organizational agility in depth report
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7/16/2019 Organizational Agility in Depth Report
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PMI’s
Pulse of the Profession in-DePth rePort
OrganizatiOnalagility
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Study Highlights
Slow economic growth and shiting global market priorities have created a
complex, risk-laden business environment—one that rewards innovation yet
also threatens to derail projects. And there’s little question that global volatil-
ity will continue into the oreseeable uture, causing organizations to cancel
or delay projects.
Such a turbulent environment demands organizational agility, a trend
identied in PMI’s 2012 Pulse of the Profession report , based on an annual
global study o more than 1,000 project, program and portolio managers.
aking a deeper dive into the topic, PMI’s 2012 Pulse of the Profession
In-Depth Report: Organizational Agility ocuses on how organizational agility
impacts success and how to increase that agility.
o orge that agility, successul organizations are aggres-
sively reshaping their culture and business practices on a
three-pronged ront:
n Rigorous change management to better adapt to shiting
market conditions
n More collaborative and robust risk management
n Increased use o standardized project, program and
portfolio practices
Te report reveals a clear payof: Highly agile organizations
are twice as likely to see increased success with their new ini-
tiatives as their counterparts with low agility.
Oaaos o ha lss al oda
2008 2012
12%
54%
34%
23%
61%
15%
n Hh Al
n Moda Al
n Lo Al
Sources: Economist Intelligence Unit, Organisational Agility: How business cansurvive and thrive in turbulent times , sponsored by EMC, 2009.
PMI Pulse o the Proession In-Depth Report: Organizational Agility , 2012.
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What Defnes Organizational Agility?
Here’s how respondents described the practices or characteristics o organizational agility:
Change
Q u i c k t o a d a p t
F l e x i b l e
Responsive
Seizeopportunities
Maintainast pace
Identifymarketshifts
Competitiveedge
rapidly
Quck espose osec oppoues
iedscppojec ems
75%
53%
64%
53%
59%
51%
54%
50%
53%
46%
Focus o chememe
Coecp
Shoe decso/poduco/evew cces
Emo o oo sos
ie voceo he cusome
Use o eve pojecmeme pcces
Focus o skmeme
leveechoo
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Key Findings
A ComPetitive eDge
Due to the volatile economic environment over the last two to three years, only 45 per-
cent o organizations reported increased success with new initiatives.
45%
n Mo suss
nUhad o lss suss
Tose organizations that are successul report higher levels o organizational
agility—giving them a powerul edge on the competition.
Even beore the economic downturn, the role o organizational agility in providing
a competitive advantage was supported by a McKinsey survey. Nine out o 10 execu-
tives, spanning all regions and industry sectors, ranked organizational agility both as
critical to business success and as growing in importance.
In addition, nearly 90 percent o executives surveyed by the Economist Intelligence
Unit ranked organizational agility as vital or business success. One-hal o all CEOs
and CIOs agreed that rapid decision-making and execution are not only important,
but also essential to a company’s competitive standing.
Agility may also be linked to proitable growth: Research conducted at the
Massachusetts Institute o echnology suggests that agile irms grow revenue 37
percent aster and generate 30 percent higher proits than non-agile companies.
HigH AgiLity LOw AgiLity
iasd Suss 27%60%
55%
SUcceSS witH new initiAtiveS Over tHe pASt 2-3 yeArS
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Done right, organizational agility provides rewards on multiple levels. PMI respondents
identied the ollowing benets o increased organizational agility:
The Takeaway: Greater organizational agilityleads to better perormance—providing organizations
with a powerul edge on the competition.
71% 54% 29% 25%55% 38%44% 27% 25%
Faster responseto changing
marketconditions
Organizationalchanges made
more quickly orefciently
Overallimproved
organizationalefciency
Fastercompletion o
projects
Improvedcustomer
satisaction
Improvedemployee
satisaction
More proftablebusiness results
Cost savings Improved riskidentifcation
and mitigation
Tere is, o course, no magic bullet or staying ahead, especially during tumultuous eco-
nomic times. However, organizational agility is proving to be a powerul tool in ensuring suc-
cess now and in the uture.
how to imProve orgAnizAtionAl Agility
Organizations cannot simply declare themselves more agile. Tey must make a concerted efort
to transorm three key areas:
1 Implement change management best practices
2 Implement risk management best practices
3 Standardize portolio, program and project management practices
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92% o oos hh eecve che meme epohh o modee .
Moo d c o exe evome
Sdde che meme
Oe o bes evee che meme
BeSt prActiceS
thos oaaos mos ha maam do h hs b ha h
mmall ouas:
n Mos oaaos
n Mmall oaaos
The Takeaway: Organizations
eective at change
management are
more agile.
D ad alua has h xal om
esablsh omal ha maamosss as maam sa
esablsh a omaam of
wok aossoaaoal slos
Ass maas hos masosbl s ha maam
id ad lasfa has
imlm omal ha maamosss boh sd ad ousd o o
52%
88%
71% 67%50%
39%
75%
7%
26%
49% 14% 11%
12%
16%
1. KeeP uP with ChAnge
Whether due to anemic economic growth or the constantly morphing digital landscape, the
business environment is changing at an unprecedented pace. Yet some organizations manage
that volatility better than others through aggressive change management.
Organizations efective at change management are more agile, not only reducing the impact
o external changes, but also capitalizing on the opportunities they may present.
he Pulse of the Profession In-Depth Report: Organizational Agility reveals that 92percent o organizations highly eective at change management report high or moderate
agility. hat’s almost three times more than organizations that report minimally eective
change management.
