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Anyhow, our world will be different. No one knows to what extent, but for sure, it will be different. Whatever And whatever happens, the uncertainty is higher than ever before. The question is, what will make the growth wheels spin again?
How are organizations doing?
As you know, the case is not that uncertainty was low before Corona. We already had a situation of ever-changing technology and needs, which required fast, adaptable, and creative development.
I'm sure leaders, everywhere on this planet, are struggling with their future. What will attract customers? What margins are feasible? How long will the downturn last? What will make my company survive?
What to do?
As you know, the case is not that uncertainty was low before Corona. We already had a situation of ever-changing technology and needs, which required fast, adaptable, and creative development. The competition Competition is ruthless, and most companies do not survive as long as expected. Several studies show that the age of companies is decreasing. For leading US companies, the average lifespan is now down to just 15 years, according to Professor Richard Foster from Yale University. I very much doubt that this trend will change.How
What to do?
So, how to become healthy and sustained as a company? Hopefully, also, taking care of people and the planet.
Many appreciated workplaces are creating new innovative products. They experiment, measure business results, figure out why they exist, and much more you can read in best sellers. Did you know there are about 100 new books on Innovation published each month?
A popular term is Business Agility, which means that an organization as a whole can adapt according to market and customer needs. It requires enormous considerable work to rebuild an organization for Business Agility, and I can see many leaders who are struggling to succeed. In most cases, a big challenge is to clarify who develops the organizational capability of an organization, versus who creates the products. Typically, Product Managers need to have the authority to and attention on products and react swiftly on market feedback and do not have the time to work as a line manager at the same time.
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How to rebuild organizations?
If you are a builder of a fantastic organization that will be able to take the edge of the significant uncertainties served by Corona, I think the following bullet points items are the most crucial. They were all very viable before, but have become more critical as uncertainty grows.
Transformational leadership. The world needs Servant leadership, Lead by example, or whatever we call the type of leadership that let lets people thrive. A fearless organization can achieve the flexibility required to deliver the best solution. You have to trust people and reward them when they learn by mistakes. Happy people will be the best force in creating the new products needed.
Value streams. If you haven't identified your real value streams and paid them the proper attention before, it is now time. One of the most decelerating factors is when a silo orientated delivery organization is cannot deliver as one unit. Most managers do not challenge political hierarchies and take the time to dig into define what happens in their organization. Instead, they continue, as before, with some kind of functional responsibilities. When organized around the value, it is so much clearer what to deliver and focus on the outcomes.
Modularized business architecture. When structures get too complicatedcomplex, it is hard to understand who can take responsibility for business outcomes. The most effective medicine against complexity is modularization, with specific interfaces and business responsibility. Organizational and product architecture goes hand in hand, which makes collaboration between architects and business owners necessary. The purpose of each team, a team of teams, and other units should all be connected. Modularization is an essential enabler for creating great value streamsValue Streams. Despite all the wonderful competent online-tools, I am pretty confident that colocation colocated cohesive units teams will differentiate.
Flow. This quote from Don Reinertsen says a lotit all: "Operating a Product Development process near full utilization is an economic disaster." Most organizations, not only the large, are still preparing large projects with predefined solutions years ahead of delivery. Then other "resources" are expected to deliver according to plan. Yet a Avoiding too much prework is yet another cultural habit that needs plenty of leadership to change. Probably also managers and leaders who are prepared to roll up the sleeves and start to learn the craftsmanship of queue management, WIP, and backlog slicing.
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Flow optimization, instead of resource management, will get products out the door.
How successful the adoption of the above items is, depends very much on the approach to implementing them. That is why I also add a fifth item I find crucial.
Incremental implementation. It seems as all transformations are thought of as a one time fix that can be implemented as a big bang. If, for example, a company wants to move into Value Streams. The usual approach is to identify all Value Streams and implement them all at once, instead of identifying just one Value Stream, or a few, and make it work properly before launching any other Value Streams. In the latter approach, there will be time to address Flow, Leadership, Compliance, and many other aspects which build in quality from the start.
The problem is not whether your organization will be able to develop and deliver a solution. From a technical perspective, it is solutions are easier to deliver than ever before. Today technology is cheaper and more available. The challenge is to figure out which solution will appeal to consumerswill become applicable in, maybe, a market we have not seen before. This is the main capability organizations will need.
Me too would like to have a world without Corona and plenty of without all uncertainties. But the reality is pressing on, and I don't think Business Agility is an option anymore; it is a must.
Stay safe,
Mats
Remember some possibly useful stuff.
While many of us are occupied in the current situation, trying to live our lives and also save lives, some need to start planning for the future. Leaders of companies and other organizations cannot wait to point out the way forward. We need to get going. We have an economy to save!.
Historically demand has gone done after a crisis. The global competition is likely to get more brutal than ever before.
It is not possible to have all the layers, streamlining organization charts and avoid silos and layers that only add administration or control
Eventually, we will come out of these crises. It is going to hurt and many will grief their close ones. But in some way, we will come out.
My prediction is that the need for Business agility will even higher after the pandemic. Markets have inevitably changed and many products will not sell. Product Management needs to be innovative solutions. Great products have always been the underlying reason for the success Some times the luck and many times research and innovation The chance of success through cost-saving and production optimization is getting lower. Company leaders need to focus more on building the capability to innovate new products and interact with the market to validate what is flying or not.
It is your choice if you want to build your organization around these value streams or stay in the functional responsibility paradigm. But, take the time to think about your choice now and prepare for the worst.
Just forget to do well-defined plans and product designs. When dealing with this massive uncertainty, building up new knowledge, and adjust is going to be your way forward.
What is your recipe to manage the competition?
They must build a flow-based and modularized organization that can act swiftly on market reactions. The time is over when Agile and Lean have been thought of just as an IT-team endeavor. Without upper management engagement, we have observed that for most "traditional" organizations it is a very long Journey
In almost all organization I can see an unclear decision order where organizational capability and product delivery are mixed and handled so unclear that not much is coming out. All organizations that want to challenge the competition have to take organizational design and product development flow much more seriously.
The time is over when the best way to organize was in functional silos with local responsibility and performance metrics. Whether you are promoting silos or not, your business is operating in valve streams. That is all strategic steps needed from start until some kind of client or user value appears.
Backlog, backlog, and backlog. A great Product Backlog is transparent, contains what we would like to have, and is prioritized based on business value. Most organizations do not have the needed knowledge to create great backlogs. They mix projects, activities, and phrases just as before. Top management needs to understand and show the rest of the organization what a great ball log is. Otherwise, it will not happen. I'm sure I have seen it far too offers.
Trash
The chance of success through cost-savings and supply-chain/production optimization is getting lower. Instead, company leaders need to focus more on building the capability to innovate, create new products, and interact with the market to validate what is flying or not.
My prediction is, that innovative Product Development will be the key to survival.
Did anyone think about slowing down?
The solution
The art of innovative Product Management, with the development of Lean-Agile mindset and frameworks, has for many years become more and more important. I am so sure this development will accelerate so much more. Since the thing with Lean and Agile is all about taming the uncertainty.