2016-04-29 09:04:43
Darrell K. RigbyJeff SutherlandHirotaka Takeuchi
From the May 2016 Issue
Agile innovation methods have revolutionized information technology. Over the
past 25 to 30 years they have greatly increased success rates in software
development, improved quality and speed to market, and boosted the motivation
and productivity of IT teams.
Now agile methodologies which involve new values, principles, practices, and
benefits and are a radical alternative to command-and-control-style management
are spreading across a broad range of industries and functions and even into
the C-suite. National Public Radio employs agile methods to create new
programming. John Deere uses them to develop new machines, and Saab to produce
new fighter jets. Intronis, a leader in cloud backup services, uses them in
marketing. C.H. Robinson, a global third-party logistics provider, applies them
in human resources. Mission Bell Winery uses them for everything from wine
production to warehousing to running its senior leadership group. And GE relies
on them to speed a much-publicized transition from 20th-century conglomerate to
21st-century digital industrial company. By taking people out of their
functional silos and putting them in self-managed and customer-focused
multidisciplinary teams, the agile approach is not only accelerating profitable
growth but also helping to create a new generation of skilled general managers.
The spread of agile raises intriguing possibilities. What if a company could
achieve positive returns with 50% more of its new-product introductions? What
if marketing programs could generate 40% more customer inquiries? What if human
resources could recruit 60% more of its highest-priority targets? What if twice
as many workers were emotionally engaged in their jobs? Agile has brought these
levels of improvement to IT. The opportunity in other parts of the company is
substantial.
But a serious impediment exists. When we ask executives what they know about
agile, the response is usually an uneasy smile and a quip such as Just enough
to be dangerous. They may throw around agile-related terms ( sprints, time
boxes ) and claim that their companies are becoming more and more nimble. But
because they haven t gone through training, they don t really understand the
approach. Consequently, they unwittingly continue to manage in ways that run
counter to agile principles and practices, undermining the effectiveness of
agile teams in units that report to them.
These executives launch countless initiatives with urgent deadlines rather than
assign the highest priority to two or three. They spread themselves and their
best people across too many projects. They schedule frequent meetings with
members of agile teams, forcing them to skip working sessions or send
substitutes. Many of them become overly involved in the work of individual
teams. They talk more than listen. They promote marginal ideas that a team has
previously considered and back-burnered. They routinely overturn team decisions
and add review layers and controls to ensure that mistakes aren t repeated.
With the best of intentions, they erode the benefits that agile innovation can
deliver.
Innovation is what agile is all about. Although the method is less useful in
routine operations and processes, these days most companies operate in highly
dynamic environments. They need not just new products and services but also
innovation in functional processes, particularly given the rapid spread of new
software tools. Companies that create an environment in which agile flourishes
find that teams can churn out innovations faster in both those categories.
From our work advising and studying such companies, we have discerned six
crucial practices that leaders should adopt if they want to capitalize on agile
s potential.
1. Learn How Agile Really Works
Some executives seem to associate agile with anarchy (everybody does what he or
she wants to), whereas others take it to mean doing what I say, only faster.
But agile is neither. (See the sidebar Agile Values and Principles. ) It comes
in several varieties, which have much in common but emphasize slightly
different things. They include scrum, which emphasizes creative and adaptive
teamwork in solving complex problems; lean development, which focuses on the
continual elimination of waste; and kanban, which concentrates on reducing lead
times and the amount of work in process. One of us (Jeff Sutherland) helped
develop the scrum methodology and was inspired to do so in part by The New New
Product Development Game, a 1986 HBR article coauthored by another of us
(Hirotaka Takeuchi). Because scrum and its derivatives are employed at least
five times as often as the other techniques, we will use its methodologies to
illustrate agile practices.
A Comparison of the Main Forms of the Agile Approach to Innovation
There are at least a dozen agile innovation methodologies, which share values
and principles but differ in their emphases. Experts often combine various
approaches. Here are three of the most popular forms and the contexts in which
each works best.
