Over 90% of executives think that being an agile organization is critical to business performance.
Backing up a minute here: what is an agile organization? Why would agile companies be able to outperform other types? And how does that impact the Talent Acquisition function?
What is an agile organization?
We’ve discussed how the agile methodology applies to recruiting before, and how it brings speed and focus to the job by splitting it into approachable tickets, for example. The agile mindset goes a bit beyond that when it applies to a whole company. Talent Acquisition leaders need to be thinking about how they’ll be recruiting for agile as their company goes through that shift.
So what is an agile organization, as opposed to an agile team? Here’s how Aaron De Smet, principal at McKinsey and expert on the subject, defines agility for companies:
“Agility is the ability of an organization to renew itself, adapt, change quickly, and succeed in a rapidly changing, ambiguous, turbulent environment. Agility is not incompatible with stability—quite the contrary. Agility requires stability for most companies.”
In other words, an agile company is a company that is structurally capable of adapting quickly to external change. In practice, this means smaller teams, a flatter organization, more bottom-up empowerment, cross-functional teams, and lots and lots of testing and iteration all around.
Why do agile companies win?
Companies in every industry are moving towards more agile structures. We’re talking household names and industry incumbents, like ING, Fujitsu, Volvo and Bosch, and not just the usual tech names you’d expect... although companies like Google, Facebook, Spotify or Tesla are certainly on the agile list.
These huge entities are letting go of the traditional pyramidal org structure, and moving toward flatter, network-based organizations. They have a central core that keeps everyone aligned on the common vision, and a network of small, cross-functional, project-based teams that can more or less function as independent business units. They hate silos.
This structure means fewer layers between leadership and the customer. As a result, they have a better understanding of the needs and problems of their target customer. They also pick up on trends more quickly, and reduce the risk that the business will be caught by surprise. Finally, they are able to go from idea to test to iteration to market very quickly, and it gives them a solid advantage over the competition.
So yes, agile companies are more likely to outperform. They’re not only comfortable with change, they see it as an opportunity: a new market trend means a new chance to disrupt, challenge, and win.
Recruiting for agile companies
So what does that mean for Talent Acquisition teams in terms of who they should be hiring? Employees, and especially team leaders who thrive in this kind of environment, are not your usual dotted-and-solid-line, who-do-I-report-to managers.
You still need the usual stuff, like ability to prioritize, keep timelines straight and keep everybody motivated to play nicely with each other. But on top of the usual management skills, we think candidates who are likely to do well in agile organizations have three other characteristics:
- They embrace and empower independence in their teams
- They want to be managers for the role itself, not for what it means in terms of promotion and compensation increase
- They are comfortable in fluid organizations that work more like a network than a pyramid
Let’s dive into each one separately.
Hire people who will empower independence
Agile teams need a culturally different DNA to function properly. They need to be able to come together, define a problem, produce a viable solution, test it and push it to market in a matter of weeks, because that’s what their biggest threats (namely, startups) are doing. That’s much easier to do when the whole team feels a sense of ownership over the project.
Forget about strategic meetings at the C-level, and products that are moved from above from R&D to Design to Manufacturing to Marketing and Sales. We’re talking about small teams with members from different functions, able to make all those decisions internally. They can talk to customers, build something and iterate on it, manufacture it at scale and then take it to market within weeks.
What needs to be true for this kind of speed to be achievable? For one, decision cycles can’t take forever. An engineer can’t wait for their boss, and their boss’s boss, to approve every single new idea they want to test. This means that managers of agile teams need to be OK with trusting and empowering their team to own their project.
Hanna Fager, VP of HR at Volvo, also adds that the key for this kind of culture is “a leadership that is not driven by hierarchy, but by contributing and achieving something together as a team.”
These managers can’t respond to ambiguity and rapid change with more rigid rules and processes; that defeats the whole purpose of agile teams. So you’re looking for people who can push a team to deliver without rule enforcement from above. People who find out what makes team members excited, and use it to keep them on track when a supplier suddenly drops out or a competitor snatches a client away last-minute.
Hire people who want to be managers
This should be a no-brainer, right?
Unfortunately, some companies still think too traditionally about career growth, and the only path they offer to promotion – and a higher salary – is to become a manager. But we’re not in Mad Men and the 80s anymore, and the path upward doesn’t necessarily have to go through management.
Some engineers want to keep making things their whole life. Some salespeople hate the idea of sitting behind a desk and building out forecasts. Those people, although great engineers and salespeople, would make terrible managers.
Agile organizations find a way to keep and nurture these high performers without forcing them through management tracks. In “Talent Wins”, Facebook CHRO Lori Goler says that getting people who want to manage in management roles is key, because they’re not there only for compensation. They will bring motivation and hunger to the role.
Set up small internal events for people who are interested in a managerial track, and tell them about the expectations and opportunities of the available and upcoming roles. It will be an opportunity for interested employees to step forward, and more importantly, to come up on your radar.
Hire people who are comfortable within "network" organizations
This is the most complex part, because it requires really understanding the following: The structure of a company needs to fundamentally change for it to be truly agile. It needs to look less like a pyramid, and a lot more like a network.
Haier, the largest home appliance manufacturer in the world, has been growing profits at a staggering rate for such a large company over the past decade. How? By getting rid of its traditional organizational structure, and making product decisions much more decentralized. In other words, by becoming one of the most agile companies in the world.
This agility was a deliberate decision made by the company’s CEO back in 2005: he decided to break the whole organization into around 2000 micro “business units”: small teams of 10 to 20 people that fluidly come together, accomplish a goal, then disband to reform into different teams.
These teams are treated as small businesses, and get to decide exactly how to solve the problem that has been assigned to them. They have their own Profit and Loss statements, and they hire, promote and compensate according to their own internal rules.
If they need market research done, or a product manufactured, they ask for proposals either from other business units within the company, or from service providers from outside the company. It’s really, truly a network-based organization, which relies on central leadership mostly to stay aligned with the overall business direction. No pyramids needed, thank you very much.
That’s a lot of independence and decentralization for a manufacturing giant. Not every manager can be successful in this kind of environment.
Think about it: for one, these managers need to be able to regularly and quickly form new teams to respond to a specific challenge, mostly by looking into the available internal pool of talent.
In addition, the teams themselves get to decide how to approach their project, so the managers are not really here to pass down directives from above. They’re here mostly to “buy” the needed resources and support for their team, and allocate those resources.
If you’re hiring for this kind of environment, you’re looking for managers who are able to network within their organization, make the case for the resources and the people they need, and see opportunity for value creation where there wasn’t any in the past.
You’re looking for the ability to network internally, negotiate, collaborate, and obtain alignment through influence rather than authority.
Ideal agile managers have an extremely rare combination of qualities: They need to be good at empowering people and managing ambiguity. They need to identify and bring in the right talent within different functional areas. They have to network, negotiate and collaborate inside and outside of their organization, all while they are figuring out how to create and exploit a business opportunity. Sounds familiar? Yes, you're basically hiring mini-CEOs.
Recruiting for agile organizations is not a nice-to-have skill anymore. Companies are coming wise to the importance of being not just ready for change and disruption, but built for them. You can see it in every industry, from technology to automotive to retail or banking.
Talent teams need to be fully aware of this change. This kind of organizational transformation can’t happen without the right people being brought into the right roles, and that is a job that only recruiters can do. It’s time for talent acquisition to jump on the agile train.