Building the ‘Agile Enterprise’

Delivering the keynote at the 5th annual Bersin IMPACT conference, held once again at the historic and beautifully restored Vinoy Renaissance Resort in St. Petersburg, Fla., Josh Bersin told the packed room that the only way organizations can thrive in an era of unprecedented change is to embrace agility.

“Within 20 years, China will be the world’s No. 1 economy, followed by the U.S. and India,” said Bersin, founder and CEO of Bersin & Associates. “CEOs will be counting on HR’s expertise to help them expand the business in fast-growing countries like India and Brazil–and it just so happens these countries are facing a paradoxical imbalance of skills and demands.”

These nations tend to have large numbers of old and young citizens, but relatively few in the middle, he said. Even in the U.S., 47 percent of the workfore will be younger than 35 by next year, according to the U.S. Census Bureau. Research from Mercer indicates these younger workers are twice as likely to be looking for a new job as older workers, said Bersin. “So engagement is crucial,” he said.

Amid these demographic changes, the very structure of organizations is changing, said Bersin: “Thanks to the web, managers are no longer in charge of companies–customers are.” Dissatisfied customers can use the web to quickly find alternatives and tell others about their dissatisfaction–a company’s reputation can go from stellar to tattered in record time, he said.

When the Economist magazine polled CEOs for their definition of agility, they chose “rapid decision-making, high-performance culture and flexible teams,” said Bersin. But when they were asked which corporate function was contributing the most to organizational agility, HR ranked last out of 14, well behind sales, marketing and even legal.

Moving up from the bottom of the list requires HR to be a key player in helping the organization transform itself to an agile one by “implementing systems and strategies that foster expertise, collaboration and decision-making,” he said, reinventing processes such as performance management so that goals are frequently updated, “ratings” are done away with and social rewards and recognition–in which team members, not managers, decide who will be recognized for their contributions–is standard.

Agile organizations are ones that aren’t afraid to ditch old processes, even if they happened to pioneer those processes, said Bersin, citing Seagate Technology, widely credited with creating the “cascading goals” model. Seagate decided to abandon that model recently because it was “too limiting,” choosing instead to focus on the constant updating of goals, he said.