Nimble: Make Yourself and Your Company Resilient in the Age of Constant Change - Hardcover

9780143131458: Nimble: Make Yourself and Your Company Resilient in the Age of Constant Change
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"Nimble shows how we can anticipate and adapt to an increasingly chaotic world--and become better leaders, strategists, and innovators along the way."
--Adam Grant, bestselling author of Originals

Cutting-edge insights for succeeding in times of chaotic change


Today's world is best described by one word: turbulence. Every leader today knows they need to be nimble, agile and resilient--but how?

In this engaging and insightful new book, management strategist and Wharton Fellow Baba Prasad sheds new light on the subject, and offers practical advice for executives, entrepreneurs, and anyone else who'll need the skills to face the unpredictability, risk, and deep uncertainty that lies ahead.

Filled with vivid examples and insights from around the world and throughout history - from the Brazilian rainforest and the "frugal innovation" of 19th century Indian engineers to Ericsson, Lego, Burt's Bees, and Zara--Nimble reveals what sets the most nimble leaders and organizations apart from the competition, presenting five types of agility that help individuals and companies not just survive but thrive in times of great change:

Analytical agility: Understanding the real problem
Operational agility: Driving leadership through action
Innovative agility: Finding creative solutions when you need them most
Communicative agility: Solving problems together
Visionary agility: Going beyond the here and now

It is possible to embrace change and uncertainty without sacrificing innovation and growth. Nimble shows you how.

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About the Author:
Baba Prasad (Prasad) is a leading thinker in the area of management strategy and leadership. He is President & CEO of Vivékin Group, a management consultancy that focuses on helping leaders and organizations become strategically agile. Prasad has a Ph.D. in Operations & Information Management from the Wharton School, where he has also been a Fellow since 1997. He teaches courses on strategy and innovation at various business schools. 
 
Prasad studied computer science and artificial intelligence and robotics at universities in India and the US. He has been a technology strategy consultant on Wall Street, and has served on the faculty in the business schools at Purdue University and the University of Minnesota.
 
Prasad lives across two continents and is a fitness enthusiast. He and his wife, Professor Leela Prasad of Duke University, also work in economically underprivileged schools in Hyderabad, India. They helped to set up “Aksharavani,” a school for children of migrant construction workers, in the city. They are currently making a documentary film titled Moved by Gandhi.
Excerpt. © Reprinted by permission. All rights reserved.:
Chapter 1

Strategy and Leadership in Turbulent Times

On December 23, 2011, the Joint Typhoon Warning Center in Pearl Harbor, Hawaii, reported that a tropical disturbance had begun to form in the Indian Ocean, about nine hundred miles to the east of Indonesia. Over the next two days, the disturbance trekked northwest, with winds near its center reaching forty miles an hour. It was now strong enough to be classified as a tropical storm and about six hundred miles to the southeast of Chennai in India. Soon the India Meteorological Department recategorized it as a tropical depression and named it Depression BOB 05. Within the next forty-eight hours, Depression BOB 05 progressed successively-and quickly-first into a deep depression, then into a cyclonic storm, and after that into a very severe cyclonic storm with winds reaching speeds of more than one hundred miles an hour. By then it had also had acquired a name: Cyclone Thane. On December 30, 2011, Thane struck the southeastern coast of India with the force of a Category 1 hurricane.

EID Parry, one of India's major sugar producers, found its largest sugar factory, in Nellikuppam (in the south Indian state of Tamil Nadu), directly in the path of Cyclone Thane. By the time Thane passed, it had blown the roof off the Nellikuppam sugar factory and wreaked havoc on the production machinery. It was estimated that it would take the factory at least thirty days to become operational again. Thane had also destroyed four thousand acres of the sugarcane fields that supplied the factory. EID Parry had a gigantic problem on its hands-it had to crush and process ten thousand tons of sugarcane. There was a further complication. Sugarcane, once it is harvested, begins to lose its juice content rapidly-even a delay of twenty-four hours can cause considerable loss in cane weight because both moisture levels and the sucrose content of the juice decline dramatically. This short shelf life of harvested cane meant that EID Parry-with an inoperative factory-had no more than ten days to finish processing ten thousand tons of uprooted sugarcane.

It had been a long day for Paul and Mary Zimby, and after dinner they settled down on the couch of their one-bedroom apartment, listening to soft music. Neither of them wanted to watch TV. Their first-floor apartment in the universityÕs graduate student housing was inexpensively but tastefully done up-some artwork on the walls, a lamp from a thrift store in the corner, and a colorful Guatemalan cloth covering the dinner table. The thumping started suddenly in the apartment above theirs, as it did some evenings. Tim and Becky, who lived upstairs, were also graduate students at the university, and good friends of the Zimbys. They had all graduated from the same college together and had known each other for years. But both Peter and Mary found it strange that Tim would not go to the university gym to exercise and instead jump up and down in his apartment. And every day the thumping of the floor as he exercised would begin at the same time. Today, however, amid the thumping, they heard BeckyÕs screaming and sobbing. Peter and Mary looked at each other-they suddenly realized that what they had assumed to be the sounds of a man exercising were most likely the sounds of domestic violence. What should they do? Call the police based on suspicion and ruin a good friendÕs life? Go up and confront Tim, who could potentially be in a bad state of mind and turn violent?

