Building your business case for agile working? According to McKinsey, the best approach is to build a stable foundation of things that don’t change, to free you up for speed in other areas. Here’s how to create that stable core for reliability and efficiency, while introducing more dynamic elements that let you respond nimbly and quickly to new challenges and opportunities.
Established retailers often struggle to become more dynamic. Some start by creating ring-fenced digital teams or innovation ‘hubs’ to foster collaboration and innovation without the traditional limitations that may stifle experimentation.
But as McKinsey points out in an article titled Agility: It rhymes with stability, these hubs aren’t enough. If you just move fast and try to operate like a start-up, you can run into too many problems.
The challenges vary. If you rush to offer customers new services, you might take unnecessary risks. Or you’ll reinvent the wheel and create customised products using different and duplicative technologies.
You might try bolting new digital solutions onto legacy systems only to find that they don’t easily integrate. You can also end up relying on too many systems to push and pull data everywhere, leaving you unable to keep pace with customer demands for frictionless and personalised experiences.
McKinsey explains that part of the difficulty comes from a false trade-off: Assuming that you must choose between much-needed speed and flexibility on the one hand, and the stability and scale inherent in fixed organisational structures and processes on the other.
However, you actually need both. You need stability and a dynamic capability.
McKinsey found that companies with both speed and stability have a 70 percent chance of being ranked in the top quartile by organisational health – a predictor of strong financial performance.
Another McKinsey survey scored organisations across a range of dynamic and stable practices it believes are critical for achieving organisational agility. It found that less than one-quarter of business units are agile. The remainder either lack dynamism or stability, or both.
So how do you become both stable and dynamic?
There are three areas where you can balance this tension:
Moving to a unified commerce platform (like Infinity) gives you a single source of truth to manage your inventory, customer data, orders and transactions. With this stable platform, you’re free to integrate new technology and legacy systems to innovate quickly, optimise inventory, maximise margin, understand customers and deploy new services – efficiently and profitably.
With a stable unified commerce backbone in place, you are free to create looser, more dynamic elements that let you quickly adapt to new challenges and opportunities.
Agile’s iterative and collaborative processes can help you move fast and cultivate an environment in which innovation flourishes. You set up self-organising multidisciplinary teams that can focus on delivering products that best meet your current and future needs – with minimal costs, waste and time. You’ll achieve bottom line gains earlier than the traditional ‘waterfall’ development approaches.
Like agile, Application Programming Interfaces (APIs) provide you with a dynamic capability to move fast and create new services that differentiate your brand.
Using APIs, you can expose rather than move or replicate data, and make one set of functions available across various systems without having to recreate it. You can add, update, modify and delete apps and services over time as your business requirements change and new capabilities develop.
If you’d like advice on how agile can work within your organisation, get in touch. We have many years of experience in product development using the agile methodology and we’d love to help you deliver capabilities faster and better to meet your changing market and business demands.