- Scrum
- Kanban
- Lean Development
Guiding Principles
- Empower creative, cross-functional teams
- Visualize workflows and limit work in process
- Eliminate waste from the system as a whole
Favorable Conditions for Adoption
- Creative cultures with high levels of trust and collaboration, or
Radical innovation teams that want to change their working environment
- Process-oriented cultures that prefer evolutionary improvements with few
prescribed practices
- Process-oriented cultures that prefer evolutionary improvements with
overarching values but no prescribed practices
Prescribed Roles
- Initiative owners responsible for rank ordering team priorities and
delivering value to customers and the business
Process facilitators who guide the work process
Small, cross-functional, innovation teams
- None
- None
Prescribed Work Rules
- Five events:
Sprint planning to prepare for the next round of work
Fixed time sprints of consistent duration (1 4 weeks) to create a potentially
releasable product increment
Daily stand-ups of 15 minutes to review progress and surface impediments
Sprint reviews that inspect the new working increment
Sprint retrospectives for the team to inspect and improve itself
Three deliverables (or artifacts ):
Portfolio backlog, a fluid and rank-ordered list of potential innovation
features
Sprint backlog, the subset of portfolio backlog items selected for completion
in the next sprint
Releasable working increments
- Start with what you do now
Visualize workflows and stages
Limit the work in process at each development stage
Measure and improve cycle times
- None
Approach to Cultural Change
- Quickly adopt minimally prescribed practices, even if they differ
substantially from those in the rest of the organization
Master prescribed practices and then adapt them through experimentation
- Respect current structures and processes
Increase visibility into workflows
Encourage gradual, collaborative changes
- Respect current structures and processes
Stress agile values throughout the organization while minimizing organizational
resistance
Advantages
- Facilitates radical breakthroughs while (unlike skunkworks) retaining the
benefits of operating as part of the parent organization
Delivers the most valuable innovations earliest
Rapidly increases team happiness
Builds general management skills
- Avoids clashes with the parent organization s culture
Maximizes the contributions of team members through flexible team structures
and work cycles
Facilitates rapid responses to urgent issues through flexible work cycles
- Optimizes the system as a whole and engages the entire organization
Provides the ultimate flexibility in customizing work practices
Challenges
- Leaders may struggle to prioritize initiatives and relinquish control to
self-managing teams
New matrix-management skills are required to coordinate dozens or hundreds of
multi-disciplinary teams
Fixed iteration times may not be suitable for some problems (especially those
that arise on a daily basis)
Some team members may be underutilized in certain sprint cycles
- Practitioners must figure out how best to apply most agile values and
principles
Wide variation in practices can complicate the prioritization of initiatives
and coordination among teams
When initiatives don t succeed, it can be hard to determine whether teams
selected the wrong tools or used the right tools in the wrong ways
- Novices trying to change behaviors may find the lack of prescriptive
methodologies frustrating
Evolutionary improvements can make radical breakthroughs less likely and major
improvements less rapid
Leaders need to make the grind of continuously eliminating waste feel
inspirational and fun
The fundamentals of scrum are relatively simple. To tackle an opportunity, the
organization forms and empowers a small team, usually three to nine people,
most of whom are assigned full-time. The team is cross-functional and includes
all the skills necessary to complete its tasks. It manages itself and is
strictly accountable for every aspect of the work.
The team s initiative owner (also known as a product owner) is ultimately
responsible for delivering value to customers (including internal customers and
future users) and to the business. The person in this role usually comes from a
business function and divides his or her time between working with the team and
coordinating with key stakeholders: customers, senior executives, and business
managers. The initiative owner may use a technique such as design thinking or
crowdsourcing to build a comprehensive portfolio backlog of promising
opportunities. Then he or she continually and ruthlessly rank-orders that list
according to the latest estimates of value to internal or external customers
and to the company.
The initiative owner doesn t tell the team who should do what or how long tasks
will take. Rather, the team creates a simple road map and plans in detail only
those activities that won t change before execution. Its members break the
highest-ranked tasks into small modules, decide how much work the team will
take on and how to accomplish it, develop a clear definition of done, and
then start building working versions of the product in short cycles (less than
a month) known as sprints. A process facilitator (often a trained scrum master)
guides the process. This person protects the team from distractions and helps
it put its collective intelligence to work.
