Agility is the key enabler of future economic success

 

I’m not sure two dinosaurs missing Noah’s Ark led to their extinction but it’s an amusing thought!

If we can suspend belief for a while then we would definitely excuse the dinosaurs for not getting the 7-day warning message in time. However, there is no such excuse these days. Technological advances mean 4 billion of us today are instantly connected via the internet (3.7bn via mobile connectivity). That’s a 1,052% increase since 2000. Source: Internet World Stats

While Moore’s Law is simple – the number of transistors in a dense integrated circuit doubles approximately every two years (Source:mooreslaw.org) – its impact has been profound. 60% of Apple’s massive revenue is from products less than 4 years old. Industries have been turned on their head by advances in technology – when was the last time you hailed a taxi or leafed through dozens of printed travel brochures comparing the prices of holidays or actually used your smartphone to make a call? Our expectations and behaviours as users are changing dramatically.

The technological developments driven by smaller, faster, cheaper, more intelligent technology will continue for years to come, driving new strategies and business models. For example, Red Bull may become known as a content media company more than a drinks company. Our children won’t use the term ‘Google it’ as they will know Google as a brand of car. More than half of preschool children will have a job that doesn’t exist today.

Indeed, we won’t be talking about technological or digital disruption for long. We will be talking about customer disruption. We will – arguably already do – live in a world where the customer experience is more important than the product. We all know more about each other, our likes and dislikes, our habits, our movements. Tapping into that knowledge to create, influence and inform new experiences will be a large part of our future.

In this experience-led world, it is essential that everyone – consumers, citizens, businesses, government bodies – all operate with agility.

Agility: ability to think and understand quickly/ability to move quickly and easily

Let me be clear, this is not as easy as the definition makes it appear! Let me draw on an example close to my heart – Government-funded business support provision. OK, it is not quite as “in your face” as healthcare or education but it is a critical aspect in our economic success therefore worthy of discussion.

To succeed in an increasingly disruptive world we need our business support provision (public, private and third sector bodies) to move with the times – we need them to act with agility. So what will this look like for those bodies aiming to stimulate business and economic growth?

Actionable Strategy – your strategy to support growth needs to look outwards and beyond geographical boundaries and regional competition. Being better than your immediate neighbour is not good enough, unless your neighbour is a genuine world leader. The strategy needs to ‘glance back and then stare forward’ – we need to recognise the past but embrace the future. Competitor regions are not looking back!

 

Tip #1 : Well, be ambitious, tell stories about what the strategy will do and create a buzz. However, remember that the strategy needs to be actioned. It needs to be grounded in reality and the people tasked to deliver it need to have the guidance, commitment, enthusiasm, and capabilities to deliver well.

The right products and services – developing and offering the right products and services is key. They need to be designed, created and delivered with users (the growing businesses). Pushing standard products and services on businesses at a time and in a way that suits the public body’s operations or funding constraints is not the experience craved by business owners.

Also, I recognise that new products and services can be costly to introduce so we need to ensure that there is good challenge given to stop the provision of existing products and services that are less valuable/delivering less impact. Spreading resources too thinly both lessens the impact of well-intended support and creates a very confused landscape for businesses.

 

Tip #2: Public bodies should be smaller, more information-rich facilitators of business growth rather than direct providers of products and services. I accept this means radical redesign of delivery structures and development of new capabilities but both are necessary.

Affecting Change without the drama – large transformation programmes are exciting and make good headlines but how often do they actually succeed? Or, if they do succeed, how much drama do they cause in the process? Change can be delivered incrementally without ever knowing the final destination (primarily because it is a moving feast!). Where to start? Choose that ‘one big difficult thing’ that everyone knows needs to happen or an important (but not mission critical) opportunity and deliver it well. In doing so, you will build capability, confidence and engagement.

For public bodies, the selection of the ‘one big difficult thing’ or opportunity may be unpopular if it focusses on a particular cohort of businesses or a sector. Accept that not everyone will be happy but at least be transparent in your decision-making.

 

Tip #3: be bold and brave but eat the elephant one bite at a time.

Playing safe with risk – I often hear ‘economic development is all about risk’. This is, of course, true. However, public bodies supporting economic development through business growth are inherently tied into political processes (small and large ‘p’) because they are spending taxpayers’ money and are therefore open to intense scrutiny. In this world, risk is not your friend. So how can we reduce the risk?

Firstly, ensure the accuracy and credibility of data used to inform the strategy is as good as it can be but don’t rely on raw data alone. Triangulate it with knowledge and insights from the diaspora of locals making a good living around the world.

Secondly, operate a governance system that matches agile delivery – approve budgets and release cash based on movement in the right direction of travel and tangible delivery rather than aligned to appointment of key individuals or production of plans.

Finally, genuinely empower those closest to customers (the growing businesses) to understand customer needs, make decisions, be fleet of foot, make changes within agreed parameters and be free of fear of political interference.

 

Tip #4: remember but don’t follow the definition of insanity –‘doing the same things over and over and expecting a different result’

So, back to our dinosaurs. Worldwide floods may not be imminent but economic crises with global impact are (many forecaster expect the next one in 2020). Disruption to our international markets is looming (Brexit), technological developments are not stopping (AI and robotics anyone?), customer behaviour is changing (watch and listen to the next generation to see that). Let’s not be the next T-Rex.

 

For more information contact us or your usual AAB Advisor.