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What Is Business Agility?

What is business agility? Business agility refers to a company’s ability to adapt to market changes through the use of technology promoting agile organizational processes.

We’ll do our best to avoid using too many buzzwords, but in essence, an “agile” business can respond more quickly to changes than a “rigid” business.

They do this by encouraging a culture within the organization (from the top down) that is receptive to change; and by getting the right digital solutions which can help guide decision makers by providing them with actionable data and reporting through analysis.

Today, we’ll be taking a look at what business agility is and look at some examples of how an agile business has a distinct advantage over its peers by putting the right processes in place.

An Example of Business Agility

A simple example of this would be a company using business intelligence (BI).

With business intelligence, a company can receive actionable data on an array of processes, but let’s just say that you’ve used BI and the data provided to shows there’s an enormous inefficiency with a worker manually invoicing customers.

Maybe it was going under the radar before, but now you know that there’s an issue, and you can implement an RPA solution to automate the task, allowing the worker to focus on more meaningful tasks, and you can save money on the labor costs of a menial process.

The end result is a more efficient business. While you’ve streamlined a process, your competitors who use their gut-feeling for decision-making are continuing to be wasteful with their resources—often unknowingly.

With successful organizations, only 40% base their decisions on gut feeling. For less successful enterprises, this number jumps to 70%.

While a basic example, this is the defining characteristic of business agility—embracing a culture change of disruption of normal working processes, and using technology to help you improve your productivity, cut unnecessary costs, and improve your product and service.

What Does an Agile Business Look Like?

We’ve had a look at an example of how an agile business can solve an issue an improve their efficiency in doing so, but what does an agile organization look like?

Let’s break down the key areas of business agility within a company and use examples to illustrate why agility is important.

Agile culture

As with virtually anything that involves the implementation of major new practices or processes within an organization, culture is key.

Business agility is a guiding philosophy behind a digital transformation strategy, which itself is a disruptive (in the good sense) approach to business.

When you’re introducing a new way of doing things into the office, employees can be reticent.

Sure, it might be easy to have an accepting culture in a tech company or marketing agency, but what about a manufacturing firm? Or a nonprofit that’s used to doing things a certain way?

Well, business agility requires that the company has buy-in from employees, which must be done from the top-down, and in a clear and decisive way that benefits them.

If workers have new technologies imposed upon them with no support, not only will they not engage with them, it will actively harm progress towards an agile culture.

One of the key reasons digital initiatives fail is for precisely this reason: a lack of care from the top about how they should handle changes internally.

Related Post: Digital Transformation Failure: Avoiding Fatigue

A survey of employees found the most common obstacle for digital transformation was the CEO at 35%.

However, once that culture is in place, with executives leading and with buy-in from employees, you have a business that is both able to accommodate new ways of operation and actively seeking out new ways to improve processes.

This is what it is to have an agile culture.

To sum up, lead from the front, get the employees on board by proposing value to them, and you’ll be well on your way to having a culture that embraces necessary change.

Business agility is crucial

Agile internal organization

Ensuring agility in your internal operational processes is a key aspect of business agility.

What do we mean by this exactly?

Well, let’s say a business has just invested in new servers to house all their data and their employees’ work.

That’s great! For now—but what about in a year’s time?

90% of all the data in the world was created in the last two years.

Data growth is exponential, and we need more and more space to keep it safe; this is the same for businesses, just as it is with consumers.

So, while that server stack might do you just fine now, the influx of data over the one, two, or five years means that upgrading it sooner rather than later will become a costly inevitability.

Add into the mix that organizations have to now contend with data privacy laws, like CCPA, which are increasingly demanding in what protections businesses have to give their customer data, and those servers won’t be fit for purpose for very long.

Now, let’s talk about another business which has taken a different approach.

They’ve decided to move all their data to the cloud, and they similarly have run out of space by the time a year’s up.

What do they do?

They scale their cloud storage, which is maintained and secured by another business (such as Microsoft, Amazon, or Google) and continue their business as usual.

Related Post: How Azure Cloud Services Provide Business Agility

The examples here are a good demonstration of how a business which exhibits agility can have a clear advantage on their competitors.

Of course, it’s not just about server space, but virtually everything within a business. Got a slow manual process? You can respond quickly by getting an automation solution from your cloud services provider and implementing it as soon as possible.

With the right process in place, an agile business can react quickly to improve its internal processes on a dime.

Digital maturity levels across industries

Agile solutions

This also applies to your external operations, where business agility allows you the opportunity to see where improvements can be made in your product or service.

One of the biggest aspects of agility is using big data and analytics to help fuel your decision making.

A good example of this would be manufacturing firms dealing with supply chain disruptions.

An agile business can implement an ERP solution, which will crawl data and give you reports which predict disruptions and allow you to manage them as best you can.

Using multiple areas of analysis, it will look at trends, historical data, inconsistencies, and other variables to give you the best chance of mitigating any disruption in the future, whether it’s from a seasonal change or something completely out of your control.

Related Post: Supply Chain Disruption: Mitigating Threats Effectively with Analysis

Meanwhile, other businesses are basing their decisions on gut feeling, and effectively throwing darts with their eyes closed.

This is the same for other areas of business too, like using analytics to determine which types customer complaints are the most common, allowing you to address them rather than keep you guessing what your consumer base wants.

Business Agility Stats That Demonstrate Its Value 

  • An estimated 71% of businesses have low business agility according to a survey by the Business Agility Institute.
  • A survey of employees found the most common obstacle for digital transformation was the CEO at 35%.
  • 59% of professionals say culture and performance management are the key challenges in their shift towards agility.
  • 70% of businesses indicate an ambition to integrate both Business and IT-enabled Agile transformation in the next three years.
  • 81% of organizations have started their agile transformation within the last three years.
  • 45% of businesses indicate that breaking down silos between business and IT is a main driver for their shift towards agility.
  • 56% of CEOs say digital improvements have led to increased revenue.
  • Digitally mature companies are 23% more profitable than their less mature peers.

Why Do Businesses Need to be Agile?

  • Agile businesses can navigate their way through trouble by using digital technology and a change of culture to move forward.
  • Businesses need to be agile because these types of organizations are invariably more successful than their competitors, particularly those who are reluctant to change.
  • As we move forward, and organizations continue to digitally transform their operations, it’s imperative for them to build, grow, and maintain business agility in order to tackle future challenges head-on.

In light of recent events, many organizations have found themselves playing catchup, trying to implement makeshift cloud solutions to make up lost ground while their workforces see drastic transformations.

To find out more about how the cloud can ensure your business is in good shape for the future, download our eBook, “Which Cloud Option Is Right For Your Business?”