The process is transparent to everyone. Team members hold brief daily stand-up
meetings to review progress and identify roadblocks. They resolve
disagreements through experimentation and feedback rather than endless debates
or appeals to authority. They test small working prototypes of part or all of
the offering with a few customers for short periods of time. If customers get
excited, a prototype may be released immediately, even if some senior executive
isn t a fan, or others think it needs more bells and whistles. The team then
brainstorms ways to improve future cycles and prepares to attack the next top
priority.
Agile Values and Principles
In 2001, 17 rebellious software developers (including Jeff Sutherland) met in
Snowbird, Utah, to share ideas for improving traditional waterfall
development, in which detailed requirements and execution plans are created up
front and then passed sequentially from function to function. This approach
worked fine in stable environments, but not when software markets began to
change rapidly and unpredictably. In that scenario, product specifications were
outdated by the time the software was delivered to customers, and developers
felt oppressed by bureaucratic procedures.
The rebels proposed four new values for developing software, described
principles to guide adherence to those values, and dubbed their call to arms
The Agile Manifesto. To this day, development frameworks that follow these
values and principles are known as agile techniques.
Here is an adapted version of the manifesto:
People Over Processes and Tools
Projects should be built around motivated individuals who are given the support
they need and trusted to get the job done. Teams should abandon the
assembly-line mentality in favor of a fun, creative environment for problem
solving, and should maintain a sustainable pace. Employees should talk
face-to-face and suggest ways to improve their work environment. Management
should remove impediments to easier, more fruitful collaboration.
Working Prototypes Over Excessive Documentation
Innovators who can see their results in real market conditions will learn
faster, be happier, stay longer, and do more-valuable work. Teams should
experiment on small parts of the product with a few customers for short
periods, and if customers like them, keep them. If customers don t like them,
teams should figure out fixes or move on to the next thing. Team members should
resolve arguments with experiments rather than endless debates or appeals to
authority.
Respond to Change Rather Than Follow a Plan
Most detailed predictions and plans of conventional project management are a
waste of time and money. Although teams should create a vision and plan, they
should plan only those tasks that won t have changed by the time they get to
them. And people should be happy to learn things that alter their direction,
even late in the development process. That will put them closer to the customer
and make for better results.
Customer Collaboration Over Rigid Contracts
Time to market and cost are paramount, and specifications should evolve
throughout the project, because customers can seldom predict what they will
actually want. Rapid prototyping, frequent market tests, and constant
collaboration keep work focused on what they will ultimately value.
Compared with traditional management approaches, agile offers a number of major
benefits, all of which have been studied and documented. It increases team
productivity and employee satisfaction. It minimizes the waste inherent in
redundant meetings, repetitive planning, excessive documentation, quality
defects, and low-value product features. By improving visibility and
continually adapting to customers changing priorities, agile improves customer
engagement and satisfaction, brings the most valuable products and features to
market faster and more predictably, and reduces risk. By engaging team members
from multiple disciplines as collaborative peers, it broadens organizational
experience and builds mutual trust and respect. Finally, by dramatically
reducing the time squandered on micromanaging functional projects, it allows
senior managers to devote themselves more fully to higher-value work that only
they can do: creating and adjusting the corporate vision; prioritizing
strategic initiatives; simplifying and focusing work; assigning the right
people to tasks; increasing cross-functional collaboration; and removing
impediments to progress.
2. Understand Where Agile Does or Does Not Work
Agile is not a panacea. It is most effective and easiest to implement under
conditions commonly found in software innovation: The problem to be solved is
complex; solutions are initially unknown, and product requirements will most
likely change; the work can be modularized; close collaboration with end users
(and rapid feedback from them) is feasible; and creative teams will typically
outperform command-and-control groups.
In our experience, these conditions exist for many product development
functions, marketing projects, strategic-planning activities, supply-chain
challenges, and resource allocation decisions. They are less common in routine
operations such as plant maintenance, purchasing, sales calls, and accounting.
And because agile requires training, behaviorial change, and often new
information technologies, executives must decide whether the anticipated
payoffs will justify the effort and expense of a transition.
The Right Conditions for Agile
Conditions Favorable Unfavorable
Market Environment
- Customer preferences and solution options change frequently.
