Anticipating the future means focusing on agility

Start building flexibility today so you can face the future with confidence.

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Anticipating the future means focusing on agility

It is difficult to set policy and develop a strategy when you are in a state of great uncertainty as an organization. One way to deal with this uncertainty is to build in flexibility. So that you can change when the situation calls for it. Start building flexibility today so that you can look to the future with confidence. In doing so, be open to Artificial Intelligence and Machine Learning and exploit the opportunities of low-code application development.

Not so long ago, organizations set their strategy for periods of three to five years. Realistic goals were set that were attractive to shareholders or other stakeholders and manageable for employees. Today, anyone who sets a three-year plan can be sure that it could be revised within six to 10 months. There are simply too many uncertain factors. This is especially true for international business, but this uncertainty naturally trickles down to the small business on the street corner. You can deal with uncertainty to a considerable extent by making your organization agile and flexible, suitable for the Act-Now economy. By this, we mean that, as an organization, you can respond quickly to continuously changing circumstances and meet customer needs, for example. You can best do that by removing obstacles, especially in the IT environment. Research on the status of the Act-Now economy shows that 21 percent of 540 top executives surveyed acknowledge that outdated core systems impede rapid change. And 19 percent say IT cannot keep up with business process change. That is precisely what is disastrous if you want to deal with uncertainty and survive as an Act-Now organization.

Recovering markets

Let us touch on some of these uncertainties. The International Monetary Fund (IMF) expects global growth to fall from an estimated 3.4 percent in 2022 to 2.9 percent in 2023 and then rise to 3.1 percent in 2024 (World Economic Outlook Update, January 2023). Central banks’ raising interest rates to combat inflation and Russia’s war in Ukraine continue to weigh heavily on the economy. Possible escalation of the war does allow energy prices to rise again and further disrupt international supply lines. On the other hand, the recent reopening of the market in China ensures that recovery may enter faster than expected.

Dealing with uncertainties

However, all these figures and percentages are surrounded by ifs and buts. For every positive economic and financial development, you can think of a countermove that is surely just as valid. That is what we call uncertainty, and that’s what you have to set your organization up for. Do raw material prices or container costs skyrocket? Then you have to be able to react quickly by rolling out alternative scenarios. We also live in an Act-Now economy at the macro level. This means, among other things, that ERP and supply chain management systems must be calculated for flexibility. Act-Now means you don’t have to wait months until your business applications can work with foreign currencies and you can deploy other means of transportation.

Labor shortage

OESE (Organization for Economic Development) approaches uncertainty from a different angle: the labor market. We are facing the effects of digital and green transformation, as well as an aging population. In recent years, especially when the economy began to rebound after Covid-19, unprecedented shortages of labor and specific knowledge and skills have emerged. Festivals could no longer take place because not enough security guards could be found. In the hospitality industry, businesses had to close their doors because of staff shortages. But there are also shortages at another level, such as nitrogen experts. As a result, housing and infrastructure projects are suffering significant delays. This situation has once again demonstrated the importance of developing and retaining talent. In the report “Retaining Talent at All Ages”, the OECD makes numerous recommendations for retaining staff of all ages. Lifelong learning is one of them.

Agility to a higher level

Another approach is to make the workforce more flexible. By this, we don’t just mean that you have to work (more) with a flexible shell, but that you also start using Artificial Intelligence and robotization to further automate processes. You can make better and faster use of the data that is available and you can deploy your employees on tasks that really add value. This development is also an important part of the Act-Now economy: you need to be able to deploy people quickly to seize opportunities and not depend on rigid IT systems to do so. Half of the managers underline this: employee knowledge affects the agility of the company.

Conclusion: you can manage uncertainty with a good dose of flexibility and agility. For example, you can quickly adapt business processes and applications by deploying low-code software development. These are the applications that empower end users and take the organization’s change capability to the next level.

About the research
USoft conducted research among 540 managers in the Netherlands, at organizations with more than 50 employees. Almost half were from organizations with more than 250 employees.

Download the full research report. Report is only available in Dutch.

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