the responsive enterprise - agile cockpit · book the responsive enterprise, written by vikram...
TRANSCRIPT
The Responsive EnterpriseHow do you make a large organization just as quick on its feet and effective as a start-up?
Pattern 2: Target a higher ambitious goal
By Vikram Kapoor and Rini van Solingen
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How do you make a large organization just as quick on its feet and effective as a start-up?Large enterprises have often lost much of their responsiveness in comparison to smaller enterprises or start-ups. This despite the fact that today, being responsive might be the most important quality an enterprise can have, as the ability to swiftly respond to changes can help an enterprise survive in the long term. This whitepaper covers one of the nine patterns from the book The Responsive Enterprise, written by Vikram Kapoor and Rini van Solingen. In this book, the authors explain the nine patterns – each of which have four sub-patterns – that help to greatly increase responsiveness. The story is written as a dialogue between two main characters, Mark and Ron. A separate whitepaper, containing concrete tips for implementation and areas for attention, has been written for each of these patterns. Responsiveness is a journey that doesn’t end once the nine patterns in this book have been implemented. The world will continue to change and, as a result, so will responsiveness. There is no reason to put off becoming faster and more responsive. Start today by making client impact a priority and using mini-companies to experiment in order to realize your higher goal.
Pattern 2: Set an ambitious higher goalMaximum energy is the result of individuals coming together as a team to strive towards a higher goal. This higher goal should be something that is ambitious yet achievable. Don’t forget to celebrate the learning experiences and intermediate results along the way.
This whitepaper is part of the book “The Responsive Enterprise” by Rini van Solingen and Vikram Kapoor, and offers additional details and information for practical implementation.
The essence of pattern 2
1. To set a higher and more valuable goal that is both ambitious and realistic.
2. To cooperate as a team that is driven to accomplish complex and valuable goals.
3. To grow both as a solid and stable team and as an individual.
4. To celebrate learning experiences and successes frequently.
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Mark is the owner of a small, fast-growing business. His friend from college, Ron, invites him to go golfing. During their round, they talk about increasing speed and decisiveness. Mark calls this “responsiveness”. Ron realizes that his organization is much too slow to be successful in the current market dynamic, so he asks Mark for advice. During the first hole, they discuss the idea of mini-companies that operate entirely autonomously and effectively. In this kind of autonomous team, all necessary competencies are present in order to do whatever is necessary to serve the client(s). Mark suggests that most large companies are much too focused on themselves and that many employees don’t have any contact with clients at all, or that they view their coworkers as internal clients. In order to be truly effective, everyone involved must focus on the client. This is where dividing into mini-companies with short lines to the client proves useful. Ron claims this is impossible in his organization and would be much too drastic a measure. Reluctantly, however, he has to admit that when large or urgent problems occur, his company does assign multidisciplinary taskforces. Mark points out that apparently, it is possible after all.
De vier onderliggende principes
The dialogue about mini-companies in the book
The Responsive Enterprise
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Set a higher and valuable goal that is both ambitious and realistic. A Responsive Enterprise takes a step towards realizing the future every single day – a future which is better for others as well as for each other.
Without a higher ambitious goal, making a profit, doing your job, ensuring continuity and serving customers will be come your only goals. It’s difficult to give these goals 100% -- your full and energetic attention -- over the long run. With a higher goal, the daily deliberation on “why are we here” also becomes easier. Why do we do what we do? An ambitious and higher goal is an important tool in getting everybody out of bed in the mornings, fully energized and ready to maximize their potential.
Cooperate with the best to accomplish complex and valuable goals. The second condition in releasing all the potential energy in a company is working together with the best colleagues possible. Everyone has their own individual qualities. Teams take their strength from the qualities of the team members as they cooperating to complete a challenging, valuable task. The team members will develop their qualities if they are in charge of deciding which team they want to join. When job candidates are interviewing, teams have the power to choose their own new members. Educating one another, embracing talented new team members and achieving results together ensures they maintain a maximum level of energy.
Growing along with a solid and stable team: growth at both an individual and a team level. The third condition is autonomy. Self-organization provides a sense of control and makes sure that everyone puts in maximum energy. This works best when all team members have a naturally autonomous way of working and are emotionally independent. The easier it is for a team to make mistakes, correct one another and give and receive feedback, the more energy is being released. That is why maintaining the stability of teams and giving them time to grow together is desirable. Changes will inevitably occur within a team, of course, but overall stability is very important. When your team is growing, you are growing as an individual at the same time. And when the team members improve their individual skills, the team in general improves as well.