- Market conditions are stable and predictable.
Customer Involvement
- Close collaboration and rapid feedback are feasible.
Customers know better what they want as the process progresses.
- Requirements are clear at the outset and will remain stable.
Customers are unavailable for constant collaboration.
Innovation Type
- Problems are complex, solutions are unknown, and the scope isn t clearly
defined. Product specifications may change. Creative breakthroughs and time to
market are important.
Cross-functional collaboration is vital.
- Similar work has been done before, and innovators believe the solutions are
clear. Detailed specifications and work plans can be forecast with confidence
and should be adhered to. Problems can be solved sequentially in functional
silos.
Modularity of Work
- Incremental developments have value, and customers can use them.
Work can be broken into parts and conducted in rapid, iterative cycles.
Late changes are manageable.
- Customers cannot start testing parts of the product until everything is
complete.
Late changes are expensive or impossible.
Impact of Interim Mistakes
- They provide valuable learning.
- They may be catastrophic.
Agile innovation also depends on having a cadre of eager participants. One of
its core principles is Build projects around motivated individuals. Give them
the environment and support they need, and trust them to get the job done.
When the majority of a company, a function, or a team chooses to adopt agile
methodologies, leaders may need to press the holdouts to follow suit or even
replace them. But it s better to enlist passionate volunteers than to coerce
resisters.
OpenView Venture Partners, a firm that has invested in about 30 companies, took
this path. Having learned about agile from some of the companies in its
portfolio, Scott Maxwell, the firm s founder, began using its methodologies at
the firm itself. He found that they fit some activities more easily than
others. Agile worked well for strategic planning and marketing, for instance,
where complex problems can often be broken into modules and cracked by creative
multidisciplinary teams. That wasn t the case for selling: Any sales call can
change a representative s to-do list on the spot, and it would be too
complicated and time-consuming to reassemble the sales team, change the
portfolio backlog, and reassign accounts every hour.
Agile innovation depends on having a cadre of eager participants.
Maxwell provided the companies in OpenView s portfolio with training in agile
principles and practices and let them decide whether to adopt the approach.
Some of them immediately loved the idea of implementing it; others had
different priorities and decided to hold off. Intronis was one fan. Its
marketing unit at the time relied on an annual plan that focused primarily on
trade shows. Its sales department complained that marketing was too
conservative and not delivering results. So the company hired Richard Delahaye,
a web developer turned marketer, to implement agile. Under his guidance the
marketing team learned, for example, how to produce a topical webinar in a few
days rather than several weeks. (A swiftly prepared session on CryptoLocker
malware attracted 600 registrants still a company record.) Team members today
continue to create calendars and budgets for the digital marketing unit, but
with far less line-item detail and greater flexibility for serendipitous
developments. The sales team is much happier.
3. Start Small and Let the Word Spread
Large companies typically launch change programs as massive efforts. But the
most successful introductions of agile usually start small. They often begin in
IT, where software developers are likely to be familiar with the principles.
Then agile might spread to another function, with the original practitioners
acting as coaches. Each success seems to create a group of passionate
evangelists who can hardly wait to tell others in the organization how well
agile works.
The adoption and expansion of agile at John Deere, the farm equipment company,
provides an example. George Tome, a software engineer who had become a project
manager within Deere s corporate IT group, began applying agile principles in
2004 on a low-key basis. Gradually, over several years, software development
units in other parts of Deere began using them as well. This growing interest
made it easier to introduce the methodology to the company s business
development and marketing organizations.
In 2012 Tome was working as a manager in the Enterprise Advanced Marketing unit
of the R&D group responsible for discovering technologies that could
revolutionize Deere s offerings. Jason Brantley, the unit head, was concerned
that traditional project management techniques were slowing innovation, and the
two men decided to see whether agile could speed things up. Tome invited two
other unit managers to agile training classes. But all the terminology and
examples came from software, and to one of the managers, who had no software
background, they sounded like gibberish. Tome realized that others would react
the same way, so he tracked down an agile coach who knew how to work with
people without a software background. In the past few years he and the coach
have trained teams in all five of the R&D group s centers. Tome also began
publishing weekly one-page articles about agile principles and practices, which
were e-mailed to anyone interested and later posted on Deere s Yammer site.
