Agility at the Leadership & Organization Layers
Contributors: Mike Dwyer and Richard Lowery
Throughout 2016, SolutionsIQ helped a growing number of companies successfully kick off and execute many large-scale Agile transformations. Having done this now with dozens of enterprises, we decided to retrospect on some of the common elements of a successful Agile transformation. We’ve summarized our findings along the Five Layers of Agile Transformation (read my blog “Leading Agile Change: Proven Change Models for Agile Transformation” for more on this):
Five Layers of Agile Transformation
- Leadership – The traditional industrial-age management style (e.g. Taylorism) is not effective for maximizing performance in a modern, digital organization of knowledge workers. Modern pressures to move and change fast require a different mindset, one that engages employees and challenges them to exploit innovation for competitive advantage. Agile leadership facilitates the emergence of organizational constructs capable of adapting in the face of ambiguity and constant change. The Agile leader exhibits leadership styles that create a culture of transparency, decentralization, engagement, collaboration and accountability.
- Organization – Business Agility refers to an organization’s ability to sense and respond to change in ways that allow it to thrive and innovate. Understood in this way, organization-wide agility is constituted by a set of capabilities. These capabilities are embedded within the organizational structures, policies, and practices, as well as within the cultural beliefs and individual mental models through which an organization functions. This includes on-boarding, employee reviews and incentives; finances and accounting; and everything that enables the enterprise to operate as a healthy living organization.
- Product & Business – How clear is the product strategy to the people that are implementing it? What is the connection between the strategy and the daily software development work? Crucial for this connection is the Product Owner role and Product Management skill sets and the way that the enterprise specifies and prioritizes work for the software development team.
- Delivery – Agile began as a way to speed up software product delivery and as a result this is the area that is (unfortunately) considered the full extent of what is possible with Agile. As seen in our paradigm, however, the Delivery layer is only one segment that benefits from Agile transformation. Focusing on the practices and processes of teams and groups of teams delivering a project, program or product, Delivery encompasses how well individual teams and sets of teams are using Agile frameworks like Scrum and Kanban, how Lean principles are being applied to value streams, and how successfully we are applying scaling patterns and frameworks like Large-Scale Scrum (LeSS) and the Scaled Agile Framework (SAFe).
- Execution – The purpose of Agile is to deliver high-quality value to the customer quickly. At the foundation of this product creation pyramid are the technical execution practices and principles that enable development teams to produce high-quality products. This includes the technical practices used in constructing, verifying, validating, and deploying software-based products, which are known in Agile as Extreme Programming (XP) and, more recently, DevOps. Executing within a disciplined Agile framework across the whole value stream can help improve project management discipline, value delivery and predictability. It helps organizations to identify gaps in their capabilities and to highlight impediments that prevent them from achieving peak performance.
In order for an Agile Transformation to provide lasting transformative results, the employed approach must be holistic and comprehensive. When we help organizations layout their Agile Transformation strategy, we typically anchor that strategy around these five major dimensions of capabilities. Now that we know what the goal is, let’s look at each of these five dimensions in a little more detail to reveal some learning insights into the patterns we have observed in enterprises achieving lasting results with Agile transformation. In this post, we consider the first two layers, Leadership and Organization.
In addition to adopting new leadership behaviors and styles that are congruent with the modern expectations of knowledge workers, leaders of organizations in the middle of a successful Agile transformation have committed to a few key leadership activities, starting with a clearly articulated vision of the future state you are trying to reach. Questions to pose to your board and leadership include:
- Why is the company undertaking an Agile Transformation in the first place?
- Is it to achieve parity with peers?
- Is it to leapfrog the competition in terms of time to market and/or quality?
- Is it to achieve a level of disruptive innovation and enter new markets?
Being clear on “why” is important, as is making sure the entire enterprise from top-level leadership to middle management and down into delivery teams is aligned and bought into that vision. When you achieve that level of alignment, you can realize some pretty far-reaching and transformative future states.
