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Business Agility in Small Business

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What is Business Agility?

Owners may ask, what is business agility and why is it important? Let me answer by telling a story. During the cold war in the 1960’s, Whitaker Pools had a core business of building swimming pools. They were able to adapt to building fallout shelters to meet, at that time, a new customer demand. They were able to reuse their craft to adapt to a new market. Those that adapt fast improve their chance of winning the market.

Therefore, the reason for business agility is to sustain a competitive business. Finding opportunities without much competition has lower cost of sale and less price pressure. A profitable business that can adapt is more valuable. Typically, increased value makes it easier to raise funds to grow. Owners earn their worth and have an easier life. A business that’s growing and adapting is also a more interesting place to work, so staff stay longer.

Are small businesses more agile?

We tend to think of smaller businesses as being more agile. That makes sense when you think of small teams and easier communication. You might also think about start-ups in discovery mode testing different ideas. At the same time, small business thinking can be quite rigid and not open to new ideas – the opposite of business agility. Start-ups can also be chaotic which can slow the ability to change. Perhaps business agility is more about attitude than company size.

In the software industry, the lean and agile movement encourages rapid learning. Short burst of forward movement followed by testing the value generated. A failure is as good as a success, because you discover early what doesn’t work. This promotes an innovative mind set, because if you’re not willing to fail then you never innovate. It turns out that small businesses are rather good at innovation. According to the Scale-up Institute  Eight out of ten scale-ups have made a significant innovation in the past three years and twice as likely to innovate than a large organisation.

How to be more agile

A good board of directors will assess business strengths and make a connection with future opportunities.  The senior leaders of Whitaker Pools must have thought we’re good at digging out a garden for a pool, we could use that to build a shelter. In that sense business agility is about having a set of strengths that can be repurposed. Whitaker Pools had developed knowledge and tools to create a strength of digging big holes. Therefore, business agility is also about seeing business strengths and using them in different ways.

Let’s dig into Whitaker Pools for a moment (excuse the pun). They had diggers and earth moving equipment (technology) and know how (process), and a trained workforce (people). In this case a reusable business strength was technology, process and people. Each of those required investment in equipment, learning, recruitment and training. I’m sure they had to learn how to apply that to building shelters. The point is that they had identified a reusable strength that allowed them to adapt quickly to a new opportunity.

Not doing away with process

I recently read an article designed for small business owners that implied that business agility was about doing away with process. As we’ve discussed, it’s more about strengths and opportunities. As a counter argument to the article, let’s look at Lean and Agile. Lean started in manufacturing process, reducing waste and improved learning. Then for Agile, in software development there is a highly disciplined team following a process. Is the process simple? Yes. Is the process documented? Yes. Are there clear roles and responsibilities? Yes. Are staff trained in process and roles? Yes. Agile teams are small, collaborative and follow a formal process that enables them to be very productive.

Small business agility

So, what do small businesses need to be more agile? The answer is in two parts. Firstly, looking outside the business to see opportunities, and secondly developing reusable strengths. Some of those strengths might include technology, process and people. Other strengths might also include resources such as physical or digital assets. How can business owners reuse strengths? The first step is to catalogue strengths, and the second is to develop them. Typically, you’ll develop strengths that align to your core business.

A fresh look at small business

How can small business stay one step ahead of the competition? Have you ever struggled to figure out something that should be easy like changing a car bulb or changing a timer? Frustrated you Google or watch YouTube only to discover it was really very easy once you knew how. One tool in the armoury is to really understand the strengths and how the whole business works together to deliver value. Business, even small business, can seem so complex that it’s easy to lose sight of all the goodness. It takes an organised view to give a fresh perspective to re-discover strengths and discover opportunities for growth.

Scaling a business so that it is efficient and profitable is important for success. Ensuring that systems are in sync with your unique value proposition and direction are important for competitive advantage. Designing your systems to scale to achieve profitability and be competitive is easier with expert help and a fresh pair of eyes. If this has resonated with you, then why not contact me at rhounsell@kr5consulting.com to arrange a call.


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