Hundreds of Deere employees joined the discussion group. I wanted to develop a
knowledge base about agile that was specific to Deere so that anyone within the
organization could understand it, Tome says. This would lay the foundation
for moving agile into any part of the company.
Using agile techniques, Enterprise Advanced Marketing has significantly
compressed innovation project cycle times in some cases by more than 75%. One
example is the development in about eight months of a working prototype of a
new machine form that Deere has not yet disclosed. If everything went
perfectly in a traditional process, Brantley says, it would be a year and a
half at best, and it could be as much as two and a half or three years. Agile
generated other improvements as well. Team engagement and happiness in the unit
quickly shot from the bottom third of companywide scores to the top third.
Quality improved. Velocity (as measured by the amount of work accomplished in
each sprint) increased, on average, by more than 200%; some teams achieved an
increase of more than 400%, and one team soared 800%.
Success like this attracts attention. Today, according to Tome, in almost every
area at John Deere someone is either starting to use agile or thinking about
how it could be used.
4. Allow Master Teams to Customize Their Practices
Japanese martial arts students, especially those studying aikido, often learn a
process called shu-ha-ri. In the shu state they study proven disciplines. Once
they ve mastered those, they enter the ha state, where they branch out and
begin to modify traditional forms. Eventually they advance to ri, where they
have so thoroughly absorbed the laws and principles that they are free to
improvise as they choose.
Mastering agile innovation is similar. Before beginning to modify or customize
agile, a person or team will benefit from practicing the widely used
methodologies that have delivered success in thousands of companies. For
instance, it s wise to avoid beginning with part-time assignment to teams or
with rotating membership. Empirical data shows that stable teams are 60% more
productive and 60% more responsive to customer input than teams that rotate
members.
Over time, experienced practitioners should be permitted to customize agile
practices. For example, one principle holds that teams should keep their
progress and impediments constantly visible. Originally, the most popular way
of doing this was by manually advancing colored sticky notes from the to-do
column to doing to done on large whiteboards (known as kanban boards). Many
teams are still devoted to this practice and enjoy having nonmembers visit
their team rooms to view and discuss progress. But others are turning to
software programs and computer screens to minimize input time and allow the
information to be shared simultaneously in multiple locations.
A key principle guides this type of improvisation: If a team wants to modify
particular practices, it should experiment and track the results to make sure
that the changes are improving rather than reducing customer satisfaction, work
velocity, and team morale.
Spotify, the music-streaming company, exemplifies an experienced adapter.
Founded in 2006, the company was agile from birth, and its entire business
model, from product development to marketing and general management, is geared
to deliver better customer experiences through agile innovation. But senior
leaders no longer dictate specific practices; on the contrary, they encourage
experimentation and flexibility as long as changes are consistent with agile
principles and can be shown to improve outcomes. As a result, practices vary
across the company s 70 squads (Spotify s name for agile innovation teams)
and its chapters (the company term for functional competencies such as user
interface development and quality testing). Although nearly every squad
consists of a small cross-functional team and uses some form of visual progress
tracking, ranked priorities, adaptive planning, and brainstorming sessions on
how to improve the work process, many teams omit the burndown charts (which
show work performed and work remaining) that are a common feature of agile
teams. Nor do they always measure velocity, keep progress reports, or employ
the same techniques for estimating the time required for a given task. These
squads have tested their modifications and found that they improve results.
5. Practice Agile at the Top
Some C-suite activities are not suited to agile methodologies. (Routine and
predictable tasks such as performance assessments, press interviews, and visits
to plants, customers, and suppliers fall into this category.) But many, and
arguably the most important, are. They include strategy development and
resource allocation, cultivating breakthrough innovations, and improving
organizational collaboration. Senior executives who come together as an agile
team and learn to apply the discipline to these activities achieve far-reaching
benefits. Their own productivity and morale improve. They speak the language of
the teams they are empowering. They experience common challenges and learn how
to overcome them. They recognize and stop behaviors that impede agile teams.
They learn to simplify and focus work. Results improve, increasing confidence
and engagement throughout the organization.
