Aspire Thought Leadership! Ever wondered about business agility?. Find out more on what has changed with business agility in the current age. Come rig
A few days after introducing students to the wonders of Chinese warfare and strategic business agility, I was planning my next post, hoping to make it as interesting as the one I delivered to my class the other day. I had set the bar high for all of my future lectures. If they took anything home from that class which I’m sure they did my students would have high expectations for the rest of the course. After all, it isn’t often that one is taught agility and management in such a unique way.
I searched through numerous books and websites for artificial intelligence in business, agility, and the need to accept and embrace change both on a personal level and from an organizational point of view but I realized that I had already spoken far too much about these topics from an historical perspective. Besides, I remembered how the students were able to relate to and grasp the concepts like value matrix far more quickly when I spoke to them quoting examples from Walmart® and IKEA®.
Naturally, as interested as they were in the concepts and strategies of war and learning how mighty and successful generals and leaders of the past weren’t afraid of experimenting and thinking outside box, the fact still remained that it would be much easier for them to understand what it was that I tried to teach them if I used examples and scenarios from the current state of the world.
Besides, talking any more about history than I already did would probably make the information from enterprise data management seem redundant enough for my students to be bored and stop listening to what I had to say altogether.
It would be best to be as innovative and creative with my lectures as possible while keeping the information and examples that I presented as relevant and relatable to students as possible.
One of the world’s leading economists, Eric D. Beinhocker, suggests that even though markets display dynamism at their best, the same is not exactly true for businesses. In fact, this American economist is of the opinion that organizations and businesses themselves are not innately capable of evolution or adaptation. He believes that organizations and companies are affected by the transitions and transformations that take place at the market level, and that they die or survive as a result. However, in most cases, they are unable to adapt by themselves.
The age we live in today provides all of those characteristics and more. In the world today, many people feel overwhelmed and burdened by responsibilities and demands from different aspects and domains of daily life. As a result, many people are in constant fear that they will not live up to the responsibilities that they have and what is expected of them. People these days have to deal with meetings, phone calls, emails, and expectations, which it is practically impossible for them to focus proper attention on simultaneously.
On top of it all, there are challenges that need to be addressed immediately challenges that are not only growing in scope, but also in size. These challenges and characteristics of the environment that we live in today are what was termed by the American Military as Volatile, Uncertain, Complex, and Ambiguous (VUCA). This term was coined by the US Army War College in the early 1990s to refer to the multilateral and multifaceted world of today. Since the end of the Cold War, the world and its environment has become more VUCA than ever before.
The concept of VUCA made its way into the business world in the wake of the global financial crises of 2008 and 2009. Since its introduction in the world of business and management, this concept has been featured countless times and now plays a very important role in the development of skills of leadership for multiple organizations and businesses throughout the world. This is primarily because leadership in the VUCA world of today is perhaps one of the most difficult tasks and the greatest challenge that people are faced with, not only in today’s world but probably throughout the history of mankind. It is up to leaders to be more agile and capable rather, responsible for making practical and viable decisions like never before in an environment that is constantly changing. In the business world, this concept is described in a slightly different way from when it is used to define the state of the world in general. For a business environment to be described as VUCA, it is important for the environment to exhibit certain qualities and demonstrate certain characteristics. The business environment usually is:
With the ever-changing world of today, leaders and managers need to up the game with their decision making and hit the ground running as they analyze huge amounts of information that they have access to as a result of the hyperconnected world of today.
