Agile working linked to faster growth and higher profits

Adopting agile ways of working makes a company five times more likely than their competitors to be a top performer, with faster growth and higher profits, according to a new report from the Boston Consulting Group (BCG).

Boosting Performance Through Organization Design identifies six key factors of organisation design that set top performers apart from rivals, based on the results of a BCG survey.

‘Agile’ describes workplace processes that emphasise speed, autonomy and teamwork to complete tasks and get products to market faster, BCG explains.“Agile ways of working help save time, simplify decision making, and engage and empower individual employees and teams” the report says.

What’s more, agile ways of working also enable the other five factors, which are:

  • A value-adding corporate centre – HQ plays a strategic role, shares best practices and supports functional excellence. Such companies are three times as likely to be top performers as their peers.
  • Clearly delineated profit & loss responsibilities – Companies in which ownership is simple, clear and empowered and supports the overall strategy are three times more likely to have faster growth and higher profits than their competitors.
  • A flat management structure with a strong frontline focus – Companies that minimise the operational distance between the corporate centre and customer-facing business units are twice as likely as their peers to become top performers.
  • Effective use of shared services – Being able to move transaction-heavy administrative functions from individual business units to centralised shared services makes companies more than twice as likely as their competitors to become top performers.
  • Strong support for people and collaboration – Organisations with a collaborative, people-focused culture double their chance of being top performers.

The authors of the report noted that, although organisation design must be tailored to an individual company’s needs, enterprises that incorporate at least one of these six factors are likely to see above-average growth and profits. Furthermore, companies that incorporate all six increase the likelihood of a becoming top performer to more than 50%.

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