Publications Mismatch between supply and demand everywhere – how agile are you really?

Mismatch between supply and demand everywhere – how agile are you really?

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By Edwin Wieringa  

Flipping through the financial pages of newspapers and my favorite news sites, I see a wide mismatch between supply and demand in a variety of industries. That’s unfortunate. In my opinion, it doesn’t take much for companies to deliver exactly what the market demands even in times of economic turbulence. The key lies in a flexibly organized core.   

That mismatch is visible everywhere. In the case of logistics firms, which allocated their resources to the wrong business activities. Or the media company, which after years of double-digit growth rates is suddenly facing a 10 percent downturn. A leading social media platform is doing even worse. A machine maker for the tire industry, due in part to a lack of staff, is unable to meet demand.   

That begs the question for me: how agile are organizations really? And how can you activate that agility? Wouldn’t it be great to be able to be flexible with available resources and people? By temporarily shifting them to business units or activities where they are most needed, if necessary?  

Adjustable organization   
To be more ‘adjustable’ as an organization, you need to be able to push a number of buttons to address uncertainty in terms of suppliers, available talent, economic conditions and impactful events. This would allow many companies, which are currently unable to meet demand, for example, to scale up more expeditiously.   

They should focus on a flexibly organized ‘core’. This is in contrast to a rigid hierarchy or structure in which specific people and roles are judged on specific things. By thinking and acting more from the bigger picture, it becomes easier to allocate resources where they are most valuable.   

In the digital domain, you can work with pools of specialists, who may or may not be available from their area of expertise for part of the time for matters of general interest. Think of a club of engineers, architects or product owners from the business, who you deploy where the pain is or for new opportunities. That would also fit in very well with the informal Dutch work culture. 

Evolutionary steps   
For example, the company LeasePlan is organized in this way. If necessary, they can make interventions in terms of people and resources. The beauty is that reshaping the organization to such flexibility is not a revolutionary change. It can all be done in small, evolutionary steps toward balanced governance, where within a functional structure it is clear who is talking to what counterpart from another pool about what.   

That way you can identify, address and solve a specific challenge without having to change the overall organizational structure. After all, most companies have that foundation well in place. Just a few buttons that allow you to adapt to outside change. Hopefully with upbeat financial news as the ultimate result.   

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Edwin Wieringa
Guild lead Organization | Management Consultant 6 1323 8109