In an era of rapid digitalization, global pandemics and unexpected curveballs being thrown from every direction, change has become the new normal and disruption the only constant. Businesses must therefore become – and remain – increasingly adaptable. In order to help companies to navigate constant complex challenges, Roland Berger has developed a 3P framework, which is inspired by lessons from science and observation from the natural world. This framework is explained in detail in our new Think:Act booklet, “The Adaptable Company”.

The demand for change is nothing new. For example, digitalization has long been arousing greater challenges in speed, quality and cost. However, new challenges like coronavirus can arise suddenly and abruptly, causing major disruption to local and global business to an unprecedented scale. In general, the three major factors placing new demands on business and driving the need for adaptability include: turbulence and volatility on the market, growing customer expectations and the transition from value chains to value networks. Much of the current advice to deal with such multifaceted challenges is simplistic or superficial and therefore incapable of helping companies to truly overcome them.

Rising to the adaptability challenge

The first step on the journey to adaptability is for companies to better understand the hurdles they need to jump over and then either learn to jump, or, better yet, learn to avoid them entirely. For this, we identified six common problems on the road to adaptability which detail common mistakes for companies to avoid: focusing on the “why” not the “how”, simplistic advice, lack of reflection, steady-state thinking, over-celebration of failure and no sense of direction. Instead, companies should be focusing on achieving balance, undergoing continuous evaluation of performance and advantages, and maintaining the right pace and direction rather than simply changing for the sake of change. In other words, companies should act cohesively within the 3P framework across these three interrelated areas.

The three P's

Purpose

Directing a company with purpose involves restricting a business to its core activities and cleansing it of everything else. Rather than following the principle of survival of the fittest and fighting to be the strongest, companies should focus on what makes them unique and rather than simply making something, mastering it. In areas that fall outside of their value proposition, companies should form partnerships with other members in their value network.

Process

The second part of the framework stipulates that experimentation should become a continuous approach. Setting key parameters for experimentation for each business area and focusing on jobs specifically geared towards customers is key. To have an effective process, businesses should also experiment with new technology, remove unsuccessful ideas quickly and generate pull rather than pushing what the market wants.

People

Incorporating people into a business means involving everyone from the entire organization and tapping into the collective potential of a workforce. Replace the pyramid structure with strong horizontal relationships that connect people across disciplines and ensure leadership focuses on facilitating rather than dictating. Ultimately, culture, not structure, is the glue that binds an adaptable company together. This involves relinquishing control, trusting people and learning to live with uncertainty.

It is important to note that change no longer requires simply a linear transformation from point A to point B, but rather a more nuanced view of adaptation. True adaptability involves engaging in continuous transformation . Are you ready to rise to the multifaceted challenge? Roland Berger is ready to support you through the tried and tested 3P framework to create an adaptable company.