Creating Competitive Advantage in the Digital Era with ‘Agile Pods’

February 6, 2017

Since the rise of the industrial era over 150 years ago, there have been a number of business trends that have shaped the course of both industry and society — but they were fundamentally just variations on the same themes. In the end, it was business as usual.

Digital transformation, however, is something altogether different. It represents a fundamental shift in how executives structure, manage and lead their organizations as technology has moved to the core of every business process and every element of the customer experience. Most significantly, it has altered the manner in which organizations obtain and protect competitive advantage.

In the industrial era, organizations derived competitive advantage from assets and barriers to entry. Heavy investments in factories, inventories, staff and intellectual property protected organizations from competition. In the digital era, however, these same assets are becoming liabilities as the source of competitive advantages shifts to speed and agility.

Reorganizing for Success

Organizations are recognizing that the top-down, hierarchical, middle-management-heavy structures of the industrial era have become albatrosses around their necks. As a result, business leaders are experimenting with various strategies in an attempt to flatten their organizational models, embrace modern technologies and drive decision making towards the edges of the organization.

And they are finding it to be a difficult transition.

The challenge is that the transformation into a digital enterprise is not a one-dimensional act. It requires that an organization transform its approach to technology strategy, structure, and operations — all at the same time. Flattening an organizational structure and moving towards modern technology platforms sounds good on paper, but it is exceptionally difficult to execute within a large enterprise organization.

This complexity has left most organizations struggling to reshape their organizational structure and culture to adapt. But technology services company, Globant, has developed a methodology and approach that delivers speed and agility at scale — and which can produce results almost immediately. They call it Agile Pods.

Agile Pods are a form of self-organization in which the organization assembles cross-functional teams with specific objectives (a constitution, in Globant’s vernacular) and then create a self-management operating model. (An example Agile Pod structure is below.)

Example Agile Pod Structure (Source: Globant)

This methodology is a powerful, yet pragmatic approach that creates a cultural and structural paradigm that can co-exist with a traditional hierarchical structure. It enables an organization to adapt quickly, make decisions and execute rapidly, and continually embrace and deploy new technologies that drive competitive advantage.

Used effectively, it is an approach that organizations can use not only as the core internal organizational and management model, but also as a primary client engagement vehicle.

Understanding Agile Pods

In the Agile Pod methodology, every pod has a pre-defined set of roles designed to ensure that it not only achieve its objective, but that it is also continually improving its respective velocity, impact, quality, and autonomy — success characteristics that the company turns into specific metrics unique to each pod and which it measures relentlessly.

The pods then naturally self-organize into a pod ecosystem as the pod members identify other pods on whom they are dependent or who are dependent on them. The result is a highly fluid, dynamic operating model that enables the organization to rapidly adapt and pivot based on market shifts and customer needs.

What makes this approach unique — and widely applicable to any organization seeking to infuse greater speed and agility into its culture — is its ability to peacefully co-exist with a traditional hierarchical model while improving and speeding intra-organizational communications and breaking down organizational silos.

The Intellyx Take

Digital transformation is a messy business. As much as business and IT leaders might like to simply buy a piece of software or hire a consulting company to magically transform them into a digital enterprise, there is no escaping the hard work of transforming your organizational structure and culture.

The good news is that organizations like Globant are forging a path for you to follow. The even better news is that you can transform your organization into a digital enterprise without needing to blow it up.

You can reshape your organization from the inside out using a pragmatic and methodical approach that changes the way your organization works and communicates — you just need to be willing to utilize dynamic, self-organizing principles, such as Agile Pods, to do it.