Celebrate successes and learning experiences frequently.Celebrating successes is a source of added energy. Complaining drains energy. That is why it is important to share and celebrate successes as often as possible. Naturally there will also be mistakes, but those mistakes can be transformed into learning experiences, which you can then also share with each other. In this way, you help one another become more successful by demonstrating what does and doesn’t work, and more importantly -- why that is the case. A Responsive Enterprise means thinking ahead. All results that have been achieved and all learning experiences deserve to be shared and celebrated. The effect of this is maximum energy within the teams and maximum exchange of energy between them.
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Step 1: Establish a higher goal that is ambitious and future-oriented yet achievable.
• Describe the existence of your organization in one sentence. What is the higher goal that you are trying to realize together? Which part of the world are you making a little bit better? Which future goals are you trying to realize? Where is the growth and improvement for everyone who contributes to realizing those goals? Where is the fun, what is nice about what you do and why should other people want to join?
• Draft a mission statement together with your team. It really isn’t that hard to do if you simply take the time. Look at the people who you work with. What is their incentive? What is their motivation to do what they do? Establish a higher goal that can also serve as a guideline to getting where you want to be in 5 years; start taking serious steps to accomplish that goal.
• Make sure it is achievable, but not in less than 2 years’ time. Take a look at other companies’ websites. This can provide you with direction and can help you make your own plans more concrete. As long as it is ambitious, future-oriented, helps others and ensures your growth, you are headed in the right direction. If you are creating, making and realizing things then you are on the right path.
• Talk about it on a regular basis In the end, the conversation, energy and progress are more important than achieving the goal itself. It must be clear to everyone where they will be working on together. What is the goal that makes you want to jump out of bed in the mornings? Without one, making money becomes the goal; that goal makes it very hard to motivate people to be the best version of themselves.
Case study 1: Divide, but how?There once was an enterprise where people wanted to create mini-companies. This was a medium-sized company consisting of 120 employees of varying roles, work experience and length of employment at the enterprise. The idea was to divide them into mini-companies. But who do you put together? The possibilities are endless and there will inevitably be someone who doesn’t agree with the group he or she has been put into.
This situation sounds difficult. What would you do?
Think about your own approach before you continue reading. How would you resolve this struggle?
The solution this enterprise chose was to provide the teams with guidelines, within which they could assemble their own teams. Their assignment was to form 10 mini-companies. 10 market and client groups were assigned in advance. The teams were also required to be “complete”, meaning that all areas of expertise necessary within a team had to accounted for. Ultimately, each of the teams would be able to handle operations from A to Z, without gaps or lack of certain qualities. In addition, the teams were given the instruction to form mini-companies with no fewer than 8 members and no more than 14. Finally, and most importantly: everyone had to be satisfied with the end result. Every team member had the right to make their opinion about the teams’ composition heard. The teams were given 2 hours to finish this assignment, without interference from a director or manager. The director joked that, since the employees were unlikely to succeed, he would end up composing the teams himself -- and that would probably turn out worse! Yet within an hour, the assignment had been completed. The second hour was used to present the teams, during which time they explained why they had all the qualities necessary to form a strong team that could function from A to Z. Everyone agreed with the choices that had been made. This is a great example of how the power of a group can be used to overcome the challenge of dividing 120 employees into 10 mini-companies.
So how do you make this happen?
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Step 2: Let teams reorganize themselves and give them a say in accepting new applicants.
• When a team is being reorganized, give the original team members as much influence as possible. Try to give them no more than four frameworks or guidelines. The size of the teams, positions or roles or the minimum amount of competences will work just fine. It can be less effective when team members are allowed to choose their own teams – but in some cases, it is necessary. The more freedom and autonomy you give them, the better.
• Formulate an interview process where the team members are responsible for managing the applicants. Eventually, a new colleague will join the team: it makes sense for the team to have a say in deciding who it will be. An additional benefit is that it will help the team members examine their situation critically, making them aware of what talents are present or lacking at the moment. And when they get a vote in the matter, they are less likely to complain about the new team member. After all, they chose the candidate themselves. In any case, the final interview can be with the manager to ensure the person is a good fit for the job. Challenge the team to attract team members whose qualities will truly benefit the team.
• Keep team dynamics in mind. The forming, storming, norming and preforming model of Bruce Tuckman can help with this. It can guide you in taking the next step, facilitating the development of team members as individuals and as a team.
Step 3: Create a rhythm of celebration for the frequent sharing of successes and learning experiences.
