German HR Departments’ Agility Deficiency

More precise: a less fuzzy way of defining agility

The concept of agility is frequently used without being precisely defined. In order to be able to compare agility across different industries and companies of varying sizes, we devised a set of questions that measure six different dimensions of agility:

1. Agile methods (Scrum, Design Thinking, etc.)
2. Agile organization (line organization, “tribes,” etc.)
3. Agile working models (trust-based working hours, flexibility over where to work, etc.)
4. Agile skills (ability to learn and change, business development, etc.)
5. Agile leadership (task or performance orientation, mentoring, etc.)
6. Digital technology (social media, apps, big data, etc.)

When it comes to agility, HR is “basic” rather than “expert”

The Overall Agility Index (OAI) developed for the study represents the average of the six dimensions, and serves as a measure of how agile German HR departments consider themselves to be. The index came out at a fairly mediocre 2.81, indicating that the German HR sector is “basic” rather than “expert” when it comes to agility. 67% of respondents reported that they have put in place the initial groundwork for agile structures and organization, and so are not absolute beginners (as was the case for 10% of respondents) but are still a long way off an advanced (17%) or expert (10%) level of agility.

• Agile methods such as Design Thinking and Scrum are increasingly popular, with 35% and 31% of HR departments respectively already using them consistently/regularly, whereas 58% and 63% respectively never use the Business Model Canvas and Lean Start-Up methods.
• There is similar divergence when it comes to organizational structure: while variable pay and 360° feedback are used in around 40% of departments, only 9% have fully moved away from line organization toward self-organizing “squads,” “tribes,” or “chapters”.
• Regarding agile working models, open-plan offices and trust-based working hours are very prevalent, with around 50% of respondents reporting that they are used in their companies. However, these models often prove limited, especially in workplaces with more employee participation rights.
• The respondents gave a relatively positive self-assessment for the dimension of agile skills, with an overall value of 3.4. However, skills such as business development and agile project management scored lower than ones such as emotional intelligence and the ability to learn and change.
• “Traditional” leadership styles still dominate in most HR departments, with task and performance orientation more common than charismatic and transformational leadership. Lean teams with an average of seven people are typically closely managed by functional specialists, with the goal of delivering results.
• The most commonly used forms of digital technology are still social media/HR software (70%) and mobile devices/apps (58%), rather than big data (20%) and artificial intelligence (5%).

Positive synergies are not being used

The study also looked at how HR departments’ level of agility correlates with other factors. For instance, a significant positive correlation was found with the innovativeness of products and services. A link was also found between the agility of a company’s HR department and that of its overall organizational structure.

People skills before business skills

HR professionals believe their strengths lie in more traditional action-based and social skills rather than in modern business and innovation skills. Consequently, they are missing out on opportunities to be considered equal partners in corporate strategy discussions, and should therefore focus more on developing their business skills.

Is agile HR essential for a future-ready organization?

An increasingly dynamic environment is making agile structures and practices essential for HR departments, even if the precise level of agility that is needed varies according to business model, company, and industry. Only if HR employees themselves are agile role models can they function as effective advisors and help the staff in their companies to deal with the dynamic competition that they now face.

The white paper for the study can be found here.