Even though using past information to identify risks and take the necessary steps to protect oneself and prosper has come in handy for humanity for several hundreds of years, the VUCA environment of the world today demands more innovative solutions that are comprehensive and elaborate instead of being dragged and slightly tweaked and modified versions of the same solutions that have been used for years all of which had one thing in common: They were based on predictions. Since we have established that anything is possible in the VUCA environment, we need to understand that focusing only on what is likely to occur based on the trends, experiences, and information of the past is a guaranteed recipe for disaster. Instead, it is crucial for people to think outside the box so that they can successfully consider all of the possibilities and make the right decisions so that they will be prepared for anything that happens. As simple as the reason for the change that is required may sound, making the said change won’t be as easy. In fact, research shows that our brains are not particularly fond of this approach either. This is primarily due to the fact that we, as humans, love to reduce the amount of information that we have to analyze and minimize, and thereby simplify the process of making decisions. For us to be informed and prepared with regard to all of the possibilities, we will not only have to move away from what has been the norm for years but also change the patterns and habits that we use and follow for the gathering, collection, and retrieval of information, as well as the steps we take to reach conclusions and make decisions based on this information. Fortunately, a few small steps can be taken to ensure that we are successfully able to deal with the changes that come as a result of the increased levels of complexity in the world and evolve and adapt accordingly.
There are four habits that can help us evolve and improve our ability to deal with higher levels of complexity. These four habits are easy to implement:
I was browsing through incredible amounts of text from every source possible to make my lecture on big data in retail more interesting and engaging when I noticed that my phone had begun to ring. As I headed to the other room to pick it up, the only thing that crossed my mind was a piece of the text that I had read earlier, which talked about mobiles and the internet marking the final stages of the information age. “What could be next?” I wondered to myself. Before I could reach my phone to answer it, the ringing had stopped. Instinctively, my sight fell upon the wall clock. It was 10:10 p.m. “This must be a real emergency,” I thought to myself, hoping that it was nothing too serious.
The environment and economy of today need to be viewed holistically. To see the bigger picture, it is imperative for managers and those in leadership positions to be able to see their organizations with fresh eyes and not continue to use the same metrics for success, failure, and predictions that they used in the past. The world of today requires people to strategize and think outside of the box one thing that most people are failing to do.
Where pricing strategy may be concerned with the “usage” aspect of things, devising new and innovative tactics has more to do with individual engagement, which is essential in today’s day and age. [how to fight a price war] Unless both of these entities are understood separately, it is practically impossible to comprehend how they differ or even how they are innately related and can be used together for success. Linearity, as we have known it for the last several decades, has always been associated with Sir Isaac Newton. Linear science has, since its inception and introduction to the common public, evolved and developed until it started being used for describing and controlling the natural course of things. As expected, it would only be so long before the philosophy that was associated with the science and its powers began to fail. Ultimately, people started realizing that the linear approach for strategic pricing prediction was not only illusory but also vague in many ways with regards to retail pricing strategies.
Linearity was a concept in different pricing strategies that was best used when limited to systems that were predictable. Unfortunately, however, the environment and systems of today are very different from ever before. In the VUCA environment, it is impossible to only use the linearity approach in decision making. As mentioned earlier, it is impossible to make predictions in an environment that is as haphazard as today’s environment. Another reason why the linear approach doesn’t work for the environments of today is because, where a linear approach in penetration pricing strategy is being followed, the cause and effects of things are often measurable and demonstrable. In a VUCA environment, however, that is not the case. The VUCA environment of today has so much going on that, in the disrupted confusion of the world of today, pinpointing the causes and effects with accuracy and precision is also impossible due to the fact that there are several different changes and ripples that a single factor can cause today.
With a linear system, having even a small amount of information on premium pricing strategy, which is sufficient and can help you to make informed decisions that are sane and viable. Practical solutions can be deployed and decision making becomes easy with even minimal information of the past because the linear environments in question and their attributes are systematic and their behaviors are predictable all of which is untrue for the VUCA environment. This is where nonlinearity comes into the picture. Literally the opposite of linearity, nonlinearity is a completely different concept in itself. Not only does nonlinearity not conform to or apply to the rules that a linear approach is bound to follow, but the nonlinear approach also covers concepts that are not as systemic and predictable as those that the linear approach covers, including complexity theory and chaos theory.
Nonlinearity is not proportional by any means, and the causes and effects of situations within the system are not demonstrable either. Unlike their linear counterparts, nonlinear systems are not identifiable or recognizable through their parts, or equal to their constituent components in any way.
