The opposite of a waterfall, ‘agile’ is an iterative, exploratory process that starts at the bottom from direct interaction with the user and then progresses through the crafting and refining of working prototypes. In this sense, Fast/Forward strategy is the product of action, engagement and intuition underpinned by a guiding sense of purpose rather than a top-down exercise in rational planning and analysis. ‘Our mindsets need to be rebooted,’ says Birkinshaw. ‘We should stop thinking about strategy as a mainly intellectual activity aimed at creating a unique position in an unknown future. Instead, fast/forward strategy-making is about doing things’. Doing is better than guessing, so strategy becomes delivery – a real-time process of trial and error in which experimentation and engagement reinforce one another to build forward momentum.
This focus on action and engagement has radical implications for the nature of organisation. A century ago, bureaucracy, based on hierarchy and standards, was a big organisational advance: without it railways and mass-production, for example, could never have developed. As intellectual rather than financial capital became the scarce resource, in the second half of the last century the meritocracy came to the fore. Universities and professional service firms are good examples – knowledge-based organisations in which an individual's position within a hierarchy is less important than his or her knowledge and how that knowledge is used.
Fluid and adaptable
Unfortunately, being inwardly focused and rules-based, neither bureaucracy nor meritocracy are good at coping with rapid change. With their bias to consensus and detail, meritocracies can get bogged down in seemingly endless debate, at the expense of actually doing anything. Immersed in their own preoccupations, they fail to notice the world speeding up around them. Instead, getting beyond analysis paralysis requires a less fixed, more fluid and adaptable form of organisation: what Ridderstrale and Birkinshaw term ‘adhocracy’.
Adhocracy is an idea that has been around for decades, in the general sense that it is the opposite of bureaucracy. But it comes into sharper relief, says Birkinshaw, when viewed through the lens of the new emphasis on strategy-as-action: ‘We want to redefine adhocracy to make it useful’. Realistically, few large firms will be able to reshape themselves as agile organisations able to turn on a sixpence in the blink of an eye – or even ever. While an internet start-up would aim to avoid bureaucracy and the endless pursuit of perfection, established companies face research, regulatory and reporting needs which make elements of bureaucratic and meritocratic organisation unavoidable. They face the difficult task of cultivating islands or cells of adhocracy within the larger structure.
Combining different organisational types is hard. Adhocracy is an uncomfortable bedfellow for more staid hierarchical forms. Yet some large companies have managed the feat: the authors single out Amazon, WPP, Air Liquide and Lloyds Bank as examples of firms that have successfully cultivated action alongside thought, exploration as well as exploitation, experiment as well as rigorous execution. As the name suggests, adhocracy is more about adopting a new mind set rather than ticking boxes. Projects, ‘skunk works’ – experimental laboratories within a company that operate independently of a main research division – and internal start-ups are well-known examples.