Five dimensions for a successful scaled agile transformation
Within the past few years, agile development approaches have become increasingly popular. Originating in software development, agile methodologies are being introduced step by step into cyber-physical products. When used in traditional industries, the typical objectives of agile development are to increase customer value and flexibility, reduce time to market, provide a faster decision-making process and to reduce project complexity.
Agile methods and processes can easily be introduced in single projects with small team sizes. But, as we at 3DSE have discovered during various projects, organizations start to struggle when it comes to integrating an increasing number of agile working teams towards one common goal, for example, in a project, in a program or in any other organizational unit. The reason is that many organizations understand “agile” as applying only to agile methods.
Most difficulties in implementing agile occur when an organization tries to scale in both directions: in terms of the number of teams at the same time and in terms of changes in organizational dimensions, from strategy to culture. We call this a “Scaled Agile Tranformation” and it results in a fully agile R&D or even organization. That is not easy for an organization to handle – quite the contrary. Such a transformation typically amounts to the largest change program in a company’s history and that takes time, effort and courage. To master a scaled agile transformation, we at 3DSE suggest carefully choosing the scaling trajectory and, instead of just changing the development method, address the following five dimensions:
Besides a strategy for your company or your products, you need a strategy for your scaled agile transformation. This includes a shared agile vision. The purpose and objectives of your agile transformation must be clear to every stakeholder. And it should be a motivating target to strive for. Furthermore, our experience shows that its crucial to have the right prioritization at every level, beginning at the product level down to the feature level. Many companies struggle on the part of deprioritizing. But, as Michael Porter said: “The essence of strategy is choosing what not to do.”.
More than likely, your company exists because you sell products to customers. That’s why you should care about the product and focus on customer value. You need to gather direct customer feedback to adapt your product. And this needs to be done often as part of your routines or processes. Requirements must be forged, so don’t need to be fixed in detail at the beginning. Changes are welcome. Since there are changes, make sure you have a modular product architecture. Module interfaces must be coordinated regularly and the right balance between standardization and customization must be established. Only then you can build real minimum viable products (MVP) and deliver frequent value to the customer. The customer also represents all significant decisions of quality. That is why we recommend introducing specific definitions of quality in alignment with your customer requirements.
When implementing agile approaches, many teams and organizations focus on standard methods, tools and processes. But to use them effectively, you have to select and adapt methods and tools according to the specific needs. Our experience shows, that it is important to tailor and customize your toolbox across all hierarchies.
Adaption is necessary because existing processes must be taken into account. The new approach must be integrated into daily processes. Introducing a scaled agile framework on a greenfield landscape is not realistic, especially for traditional industrial companies. When it comes to usage of new digital tools, organizations must find a balance between standardization and freedom for the teams. To obtain constant feedback, processes should be designed to frequently produce prototypes. That can be achieved, for example, by virtual development, generative design, agile prototype purchasing processes or test-driven development. In our experience, the most critical success factor, especially when scaling agile, is to set the right rhythm for synchronization. Synchronization across different teams and different hierarchies is key. A release rhythm helps to focus everyone on the essential business values you want to deliver. If your product is very complex you might also think about a multi-speed product development process, as implemented at one of our clients.
One major dimension that needs to be addressed for a scaled agile transformation is the organization. There are many obvious organizational requirements for agile team setups as interdisciplinary teams, t-shaped competencies or co-location. Besides these, our experience shows that companies must not only scratch the surface but rethink the organizational structures to really work agile and apply the agile mindset. This includes changing the organizational structures for more product orientation. Customer examples are end-to-end product ownerships or a product family organization. Roles and responsibilities also need to be adapted. In contrary to traditional setups, we suggest competency-based leadership roles combined with flat hierarchies. One who is good with leading teams must not automatically be good with sharing a product vision, with developing personnel or with leading technically. That’s why these roles should be separated, even if this is not a common approach. It means a major change in traditional leadership mindset.
Although culture is intangible and a result of several factors, it is a crucial dimension for a scaled agile transformation. Most of the aspects mentioned above will assist in evolving toward a more agile culture. But, as our experiences with agile transformations have highlighted, there are cultural aspects that should be fostered and promoted. For example, this includes increasing transparency over all hierarchies and product levels. To insure this, methods like visual management, “go to gemba”, daily standups or team health checks can be applied. Besides increasing transparency, the organization must develop a culture of trust, where fast actions can be taken. Therefore, mandates for decision-making must be granted and action orientated decision-making processes applied. Also, continuous learning and fast impediment removal processes foster faster decisions. To ensure cultural change is really implemented and not only existing on PowerPoint slides, top management teams must act as agile role models. Our projects have shown that agile leadership principles that are written down, trained within transfer workshops, operationalized and integrated within management tools, helps management teams become those agile role models. Developing an agile culture is crucial, but probably the biggest challenge.
Scaling agile has shown significant improvements in development effectiveness and efficiency. We advise companies to not only scale but also transform and to start a scaled agile transformation with being clear on the motivation as well as trajectory. They should not only address scaling an agile method but seriously take the described five dimensions into account.
Philip Kloibhofer was a Manager at 3DSE Management Consultants GmbH in Munich. He has eight years of consulting experience in design, planning, and execution of R&D change programs. His core competencies lie in the area of organizational development, innovation methods and systems, as well as agile scaling and transformation. His industry focus is set on Automotive, Industrial and Aerospace & Defence.