When talking about a nonlinear system, you cannot even expect the results to repeat themselves. Even if a situation has the exact same factors involved as one in the past, it is impossible to make judgments based on the results of the past because there can be a profound difference between the two situations, regardless of the fact that they were both part of the same system and had the same factors involved. What this means is that there is no way in which you can predict anything about the system with accuracy. Again, much unlike linear systems, having a little information about the nonlinear system essentially means nothing as it can be of little to no benefit. This has many ramifications on price optimization. Not only is one perpetually unaware of the workings of a nonlinear system, but this uncertainty and lack of predictability also means that there will always be a risk involved in the planning and control of the system. As difficult as it may sound and as hard to digest as it may be, the world we live in today is a blend of the linear and the nonlinear. Even though it might be possible to make some predictions based on certain factors and lucky enough to find that they were accurate, the fact of the matter is that most of the scenarios that occur today are much different from those of the past, even though they have uncanny similarities with events that we have all witnessed and learned from in the past.
As with everything in the world, however, nonlinear systems and the nonlinear approach to things also has its fair share of benefits and advantages. Even though instability can ensure and a nonlinear system may result in discontinuities and synergies, nonlinear systems also place extra pressure on organizations, companies, businesses and even people! to adapt and go the extra mile to devise and deliver elaborate solutions that are not only innovative and creative but are also based on key factors such as dynamism, responsiveness, and flexibility. To progress, thrive, and succeed in the world today, it is imperative for us to understand how we are all shackled by our own imaginations and the confines that have dogmatically been placed upon us. Where linearity may ease the decision-making process for us in many scenarios and make us react to situations according to what we expect or anticipate happening rather than everything that is possible, there is also a deep-rooted problem with linearity.
This approach essentially closes our doors and narrows down our viewpoint on systems that are a major part of our social and natural existence. This, in turn, leaves us weak and vulnerable in front of adversaries who are already making plans and strategizing to get ahead of the game. Knowing one’s constraints and limitations beforehand can not only help minimize the surprise aspect of things but also ensure that one does not remain in shock for a longer period of time than is necessary. This holds true for both organizations and individuals, including leaders and executives of the VUCA world. With a more holistic view and comprehensive model of the world before us, we will not only be able to adapt in a better and more efficient way, but it is also possible that focusing on nonlinearity will help us develop and implement robust systems that are needed to succeed in today’s world. As I tried to explain these very intricate concepts to Bill in as detailed and concise a way as possible, I concluded that he was able to understand most of what I was saying, judging by the lack of responses from his side.
He was thinking long and hard about it all how his organization and its structure was stuck in time, perhaps never to break free from the shackles that it imposed on itself, all due to a different approach and mindset than what was necessary. Finally, after I had spoken at length without a word from him, he responded. “Thank you, Joe,” he said, as courteously and politely as he could. But before I could acknowledge his response, he continued. “I don’t know if this will be too much trouble, and I know that I’ve already taken too much of your time, but is it possible for us to meet sometime soon? I think I’d like to talk about this in person. You’ve been of such great help.” After I hung up the phone, it became obvious to me that this conversation put me on a clear path to agility research. As close to my heart as the topic of discussion was, I just couldn’t say, “No.”
I searched through numerous books and websites for artificial intelligence in business, agility, and the need to accept and embrace change both on a personal level and from an organizational point of view but I realized that I had already spoken far too much about these topics from an historical perspective. Besides, I remembered how the students were able to relate to and grasp the concepts like value matrix far more quickly when I spoke to them quoting examples from Walmart® and IKEA®.
Naturally, as interested as they were in the concepts and strategies of war and learning how mighty and successful generals and leaders of the past weren’t afraid of experimenting and thinking outside box, the fact still remained that it would be much easier for them to understand what it was that I tried to teach them if I used examples and scenarios from the current state of the world.
Besides, talking any more about history than I already did would probably make the information from enterprise data management seem redundant enough for my students to be bored and stop listening to what I had to say altogether.
It would be best to be as innovative and creative with my lectures as possible while keeping the information and examples that I presented as relevant and relatable to students as possible.
