The Agile Organisation

Transcription

1 The Agile Organisation The What, the Why, the How Presented by: Roger Perry, Managing Director, Bevington Group Business Model Design Process Improvement Change Management Australia and NZ patents, US and Canadian Patents pending

2 What is the Agile Organisation? The Basics

3 There are, broadly speaking, four types of Agile in serious play Technology related Agile projects Non-technology Agile projects Project-related Agile Scaled Agile in various forms Major programs Full organisational transformations Agile as BAU a new way to structure and operate your enterprises (effectively a new form of operating model) 3

4 Each of the Agile forms shares characteristics devolved from Agile technology related projects There are 12 guiding agile principles to support teams in adopting this approach: 1. Satisfy the customer Focus on the value eliminate the waste 2. Welcome changes 3. Deliver frequently 4. Collaborate daily 5. Motivate individuals 6. Communicate face-to-face 7. Measure 8. Deploy sustainably (test and learn) 9. Use Minimum Viable Product (MVP Plan-Do-Study-Act (PDSA) 10. Simplicity is essential 11. Self-organising teams 12. Reflect and adjust 4

5 You could summarise the Agile approach as commonly having six attributes Cross-functional teams Co-location Rapid iterations Working experiments before documentation Fixed timelines for given cycles Embedded self-management 5

6 Agile methods are now regularly applied to all manner for project types Agile for IT (software development) Agile for Process Improvement Agile for Implementation Agile for Workspace Agile for Strategy Agile for Scenario Agile for Policy Agile for Product Agile for Learning 6

7 Agile is attractive for a variety of reasons Speed: by bringing critical team members together solutions evolve more rapidly Decision making: the decision making model is simplified in Agile, so that the decision maker/s interacts directly with the team, and make decisions within the Agile sprint timeframe Creativity: Bringing different perspectives into the room can lead to a much richer solution set Shared understanding: where cross-functional teams share the same understanding of the problem and the potential solution then implementation tends to go more smoothly Risk reduction: as well as the reduced implementation risk (from shared understanding) there risks of design flaws are reduced because the solution can be tested with critical players in the room 7

8 How Agile is being taken into BAU Agile Way of working in Squads, Chapters and Tribes 8

9 More on Agile 9

10 As discussed, broadly speaking, four types of Agile are in serious play Technology related Agile projects Non-technology Agile projects Project-related Agile Scaled Agile in various forms Major programs Full organisational transformations Agile as BAU a new way to structure and operate your enterprises (effectively a new form of operating model) 10

11 One form of Scaled Agile is the application to turn-arounds* There is a flawed assumption that crises require tight command-and-control from the top However, HBR has reported that command-and-control systems work best when operations are stable and predictable, commanders have greater knowledge potential solutions, centralised decision makers handle peak decision volumes, and sticking to standard operating procedures is more important than adapting to change This is not the context for natural disasters, turn-arounds and not even the context for many contemporary business problems. In such rapidly changing contexts central command could easily become a bottleneck or become paralysed by information overload So, unsurprisingly, natural disaster teams are increasingly turning to agile team structures and methods to make a difference Turnaround deployment of agile teams is now also becoming more prevalent * 11

12 Australia has its own examples of this type of agile organisational application WorleyParsons, a global engineering and construction firm that specialises in oilfield and other energy-related projects In 2015 demand for WorleyParsons services crashed After several rounds of cost-cutting proved insufficient to stabilise the organisation, hundreds of individual projects were established Most of these teams operated in an agile manner with work structured in sprints, discipline in decision making, backlogs, daily huddles and other tools Senior leaders helped clear away obstacles and tracked the teams results In the first 100 days, the firm increased its cash position by 20%, reduced its net debt, and registered a $120 million gain in anticipated profitability. After just one year, margins had increased by five percentage points, cost savings totalled $400 million (on an addressable cost base of $1.2 billion), and the stock price was up more than fourfold This is an example of leaders enabling the change that needs to happen rather than defining every solution 12

