows what tomorrow will bring? Maybe sunshine and maybe rain.” Lessons from past crises shows us that we need to be highly adaptable to mould our organisations to the shocks of external forces, learn and ultimately grow. This is how we will become truly antifragile.

Written by Nico Prinsloo