A number of companies have reallocated 25% or more of selected leaders time
from functional silos to agile leadership teams. These teams rank-order
enterprisewide portfolio backlogs, establish and coordinate agile teams
elsewhere in the organization to address the highest priorities, and
systematically eliminate barriers to their success. Here are three examples of
C-suites that took up agile:
1. Catching up with the troops.
Systematic, a 525-employee software company, began applying agile methodologies
in 2005. As they spread to all its software development teams, Michael Holm,
the company s CEO and cofounder, began to worry that his leadership team was
hindering progress. I had this feeling that I was saying, Follow me I m just
behind you, he told us. The development teams were using scrum and were
doing things differently, while the management team was stuck doing things the
same old-fashioned way moving too slowly and relying on too many written
reports that always seemed out-of-date. So in 2010 Holm decided to run his
nine-member executive group as an agile team.
The team reprioritized management activities, eliminating more than half of
recurring reports and converting others to real-time systems while increasing
attention to business-critical items such as sales proposals and customer
satisfaction. The group started by meeting every Monday for an hour or two but
found the pace of decision making too slow. So it began having daily 20-minute
stand-ups at 8:40 am to discuss what members had done the day before, what they
would do that day, and where they needed help. More recently the senior team
began to use physical boards to track its own actions and the improvements
coming from the business units. Other functions, including HR, legal, finance,
and sales, now operate in much the same way.
2. Speeding a corporate transition.
In 2015 General Electric rebranded itself as a digital industrial company,
with a focus on digitally enabled products. Part of the transformation involved
creating GE Digital, an organizational unit that includes all 20,000-plus of
the company s software-related employees. Brad Surak, who began his career as a
software engineer and is now GE Digital s COO, was intimately familiar with
agile. He piloted scrum with the leadership team responsible for developing
industrial internet applications and then, more recently, began applying it to
the new unit s management processes, such as operating reviews. Surak is the
initiative owner, and an engineering executive is the scrum master. Together
they have prioritized backlog items for the executive team to address,
including simplifying the administrative process that teams follow to acquire
hardware and solving knotty pricing issues for products requiring input from
multiple GE businesses.
The scrum team members run two-week sprints and conduct stand-up meetings three
times a week. They chart their progress on a board in an open conference room
where any employee can see it. Surak says, It takes the mystery out of what
executives do every day. Our people want to know if we are in tune with what
they care about as employees. The team collects employee happiness surveys,
conducts root cause analysis on the impediments to working more effectively,
and reports back to people throughout the organization, saying (in effect), We
heard you. Here is how we will improve things. Surak believes that this shows
the organization that executives work in the same ways as engineers,
increasing employee motivation and commitment to agile practices.
3. Aligning departments and functions on a common vision.
Erik Martella, the vice president and general manager of Mission Bell Winery, a
production facility of Constellation Brands, introduced agile and helped it
spread throughout the organization. Leaders of each department served as
initiative owners on the various agile teams within their departments. Those
individual teams achieved impressive results, but Martella worried that their
time was being spread too thin and that department and enterprise priorities
weren t always aligned. He decided to pull department leaders into an executive
agile team focused on the enterprise initiatives that held the greatest value
and the greatest opportunity for cross-functional collaboration, such as
increasing process flows through the warehouse.
The team is responsible for building and continually refining the backlog of
enterprise priorities, ensuring that agile teams are working on the right
problems and have sufficient resources. Team members also protect the
organization from pet projects that don t deserve high priority. For instance,
shortly after Martella started implementing agile, he received an e-mail from a
superior in Constellation s corporate office suggesting that the winery explore
a personal passion of the sender. Previously, Martella might have responded,
OK, we ll jump right on it. Instead, he replied that the winery was following
agile principles: The idea would be added to the list of potential
opportunities and prioritized. As it happened, the executive liked the approach
and when he was informed that his suggestion had been assigned a low priority,
he readily accepted the decision.
Scrum takes the mystery out of what executives do every day.
Working on agile teams can also help prepare functional managers who rarely
break out of their silos in today s overspecialized organizations for general
management roles. It exposes them to people in other disciplines, teaches
collaborative practices, and underscores the importance of working closely with
customers all essential for future leaders.
