Your business requires more agility than we’ve seen at any time since the industrial revolution. The ability to adapt, change and grow is as important as the production of high-quality products and services. As business leaders, we must do more to create organizations that move with our customers, suppliers, markets, and products. But what is the most effective way to guide change that brings the entire organization along on the journey? How can we create an environment that continues to grow and adapt as customer demands, technologies and stakeholder expectations change?
To meet that challenge, I’ve consulted a variety of agility change leaders who are living at the heart of agile transformation every day. This survey has helped me create a quickly deployable, repeatable method of transformation that is pragmatic, effective and long-lasting. It provides a foundation to create a perpetual learning organization in which teams thrive, common culture is developed and business performance improves.
Regardless of the industry, this method provides a set of guiding principles and tools to change organizational performance in a rapid, real and durable way. From aligning to the organization and customer’s objectives to delivering products faster with higher quality, here’s how to transform your organization to improve what your teams deliver every day.
Eight Powerful Results to Expect from Your Enterprise Agile Transformation
- Release products and business capability faster with better alignment to the needs of the customer and the business
- Improve internal accountability for business outcomes throughout the enterprise
- Revise business & operating models as software is built and avoid embedding the old way of doing things into new products and software
- Deploy new technologies without a forklift architectural shift
- Find constraints to rapid delivery and poor quality and eliminate them.
- Harness the power of “internal entrepreneurs” and incorporate them into productive team outcomes aligned to the business plan
- Systematically incorporate learnings into products and software and eradicate blocking issues
- Identify when development isn’t meeting market or internal expectations and know how to gracefully pivot
Agile transformation changes the business in two ways: how we manage and how our teams work. In part 1, I’ll review the common changes in how we manage and the potential impact of each. In part 2, I’ll discuss the changes in how we work, along with the potential impact.
To enable teams to form, function and thrive, we must change how we manage the development and delivery of products and software. These changes make it possible to form teams, align development and operations responsibilities, provide stable funding for them and keep a balance of expertise that makes them effective. Changes in operations management can account for 40% of the value that comes from agile transformation, and likely won’t be successful without them.
- Organize to maximize the success of stable feature teams
Stable, dedicated multi-disciplinary teams that remain working together until an assigned capability backlog is complete have higher performance than teams where members change on a regular basis. Members of the team are experts in product architecture, business operations, scope & solution definition, system design & development, testing and system operations. This is in contrast to traditional organizations that are formed along boundaries defined by system or professional specialty. During this step, we also help employees find their appropriate role in the new structure, increasing engagement and reducing fear.
IMPACT: Stable, dedicated teams are up to 15% more effective than alternatives. Team members that don’t context switch improve performance by 20% per loaded context.
- Consolidate development and operations teams
When capability and operations teams are consolidated, two results emerge: First, teams develop software that is more efficient to use and operate because of increased accountability and information and second, defects that are found are generally resolved more quickly. Systems are more simple to build and operate.
IMPACT: Companies with simplified operations grow 30-50% faster than companies that are more complex.
- Upgrade the funding process to align with value chains & stable teams
Today’s funding processes are often driven by legacy practices that seek to tie development investment to particular projects. This has two adverse effects: 1) the first project to require a capability must pay for all the development costs associated with it, even when it is shared and 2) teams must be reconstituted each time funding is exhausted, preventing the team from capturing the benefits of stable, persistent teams. In agile environments, funding processes change to provide an allocation of funding sufficient to sustain teams through the budget period, and those costs are allocated to projects over time.
IMPACT: Divided. Advocates argue that front line teams are best able to allocate funding, while critics cite lack of control as an issue.
- Reorient capacity and sourcing processes
A key to agile’s efficiency and effectiveness gains comes from having the ability to start work sooner and continue to drain backlogs until they are exhausted or the business decides that further work is no longer necessary. Upgrading capacity and sourcing process is critical for organizations who choose to capture the benefits of completing work quickly and maintaining stable, dedicated teams.
IMPACT: Optimized resource supply chains can improve organization efficiency 6-8% for complex processes like development.
- Improve technical capabilities in the platform
DevOps practices other modern system technologies (containerization, orchestration, configuration management) improve the later stages of software development and deployment by automating the deployment and operation of systems. They also create a shared working relationship between development teams and system operations, improving failure rates and time to restore systems.
IMPACT: DevOps technology implementation can improve development cycle time by up to 33%
- Implement product ownership roles
Coordination and alignment with the business for each development team is critical to improve flow and team efficiency. Product owners represent the business, maintain backlogs to assure items are relevant, grouped into like elements and prioritized. They assure software works as intended and that the business is ready to receive new capabilities delivered by the system. They improve efficiency by providing single points of contact, scope clarification, testing support and business readiness management.
IMPACT: Effective performance by the product owner increase team productivity by up to 35%.
What Benefit Should You Expect?
Agile transformation is just like any other transformation: when successful, it can pave the way for a very bright future. When it goes bad, it can be difficult to recover from.
Agile transformation can have a tremendous impact – 50-60% cycle reduction, 90% increase in delivered quality and much more predictable delivery. It can only deliver those outcomes if the change is appropriately designed and managed.
Migration to agile is equivalent to changing the engine of IT development while the car is running. It’s possible, but much more effective when someone is alongside to provide expertise, guidance and help interpret interim results.
In part 2, I’ll outline the changes to how we work in the organization and give you a view to the impact that come from the changes.
Tell me your thoughts in the comments and let’s open a dialog. I would be excited to hear other opinions on this topic.
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Russell has led Lean, agile, business and IT transformation for Fortune Global 1000 companies around the world. The benefits he has helped companies and clients achieve include faster time to market, improved customer alignment, improved quality and lower development & operations costs. Most recently, he lead agile transformation for a custom software development provider at a large Canadian corporation.
Using techniques from Scrum, SAFe, LeSS, and Lean, that transformation led to a 56% improvement in on-time delivery, a 94% improvement in quality and a 60% reduction in time to market. Russell is currently focused on developing and documenting processes and methods he's used to improve the scalability of agile implementations, with a special emphasis on instrumentation, removing constraints to success, and capacity and throughput growth.
He lives with his wife and son in the Seattle area.
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