No Agility Without Trust

Without a cul­ture of trust, no agili­ty. Car­go cult yes, but no agili­ty. And with­out agili­ty there is no chance of at least sur­viv­ing dig­i­tal­iza­tion, let alone ben­e­fit­ing from it. In an agile orga­ni­za­tion, respon­si­ble and empow­ered peo­ple can quick­ly make cus­tomer-ori­ent­ed deci­sions in decen­tral­ized struc­tures. This requires trust. They make these deci­sions in com­plex and uncer­tain envi­ron­ments, val­i­date them through rapid imple­men­ta­tion and learn par­tic­u­lar­ly from fail­ures. And that needs even more trust.

In the face of a vari­ety of new tech­nolo­gies such as arti­fi­cial intel­li­gence (which is not such a new con­cept, but is only now prac­ti­cal­ly usable through suf­fi­cient­ly large com­put­ing pow­er) or blockchain (which has been around for 10 years as an idea and first prac­ti­cal imple­men­ta­tion with Bit­coin), many com­pa­nies are increas­ing­ly feel­ing the pres­sure of dig­i­tal­iza­tion as a threat to their estab­lished busi­ness mod­els. This change would be dif­fi­cult enough if the new busi­ness mod­els were clear and “only” a ques­tion of exe­cu­tion. How­ev­er, the dig­i­tal busi­ness mod­els are not clear and prob­a­bly new busi­ness mod­els have nev­er been like this before, but rather a ques­tion of tri­al and error. Or in the words of Thomas Edi­son: “I did not fail, I only found 10,000 ways that did not work.”

If the rate of change on the out­side exceeds the rate of change on the inside, then the end is near.
Jack Welch

In this uncer­tain­ty (and one can cer­tain­ly add to it the polit­i­cal sit­u­a­tion with Brex­it in Europe and the renewed pro­tec­tion­ism of the USA under Don­ald Trump) more and more suc­cess­ful and there­fore large and, in their size, rather inflex­i­ble com­pa­nies are striv­ing for more adapt­abil­i­ty. Trans­for­ma­tions there­fore are under­way every­where: Agile trans­for­ma­tion, dig­i­tal trans­for­ma­tion or both at once. Flex­i­bil­i­ty should increase, one wants to and must become faster and more effec­tive. That’s why Sil­i­con Val­ley is trav­elled up and down and of course Spo­ti­fy is not left out. And then they are busy trans­form­ing, reor­ga­niz­ing and preach­ing change.

The great­est dan­ger in times of tur­bu­lence is not the tur­bu­lence, it is to act with yesterday’s logic.
Peter F. Drucker

How­ev­er, the key to the suc­cess of such a trans­for­ma­tion is the change in cul­ture. The foun­da­tion for agili­ty is a cul­ture of trust and based on it a learn­ing cul­ture in which the max­im is tri­al and error rather than plan and con­trol. This cul­ture of trust could also be observed dur­ing vis­its to those agile and dig­i­tal pio­neers. At Spo­ti­fy, every­one sim­ply takes the required new equip­ment such as key­board, cables and mouse from an open cab­i­net and Net­flix offers an “Open Vaca­tion Pol­i­cy” so that employ­ees can decide for them­selves how much vaca­tion they need. These prac­tices are (often bewil­dered­ly admired) man­i­fes­ta­tions of this impor­tant cul­ture of trust. In agile orga­ni­za­tions there is also this pat­tern of trust in respon­si­ble and empow­ered employ­ees, who make deci­sions as close to the place of action and cus­tomer as pos­si­ble rather than as high up in the hier­ar­chy as pos­si­ble. And so Reed Hast­ings, as CEO of Net­flix, right­ful­ly prides him­self not mak­ing any deci­sions. And that’s a dif­fer­ence that makes a difference.

We aim to make mis­takes faster than any­one else. But fail­ure with­out learn­ing is just: Failure!
Daniel Ek