Strategic digital business agility
Whether you call it the Digital Age, the Computer Age, or the New Media Age, one thing is for certain: The Information Age has brought with it changes that were not only unprecedented, but their magnitude was such that it could not have been imagined by anyone not even in the recent past. Not only has there been a complete shift in the way our industries work and function, but the production mechanisms of our industries have also changed. The Industrial Revolution brought with it industrialization that gave us traditional industries as we know them. Then came the Information Age, which caused a shift in our economy, and the computerization of information became its basis. Industrial production changed to production based on computerization, information, and adequate relevant knowledge. But now, two and a half decades after the introduction of the World Wide Web and customer value proposition, the Information Age is at its final stages of digital disruption because of the Internet and mobile screens. And businesses know that they must adapt quickly in order to survive in the Age of Agility, which is now upon us.One of the world’s leading economists, Eric D. Beinhocker, suggests that even though markets display dynamism at their best, the same is not exactly true for businesses. In fact, this American economist is of the opinion that organizations and businesses themselves are not innately capable of evolution or adaptation. He believes that organizations and companies are affected by the transitions and transformations that take place at the market level, and that they die or survive as a result. However, in most cases, they are unable to adapt by themselves.
The age we live in today provides all of those characteristics and more. In the world today, many people feel overwhelmed and burdened by responsibilities and demands from different aspects and domains of daily life. As a result, many people are in constant fear that they will not live up to the responsibilities that they have and what is expected of them. People these days have to deal with meetings, phone calls, emails, and expectations, which it is practically impossible for them to focus proper attention on simultaneously.
On top of it all, there are challenges that need to be addressed immediately challenges that are not only growing in scope, but also in size. These challenges and characteristics of the environment that we live in today are what was termed by the American Military as Volatile, Uncertain, Complex, and Ambiguous (VUCA). This term was coined by the US Army War College in the early 1990s to refer to the multilateral and multifaceted world of today. Since the end of the Cold War, the world and its environment has become more VUCA than ever before.
The concept of VUCA made its way into the business world in the wake of the global financial crises of 2008 and 2009. Since its introduction in the world of business and management, this concept has been featured countless times and now plays a very important role in the development of skills of leadership for multiple organizations and businesses throughout the world. This is primarily because leadership in the VUCA world of today is perhaps one of the most difficult tasks and the greatest challenge that people are faced with, not only in today’s world but probably throughout the history of mankind. It is up to leaders to be more agile and capable rather, responsible for making practical and viable decisions like never before in an environment that is constantly changing. In the business world, this concept is described in a slightly different way from when it is used to define the state of the world in general. For a business environment to be described as VUCA, it is important for the environment to exhibit certain qualities and demonstrate certain characteristics. The business environment usually is:
- Volatile: There is an increase in the speed, volume, scale, and types of challenges that affect all of the businesses and the workforce of the business environment in question.
- Uncertain: Due to the volatile nature of the business environment, people are unable to predict the way in which progress will be made in the environment and how future events will be different from the current scenario. Complex: There is confusion to the extent that all of the businesses are affected by the changes and are unable to put their finger on the causes of the changes or the connections between the causes of change and their outcomes.
- Ambiguous: There isn’t a precise definition for most of the conditions of the business environment, and multiple meanings exist simultaneously.
With the ever-changing world of today, leaders and managers need to up the game with their decision making and hit the ground running as they analyze huge amounts of information that they have access to as a result of the hyperconnected world of today.
