Why are so many large organisations struggling in today's economy?

The world has changed. Though we are being told that the economy is growing by politicians, the truth is that the economy still lacks stability and many a brave economist and social scientists are proving that growth is not and never has been a sustainable ambition. The future remains uncertain.

To survive this uncertainty, the principle of 'lack of stability' is an important one to respond to. It suggests that at any given time more challenges may need to be faced, insisting on a resilience and adaptability for any organisation. This is not easy to achieve, particularly for larger organisations.

Organisations who hold onto stability by not reviewing and amending their values, culture and practices in line with an unstable economy create a tension between themselves and the economy. This tension can be felt in the guise of increased reactivity, stress, overwhelmed workforce and often an increased commitment to centralised control, which in turn negatively affects the performance of the workforce, quality of decisions and service delivery. It also can lead to a need to downsize. All of these are symptoms of an Organisation in Crisis.

The traditional organisational practices which were built when the economy was stable should be reviewed if the organisation wishes to stay healthy, adaptable, resilient and sustainable. If not, these practices can actually feed increased negativity, distrust and blame into the already highly-pressured environment, which is trying to 'fight' the tension and the changes needed to resolve the tension. The consequences are that the organisation, despite its increased commitment to control, looses its grip and very quickly slips into dysfunction, ill-health and its inevitable decline.

So what do organisations need to do different?

Organisations do well to match the principle of instability with becoming more agile and adaptable in their nature. For larger organisations, which can be compared with a large tanker trying to avoid icebergs, this is not an easy task, yet absolutely crucial for its survival.

The following questions may help Governance Boards and Senior Managers reflect on their organisation's adaptability:

1. Have you recently reviewed your organisational values, culture and practices in line with the changes in the economy?
2. What leadership mindsets and strengths do you need to build an adaptable organisation and lead agile teams?
3. How quick can your organisation respond to an opportunity or challenge? What role does the hierarchical organisational structure play in decision-making?
4. Do your centralised processes and communication channels help or hinder your organisation's agility?
5. Can your workforce move around the organisation fairly quickly? And what can help to make this easier?
6. Are there parts of the organisation which prioritise Business as Usual over being involved in the organisation's Transformation initiatives?
7. What can large organisations learn from innovative and adaptable SMEs?

Not only can the principle of adaptability translate to the organisation and its leaders, but also can be applied to the qualities you require from your workforce. A flexible workforce is not solely about having policies and procedures which support workforce mobility, it - like with leaders - equally comes down to attracting and retaining complimentary mindsets and strengths.

So what if an organisation feels it's losing its grip? Is it too late?

Though a proactive approach is always advisable to keep an organisation in good health, it may not be too late to seek advice and support at time of crisis. Like an individual, organisations who are suffering ill-health need to first acknowledge it and be open to exploring different ways to restore organisational health.