Strategic Agility

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What is Strategic Agility? Meaning.

Strategic Agility is a company's ability or capacity to continuously adjust and adapt its strategic direction by identifying and decisively seizing major, game-changing opportunities when they arise. Like other forms of agility, such as operational agility,  portfolio agility  and organizational agility, the underlying idea is being quick on your feet, nimble, responsive, always alert. However in the case of strategic agility the focus is on the need for flexible, fast adaptive strategy formation.

A major challenge with achieving strategic agility is to balance this ability to respond and adapt quickly to changing market conditions with having a relatively stable direction (strategic vision) and key corporate resources.

Typical examples of this type of organizational agility are:

• Rapidly establishing and scaling up a new business (Compare: Business Incubator).
• Aggressively entering a new market (Compare: First-mover Advantage, Time to Market).
• Betting heavily on new technologies.
• Making significant investments in capacity.

Specific organizational capabilities to be strategically agile include (Donald Sull in HBR, February 2009):

• Strong capability to finance big bets.
• Flexible governance structure.
• Long-term perspective by shareholders and executives.

Other organizational capabilities to be a strategically fast company are (Jocelyn R. Davis ad Tom Atkinson in HBR, May 2010):

• Align senior leaders to strategic initiatives.
• Innovation teams capture and communicate lessons learned.
• Develop the ability to explore new technologies rather than improve quality or lower costs.

In their book 'Fast Strategy: How strategic agility will help you stay ahead of the game' (2008), Yvez Doz and Mikko Kosonen formulate 4 Key Enabling Capabilities for Strategic Agility:

• Strategic Sensitivity (seeing and framing opportunities and threats in a new way, in time)
  • Casting a wide net.
  • Multiple levels of analysis.
  • Including understanding of one's creeping and binding "lock ins".
• Collective Commitment (collective decision-making and commitment)
  • Keep the top level meetings focused on strategy.
  • Create culture of holistic accountability instead of silos.
  • Make time for full information sharing and interaction.
  • Treat personal objectives and concerns as critical inputs.
  • Have a FAIR process that allows for needed UNEQUAL resource allocation.
• Resource Fluidity (fast and efficient resource mobilization, redeployment)
  • Some resources are more fluid (money, brand) than others (key people, fixed inputs, special relationships with clients).
  • Challenge is cognitive and political rather than procedural or financial.
  • Generative growth (on the edges) is key.
  • Maximize knowledge sharing with outside parties (Compare: Co-Creation).
  • Experiment.
• Management Depoliticization
  • Most top teams are, for natural reasons, collections of independent individuals with strong opinions rather than inspiring and innovative teams.
  • Teams need to be organized for mutual interdependencies, with incentives to match.
  • Cognitive diversity is a key precondition to high-quality internal dialogs (Compare: Cross-Functional Team)
  • Use young rising leaders as a shadow management team focused on the future.
  • Have an OPEN strategy process.
  • Leaders must learn to ASK and ADAPT rather than to DECIDE and TELL.

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Compare with: Operational Agility  |  Portfolio Agility  |  Organizational Agility  |  Anti-Fragility (Taleb)  |  Organizational Absorption  |  Agile Absorption  |  Strategic Risk Management  |  Scenario Planning  |  Game Theory  |  Real Options

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