Strategic business agility
One of the biggest problems that these leaders and managers face when making decisions in the digital age of today, however, is that for centuries, it has been believed that there is a degree of certainty and predictability in the world. Being raised within this context, people tend to focus more on the probability of things. What is needed for the progress and success of an organization, company, or business in today’s world is a shift in perspective. It is imperative for leaders of today to shift their focus and divert their energies and efforts to what is possible instead of the probability. But the question here remains: How is one to change the mindset that has been the norm for centuries? The answer lies in one simple truth. As mentioned before, today’s world is unpredictable and in many ways different from the past. This means that it is not a wise idea to use the information and experiences of the past as a basis for our decisions regarding the future. Even though this approach proved to be successful for hundreds if not thousands of years, the limits of the approach are manifesting themselves in today’s world because the challenges and changes that we face and experience today are like nothing that was ever witnessed in the past.Even though using past information to identify risks and take the necessary steps to protect oneself and prosper has come in handy for humanity for several hundreds of years, the VUCA environment of the world today demands more innovative solutions that are comprehensive and elaborate instead of being dragged and slightly tweaked and modified versions of the same solutions that have been used for years all of which had one thing in common: They were based on predictions. Since we have established that anything is possible in the VUCA environment, we need to understand that focusing only on what is likely to occur based on the trends, experiences, and information of the past is a guaranteed recipe for disaster. Instead, it is crucial for people to think outside the box so that they can successfully consider all of the possibilities and make the right decisions so that they will be prepared for anything that happens. As simple as the reason for the change that is required may sound, making the said change won’t be as easy. In fact, research shows that our brains are not particularly fond of this approach either. This is primarily due to the fact that we, as humans, love to reduce the amount of information that we have to analyze and minimize, and thereby simplify the process of making decisions. For us to be informed and prepared with regard to all of the possibilities, we will not only have to move away from what has been the norm for years but also change the patterns and habits that we use and follow for the gathering, collection, and retrieval of information, as well as the steps we take to reach conclusions and make decisions based on this information. Fortunately, a few small steps can be taken to ensure that we are successfully able to deal with the changes that come as a result of the increased levels of complexity in the world and evolve and adapt accordingly.
There are four habits that can help us evolve and improve our ability to deal with higher levels of complexity. These four habits are easy to implement:
- Asking questions of various types
- Taking on different perspectives
- Development of a systemic vision to approach events
- Understanding the holistic view of things and picturing all of the possibilities
I was browsing through incredible amounts of text from every source possible to make my lecture on big data in retail more interesting and engaging when I noticed that my phone had begun to ring. As I headed to the other room to pick it up, the only thing that crossed my mind was a piece of the text that I had read earlier, which talked about mobiles and the internet marking the final stages of the information age. “What could be next?” I wondered to myself. Before I could reach my phone to answer it, the ringing had stopped. Instinctively, my sight fell upon the wall clock. It was 10:10 p.m. “This must be a real emergency,” I thought to myself, hoping that it was nothing too serious.
The environment and economy of today need to be viewed holistically. To see the bigger picture, it is imperative for managers and those in leadership positions to be able to see their organizations with fresh eyes and not continue to use the same metrics for success, failure, and predictions that they used in the past. The world of today requires people to strategize and think outside of the box one thing that most people are failing to do.
Where pricing strategy may be concerned with the “usage” aspect of things, devising new and innovative tactics has more to do with individual engagement, which is essential in today’s day and age. [how to fight a price war] Unless both of these entities are understood separately, it is practically impossible to comprehend how they differ or even how they are innately related and can be used together for success. Linearity, as we have known it for the last several decades, has always been associated with Sir Isaac Newton. Linear science has, since its inception and introduction to the common public, evolved and developed until it started being used for describing and controlling the natural course of things. As expected, it would only be so long before the philosophy that was associated with the science and its powers began to fail. Ultimately, people started realizing that the linear approach for strategic pricing prediction was not only illusory but also vague in many ways with regards to retail pricing strategies.
Linearity was a concept in different pricing strategies that was best used when limited to systems that were predictable. Unfortunately, however, the environment and systems of today are very different from ever before. In the VUCA environment, it is impossible to only use the linearity approach in decision making. As mentioned earlier, it is impossible to make predictions in an environment that is as haphazard as today’s environment. Another reason why the linear approach doesn’t work for the environments of today is because, where a linear approach in penetration pricing strategy is being followed, the cause and effects of things are often measurable and demonstrable. In a VUCA environment, however, that is not the case. The VUCA environment of today has so much going on that, in the disrupted confusion of the world of today, pinpointing the causes and effects with accuracy and precision is also impossible due to the fact that there are several different changes and ripples that a single factor can cause today.