• Make sure the champagne is always kept chilled, a bouquet of flowers can be delivered to the office within an hour and that you recognize concrete moments for celebrating successes. Nothing creates as much energy as sharing and celebrating successes.
• Talk openly about mistakes or failures; always do so with an eye to the future. What are we going to do differently next time? What have we learned from this experience? Who should we share this experience with to make sure the same mistake isn’t made twice? It is typical of a Responsive Enterprise to be future-oriented. Every single day, you want to get a little bit better, get closer to reaching your end goals. Making mistakes and learning from them is therefore an essential process.
• Discuss the importance of celebration will all employees on a regular basis. At the end of the day, everyone has a duty to provide each other with additional energy. Successes are a way to make this happen. At the same time, it is very important to make everyone aware of the negative effects of complaining: it isn’t a source of energy for you, or for your colleagues. Search for the positive effect behind every disappointment and transform them into concrete action. Doing so is certain to provide you with more energy.
Case study 2: ZapposOne great example of an enterprise with an exciting higher goal is Zappos. You might think their higher goal would concern shoes, feet or walking – but that isn’t the case. Zappos’ mission statement is all about giving their clients the best possible service. Which has nothing to do with their shoes at all. They are deeply convinced that customer impact is responsible for all aspects that matter to a company: impact, growth, utility, continuity and so on. This is reflected in the Zappos core values.
1. Deliver WOW Through Service
2. Embrace and Drive Change
3. Create Fun and a Little Weirdness
4. Be Adventurous, Creative and Open-minded
5. Pursue Growth and Learning
6. Build Open and Honest Relationships with Communication
7. Build a Positive Team and Family Spirit
8. Do More with Less
9. Be Passionate and Determined
10. Be Humble
There you have it: a higher goal can help provide direction by making the client a central priority. You could say this means that Zappos is already a Responsive Enterprise. If clients preferred something different in terms of service or product, Zappos would oblige and adapt to their changing wishes: client service is the central point in their mission statement.
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Things to keep in mind:
1. Individual agendas should be in line with the higher goal. Individual or team goals must all be in service of the higher goal. When they conflict with one another, it’s a waste of energy. For everyone involved. That’s why it’s important to ensure that everyone maintains a connection with the higher goal. This can often be observed in everyday moments on the work floor. If you see contradictory behavior, ask the person why he or she is behaving that way. The conversation that ensues will help you to understand the situation and help you refocus on the higher goal.
2. Naming problems makes it your responsibility to help fix them. Resolving problems successfully is a source of energy. Pointing out problems without taking action only uses up energy. Be aware of people who are complaining the loudest but aren’t helping solve the problem. Naming problems comes with a duty to help fix them and to ask your colleagues for help when needed.
3. Make a habit of celebration. Celebrating successes is crucial and should never become boring or a routine. If there is cake at the office every single day, it will no longer be energizing. That is why you should celebrate your successes in varying ways – change it up a bit. But make sure you don’t fall into the habit of celebrating things for celebration’s sake alone. When celebrating becomes a routine, it’s time to do something completely different. You want to continue the celebrations, of course. The ultimate objective is to create additional energy, so it’s important to keep on celebrating.
4. Fill job openings with care. Responsive Enterprises are fast-growing. That means that there is almost always more work than there are people to carry it out. This also gives energy: people like having plenty of things to do. But that’s now what we’re talking about right now. When there is a lot of work, sometimes it becomes a habit to just fill all the positions and get it over with, so the work will get done. This means that the new team members have been selected less critically; they have been hired simply to do the work because of an existing capacity shortage. This is damaging to both the teams and the team culture. The most important disadvantage is that the team misses out on a much better potential team member, because the job has been filled with the first warm body. Make sure you don’t hire new team members too quickly just because there’s a job that needs to be done: hire them because of who they are.
5. Selection of talent. Another potential pitfall is that team members choose to hire less talented people – sometimes because it prevents hassle, and sometimes because they want to be the best themselves. It doesn’t matter why, in the end. The quality of the team will increase with the hiring of new talented team members, rather than personal advancement. You should try to select applicants based on talent, seeking new team members who can really make a difference.
6. Be open about problems and failures. In striving for energy and celebrating successes, you shouldn’t forget to share mistakes, failures and problems. Even though a Responsive Enterprise is focused on the future, this does not mean everything else has to be swept under the rug. Making mistakes is inevitable; they should be shared. Just as with moments of celebration, moments of failure should get attention at regular intervals. Sharing mistakes and passing on learning moments is crucial. Make sure your employees are sharing not only their successes, but also the things that didn’t work out.
