Why a Resilient Business Depends on Both Agility and Innovation
Building a resilient business can help your organization thrive during unforeseen disruptions, but not all interferences are unpredictable. Getting ahead of the curve with technology-driven changes can improve organizational resilience in several ways.
The COVID-19 crisis was a perfect example of this. In the past year, the most resilient businesses were those that had already prepared for inevitable technology-driven changes, such as the arrival of cloud computing. Organizations that hadn’t yet migrated to the cloud, however, were forced to rapidly adopt work-from-home (WFH) policies, as well as implement widespread safety measures, new business strategies, and brand-new operating models.
Below, we’ll look at a few technology-driven changes that are seemingly inevitable, so you can get ahead of them before they transform the marketplace. In order to build the perfect change management plan, let’s first clarify the difference between agility and innovation—both of which are pivotal to business resilience in today’s fast-paced world.
Agility vs. resilience vs. innovation
According to consultancies such as McKinsey, agility is a cornerstone of business resilience—the more responsive and flexible an organization is, the easier it will be to respond to unexpected changes.
Yet agility and innovation are not the same, according to Karine Sabatier, founder of Hackernoon, who says:
Innovating is creating change. Being agile is adapting to change. The mindset is radically different.
In short: Agility follows, while innovation leads.
Today, agility is more essential than ever, enabling resilience when disruptions threaten normal business operations.
Innovation, however, is what drives change forward. Since disruptive innovation is ongoing and predictable, companies that want to adapt to forthcoming innovations can begin by investing in innovation earlier rather than later.
According to Altimeter, digitally mature companies focused on digital innovation in 2020, despite the hardships caused by the pandemic. That forward-thinking innovation is what allowed them to pull ahead while less mature companies were focused on building out more basic digital capabilities.
McKinsey also revealed a widening gap among industries—those leading before the pandemic pulled farther ahead, while those that were lagging before the pandemic fell by the wayside. One of the reasons suggested for this disparity came from the leaders’ competence in creating “resilient, future-ready business models.”
The question then arises, what does “future-ready” mean and how can we prepare?
To build a resilient business, focus on innovation
Digital innovation and technology-driven disruption can be easier to predict than other types of changes, such as shifts in customer behavior.
In the years to come, we’ll see the mass adoption of technologies that are still emerging today, such as artificial intelligence (AI) and blockchain.
ARK Invest’s Portfolio Manager and Chief Investment Officer, Cathie Wood, specializes in disruptive innovation, and her entire investment fund is built around disruptive innovation.
According to her firm’s research, five platforms and fourteen technologies will converge in the coming years and radically revolutionize the modern world.
Their five platforms include:
- Artificial intelligence
- Energy storage
- DNA sequencing
- Blockchain technology
These platforms will ultimately enable fourteen specific technologies that will upend many “conventional” industries that have dominated the economy for decades.
Those fourteen technologies include:
- Frictionless value transfer
- Autonomous mobility
- Battery systems
- Sequencing technology
- Gene editing
- Adaptive robotics
- 3D printing
- Reusable rockets
- Neural networks
- Mobile connected devices
- Cloud computing
- Internet of Things (IoT)
Naturally, each of these platforms and technologies will have a unique impact that will play out on a different timeline.
Future-focused Chief Information Officers are taking the strategic helms at their organizations and making massive investments in emerging technologies. When those technologies become the norm, they will disrupt existing economics, business models, and competitive landscapes.
How to prepare for technology-driven disruption
The important takeaway is that change is coming, and keeping a finger on the pulse of the market’s innovation is key to staying resilient.
Here are a few points to keep in mind when building a future-ready, resilient organization:
Pay attention to technology trends and forecasts. There are many, many research firms that offer insights and perspectives on the technology-powered revolution. Among the best are business consultancies, such as McKinsey, Deloitte, and BCG. These firms stay on the cutting-edge of technology and business, consistently presenting insights regarding the tech trends of tomorrow.
Invest in both agility and innovation. To reiterate the point made above, agility is essential for resilience in the face of unpredicted changes, while innovation can help a company prepare for more predictable changes.
Build business functions dedicated to digital transformation and adoption. Digital transformation is essential for any organization that wants to attain digital maturity, innovate, and stay resilient in the digital era. Digital adoption—the seamless integration and full utilization of new technology—is fundamental for streamlining that transformation and ensuring employees can stay both creative and agile.
Become a digital-first organization. Digitally-mature organizations have fared the best throughout the pandemic. Since the years to come will bring even more uncertainty and change, it is imperative to stay ready not only by adopting new technology, but by integrating it into business strategy.
Technology-driven innovation will continue to define the business landscape for years to come. While staying agile is a prerequisite for business resilience, so too is innovation, especially for those businesses that want to become digital leaders in their space.