Business Agility definition

Business agility refers to distinct qualities that allow organisations to respond rapidly to changes in the internal and external environment without losing momentum or vision. Adaptability, flexibility and balance are three qualities essential to long-term business agility.

Business agility is important for firms looking to survive long-term and who work in quick-paced industries. Innovation is often the key to maintaining long-term business agility. Companies that don’t innovate and rely on ‘proven’ methods of doing things often find themselves falling behind the competition because they can’t adapt quickly enough to shifts in the environment.

From an HR perspective, agility is about ensuring the human capital in the organisation have the skills and abilities to respond quickly to new developments  and the infrastructure and processes to mobilise this human capital into action as efficiently as possible.

Companies may display business agility at certain times, in which case the agility is a form of crisis response, or the company may have business agility built into its structure.

Agile organisations can differ from traditional bureaucratic organisations in many ways, such as in fluidity of role definitions and a lack of long-term competitive advantage – generally agile organisations will pursue a program of short-term competitive advantages, which are then neutralised, before moving onto the next

Four useful concepts when discussing business agility include interactions, co-evolution, self-organisation and the edge of chaos.

Interactions are interactions between individuals and groups with similar values, drive and long-term goals. In an organisation, these often take the form of meetings, discussions and brainstorming sessions and are key drivers of the innovation necessary to drive adaptability and therefore business agility.

Self-organising describes spontaneous and unguided exchanges conducted for the purposes of decision-making, often resulting in high levels of innovation. A high level of both individual and group maturity is necessary for self-organising to succeed.

Co-evolution is the continuous progression of products, services and processes whereby companies consistently learn and evolve to meet the changing needs of the environment.

All three of these concepts are important in relation to the edge of chaos, a region lying between randomness and lack of logic and normalised equilibrium. Organisations positioned in the middle of this region are able to mould and adapt to the changing environment through a combination of frequent interactions, self-organising and co-evolution.

The general opposite of agile organisations are bureaucratic organisations, in which decision-making takes longer because there are multiple channels of command to go through before a decision can be made.

A related term is high reliability organisation, which refers to organisations which avoid accidents in industries that are innately prone to risk e.g. air traffic control or fire fighting.