It’s safe to say that the current economic roller coaster brought on by the rise of COVID-19 was not built into anyone’s 2020 forecast. Not many people could have predicted the unprecedented and devastating impact this virus has had on the nation and the globe. But whether or not change comes in the form of a market shift, a technological innovation, or a biological threat, it will come. Change is both inevitable and unpredictable at once, forever pressuring organizations to respond or adapt—or fail.
Change is constant. And to survive it—or even thrive in it—you need to be agile.
That’s why in today’s environment, successful companies are defined by agility; these are the disruptors that are shaping their industries, creating new strategies, operationalizing them into plans, and executing them quickly and easily.
Agility: a tool and a mindset
In 2017, Daniel Newman observed in Forbes that change is accelerating, forcing businesses to respond just as quickly. Agility isn’t just a defense mechanism, used to combat typical threats like the speed of innovation, technology disruption, globalization, or competitive dynamics. It’s a way of thinking and behaving. Agility must be baked into the heart of the organization—and its digital transformation agenda—so leaders are not only able to respond to change but identify potential growth opportunities.
Workday Vice Chairman Tom Bogan agrees. A former finance executive and an early adopter of the first commercial spreadsheet application, Bogan has written and spoken for years about how agility is an attribute of successful businesses in the age of urgency—and how modern business planning helps them acquire that attribute. “Agility is a tool, and I think it’s also a mindset. It needs to be embedded in the culture of the organization,” says Bogan in a recent Workday podcast. “The organizations who will be most successful are the ones who plan on change, develop internally the agility to respond to that change … and be opportunistic and take advantage of those competitive dynamics.”
Bogan cites Microsoft and Apple as examples: two constantly innovating heavyweights that’ve managed to harness the power of agility, evolve with change, and shift into areas and offerings they didn’t originally set out to own. As innovation accelerates, these two entities have seen generations of businesses, market upheaval, and economic shifts come and go in the relatively short time they’ve existed. And they’re both still around today, not only because they anticipated change, but because they used it to their advantage. “In both cases,” says Bogan, “it required the companies (and) the executives in those companies to … have an agile mindset as they thought about competitive dynamics, innovation, and market changes.”
The key change agent? The CFO
Transforming an organization to embrace and embody agility isn’t easy, but it can be done. “It’s essential that it be embraced by everybody in the organization, but it really starts with the leadership,” says Bogan. And the pivotal figure driving that change? The CFO.
“For most organizations, CFOs and finance teams are really at the center of managing change for their organizations because they’re generally responsible for the planning process in those companies,” observes Bogan. “And they need to develop the tools to allow them to be agile.”
Another insight from Bogan: To operate with agility, everyone across the organization must be working from the same source of truth: the same data, the same assumptions, and the same outcomes. Moreover, the operational leaders responsible for this data must be able to access this shared model at any time. To ensure your organization really plans for agility, implement fully functioning control and feedback mechanisms to build seamless workflows or data sources, metrics, key business drivers, and reporting. This, Bogan notes, is where cloud-based planning solutions enter the picture to provide operational leaders with a continuous, comprehensive, and collaborative single source of truth.
Finance is at the epicenter of this organizational change and is the key force in executing it. Beyond the planning stages, as execution unfolds and the unexpected arises, it’s the CFO and the finance teams who lead with insight-driven recommendations and meaningful strategy.
Harness the future
The introduction of spreadsheets 40 years ago proved a game changer in business planning because spreadsheets allowed teams to run multiple scenarios. In the past decade, the cloud has accelerated that process and enabled teams across continents to plan and collaborate in real time and with real-time data. And as innovation keeps accelerating, imagine what business planning will be like in 10 years or even five.
As Bogan points out, machine learning and artificial intelligence will elevate our planning environments even more, improving the richness and quality of our plans, allowing us to run more intricate scenarios, equipping us to share and disseminate information more seamlessly, and ultimately allowing teams to focus on strategic execution rather than plan preparation. When CFOs submit plans to the board for review, they’ll no longer have to submit “25% confident” plans or even “50% confident” plans. Thanks to the ability of cloud-based solutions to harness these technologies, says Bogan, confidence in plans will be consistent—and consistently high.
Building a culture of agility
Regardless of the technology in use, Bogan says agility boils down to company culture. The most effective organizations are the ones that are closest to the business and understand it in a fundamental way. And in an increasingly unpredictable world, the most successful teams will be those that can adopt an agile mindset, anticipate the unexpected, and ultimately lead the organization through change.