“The Path to Business Agility” Webinar – Q&A Follow-up

Following up on our webinar last week, “The Path to Business Agility” with Evan Campbell and George Schlitz – the first in our Business Agility Webinar Series – we are shining a light on a couple of really great questions that came out of this session. We shared these questions with consultants all over the world through an internal Slack channel (#business-agility) and have attempted to consolidated the responses into a reasonably cohesive answer. Thanks upfront to those who asked questions here and during the webinar and many thanks as well to those who contributed to the answers!

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Question 1:

How do you get commitment for a transformation when the productivity gains from overcoming bureaucracy results in losing so many (now unnecessary) job roles? Extrapolating from Gary Hamel’s $3T point (from this HBR article), possibly 17% of employees will not be needed, a rate of headcount greater than most organization’s rates of growth, so even re-deploying people cannot absorb all the change. (Thanks to Jay Goldstein for this question!)

The article in question here, “Excess Management is Costing the US $3 Trillion Per Year” by Gary Hamel, focuses on management, but regardless the motivation for companies across the nation and around the world to address such waste is considerable and urgent. The commitment and investment in transformation is likely to come from leadership, however, who are not known for being particularly squeamish about laying off jobs they deem “unnecessary.” The question may be more for those middle managers who are tasked with implementing transformation initiatives, despite knowing that they may be rendering their own roles obsolete.

Here, we acknowledge a truth about business agility and Agile transformation: all roles may see greater or lesser change as a result of reduced waste through the organization, wherever it occurs. This will include middle management positions, as they are currently defined. The change is generally of two varieties:

  1. Attrition = A person’s role goes away and said person has motivations to leave the company.
  2. Transition = People who fill a no longer necessary role are offered the opportunity to transition into new roles.

The use of the word “role” is important: people can grow and transform to fill different roles, despite the generally accepted concept that people are synonymous with the roles they play, in life as in work. Thus a middle manager is someone who performs the functions associated with middle management because the organization enables it. By extension then, the organization can enable a former middle manager to embrace or even help define a new role that generates value for the Agile organization. Now we are in a position to ask, “How can existing middle management roles be transformed to generate value in the Agile organization?” Indeed, Agile organizations may want to invite those whose existing roles are likely to be impacted the most to help find ways of tapping into their own trapped value. Even so, some people won’t want to or will be unable to change or transform so there will likely be some attrition.

In addition we assume that transformation is justified not just to reduce costs but to also increase growth. The transformed organization should be able to better leverage the experience of middle management, for the same reason that it can now better leverage knowledge workers in general. Also, once it is understood that the objective is not just to reduce costs but to grow, the expectation is set that not only will middle management positions add more value but the ratio of these positions to staff in general will decrease over time as the Agile organization matures and grows.

One way middle management can be re-injected into the value stream?

Well, in large organizations, the job of grooming both the business and technical runway at the program and portfolio level is typically understaffed. As a result, there tend to be appreciable gaps in systems/architecture that need attention and could be addressed by people who previously performed middle management functions. Over a multi-year transformation of a large organization, the need for various roles will likely shift several times and, if that process is managed with much foresight, people can transition into new roles or leave the company without necessitating a mass layoff.

Question 2:

I am curious if you can give me an example of some useful metrics a team or organization can use to measure their effectiveness implementing Agile Development or Business Agility? (Thanks to Josh Speerstra for this question!)

Because metrics can be used to measure anything, in either case, it’s critical to create alignment throughout the organization to the “big why” for their transformation:

  • Why is the company trying to transform? What is the desired value the company hopes to achieve as a result of the transformation?
  • What are indicators that that transformation is yielding the desired value?

If an organization is looking to improve quality, we can talk about quality metrics. But if they want to focus on customer experience, then that leads to another conversation and likely different metrics. Once we have a set of outcomes in mind, then it becomes much easier to start talking about specific metrics, whether its likes or sales conversations or more employee engagement.

The challenge then becomes “How do you create a basis for comparison if you are enabling net new capability within the organization?”

For example, we had a client who stated simply, “We want to ship four times a year instead of once a year and six weeks late.” In seven months, they shifted to quarterly releases, on time and vastly fewer defects. Then they started thinking about a different way to measure continued improvement. In each case, the metrics differ. For example, to achieve the desired state of “on time delivery four times a year”, metrics would be aligned to delivery cadence. Whereas, to achieve the state of “continuously improve delivery processes”, the metrics might be aligned to team dynamics, or bug count, or even user engagement.

A question that you might ask of any proposed metric is “What would you do if that number changed? What decision would you make?” This calls every metric into question, to ensure that it is serving a higher purpose and not simply vanity metrics. All too often people measure stuff just because they can, without any real understanding of how the metric might connect with their desired outcomes. Instead we encourage driving toward the desired value and leveraging whatever metrics that help.

And in case you want something slightly more concrete, check out our blog “Aligning Metrics to Your Agile Vision”!

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