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The Takeaway: Organizations
eective at risk
management
are more agile.
90% o oos eecve sk meme epohh o modee .
Moo d c o exe evome
Sdde sk meme
Oe o bes evee sk meme
BeSt prActiceS
th ds b oaaos o hhl sk maam ad
hos o mmall sk maam ollo a smla a o h ha
maam fds abo.
O aa, hhl oaaos do h hs b ha h mmall
ouas:
n Mos oaaos
n Mmall oaaos
D ad alua sks h xal om
esablsh a omaam of
Ass maas hos masosbl s sk maam
id ad lasfa sks
72%
71% 60%
39%
2%
iao o husom
90%
36%
coduo ask
smlfao
84%
34%
coduo
la
80%
27%
47% 16%
6%
esablsh omal sk maamoss usd h ad
ousd o os
89%
20%
2. mAster risK
When organizations are orced to make rapid-re decisions, they can sometimes lose con-
trol. Efective risk management helps executives and project leaders identiy and mitigate
the actors that could sabotage success.
Te ndings on risk management echo those on change management, with 90 percent
o organizations efective at risk management reporting high or moderate agility. hat’s
more than double the organizations that report minimally eective risk management.
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Sdded pcceshouh depmes
Sdded pcceso houh depmes
High Agility 7%
60% 51%
18% 42%
Moderate Agility
Low Agility
22%
Use pooo memews/oe
Use pooo memee/eve
High Agility 6%
57% 46%
25% 48%
Moderate Agility
Low Agility
18%
The Takeaway: Organizations that use
standardized practices
are more agile.
*Us alas o o
26% Al a o maam os o oolo maam
23% ia hqus*
22% po ask smlfao*
22% Al a o maam os o oam maam
18% poolo maam*
18% idsla o ams*
17% ia o o h usom*
17% rsk maam*
17% cha maam*
17% rsou maam*
17% cha oss usd h ad ousd o os
16% poam maam*
15% rsk oss usd h ad ousd o os
14% Fomal sk oss
14% Fomal ha oss
12% Study Average
3. stAnDArDize PrACtiCes
Faced with changing economic conditions, priorities and demands, organizations have to act
ast. But a solid oundation o portolio, program and project management practices is still a
must.
When organizations standard-
ize their project management
practices throughout all depart-
ments, they are three times aslikely to report high agility than
their counterparts that don’t.
Te study also shows that orga-
nizations that always or oten use
portolio management are three
times more likely to report they
are highly agile than those that don’t
use portolio management.
Te report urther highlights
the need to improve agility. Only
12 percent o organizations char-
acterized themselves as highly
agile. But the data also reveals
standardized practices that highly
agile organizations said they use always or oten:
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prOject SUcceSS MetricS By LeveL OF AgiLity
73%
44% 47%
75%
59%
83%
40%
71%
O me O bude Mee osd busess
objecves
Mee/exceedrOi
n Hh Al
n Lo Al
the PAyoff
Agile organizations lead the pack. I project leaders and executives work together to build
greater agility, they can solve problems, take smarter risks, and deliver innovative prod-
ucts and solutions to market aster—all leading to greater success.Consider this: Te average percentage o projects completed on time, on budget,
achieving business objectives and orecasted ROI is signicantly greater in organizations
reporting high agility than those reporting low agility.
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Greater
Organizational
Agility
45%
40%
15%
to
The End Result
Better
Perormance
Improved
Competitive
Advantage
= =
n S asd suss
nUhad
n S dasd suss
57%
37%
7%Sddedhouh
depmes
65%
31%
4%Eecve che
meme
3%Eecve
skmeme
71%
26%
ConClusions AnD imPliCAtions
PMI’s Pulse of the Profession In-Depth Report: Organizational Agility demon-
strates that organizations are increasing their success rates on new projects, even
in a weak global economy, with high agility. o survive—and indeed thrive—in
today’s competitive marketplace, organizations must build their agility by imple-
menting risk management, change management and standardized practices
across the enterprise.
prActiceS tHAt LeAD tO AgiLity LeAD tO greAter SUcceSS
By investing in the three core practices outlined above, organizations improve
agility—giving them that elusive edge in a ast-paced, dynamic market.
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tHe OrgAnizAtiOnS repreSenteD Are LOcAteD in:
SOMe OF tHe inDUStrieS repreSenteD Are:
tHeir AnnUAL revenUe iS:
OF tHOSe SUrveyeD:
OF tHOSe FiLLing A prOject MAnAgeMent rOLe:
nohamec
48%
l amecd he
Cbbe
15%
Euope, he
Mdde Esd ac
22%as-Pcfc
15%
22% a o maas
20% a dos o o maam/
o maam of12% a oam maas
8% a oolo maas
7% a o maam osulas
4% a o maam salss
72% fll a omaamol
18% axus
8% auoalmaas
iomo techoo
6%goveme
6% teecom
6% Cosuco
23%
13% Cosu
11%Fc Sevces
n less h US$50 mo
n Bewee US$50 mo d US$1 bo
n Bewee US$1 bo d US$5 bo
nOve US$5 bon Dd o epo he eveues
32%
28%
13%17%10%
About the stuDy
PMI’s 2012 Pulse of the Profession In-Depth Report: Organizational Agility was con-
ducted in August 2012 among 1,239 practitioners around the world who are involved in
project management.