TodayÕs world is best described by one word: Òturbulence.Ó Whether we are talking of business climates or our own personal lives, change is all around us. We are buffeted by ever-changing technological winds; globalization is opening unexplored markets at the same time that it is dramatically altering existing ones; political instability and governmental policy are creating tremendous uncertainty; competition cannot be foreseen and often originates from unexpected quarters; and customers are fickle and their preferences unpredictable. Patterns of labor migration and increasing rates of employee attrition only serve to compound this problem. These are only a few of the many unforeseeable forces that impact organizations today. And of course turbulence in the business environment has economic and human implications for our everyday lives.

Life, both for you personally and for your company, is marked by a string of curveballs, inflection points, disruptions, and the like-and, like everything in life, some of these unpredicted happenings are positive and some are negative. Your company could suddenly face an unexpected labor strike or a sudden choking of its supply chain. On the other hand, a new technology may be able to help you create an exciting innovation. A change in government may open up new market opportunities or bring stricter regulations. Similarly, at the personal level, for you, a critical subordinate may resign. Your team may become embroiled in a communication crisis with a key customer. An unanticipated promotion may open up a new leadership opportunity.

CEOs everywhere are seeking ways to capitalize on unforeseen opportunities and to cope with unanticipated hurdles. Unfortunately, in a world where the unforeseen and unanticipated are happening at a faster and faster pace, older ideologies and familiar methods are proving grossly inadequate; organizations and executives need new paradigms and new frameworks. And the need is urgent.

In this context, this book will help you in two ways. First, it will teach you how you and your organization can develop capabilities, not only to survive and succeed, but to emerge as leaders and sustain leadership positions even in conditions that are characterized by unpredictability, risk, and deep uncertainty. Second, rather than just teach you how to be reactive and agile in the short term, this book will teach you how to be successful in the long term with a sustained strategy.

Let me elaborate. As I said before, it has become common business wisdom that in today's turbulent circumstances we need to develop agility-the ability to quickly adapt to changing environments and circumstances. But simply having agility isn't enough. Consider the story of this company that demonstrated tremendous supply chain agility.

A Fiery Test of Agility

Around 8:00 p.m. on March 17, 2000, the Dutch company Philips NV faced an "act of God" disaster different from the one that destroyed the EID Parry factory. Philips's semiconductor chip manufacturing facility in Albuquerque caught fire after a lightning strike created electrical surges across the state of New Mexico. The fire was put out in less than ten minutes by the factory's automatically activated sprinklers and by the trained factory staff. The damage seemed minimal at first: eight trays of silicon wafers were destroyed in the clean room-the wafer-producing facility that is kept thousands of times cleaner than operating theaters in hospitals. The thought that these eight trays would have produced radio-frequency chips for thousands of cell phones was sobering. But more significant was the damage inflicted by the water and smoke on the clean room itself. Philips estimated a week's delay in production and proceeded to inform its two major clients-for now, let's call them company A and its competitor, company B. Forty percent of the chips from this factory went to these two clients, and they were the main customers who were going to be affected.

Company B, upon receiving the news about the fire and the shipment delay, quickly examined its inventory positions. It determined that it had enough chips in stock to tide over the week's delay-such delays, it knew, were routine in the tight supply situations that marked the semiconductor-manufacturing industry. And thus it waited for the Philips factory to be restored.

Company A, on the other hand, went into classic firefighting mode. It first set up a team to monitor the progress of the repairs to the factory with Philips. A few days later, it realized that the problem was much larger than Philips had initially estimated. When it became clear that supplies from the New Mexico factory would take longer in coming than initially estimated, company A immediately did three things. First, it scoured the chip-manufacturing world for other suppliers and grabbed up chips wherever they were available-including Southeast Asia. Second, with CEO-level negotiations, it got Philips to rearrange production in its factories in Asia to be able to manufacture chips for company A's phones. And third, it redesigned portions of the critical chip so that it could be manufactured in other plants-both Philips and non-Philips.

By the time company B woke up to the seriousness of the situation and started to look for other manufacturers, it found that company A had cornered all the chips available on the market. The Philips factory took six weeks to get back in action. At the end of that operating quarter, company B reported that it had suffered a $200 million operating loss as a result of the shortage of chips. Six months later, in its annual report, it declared that it had suffered a 3 percent loss in its mobile phone market share, and that its mobile phone division had incurred a loss of $1.68 billion (pulling the overall company to an operating loss of $167 million). Company B never recovered from this, and ultimately, in 2001, it ended up selling its phone division to another company. Company A, on the other hand, went on to become, over the next few years, the biggest cell phone manufacturer in the world, commanding a huge 50 percent market share in 2007.

