There has been a growing awareness need for organizations to be as close to their stakeholders as possible to be able to co-create value for a better community experience. A key factor in the co-creation of shared value is an in-depth understanding of an organization’s external environment. Using current technologies and tools available today, an organization potentially has the capability to become hyper –sensitive to its surroundings. The challenge of the leaders today is to transform their organizations into an agile learning organization that can better readily co-create, co-deliver and capture value from its partner communities.
An organization that is present in an organic and ever-changing environment requires a highly adaptive structure that is hyper-sensitive to its environment in order to survive.
Kourteli (2000) concludes that the different kinds of hierarchies, organizational practices, and strategies, which have been developed in the past, do not seem to fulfill the needs, the demands and pro-activeness of the present (Kourteli, 2000). AS a result, wrong information may be misinterpreted by current managers and leaders; therefore, leading to wrong decisions and overall strategic choices. Initially, contingency theory was presented as a working framework on how and why groups organize themselves in a given context.
The drawback of contingency theory is that organizations are matched to a certain situation. This may happen when the current value proposition of an organization fits well with the demands and desires of its target market. However, as soon as the demands and desires of the target market changes, a mismatch between the stakeholders and the organization emerges. And if the mismatch is not addressed, then the strain on the current organization-stakeholder relationship may eventually lead to the breaking off of the relationship.
Johnston (2009) proposes that many firms suffer from ‘self-concept specificity’. This is an unconsciously self-imposed restriction on creative strategy formulation that is the result of a highly bounded concept of a firm held by its senior management (Johnston, 2009). Other researchers have defined this as ‘Marketing Myopia’ (Lings, 1999). Organizations that have a clear disconnect between demands of the external environment and the operational situation of the organization. New schools of strategic thought and new organizational forms have the potential to increase greatly an organization’s ‘degrees of freedom’ for strategy formulation in comparison to the rigidities and determinism of vertical integration (Johnston, 2009).
Widening of an organization’s ‘degrees of freedom’ for strategy formulation calls for the use of information technology.
Kourteli (2000) states that In order for these systems to maintain a symbiotic relationship with their environments they must develop the appropriate sensitivity towards the changes and differentiations of their environments. There are three challenges faced by the managers of organizations today – inability to marshal external environmental information, inability for manager to gather information that is useful for others, and failure of management to use relevant information.
To counter this weakness, organizational leadership should call for the adoption of IT tools and methods that can make the organization more agile. A well – informed organization enables its people to be better informed, more inclusive and more productive.
Adaptive Leadership and the creation of a learning organization
Organizations are social creations of people that need to develop a symbiotic relationship with their environment. These organizations should be sensitive enough to identify, develop actionable options and decide to act accordingly (Kourteli, 2000). The need for a leadership team that can enable this organization to survive is critical. In such a setting, the essence of leadership is influencing and facilitating individual and collective efforts to accomplish shared objectives. Leaders can improve the performance of a team or organization by influencing the processes that determine performance (Yukl, 2012). Good leadership promotes effective team and group performance, which in turn enhances the well-being of the incumbents; bad leadership degrades the quality of life for everyone associated with it (Hogan & Kaiser, 2005).
According to Peter Senge, the basic rationale for such organizations is that in situations of rapid change only those that are flexible, adaptive and productive will excel. Senge argues further that current societal problems cannot be resolved by hierarchical authority (Senge, 1996). Organizations need to ‘discover how to tap people’s commitment and capacity to learn at all levels (Smith, 2001). Furthermore, leaders are responsible for building organizations wherein people may continually expand their capabilities to understand complexity, clarify vision, and improve shared mental models.
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Kourteli, L. (2000). Scanning the business environment: some conceptual issues. Benchmarking: An International Journal, 7(5), 406–413. https://doi.org/10.1108/14635770010694340
Lings, I. N. (1999). Balancing internal and external market orientations. Journal of Marketing Management, 15(4), 239–263. https://doi.org/10.1080/09652540802619251
Senge, P. M. (1996). Leading learning organizations. Training & Development,50, 36–37.
Smith, M. K. (2001). Peter Senge and the learning organization. The Encyclopedia of Informal Education,(1990), 1–18. https://doi.org/10.1016/j.lrp.2005.11.005
Yukl, G. (2012). Effective Leadership Behavior : What We Know and, 26(4), 66–85.