Last week, Alan Alda spent an hour on “The Human Spark” on PBS exploring why modern man survived and Neanderthals did not. The likely answer? Adaptablity—and it’s still the key to survival.

“There’s probably no organizational attribute that’s more important today than adaptability,” writes Gary Hamel, author and the world’s leading expert on business strategy, according to Fortune magazine. “In our topsy turvy world, every organization is teetering on the brink of irrelevance, and unless it can change as fast as change itself, it will soon tumble off the ledge.”

Baldrige organizations promote adaptability by valuing agility, a focus on the future, and a systems perspective. They constantly and systematically renew themselves by questioning what markets to serve and what the customers in their markets require, how to make their processes more efficient, and how to engage their employees in change and innovation. Rather than reacting to change, they deploy processes that help them adapt and grow.

In “Outrunning Change—the CliffsNotes Version” on WSJ Blogs (October 21, 2009, click on Part 1 here and Part 2 here), Hamel shares his thoughts on how to build a highly adaptable company:

Anticipation

• Face up to strategy decay.
• Learn from the fringe. “The future will sneak up on you unless you go out looking for it.”
• Rehearse alternate futures. Think through the implications of trends and how you will react.

Intellectual Flexibility

• Regard every belief as a hypothesis. “The biggest barriers to strategic renewal are almost always top management’s unexamined beliefs.”
• Invest in genetic diversity. Seek diversity in the executive committee.
• Encourage debate and dialectic thinking. Ask your colleagues, “Where do I have this wrong? How do you see this differently? What would you do here?”

Strategic Variety

• Build a portfolio of new strategic options.
• Build a magnet for great ideas.
• Minimize the cost of experimentation. You need to master the art of rapid prototyping.

Strategic Flexibility

• Disaggregate the organization. “Big things aren’t nimble.”
• Create real competition for resources. Existing businesses sustain their budgets year-to-year at the expense of new ventures and breakthrough projects.
• Multiply the sources of funding for new initiatives. A “paucity of funding sources squelches innovation.”

Structural Flexibility

• Avoid irreversible commitments. “Managers have often traded away future flexibility for short-term economic advantage.” Stop doing that.
• Invest in flexibility. You need room to maneuver. “Paradoxically, building a flexibility advantage often requires a degree of operational standardization.” That sounds like Baldrige to me.
• Think competencies and platforms. Define your organization by its core competencies and broad platforms rather than products and services.

Structural Adaptability

• Embrace a grand challenge. Involve employees in creating a shared vision that challenges them “to do something big, exciting, or noble.”
• Embed new management principles. Value variety, decentralization, serendipity, and allocational flexibility.
• Honor resilience-friendly values. The Web reveals what those values are: community, transparency, freedom, meritocracy, openness, and collaboration.

To read more about ideas and processes that support adaptability, click on these articles:

• 10 Questions to Ask about Everything You Do
• How to Integrate Baldrige
• 10 Steps to World Class
• Anticipating Disruptive Change
• Identifying Capabilities Your Organization Needs
• Co-Creating a Shared Vision
• The Priorities of Leadership

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