Agile Leadership: The key to running successful companies in the 21st century
What is agile leadership? What are the benefits of agile leadership? Find out why it is the key to success in leading modern businesses.
Successful organisations were once defined by stability and structure, which brought with it hierarchy and silos. However, the way that we do business is evolving at a rate we could never have predicted and modern businesses are expected to survive in an environment where continual change, disruption, and a host of other external factors are the norm.
The traditional business model was forged in a far simpler time and, as such, leadership of these companies was infinitely more straightforward. In the 21st century, organisations need to be dynamic, flexible and evolving, which is a far cry from the static, structured companies of yesterday. So, how do leaders need to change in order to inspire and lead these new businesses?
Organisations need to be dynamic, flexible and evolving.
Amidst the adoption of new technology, the birth of entirely new industries, and turbulent economic cycles, agile leadership has emerged as a beacon, creating leaders who are able to guide companies through the challenges of the modern business world.
What is agile leadership?
Agile leadership enables leaders to inspire others and build a culture of self-organisation, whilst maintaining openness, inclusion, and democracy. It is organised around creating value for customers rather than a strict adherence to hierarchy, and promotes cross-functional collaboration and swift decision-making. Agile leadership builds on a strong and well-communicated vision, and requires leaders to embrace innovation, foster continuous learning, and focus on developing others.
According to McKinsey, agile leadership is developed in three phases.1
- Firstly, agile mindsets are required amongst leaders. Change can not be affected until leaders break down the silos of their own ways of thinking and expand their mindsets to include modern ways of working. This can be a painful process, but it is imperative in order for agile roles to be defined and for agile transformation to take place.
- Secondly, leaders need to practice what they preach. Before they can evangelise agile ways of working, leaders need to embrace these practices themselves. Once they have been able to accept, embrace, and embody this new way of working, leaders will be able to mobilise their workforces behind a vision to do the same.
- Finally, leaders need to build agility into the fabric of their organisations, creating the open, inclusive and dynamic environment required to make agile leadership possible. This will include defining agile roles within their organisations, adopting new technologies, and in many cases, undertaking a complete agile transformation that will render their former business unrecognisable. This step will involve building agile and fluid working practices into business as usual.
Agile leadership requires leaders to modify their responsibilities - both operational and cultural - and it is their role to ensure that the companies they lead adopt the principles of agile working.
This is a dynamic process that takes time, but the benefits are far-reaching. So, what are the benefits of agile leadership?
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What are the benefits of agile leadership?
The benefits of agile leadership are indisputable. According to the Boston Consulting Group2, agile leadership:
- creates a reduction in costs of somewhere between 25% and 35%
- can lead to a 100% to 200% increase in the rate of delivery of new products and services
- and leads to an overall increase in quality of 20%
The benefits are also felt in an improvement in organisational culture, which is especially important as we welcome younger generations into the workforce, many of whom will expect to fulfil agile roles and consider values and culture to be as important as more traditional benefits. Furthermore, agile leadership imbues the principles of continuous learning, and sharpens the focus on results, both of which reduce the likelihood of ‘presenteeism’ and lead to increased operational efficiency.
Finally, agile leaders focus on doing, and as such, agile leadership is synonymous with being a force for action. This addresses many of the issues surrounding failed strategic implementation which beleaguer a vast number of organisations, and creates an atmosphere where employees aren’t afraid to try new things.
1 'Leading agile transformation: The new capabilities leaders need to build 21st-century organizations', McKinsey, 2019.
2 'How to Get Agile Right', Boston Consulting Group, 2019.