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Summary of the book
The Responsive EnterpriseIf they are to effectively cope with the speed of change in the future and the ever-more-dynamic marketplace, the responsiveness of businesses will need to increase. In those terms, responsiveness is a characteristic or skill an organization possesses. A Responsive Enterprise is capable of managing delivery and innovation at the same time. This kind of environment is able to achieve results and finish tasks quickly – meaning they have time left to make adjustments when necessary.
The patterns and principles that play an important role in responsiveness have been expressed in The Responsive Enterprise by means of a narrative. They can be summarized in the adjacent model.
The client comes first: everything the company does is in service to the top priorities of client impact and client value. Alongside those efforts, employees use experimentation to identify new solutions. The learning interval is the most important indicator: the faster employees are able to learn, the faster they can create solutions (and the better those solutions will be). This means that instead of standing around thinking and planning, they must try new things without hesitation – and then see what works, and how. The cycle goes: Sketch, Make, Learn and Respond. It’s not like chess, where a player must try to think six steps ahead—and hope his or her opponent does what is anticipated—in fact, it’s the complete opposite. Think of Angry Birds: let them fly and see what happens. Try, learn and begin again.
• Setting up teams that are autonomous to the point of being mini-companies and are self-guided in serving a fixed client group (as determined by geography, for example).
• Ensuring an ambitious higher goal to inspire employees.
• Examining real data and attempting to automate as many aspects as possible, in order to scale up and grow quickly.
• Working in a fixed rhythm of delivery that effectively sets the tempo for the organization.
• Implementing a culture of total openness and extreme transparency.
• Making individual mastery and entrepreneurship concrete aspects and areas of constant growth.
And finally, we come to the outermost layer: anchoring the organization via a self-scaling culture propagated at the group level by teams through the growth and division of these teams. This enables culture, points of view, attitudes and behavior to be passed on in a scaleable fashion and at a group level.
Self-scaling Culture
Self-scaling Culture
ClientImpact
Rapid learning
Experimentation
Make
Sketch
Learn
Respond
and
Mas
tery
ExtremeRhythm
and Data
higher goal
(Mini-co
mpanies)En
trep
rene
ursh
ip
transparency
Software
AmbtiousAu
tonomous Teams
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1. Form autonomous teams (mini-companies)
• Everything is built around cross-functional teams with end-to-end (P&L) responsibility.
• The key concepts are client impact, client satisfaction and a focus on the client.
• A clearly demarcated client area for each mini-company prevents them from competing with one another over clients.
• Mini-companies compete in achieving performance targets along a simple KPI ladder.
2. Set an ambitious higher goal
• Attempting to reach a higher, valuable goal that is both ambitious and inspiring.
• Working together with the very best people to achieve complex and valuable objectives.
• Growing side-by-side with a permanent, stable team: experiencing growth both individually and as a team.
• Celebrating successes and learning moments with great frequency.
3. Make every aspect extremely transparent
• A culture of complete transparency, without secrets and where no question is out of line.
• Clear, unambiguous performance measurements that are publicly available to all.
• An infrastructure for the transparent exchange of information is in place and is kept up to date.
• Finding fun and energy in ownership and accepting responsibility.
4. Put the client(s) behind the wheel
• The goal is to deliver value through spontaneously developed solutions, working in close cooperation with the client.
• Because they are best-informed, employees with direct client contact will make their own decisions.
• Delivering client value at all times, even when there’s no profit in it (yet).
• The client principles will be made explicit and are geared towards trust, success and impact.
5. Conduct plenty of experiments
• Managers should focus constantly on removing fears: on any subject and from every employee.
• Decisions should be made based on data gained from experimentation and actual use.
• The organization should design an infrastructure in
The nine components of the model, and the four underlying patterns for each of them:
which employees can experiment with ease.• They should nurture a healthy tension between
innovation and profit.
6. Encourage individual entrepreneurship and mastery
• Each individual person is an entrepreneur and has the right to achieve personal success.
• Entrepreneurship knows no boundaries and grows right along with a person’s success and impact.
• Personal mastery is directly linked to client impact and operating results.
• Freedom, space and the desire to be the best: these things are both a right and a duty.
7. Create a self-scaling culture
• Values and principles are explicit, pro-active and client-focused.
• It uses autonomous teams that grow and develop on their own and can split off like bee colonies.
• Models for operations and growth are highly elaborated and aimed at self-direction.