With a linear system, having even a small amount of information on premium pricing strategy, which is sufficient and can help you to make informed decisions that are sane and viable. Practical solutions can be deployed and decision making becomes easy with even minimal information of the past because the linear environments in question and their attributes are systematic and their behaviors are predictable all of which is untrue for the VUCA environment. This is where nonlinearity comes into the picture. Literally the opposite of linearity, nonlinearity is a completely different concept in itself. Not only does nonlinearity not conform to or apply to the rules that a linear approach is bound to follow, but the nonlinear approach also covers concepts that are not as systemic and predictable as those that the linear approach covers, including complexity theory and chaos theory.
Nonlinearity is not proportional by any means, and the causes and effects of situations within the system are not demonstrable either. Unlike their linear counterparts, nonlinear systems are not identifiable or recognizable through their parts, or equal to their constituent components in any way.
When talking about a nonlinear system, you cannot even expect the results to repeat themselves. Even if a situation has the exact same factors involved as one in the past, it is impossible to make judgments based on the results of the past because there can be a profound difference between the two situations, regardless of the fact that they were both part of the same system and had the same factors involved. What this means is that there is no way in which you can predict anything about the system with accuracy. Again, much unlike linear systems, having a little information about the nonlinear system essentially means nothing as it can be of little to no benefit. This has many ramifications on price optimization. Not only is one perpetually unaware of the workings of a nonlinear system, but this uncertainty and lack of predictability also means that there will always be a risk involved in the planning and control of the system. As difficult as it may sound and as hard to digest as it may be, the world we live in today is a blend of the linear and the nonlinear. Even though it might be possible to make some predictions based on certain factors and lucky enough to find that they were accurate, the fact of the matter is that most of the scenarios that occur today are much different from those of the past, even though they have uncanny similarities with events that we have all witnessed and learned from in the past.
As with everything in the world, however, nonlinear systems and the nonlinear approach to things also has its fair share of benefits and advantages. Even though instability can ensure and a nonlinear system may result in discontinuities and synergies, nonlinear systems also place extra pressure on organizations, companies, businesses and even people! to adapt and go the extra mile to devise and deliver elaborate solutions that are not only innovative and creative but are also based on key factors such as dynamism, responsiveness, and flexibility. To progress, thrive, and succeed in the world today, it is imperative for us to understand how we are all shackled by our own imaginations and the confines that have dogmatically been placed upon us. Where linearity may ease the decision-making process for us in many scenarios and make us react to situations according to what we expect or anticipate happening rather than everything that is possible, there is also a deep-rooted problem with linearity.
This approach essentially closes our doors and narrows down our viewpoint on systems that are a major part of our social and natural existence. This, in turn, leaves us weak and vulnerable in front of adversaries who are already making plans and strategizing to get ahead of the game. Knowing one’s constraints and limitations beforehand can not only help minimize the surprise aspect of things but also ensure that one does not remain in shock for a longer period of time than is necessary. This holds true for both organizations and individuals, including leaders and executives of the VUCA world. With a more holistic view and comprehensive model of the world before us, we will not only be able to adapt in a better and more efficient way, but it is also possible that focusing on nonlinearity will help us develop and implement robust systems that are needed to succeed in today’s world. As I tried to explain these very intricate concepts to Bill in as detailed and concise a way as possible, I concluded that he was able to understand most of what I was saying, judging by the lack of responses from his side.
He was thinking long and hard about it all how his organization and its structure was stuck in time, perhaps never to break free from the shackles that it imposed on itself, all due to a different approach and mindset than what was necessary. Finally, after I had spoken at length without a word from him, he responded. “Thank you, Joe,” he said, as courteously and politely as he could. But before I could acknowledge his response, he continued. “I don’t know if this will be too much trouble, and I know that I’ve already taken too much of your time, but is it possible for us to meet sometime soon? I think I’d like to talk about this in person. You’ve been of such great help.” After I hung up the phone, it became obvious to me that this conversation put me on a clear path to agility research. As close to my heart as the topic of discussion was, I just couldn’t say, “No.”
COMMENTS