The Agility Puzzle

The incident of the fire in the Philips factory and its aftermath is often used as an example to show how a company that is agile (company A) reaches the pinnacle of success while a company that lacks agility (company B) fails dismally. An article in the Wall Street Journal epitomized this assessment of the two companies. Among other causes, it claimed that company A responded to the fire incident with "a characteristic Finnish curtness under pressure-the Finns call it sisu-that signaled they meant business." However, this conclusion comes from a short-term perspective, as the revelation of the names of these companies will indicate. If you have not already recognized them, company A is Nokia, and company B is Ericsson, whose cell phone division was acquired by Sony to form Sony-Ericsson. As this episode demonstrates, Nokia was celebrated for its supply chain agility. As it turns out, the critical word in the previous sentence is not "agility" but "was." Because Nokia, the wireless-handset company, does not exist today.

The understanding that agility is a driver of competitiveness in turbulent environments is itself called into question by Nokia's struggles and dismal performance over the last few years, which culminated in its selling its devices business to Microsoft in late 2013. In fact, Nokia's fall has been extraordinary and fast. Even as recently as 2008, its share of the worldwide market for handheld mobile phones was a dizzying 50 percent. Nokia's share of the smartphone market dramatically declined from more than 50 percent in 2007 to less than 5 percent in 2013. Nokia's return-on-assets performance was also dismal. It declined from nearly 25 percent in 2007 to negative 10 percent in 2012. Return on assets is a significant measure because it is a commentary on the company's management practice. So at the end of all of this we are left with a puzzle: if Nokia was remarkably agile, as it demonstrated in the aftermath of the fire incident in the Philips factory, why did it fail?

The Concept of Strategic Agility

The answer to why Nokia failed lies in the fact that there is more to agility than meets the eye. With 20/20 hindsight, today we can say that while Nokia demonstrated tremendous supply chain flexibility, it was, in fact, not agile in many other ways. As several business thinkers have argued, Nokia was not sensitive to customer preferences. For instance, it did not produce a clamshell phone despite the incredible success of Motorola's Razr in the US market. It refused to move from the proprietary Symbian operating system, which did not adequately support smartphone applications, and when it did move, it chose to go with a Microsoft operating system despite the popularity and promise of the emerging Android operating system.

There is more to agility than meets the eye.

Simply put, agility is never about just one thing; organizations always operate in business contexts that are inherently multidimensional and complex. We need an appropriately sophisticated understanding of agility-a concept that we call in this book strategic agility. Strategic agility makes the concept of agility comprehensive by locating it in the realm of long-term planning in the face of a quickly unfolding unknown-an unknown that is not only about risk but also about uncertainty and, sometimes, about unknowable, deep uncertainty. The term "strategic agility" combines two contradictory concepts: strategic implies slow-moving and long-term, while agility connotes speedy, short-term orientation. In essence, the term forces us to hold concepts that are in seeming opposition as we think about business moves-and dealing with ambiguity is critically necessary in today's business environments.

In this book I present the VivŽkin Intelligences Framework, which enables leaders and companies to develop strategic agility. The quintessential driver of human adaptability-intelligence-inspires the framework, which developed during years of my research at Wharton, and the business schools at Purdue University and the University of Minnesota. It incorporates findings from many fields of research-from evolutionary economics and ethnography to psychology, operations management, and business strategy.

Using advances made in research in these diverse fields, I will show that companies need to develop multiple kinds of agilities and cultivate an enhanced sensitivity to context so they can apply the combination of agilities that is most appropriate to the situation. The framework you'll discover encompasses both a people aspect and an organizational aspect. This implies that strategic agility brings together two fields that were traditionally thought to be separate: leadership development and competitive strategy.

The VivŽkin Intelligences Framework will help you assess yourself and your organization to determine flexibilities in five different dimensions. It will guide you in leveraging your strong agilities and strengthening your weaker agilities. It will also enable you to design context-appropriate dynamic strategies so you can develop into a flexible leader and also transform your company into an agile and resilient industry leader-and to do it all in the face of rapid change.

Chapter 2

Intelligence-Driven Agility

About 10,000-11,500 years ago, the first humans arrived on the North American continent using a land bridge to cross what we today call the Bering Strait-the small strip of sea that separates Russia from Alaska. Paleontologists believe that a corridor opened up between giant ice sheets covering what is now Alaska and Alberta, making possible the journey of these first North Americans. These immigrants, now known collectively as Clovis people, spread quickly through the North American continent, going southward across the Great Plains and the southwestern states, even as far as New Mexico. In fact, since the early 1900s several archaeological finds in New Mexico have uncovered evidence of this migration through items such as spearheads big enough to kill large animals. Not only is the advent of humans into North Americ...

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  • PublisherTarcherPerigee
  • Publication date2018
  • ISBN 10 0143131451
  • ISBN 13 9780143131458
  • BindingHardcover
  • Number of pages272
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