Tag: benefits of agility

In turbulent markets, firms need portfolio agility–the ability to quickly and effectively remove resources from businesses that have stagnated or no longer fit a company’s strategy and reallocate them to promising opportunities. Before shifting resources among them, executives often  categorize units within a portfolio using frameworks such as the growth share matrix. Despite its widespread use, this framework gives a static snapshot of a portfolio at a point in time and overemphasizes the benefits of scale.

An alternative approach to mapping a portfolio begins by dis-aggregating an organization into components that correspond to opportunities, recognizing that these units vary by life-cycle stage-i.e., start-up, scaling the business, maturity, and decline. Opportunities begin 

My last post presented findings from a survey on organizational agility that I conducted with McKinsey Quarterly. This post explores findings from two earlier surveys on agility.  In June 2006, McKinsey Quarterly conducted a survey, collecting responses from 1,562 executives from public and private companies across a range of industries. The Economist Intelligence Unit (EIU) survey, conducted in December 2008 and January 2009, included responses from 349 executives with 49% from three European countries (UK, France, and Germany), 19% from the United States and Canada, and the remainder from Singapore, Australia and New Zealand. The EIU respondents represented eighteen industries, and nearly one-third had revenues in excess of $5 billion.

The precise definitions of agility varied between the two surveys. For McKinsey, agility is linked to speed and defined as an organization’s “ability to change tactics or direction quickly…to anticipate, adapt to, and react decisively to events in the business environment.”  while the EIU defines it as how firms “respond quickly and nimbly to the changing environment.” Both definitions share a focus on how well a firm anticipates and responds to environmental changes.

  1. It’s not about IT. Information technology factors were ranked as the three least important

Leading in turbulent times

This blog is no longer active but it remains open as an archive.

Don Sull is professor of management practice in strategic and international management, and faculty director of executive education at London Business School. This blog is dedicated to helping entrepreneurs, managers, and outside directors to lead more effectively in a turbulent world.

Over the past decade, Prof Sull has studied volatile industries including telecommunications, airlines, fast fashion, and information technology, as well as turbulent countries including Brazil and China, and found specific behaviours that consistently differentiate more, and less, successful firms. His conclusion is that actions, not an individual’s traits, increase the odds of success in turbulent markets, and these actions can be learned.

Don Sull’s blog: a guide

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FT Business School videos

Managing in an Unpredictable World
A series of video lectures by Professor Don Sull

Part 1: Fog of the future
Part 2: Future reconnaissance
Part 3: The strategic agility loop
Part 4: Executing with commitments
Part 5: Leading into the fog

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