• The goal is growth as a necessary precondition for energy.
8. Design a strict rhythm for delivery
• The daily rhythm comes from delivering valuable results in short cycles.
• Finishing tasks quickly is key: deliver results, learn from them and start over again.
• A structured rhythm that is able to accommodate unexpected developments.
• In other words, a heart that beats in short cycles, much faster than that of the market or the clients.
9. Make your business software-centric and data-driven
• The most valuable products and/or services must become fully automated.
• Design an infrastructure to support the automated delivery of products and services.
• Log all data involving client behavior and system usage and apply comprehensive data-driven monitoring.
• Focus on solutions that offer the most impact and pose the greatest technical challenge.
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Where to find more?• Simon Sinek - Start with Why: How Great Leaders Inspire
Everyone to Take Action, Penguin Books Ltd, 2011
• Stephen Kohn, Vincent O’Connell en Vincent D. O’connell - 6 Habits of Highly Effective Teams, Career Press, 2007
• Charles Duhigg – The Power of Habit: Why We Do What We Do in Life and Business, Random House, 2012
• Patrick Lencioni - The Five Dysfunctions of a Team, John Wiley & Sons Inc, 2002
• Kory Kogon, Adam Merrill, Erik Roger - The 5 Choices: The Path to Extraordinary Productivity, Simon & Schuster, 2014
• Jurgen Appelo – Managing for Happiness: Games, Tools, and Practices to Motivate Any Team, Wiley, 2016
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Did you enjoy reading this whitepaper? There are eight more: for each of the nine patterns from the book The Responsive Enterprise, there is a separate whitepaper.
Curious about the conversations between Ron and Mark on the green? Do you want to know their thoughts and understand their arguments? Buy the book! The Responsive Enterprise is available through all the usual channels including Bol.com, managementboek.nl or your local bookstore. It is also available in Dutch, German and e-book format.
About the authors
Vikram Kapoor CEO of Prowareness
Rini van Solingen CTO of Prowareness
Vikram Kapoor is a born entrepreneur. As founder and CEO of Prowareness, he helps large and well-known organizations to become software-driven Responsive Enterprises. Prowareness is growing rapidly and currently operates in the Netherlands, India, Germany and the United States. Growth is important to Vikram; he prefers to work on the outer frontiers – in “no man’s land”, as he puts it. As a serial entrepreneur, Vikram is always in search of new business ideas. Before starting Prowareness, he founded two other companies and made them successful: Silverside and iSense.
In 2013, Vikram was selected “CEO of the Year” by the readers of Computable web platform. He has also published several books as a result of his work with Prowareness and his previous enterprise, iSense. The Cheerleading principle, for example, is about how a team is influenced by culture. Responsibility, self-development and trust are important aspects within a team. This book gives tips on how to achieve those things. Kapoor’s second book, Engaging offshore teams is child’s play, focuses on the cultural differences that can affect the offshoring process.
Vikram enjoys providing those around him with opportunities to develop as entrepreneurs. He invests in a number of businesses and has created some remarkable possibilities within Prowareness, including the possibility for employees to become partners in the company. The culture at Prowareness is energetic and challenging. Making mistakes and providing feedback are encouraged: according to Vikram, these are ideal opportunities for growth. If you would like to exchange thoughts or ask Vikram a question, don’t hesitate! He enjoys sharing his ideas with others. You can e-mail him at:
Dr Rini van Solingen is CTO at Prowareness and part-time professor at the Delft University of Technology. At TU Delft, he leads teaching and research concerning globally-distributed software teams. In his work at Prowareness, he helps clients’ organizations to deliver valuable software that works in a fast and agile manner. Leading large-scale transformations to extensive responsiveness and designing Agile operations on a major scale, involving dozens to hundreds of teams, are his areas of expertise. To that end, he also provides training and consultancy to management teams and executive boards. See his master class, for example: www.leading-agile-transformations.com
Rini published the book The Power of Scrum together with Eelco Rustenburg in 2010. The book, which became a bestseller, describes the principles of Scrum in the form of a novel. In 2014, together with Rob van Lanen, Rini wrote Scrum for Managers; this second book was aimed at helping managers guide their Agile organizations effectively. His latest book—De Bijenherder (The Bee Shepherd) — is about providing leadership to self-steering, responsive teams and is currently in its third edition.
Feel free to e-mail Rini with questions or to discuss his work. He enjoys sharing his ideas with others. If you really want to do him a favor, invite him to give a reading, training course or workshop at your company: those activities are where his passion truly lies.
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