Strategic Agility: The Antidote to a Hostile Business Environment

Remember when government was a friend to small business – the leading source of new jobs in the U.S.? Me neither. And now it’s getting worse.

The Job Creators Alliance — a non-profit organization whose mission is to educate the public and policymakers on what it takes to create jobs – recently surveyed 600 small businesses with 100 employees or less. They found that a majority of small business owners believe the federal government has become more hostile to free enterprise in recent years.

The #1 concern for employers? Taxes, followed by health care, government regulations, the economy, and the budget deficit. Business owners also worry that the lack of spending restraint in the recent fiscal cliff deal will negatively impact their companies.

Such pessimism does not bode well for today’s employers or employees. If we have to consider the government an adversary (similar to competitors), it adds another layer of complexity, making it even harder to compete in an already complex world.

To further complicate matters, we’ve experienced a complete breakdown in trust in our leaders – both political and corporate. We’ve gone through so many scandals that we’ve become incredibly cynical as individuals and as a nation. When we lose trust in the system that governs us, it cascades through all of our decision-making, negatively impacting our desire and ability to take risks and grow our companies.

Without trust, it becomes hard to believe that the entities we depend on to regulate the system will serve us well. This causes business leaders to delay critical decisions, and organizations to do more workarounds. It injects more uncertainty into the decision-making process. And it diminishes the energy and productivity of the system. It’s hard to focus on winning when we don’t think the coach is playing for our team.

All of which makes it more important than ever for companies to develop strategic agility – the ability to move fast with focus in an ever-changing world.

Strategic agility starts with actively managing your strategic thoughts and the plan that follows. Many companies cling to the misguided notion that their strategic plans will unfold exactly as written. But in today’s hyper-fast markets, too many internal and external factors are involved for any plan to unfold without some degree of change along the way.

To adapt your plan to shifting market realities, automatically assume that your market is constantly changing (it is!), and monitor it on a regular basis. Then develop a formal process for managing your strategy.

Select a time, preferably once a month but no less than once a quarter, to review your strategy. Identify any changes in your environment, review how your strategy is unfolding compared to how you thought it would, and make any necessary adjustments to the plan.

When monitoring the environment, pay close attention to uncertainties. For example, what assumptions are you making about your markets and customers? Are they still valid? What are your customers and suppliers uncertain about? What are their customers and suppliers uncertain about?

When reviewing your strategy implementation, ask: What has changed internally or externally that might alter or undermine our strategy? Is our strategy working as expected? Are we executing correctly? If not, what do we need to refine or change in order to get back on track?

Once you determine the necessary course corrections, take action immediately! It’s hard making decisions without having any certainty about what the future holds. But the world moves so fast that once you fall behind, it can be very difficult to catch up.

To further develop your organization’s strategic agility:

• Paint a very clear picture of what winning looks like for your organization. When unforeseen events force a change in course, communicate to all employees how and why you will still win.
• Teach people at all levels to think strategically by keeping one eye on the future as they perform what needs to get done today.
• Unlearn what made you successful in the past but no longer applies to today’s market realities. Then learn new and better ways of adding value to your customers by seeking out many different sources of data.
• Give ongoing performance feedback. To perform at their best, employees need to know how the results they produce contribute to reaching the destination.

When it seems our own government is no longer on our side, we need to make our companies fast, agile, and able to change course with a minimum of disruption. Then we need to elect officials who will support a friendlier business environment.

Call to action: Identify one thing you could do to make your business more agile.

Forbes.com