Wednesday, July 14, 2021

Stagnation vs. Stability

Compared to the traditional organization as the mechanical system which is easy to turn outdated and thus, get stagnated. Organizations today are like the organic living system which keeps evolving to adapt to business dynamics.

Due to the occurrence of increased disruptions often led by technology and unprecedented uncertainty, improving organizational agility is a strategic imperative for business’s survival today. In reality, most organizations today limit their role to keep the lights on and still get stuck at a lower level of maturity (reactive, order taking).

The point is, ad hoc change is doomed to fail, keeping things stable is reasonable. But the management needs to ponder around: Is stability the same as stagnation? How to drive incremental change in a stepwise manner? Can you work on the activities and considerations that need to be addressed to identify opportunities for enhancing the business relationships, improving organizational responsiveness, and enforcing organizational firmitas?

Stagnation implies silo, fragile, inertia; while stability is about process, standardization, caution: When the business gets stuck, it usually shows the dysfunctional symptom such as silo mentality, culture inertial, outdated system which is built using out-of-favor or at least depreciated tools, running on out-of-favor platforms, or documentation not matching the actual system, not mention to disengaged employees or unhappy customers. Most managers still apply old silo management mindsets to new ways of organizing the hybrid structure, that gets their business keep spinning without going anywhere. Even though those organizations are reluctantly functioning, they will become irrelevant from a long term perspective.

Thus, to help the management understand that stability is not the same as stagnation, they need to break down silo mentality, take a wide look around at what's going on inside the company & outside the organization at the business ecosystem scope; and how it might affect the organization (an environmental scan), and identify opportunities and threats. Make an objective “SWOT” analysis, deeply understand their organizational core capabilities, as well as diagnose their rooted problems that need to be solved in a prioritized order, so they can stay focused on, leverage their resources and talent to get the right things done at a steadfast speed.

Stagnation is about unresponsiveness, unproductivity; stability is about a balance cycle of process and change, learning & doing; solid and responsiveness, etc: We live in a constantly changing world, if you get stuck, you are already lagging behind. Repetitively doing something without making improvement is a stagnation. Hoarding knowledge without updating it is stagnation; being compliant without performance is a stagnation; following outdated rules or conventional wisdom is a stagnation; fixing symptoms without digging into the true cause is a stagnation, etc. There are both hard barriers and soft pitfalls behind stagnation. When resource management becomes a bottleneck for organizational change success, no wonder companies across the vertical sectors get stuck going nowhere. Or when the culture is inflexible, people are used to following overly restrictive procedures which are outdated somehow, they become unproductive, and businesses get stuck.

Keep in mind, stability is not slow to change, it’s about adapting to the change environment with the right speed. In fact, there is never “enough” to optimize business operations. To run a progressive business without rocking the boat too much, companies can leverage industry best practices for having better control, identifying or implementing processes specific to enforce standardization, which will increase organizational efficiency, competitiveness, and profitability. High standardization brings control, efficiency, and speed to a certain degree, the process oriented perspective enables the business management to make continuous improvement such as system optimization, process streamlining, or cost reduction, etc. To reach the higher level of business maturity, the management needs to further shift from process driven to people oriented, for unlocking the full potential of their company.

Stagnation is about being static, rigidity, inflexibility, disengagement; while stability indicates efficiency, adaptability, optimization: The symptoms of organizational stagnation include disjointed strategies, overly rigid hierarchy, outdated knowledge/procedure, lack of reusability or resilience in design, the process is forcibly jammed within an existing organizational design, etc, They are fragile to business velocity. To keep the business moving forward, a transaction seeks continuity. The goal of process management is to eliminate unnecessary complications, optimize processes to reduce the burden on the company while trying to stay current. For many transaction-heavy organizations to provide stabilized products/services to customers, where transactional or operational capability usually makes only minor adjustments in the organization's structure, ad management, etc, it often takes the linear step for tuning the enterprise machine and ensures it keeps spinning with stability. But if you need to transform the business upto the next growth cycle, the management needs to take a holistic view, jumpstart into the innovation mode, accelerate the speed of changes, and make a transcendent movement.

In a stagnated working environment, people are disengaged, employees do not feel connected- they do not feel like they have an opportunity to contribute, or their work gets recognized. Silo and “stucky mode” sets the barriers to real problem-solving also because people are not comfortable to go across the territories for cross-boundary communication and collaboration. If the management tries to impose solutions or structures that are too far ahead of the curve, the result is alienation and rebellion rather than problem-solving. Those organizations that have a more mature strategic alignment (integration, collaboration, harmony, etc.) outperform their competitors and tend to be more responsive to the business dynamic.

Compared to the traditional organization as the mechanical system which is easy to turn outdated and thus, get stagnated. Digital organizations today are like the organic living system which keeps evolving to adapt to business dynamics. Just like those plants in the natural world, they seem to be still when we see them everyday, but they grow strong continually. Contemporary organizations need to be firm enough for delivering quality products or services, but also fluid enough to interact with the expanded digital ecosystem to achieve their purposes.


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