6. Destroy the Barriers to Agile Behaviors
Research by Scrum Alliance, an independent nonprofit with 400,000-plus members,
has found that more than 70% of agile practitioners report tension between
their teams and the rest of the organization. Little wonder: They are following
different road maps and moving at different speeds.
Here s a telling example: A large financial services company we examined
launched a pilot to build its next mobile app using agile methodologies. Of
course, the first step was to assemble a team. That required a budget request
to authorize and fund the project. The request went into the batch of
submissions vying for approval in the next annual planning process. After
months of reviews, the company finally approved funding. The pilot produced an
effective app that customers praised, and the team was proud of its work. But
before the app was released, it had to pass vulnerability testing in a
traditional waterfall process (a protracted sequence in which the computer
code is tested for documentation, functionality, efficiency, and
standardization), and the queue for the process was long. Then the app had to
be integrated into core IT systems which involved another waterfall process
with a six-to-nine-month logjam. In the end, the total time to release improved
very little.
Here are some techniques for destroying such barriers to agile:
Get everyone on the same page.
Individual teams focusing on small parts of large, complex problems need to
see, and work from, the same list of enterprise priorities even if not all the
teams responsible for those priorities are using agile processes. If a new
mobile app is the top priority for software development, it must also be the
top priority for budgeting, vulnerability testing, and software integration.
Otherwise, agile innovations will struggle in implementation. This is a key
responsibility of an executive team that itself practices agile.
Don t change structures right away; change roles instead.
Many executives assume that creating more cross-functional teams will
necessitate major changes in organizational structure. That is rarely true.
Highly empowered cross-functional teams do, by definition, need some form of
matrix management, but that requires primarily that different disciplines learn
how to work together simultaneously rather than separately and sequentially.
Name only one boss for each decision.
People can have multiple bosses, but decisions cannot. In an agile operating
model it must be crystal clear who is responsible for commissioning a
cross-functional team, selecting and replacing team members, appointing the
team leader, and approving the team s decisions. An agile leadership team often
authorizes a senior executive to identify the critical issues, design processes
for addressing them, and appoint a single owner for each innovation initiative.
Other senior leaders must avoid second-guessing or overturning the owner s
decisions. It s fine to provide guidance and assistance, but if you don t like
the results, change the initiative owner don t incapacitate him or her.
Focus on teams, not individuals.
Studies by the MIT Center for Collective Intelligence and others show that
although the intelligence of individuals affects team performance, the team s
collective intelligence is even more important. It s also far easier to change.
Agile teams use process facilitators to continually improve their collective
intelligence for example, by clarifying roles, teaching conflict resolution
techniques, and ensuring that team members contribute equally. Shifting metrics
from output and utilization rates (how busy people are) to business outcomes
and team happiness (how valuable and engaged people are) also helps, as do
recognition and reward systems that weight team results higher than individual
efforts.
Lead with questions, not orders.
General George S. Patton Jr. famously advised leaders never to tell people how
to do things: Tell them what to do, and they will surprise you with their
ingenuity. Rather than give orders, leaders in agile organizations learn to
guide with questions, such as What do you recommend? and How could we test
that? This management style helps functional experts grow into general
managers, and it helps enterprise strategists and organizations evolve from
silos battling for power and resources into collaborative cross-functional
teams.
Agile innovation has revolutionized the software industry, which has arguably
undergone more rapid and profound change than any other area of business over
the past 30 years. Now it is poised to transform nearly every other function in
every industry. At this point, the greatest impediment is not the need for
better methodologies, empirical evidence of significant benefits, or proof that
agile can work outside IT. It is the behavior of executives. Those who learn to
lead agile s extension into a broader range of business activities will
accelerate profitable growth.
A version of this article appeared in the May 2016 issue (pp.40 48, 50) of
Harvard Business Review.
Darrell K. Rigby is a partner in the Boston office of Bain & Company. He heads
the firm s global innovation and retail practices. He is the author of Winning
in Turbulence.
Jeff Sutherland is a cocreator of the scrum form of agile innovation and the
CEO of Scrum Inc., a consulting and training firm.
Hirotaka Takeuchi is a professor in the strategy unit of Harvard Business
School.