Organisational tensions. Who isn’t familiar with them?

Usually, these tensions arise when there is a tug of war between Capability and Demand.

We want more features.

We want them faster.

We want more products.

We want to pay less.

Functions like HR and IT often get caught in these tensions.

Different departments start pulling in different directions. So, how do managers diffuse these tensions?

In his recent Lithe Talk, Russ Lewis – organisational coach, mentor and consultant – talked through organisational ambidexterity: simply, Agile for Managers, which can help managers improve business agility.

As a practitioner and doctoral candidate, Russ has been researching the emerging role of managers in the digital age. His thesis is that managers at every level would lead the improvement of their organisations if the conditions allowed.

An early adopter of Agile methods and service-based architectures, Russ has designed, built, and led the team that developed Transport for London’s contactless fares billing system. His software systems have supported functions within Best Western Hotels, British Telecom, Toyota, and the Metropolitan Police. His one-week kick-start for agile development assured the success of scores of teams. He has rescued countless IT projects and improvement programmes, and designs and leads large-scale business agility and digital transformations.

So, when looking at organisational ambidexterity, Russ has found that there is huge scope in looking at Agility for Managers and how organisational transformations can take place by allowing for ambidexterity to impact not just research literature but also business outcomes.

It does come down to mindset when coaching for agility in managers. In his comparison of an Academic Mindset and one of a Business Mindset, he has found that in an Academic Mindset:

The Researcher’s positionality matters
The selected literature matters
The methodology matters

Whereas in business, results matter.

Russ, in all his years in the industry, sees his role as the connector, the bridge between what we can do with software engineering and what businesses want to do in terms of fixing problems and taking advantage of opportunities.

The landscape of management literature has evolved over time, from the Management Pioneers, The Systems Men and The Behavioural Scientists. Referencing the book, Makers of Management by Clutterbuck and Crainer, we can see that up until the late 1960’s, the focus was on rebuilding after the World Wars. Then the technological revolution coincided with the focus on people’s behaviours. And since then, the shift started to happen toward agility and humanising the workplace.

The Ambidextrous Organisation

The concept of the Ambidextrous Organisation or Organisational Ambidexterity came about in a Tushman and O’Reilly article covering the topic. The article, ‘The Ambidextrous Organisation: managing evolutionary and revolutionary change’, focused on the idea that managing the system of management and the responsibility of managers is not just improving the organisation because that is already established; it’s also about making improvements in an incremental or evolutionary manner, but also make changes in a revolutionary way.

This is all well and good, but in practice this can be hard to implement. Success creates inertia, and this leads to managers being unwilling to make revolutionary changes. Russ quotes Machiavelli’s The Prince to counteract this to say that introducing change can make you really unpopular, but sometimes it is the necessary step.

The method that Tushman and O’Reilly cover in this article to make those revolutionary changes, allude to the following.

Ambidextrous managers must do these… or die! (Cue the dramatic music)

Promote variation: To increase diversity of products, technologies and markets
Select winners and kill losers: By letting units stay close to customers and make decisions
Keep only what the market wants: Including managers, technologies, and strategies

Following this method is imperative for companies that want to survive and thrive in the marketplace. Many agile coaches come across situations where managers are trying to reduce variation to make managing easier – by using the same tools across the company or the same time management systems, or even the same hiring processes.

Tushman and O’Reilly advocated that variation allows for innovation and different ways of thinking and avoiding the impending death of an organisation that refuses to adapt or change in that evolutionary and revolutionary manner.

This wasn’t just isolated to products and services but also allowed the market to dictate what kind of managers an organisation employs and their particular styles.

This article renewed interest in Organisation Ambidexterity and Tushman and O’Reilly structured organisations into arranged units.

One unit would cover Exploration and Innovation, such as an R&D Department and the other unit as an Exploitation unit could be an Operations Department.

Exploration and Innovation would cover:

Product development departments
Change the Business (CTB) activities
Raising variety that increase opportunity

The measures that matter here are learning metrics – what was learnt and adapted?

Exploitation units would cover:

Operations departments
Run the Business (RTB) activities
Increasing alignment raises efficiency

The measures here would be about how much costs were reduced.