Another best practice we have observed is establishing a communication plan. This is more than just a broadcast from leadership; it’s a bidirectional feedback loop that communicates intent, invites and receives feedback transparently, and objectively measures progress.
Lastly, one of the other key success indicators for an Agile Transformation is a greater degree of empowerment throughout the enterprise:
- Leaders empower middle managers to resolve problems at the sub-executive level and only intervene when management escalates issues.
- Management empowers teams to provide guidance in terms of best practices to yield optimal results and only intervenes when the team escalates issues.
- Team members empower each other to be informed about what high quality means at the development level and how to achieve it. Team members are also empowered to request resources to achieve their goals while actively radiating progress.
This is no easy task. It takes a well-conceived strategy communicated by a dedicated leadership continuously and unwaveringly in order to achieve the desired results. That is partly why, in “The Third Wave of Agile”, SolutionsIQ Chairman Charlie Rudd calls for the role of management and leadership to be redrafted to account for the explosive growth of Agile teams and Agile adoption in general.
Naturally, leadership cannot accomplish anything without individuals actually doing the work, so let’s turn to the people in the organization. In particular, we look now at some of the key success indicators in the Organization layer.
For many enterprises, Agile Transformation is the largest organizational change it will ever undertake. The results are deep and broad, including structural and behavioral changes, as well as the introduction of new mindsets that may fundamentally alter the overall culture of the organization — and in a good way.
However, these sweeping changes don’t just happen. In order to become a learning organization with high degrees of transparency and collaboration, the enterprise needs to have a strategy for designing, executing and maintaining change. Many of the organizations enjoying success with Agile Transformation owe it in part to using some classic organizational change management models and frameworks, including:
- John Kotter’s 8-Step model
- Prosci’s ADKAR framework
- Jason Little’s Lean Change Management, a newer emergent model that is starting to get a lot of attention
What makes organizational change management so thorny is that people – many, many people, all with their own capabilities and fears – are the focus. Change, as will surprise no one, is something that few people enjoy. Often leadership, specifically, creates a corporate culture against change, because fluctuations of even the smallest degree can affect the bottom line. Operating under a traditional world view where the market is wieldy and fluctuates little to not at all, stability is the only important metric. However, in today’s continuously changing business world, only those institutions – and those people – who are capable of learning and growing and changing as quickly as possible have a horse left in the race. In other words, organizational change management must be a part of any successful enterprise’s survival kit. Otherwise, any and all success will be short-lived.
This is where departments traditionally seen as “support” (HR, finance, recruiting — even sales and marketing) are brought into the change equation. In organizations who want to attract people resilient to and even adept at change, for example, human resources and recruiting has to be better at finding and keeping these candidates. In addition, to achieve long-lasting changes to mindsets, culture and behavior, enterprises must fundamentally rethink their overall incentive programs — and this is exactly the trend we are witnessing with many of our clients. The corporate value of collaboration becomes suspect when individuals are rewarded and promoted at the expense of their own team mates. Fortunately, we have seen a handful of our clients switch to more team-based rewards so as not to undermine their hard-earned successes achieved through Agile transformation. Positive, managed changes throughout the organization like these require consistency and transparency, which creates an even stronger imperative to leverage tried and true change management models.
So as you can see, there are a number of dimensions to a successful Agile Transformation. We’ve explored the first two, Leadership and Organization:
- Leadership – Agile leaders exhibit leadership styles that create a culture of transparency, decentralization, engagement, collaboration and accountability. Enterprises who have success with Agile Transformation include a focus on Leadership as part of the overall transformation strategy.
- Organization – The success of any enterprise lies in the people on staff. Enterprises who have success with Agile Transformation use change management frameworks and tools in order to manage and maintain change in the direction of the desired organizational culture. These enterprises also update their approach in support roles like HR and recruiting.
In the second part of this series, we continue the discussion by exploring the remaining three dimensions of a successful Agile Transformation: Product, Delivery and Execution.
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