13 But, returning to Agile as BAU (business-as-usual) Traditional organisational structures Pivot on different characteristics (e.g. function, geography, product, customer type etc) but nonetheless tend to use silos Silos tend to be hierarchical in terms of authority levels Most powerful governance bodies tend to sit at the top of hierarchy Budgets tend to be organised by silo (department, division) or by project Theoretically silo personnel can work together on a project Agile structures A network of teams Teams tend to be called squads Squads are organised into tribes Squads have specific objectives Tribes consist of squads with related objectives Functionals skills are addressed through chapters Leadership provides a mission and integration function 13

14 BAU Agile can touch all elements of an operating model What is a Business Operating Model? A Business Operating Model is the combination of roles, skills, structures, processes, assets and technologies that allow any organisation to deliver on its service or product promises It is in effect the way the business is set up to deliver VALUE (both in terms of the customer and in terms of the business) The aspirational view of how the business is to be set up to deliver against future or changing markets, environment and technology demands is sometimes called the Target Operating Model 14

15 People often think of structure first with an operating model yet agile structures are often slippery to grasp Agile structures are unlike traditional hierarchical structures They need other parts of the operating model (such as technology, culture, and process) to work well 15

16 Often the Agile organisation s inspiration has been Spotify. 16

17 Yet, agile is not just structure! Spotify often quotes a range of other aspects Deep pools of talent Entrepreneurial values Enabled by technology Collaborative culture Intense customer focus Strong sense of mission Experimental mindset Low levels of bureaucracy 17

18 Why are organisations considering agile alternatives? The context is often reported to be different, with rapid changes in Competition Demand Customer expectations Technology Regulation Predictability is a challenge The war for talent is just as intense as ever So, organisations are seeking ways to Respond to context changes faster Respond more effectively Identify emerging trends before the competition Improve customer service and intimacy Improve staff engagement 18

19 There is a link between Agile and other emerging practices Customer centricity and Customer Journey Maps Iterative Experimentation Minimal Viable Product Agile Collaborative technologies Design Thinking Human Centred Design 19

20 Whilst digital enterprises are the early adopters, there are emerging benefits for established enterprises Speed Brings critical team members together so that solutions evolve more rapidly Fun There is a sense of satisfaction from working together towards achieving the same goal and seeing regular results Momentum building The swift pace of Agile sprints and implementation helps build momentum to drive broader change Features of Agile Decision making Simplified decision making with business owners interacting directly with the team, and decisions made within the Sprint timeframe Creativity Bringing different perspectives into the room can lead to a much richer solution set Risk reduction Reduced implementation risk (from shared understanding) and the risks of design flaws are reduced because the solution can be tested with critical players in the room Scalable upskilling As sprint cycles continue it is easy to engage and upskill more staff Shared understanding Cross-functional teams share the same understanding of the problem and the potential solution - implementation tends to go more smoothly 20

21 These benefits can be observed in more traditional metrics* 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 enquiries? 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? These are the sorts of benefits sought by Ericsson Ericsson has over 100 small teams working with its customers needs in three-week cycles. The result is faster development that is more relevant to the specific needs of the customers. The client gets value sooner. Ericsson has less work in progress. And Ericsson is deploying one to two years earlier than it otherwise would, so that its revenue comes in one to two years earlier. * 21

22 However, to successfully deploy, organisations need to be aware of the irrefutable disciplines that go with the Agile approach Satisfy the customer Focus on value & eliminate waste Welcome Changes Deliver Frequently 4. Collaborate Daily Motivate Individuals Communicate Face to Face Measure Deploy Sustainably (Test & Learn) Use Minimal Viable Product (MVP) / Plan- Do-Study-Act (PDSA) Maintain Simplicity Empower Self Organising Teams Adjust and Reflect 22

23 Organisations tend to start in customer relevant and internal customer spaces Activities with early or deep customer impact: Activities with major internal customer impact: Innovation Customer Experience Human Resources Technology Sales Servicing (selective) Strategy Development Some operations (special case) Product development and management 23

24 The roadblocks to any type of agile deployment are similar In 2015 a large enterprise attempted to deploy agile to accelerate product deployment The organisation was suffering from Slow processes Cumbersome decision making Late product deployment Staff dis-engagement The cross-functional approach showed early promise Engaged staff Creative options Experimentation Rapid deliverable production Yet the whole exercise collapsed when Other (non-agile) teams insisted on applying governance Leaders did not understand the different decision making model Budget was withdrawn in the new-financial year because of regulatory demands 24