Back in 2011, an article in Harvard Business Review posited that adaptability would be a competitive advantage for organizations in the coming years. “Sustainable competitive advantage no longer arises exclusively from position, scale, and first-order capabilities in producing or delivering an offering,” authors Martin Reeves and Mike Deimler wrote at the time. “Increasingly, managers are finding that [sustainable competitive advantage] stems from the ‘second-order’ organizational capabilities that foster rapid adaptation. Instead of being really good at doing some particular thing, companies must be really good at learning how to do new things.”
Fast forward to 2024. The globe has endured multiple shifts, disruptions, and changes since this article first appeared, including a worldwide pandemic. Increasing globalization means greater complexities, such as supply chain disruptions and remote teams scattered around the world. Generational shifts mean that leaders must manage across a range of beliefs and desires about what work should look like. And into this mix of variables, leaders now have to navigate artificial intelligence and the potential upheavals it will bring.
As the old saying goes, the only constant is change—and it feels like that’s never been more true than in 2024. In these rapidly shifting times, developing a strategy of adaptation is necessary to stay one step ahead of the competition and maintain an established marketplace position.
Here are four ways to start developing a strategy of adaptation and future-proof your organization.
1. Build a Strong Change Muscle
If everyone agrees that disruption is inevitable, organizations should prioritize leadership development and emphasize the skills that leaders will need to navigate rapid change and instability. Spend time developing skills such as decision-making and change management, and look for ways to increase exposure to other functions and roles so that more leaders are equipped to step into gaps in the event of disruption.
In addition, a recent article in the MIT Sloan Management Review suggests that organizations should also develop their change muscles at the organizational level. The authors suggest that “adaptable systems, empowered employees, and a culture open to change” can better position an organization to weather disruption and rapid change.
Focusing only on making leaders able to handle change without improving internal systems and culture is like trying to lose weight through exercise while ignoring a lousy diet—you might see some improvement, but until you address the systemic challenges, you can’t achieve real progress toward your goals.
Take some time to look carefully at systems and processes within your organization. How nimble are they? Are managers, team leaders, and employees at all levels empowered to make decisions and raise questions? Do leaders at all levels embrace a growth mindset and value input from others?
2. Engage in Scenario-Based Planning
Think back to 2019. Had you or your leaders taken time to prepare for a disruption that would send large portions of your staff to work from home? Did you have technology and systems designed to accommodate remote or hybrid work? Was your factory prepared to manage an uptick in demand—or a considerable decrease? Did you know how to manage issues like curbside pickup and delivery or supply chain disruptions?
Very few organizations were adequately prepared for the events of 2020 and 2021, and those that were had a tremendous competitive advantage over those that weren’t. The chances of another pandemic striking the world might not be imminent, but what about other disruptions? Does your organization have a plan for the next market downturn, supply chain disruption, or natural disaster?
If the answer to these questions makes you feel unprepared for the unexpected, it might be time for an offsite meeting to engage in scenario-based planning.
3. Work Toward a Dynamic Organization
Whether you realize it or not, your organization is already perfectly designed. As John W. Gardner said, “Every organization is perfectly designed to get the results it gets.” The question is not whether the organization has a design—it’s whether the design is happening by default or by intention.
If your organization isn’t getting the desired results, it’s probably time to invest in intentional organizational design. This process doesn’t mean just drawing new lines and boxes around functions and people; instead, it starts with strategy and focuses on aligning processes, systems, people, and incentives with that strategy.
As part of your organizational design, look for ways your organization can improve its agility to meet market needs in moments of rapid change.
4. Play the Long Game
Part of being an adaptable organization is keeping your company’s long-term vision in mind—that is, understanding that strategic moves, organizational design, and the vast array of market shifts and disruptions that come along are all part of the journey toward fulfilling the company’s big vision and purpose.
Sometimes, playing the long game means taking a short-term hit to pursue long-term gains, such as when Adobe Systems shifted from hardware-based solutions to subscription-based cloud software. The company’s revenue went down 8% in 2013, the first year of the process. By 2022, it had more than rebounded—from $4 billion to $14 billion, with 80% of revenue coming from subscriptions and related sources.
In other cases, keeping the long-term vision in mind might mean taking a chance on a new product or service or even narrowing focus, such as when Jeff Bezos focused on creating an online bookstore with the long-term goal of creating an online store that would sell much more than books. The key to playing the long game is vision—clarifying it first and pursuing it through obstacles.
If leaders in your organization suspect the company is mired in outdated processes or systems or unprepared for potential disruptions, it might be an excellent time to plan an offsite. Even a few days away from the office with senior leaders could help break through to new ways of thinking and help form a better plan for the rapidly changing modern business world.
Stewart Leadership can help. Whether you need offsite facilitation or help with organizational design and strategic planning, our experts can help your leaders prepare to deliver results through whatever the future brings. Contact us to learn how.
Self-check:
- On a scale of 1 (not ready at all) to 5 (ready for anything), how prepared is our organization for a big disruption?
- Are we guided by an overall vision, or are we more engaged in reactionary damage control?
- What is one way we could have a better culture of adaptation?