The idea is that if these units are structured in the way they are, the Exploration units cover their CTB remit and the Exploitation units cover their RTB remits, and in this way there can be little to no tension.

Leaning into Ambidexterity: The Toyota/GM Case Study

In a study that covered the work Toyota and GM were doing as a joint venture at a plant, it showed that the same team was able to be ambidextrous within the same structure, achieving both efficiency and flexibility. This was in reference to how the workers at the plant created meta-routines in non-routine tasks.

At the time, GM’s Californian manufacturing plant was extremely dysfunctional. The factory had an inefficient assembly line with hundreds of misassembled cars and cars with missing parts. Employee morale was low, and strikes were a common occurrence. So, GM struck a deal with Toyota and opened New United Motor Manufacturing, Inc. (NUMMI) using the same GM plant and retaining the same workforce. At NUMMI, Toyota showed GM how they made some of the best built, most reliable cars in the world at a much lower cost, which allowed GM to transform its worst workforce quickly and dramatically, into one of its best.

The Toyota Production system is all about the idea of only making what you need. The team would produce a certain number of panels on one dye and then change over. The changeover was what was considered non-routine and had a turnaround time of 4 hours. The team, working with ambidexterity, incorporated this non-routine sequence into their routine tasks and made it part of their normal production outline. This allowed the overall time spent on the task to be brought down significantly (mere minutes, through continuous improvement).

This was efficiency personified not just on an operational level but also on a mindset level.

Contextual Ambidexterity

In Birkinshaw and Gibson’s paper in 2004, which coined the phrase Contextual Ambidexterity, they highlighted that the performance of a business unit can increase by improving their ambidexterity. So, the ability to simultaneously align to the targets that they're expected to meet and their ability to adapt and course correct. And that is achieved through context: the social context, the cultural activities involved and the way teams are managed in terms of performance management.

Russ gives high importance to this paper, as it legitimises a lot of what is believed in the Agile world but sometimes doesn't have evidence for.

“Encouraging a supportive organisational context that generates simultaneous capacities for alignment and adaptability may be a key source of competitive advantage.”

Structural and Contextual Ambidexterity

Raisch, Zimmerman and Cardinal’s paper (2012) tried to marry these two forms of ambidexterity. What they mapped was technical innovation versus market innovation, and outlined 4 different factors.

Explorative Market Innovation
Exploitative Market Innovation
Explorative Technical Innovation
Exploitative Technical Innovation

Managing Different types of Tensions

When it comes to managing tensions, there are quite a few ways to depict these.

Russ categorises these in the following way:

Exploration-Exploitation tensions
Value conflicts
Paradoxes
Philosophical differences

How does this apply to managers?

Ambidexterity is a managerial capability; managers are crucial for developing ambidexterity.

“Why else do we need managers other than to help organisations do the things that don’t come naturally to them?”
- Birkinshaw and Gupta (2013)

If managers don’t intentionally develop both sides of these tensions and conflicts, it won’t happen on its own. Which is why through an Academic Mindset, it helps us understand how organisations work and what organisations require of managers.

This has further highlighted that despite there being organisational-wide Agile literature, there is a huge missing link for management research into business agility and there is no literature on Agile for Managers.

In Russ’ experience and interest as a professional practitioner, he has found that applying Agile principles is a way for managers to develop ambidexterity.

He advises that ambidexterity needs to be the goal for managers in organisations: that they have to be able to be simultaneously effective across all identifiable tensions and increase performance by managing tensions.

Through this lens of ambidexterity and Agile for Managers, we can identify and manage tensions, not people and increase performance as a result – from ‘zero-sum’ to ‘win-win’ outcomes.

About Russ Lewis

Russ “The Agiliser” Lewis designs and leads transformations of very large organisations. He is an organisational coach, mentor, and consultant; coaching executives, working with leadership teams, and helping managers at all levels improve their organisations with their teams.

As a practitioner and doctoral candidate, Russ is researching the emerging role of managers in the digital age. His thesis is that managers at every level would lead the improvement of their organisations if the conditions allowed.

Read more about Russ Lewis and about his book “Business Agility – For Managers of the Digital Age” on Russ’ website.

Organisational Ambidexterity: Managing Tensions