Companies have always had to adapt to change. No matter how far back you travel in history, there have been shifting conditions to contend with. Today, however, organizations face especially challenging conditions.
To operate an effective company today and maintain a competitive advantage, you must adjust to changes that, when compared to even the recent past, are:
- Faster-occurring
- Deeper and more thorough
- Larger in scale
The current business climate is defined by rapidly evolving tech areas like AI, along with a continually redrawn map of political alliances and priorities, and markets that are fragmenting from a peak level of globalization. Building organizational agility into your business structures allows your company to keep pace with its industry, seize opportunities, and avoid functional roadblocks that can stop slower-moving competitors.
Taking on the right adaptable leadership style to thrive in these conditions is a very specific kind of practice. A great leader of a transformation-ready organization will offer effective, profitable direction in the present while constantly keeping an eye on the future. Fortunately, the adaptability skills tied to this approach can be learned.
Read more: Find out what MIT Sloan Executive Education leaders think about harnessing the forces moving industries forward.
Defining adaptability in business
In short, business adaptability is your company's ability to execute transformations in its business model and operations. This could apply to any area, from strategy to staffing and beyond. Perhaps the easiest way to highlight what adaptability looks like is to explain what happens when a company lacks it.
Businesses that aren't adaptable are stuck in their current state and unable to easily or affordably change to meet the conditions around them. This could happen for a variety of reasons, including:
- Tech debt: Legacy technology deployments that become overly complicated or interconnected can be expensive to maintain, prone to failure, and hard to replace, inflicting inertia upon companies.
- Inflexible contracts: Agreements with suppliers, logistics partners, consultants, and other key businesses can trap a business in one style of operations. It could be financially damaging to evolve beyond these contracts' constraints.
- Unsuitable business practices: A company's inflexibility may reside in its internal operational methods, separate from both technology and third-party contracts. If all employees are trained on overly complex or hard-to-untangle systems, adaptation can come with excessive costs or demand long timelines.
The core concept that goes into counteracting these factors is future-proofing. An organization that puts time and effort into planning for potential future directions will naturally find itself less constrained by inflexible technologies, contracts, or practices.
This process of future-proofing is universal: Every company experiences change over time, simply by virtue of existing in shifting marketplaces. Therefore, the ability to evolve slowly and pivot quickly should be embedded in your core business strategy. You know some kind of change is coming, which means it's important to meet it on your terms.
See more: Watch an expert webinar on what it means to run a future-ready organization or one on what it takes to become future-ready.
How adaptability helps companies thrive
Building an adaptable organization is valuable in two distinct but related ways, each tied to the ways in which companies cope with changes in the market around them.
In contrast to inflexible competitors, an adaptable organization can:
- Take advantage of new opportunities for value: A new development that affects large numbers of companies — for example, a sudden spike in interest around generative AI — can present a way forward. Businesses that are able to pivot effectively, without unbalancing their budgets or harming their everyday operations, can become first movers in the new segment. Less adaptable competitors will either place undue strain on their operations or move too slowly to take full advantage of the emerging market segment.
- Prevent major losses tied to changing circumstances: A shift in conditions can put a business model in jeopardy. In these cases, such as when COVID-19 forced in-person companies to work remotely for over a year, change isn't an option; it's an imperative. Businesses with flexibility and resilience built into their technology, contracts, and planning can soften the impact of these changes. More rigid businesses will have to struggle with budget overages, delays, and logistical challenges.
Read more: Discover how an organization from 1831 is forging new pathways.
Transformation readiness flows downward from corporate leaders' example. As an executive, you need to embody adaptable and flexible operations, all while never losing sight of the best practices of the current moment. This is a complex balancing act, but the rewards of success are worth the investment.
Organizations led by leaders who embrace and impart flexibility can remain in pole positions within their sectors, even as market conditions change around them. This ability to suit new landscapes as they emerge is an eternally relevant management trait, as there's no such thing as a truly stagnant market.
Read more: See the connection between nimble operations and innovation.
Learning to build an adaptable business
The best practices associated with adaptability include changing your mindset as an executive to always keep one eye on your company's future potential. Adaptable business practices affect multiple areas of management and leadership, including:
- Technological change management: Avoiding excessive tech debt and becoming adept at assessing and integrating new technological developments are two of the most important practices for a modern executive. With your company's everyday effectiveness defined by its IT capabilities, you can't neglect this aspect of your leadership style.
- Process design and planning: The best-prepared organizations can thrive through a wide range of outcomes and conditions. Learning to plan for multiple scenarios using advanced analytic methods — and creating actionable plans based on these scenarios — can help you thrive in an executive role.
- People management: No matter how adept you are at managing technology and processes, business evolution will fall apart if your people aren't ready to follow along. Employees must be motivated, well-trained, and committed to the company's mission to form adaptable teams that will stay in line as conditions and practices change around them.
You can take direct action to build these skills by participating in MIT Sloan Executive Education courses such as Future-Ready Enterprise Academy. The course, co-offered by MIT Sloan Executive Education in Cambridge, Massachusetts, and the International Institute for Management Development (IMD) in Singapore, is built around the dual need for current management excellence and adaptable, future-looking practices.
In this course, you'll study case studies and apply exercises to your own operations while also reviewing theory and self-reflecting. Important concepts include freeing up your employees to be innovative and nimble, all while staying strategically aligned and avoiding bureaucracy.
Read more: Learn about six questions your business has to answer to display resilience and stay relevant today.
Ready to make adaptability skills a core value?
When you study business adaptability, you're building a key in-demand skill. Whether you use that to excel within a current role or aim for success on the job market is up to you. Companies of all kinds across industries will need leaders who are ready to shift with changing circumstances; therefore, you have a strong motivation to become one of those executives.
Whatever form the business world takes next, considering technological advancement, geopolitical realignment, and markets in flux, it won't look like it does today. Adaptable companies will be able to shape themselves to fit, maintaining a competitive advantage, and you could become the leader of such a business.
Enroll in Future-Ready Enterprise Academy to get started on your next executive evolution.