Nobody needs to be told that 2020 has been a year that will go down as one of the most disruptive, unpredictable, and pivotal in history. In what can reasonably be anticipated as a new normal of unprecedented risk, leaders need a new paradigm for not only withstanding disruptive change but benefitting from it. This new framework may be best understood through the concept of antifragility.
What is antifragility?
Developed by Nassim Taleb, Distinguished Professor of Risk Engineering at the New York University Tandon School of Engineering and co-editor-in-chief of the academic journal Risk and Decision Analysis, antifragility is a counter-intuitive concept to many leaders. It refers to systems whose capacity to thrive is increased rather than decreased by disruption. As Taleb explains, “Antifragility is beyond resilience or robustness. The resilient resists shocks and stays the same; the antifragile gets better”.
At Pivot International, we’ve successfully led global clients through COVID-19 disruption, escalating trade tensions, economic volatility, and environments of heightened risk for nearly a half-century. Operating from an antifragile model means prioritizing evolution over adaptation. It’s an approach that’s allowed us to add two new businesses to our family of companies amid a global pandemic and drive growth for our clients in challenging times. With product development expertise across fourteen different industries and alternative sourcing solutions across three continents, we’re helping our partners harness disruption to grow their business and improve their market position.
How Can Businesses Embrace Antifragility?
The development of agility can be understood as the most direct path to antifragility, provided this path is understood correctly. Agility is often mistaken for a company’s ability to operate with speed while navigating complex obstacles. But agility is about much more than speed. It’s about reengineering the vehicle itself. In this case, the vehicle is a leader’s mental model, a company’s culture, and its organizational structures. This reengineering ensures the vehicle is continually optimized for maximum performance across a wide range of unpredictable road conditions.
Orchestra or Jazz Band?
Agility requires decentralized decision-making, distributive organizational structures, and dynamic resource allocation. A second metaphor may be helpful to illustrate this point. While traditional organizations function like an orchestra, agile organizations function like a jazz band. In an orchestra, each musician plays a predetermined piece of music, taking their cues from a conductor. In a jazz band, each musician plays improvisationally.
Agile Mental Models: The Leadership and Cultural Challenge
Whether an organization can make the cultural shift to agile has much to do with a leaders’ mental model. A mental model is more than just a mindset. A mindset can be understood as a perspective or attitude that a leader may take. A mental model, on the other hand, is more like a cognitive-emotional “operating system.” It determines the perspectival or attitudinal “software” a leader can run.
We said earlier that agile involves decentralized decision-making. But many leaders have been deeply conditioned to think of themselves and their executive team as a command center. They view themselves as a directive-issuing hub around which culture revolves. Returning to our musical analogy, we could say that leaders often conceive of their role as the “conductor” of an organizational “orchestra.”
For this reason, leaders may struggle with one of the chief mandates of agile: granting authority to teams to act with a high degree of autonomy. Learning to operate from an agile mental model may be the hardest a leader may face of all challenges. This is because it requires loosening control and nurturing a culture in which all stakeholders are appropriately empowered.
Agile Organizational Structures: Dispelling Misconceptions
The analogy of agile as a jazz band sometimes leads to a common misconception that “anything goes” or that agile organizations lack structure or vision. It’s important to recognize that a jazz band lacks neither. Well before a set even starts, the key, chords, tempo, and style of each song have been determined. Jazz has strictly prescribed rules of etiquette. These rules are the basis for collaboration and innovation. Musicians who deviate from them raise their bandmates’ ire. If the behavior persists, they may be ejected from the band.
Agile isn’t a “free-for-all.” As with the rules of etiquette for jazz, agility is “freedom within a framework.” This allows for on-demand resource allocation that lets a company rapidly innovate and pivot in response to urgent needs, emerging market opportunities, and imminent threats. Once an action is taken, any available outcome-data is quickly analyzed for insights and fed back into the system. This enables the organization to evolve rather than merely adapt.
The difference between agile and more traditional organizational structures is not the lack of structure, but the type of structure and how this structure is created. Agile structures are dynamic and flexible rather than fixed or rigid. These structures aren’t built through a command-and-control chain of linear decision-making but a network of highly coordinated stakeholders. This structural coordination spans every aspect of the organization, from cross-functional teams to HR systems to finance and budgeting systems.
Antifragile is the new model needed for benefitting from disruptive change, and agile is the most direct path for reaching it. If you’re seeking a partner with agile operations to help your company bring a new product to market, Pivot’s industry-leading, end-to-end solutions can help drive your success. With extensive experience in multiple markets, we deliver top design and engineering talent and advanced manufacturing technology to serve your product development and supply chain needs. Contact us today.