Agile transformation on a strategic level
Agile as a management framework
In the last decade, agile frameworks have proven effective at delivering faster return-on-investment, increase quality of deliveries and better project control. One outcome of this, is an increased focus on the use of agile approaches, as product development frameworks, for larger IT-projects and programmes. Agile as a general management philosophy has also made a lot of progress within the capabilities of being able to scale to larger programmes, and do, in many cases, also prove successful.
But going towards an agile philosophy, and the adoption on a corporate or business level, is not always easy, and will, in many cases, take a lot of time and effort to succeed with. Many companies highlight the concern of “going agile” and, in the process, losing the conventional governance and control as a trade-off. But as agile goes – one thing does not exclude the other. Implementing an agile framework or philosophy, doesn’t mean that you must discard your existing frameworks and governance, resulting in your employees run free like untrained monkeys. If you, as an example, feel the need to keep the gate-based, end-stage reports, feel free to do so. Just know that together with agile frameworks, you need to be aware of some high-level parameters:
- Budgeting should be defined in value streams, rather than e.g. cost centres or departments. This promotes a better understanding of your resource allocation and can facilitate better budget management tools
- Development and delivery cadence should be aligned between governance assets and project teams. If you expect monthly KPI evaluations, the metrics and frameworks should be applicable to the context of the work performed on the functional levels
- Decision making governance will be more tactical, and in a higher degree decentralized to self-managing teams. The overall scope will still be dictated on a strategic corporate level
Strategic agility – stability through adaptability
Funding value streams rather than departments, is a good example from Lean budgeting and SAFe to decrease development overhead and maintain fit-for-purpose financial governance. The SAFe framework also provides a good way to facilitate a saleable, agile way-of-working and a way to ensure deployment cadence and overall alignment. But it does require a considerable amount of training, change management and commitment from the entire organization.
Going towards an agile transformation, requires changes on all levels of the organisation. One thing is that product development needs to be able to adapt to changing customer needs, another is that the strategic organisation can adapt and capitalize on e.g. changing market needs. Strategic agility, in this sense, defines the organisations ability to adapt the business model or change its business processes to facilitate a change of pace on a functional level. Over time, the process of adapting will become routine, and the organisation will be able to deliver value continuously while performing any adaptive manoeuvres. This of course doesn’t come easy or for free. There is a certain amount of resources, time and dedication needed to reach this level of stability.
Considering the amount of resources and time one would need to dedicate, when seeking new ways to improve the strategic agility of your organisation, make sure that the following questions are clearly aligned on the corporate and business levels of the organisation:
- Why do we need to be agile? – is it worth the effort? Do you want to be agile, just “to be agile”?
- What do we expect to gain from this transformation? – the expected outcome should be well-founded in the organisational strategic value streams and future vision
- What can we commit to this? – the transformation simply won’t fly unless you have commitment from the business. Since the strategic themes, or agenda if you will, will be defined by them
- Cost of the transformation and change? – Both tangible and intangible costs
“Going agile” is not only a transformation in the functional levels of an organisation, but most definitely also calls for a change on the strategic business level. New agile development processes should change the way business understand how they differentiate themselves from competitors or deliver value to customers, which also should be reflected in how they operationalize the corporate vision and mission.
Gate-based governance can be deployed together with agile frameworks, to create hybrid setups. Adopting agile doesn’t mean that all conventional project governance is out of the frame, it only means you need to sync it to the new ways-of-working and make sure that cadence, metrics and vision between the different strategic levels of the organisation is aligned.
All-in-all, before you start throwing around Kanban boards, facilitate stand-up meetings and implement agile release trains galore, then consider the following:
- Understand your need, and more importantly, define the expected outcome of the transformation
- Identify and define value streams for development and operations, and the underlying people and systems that supports these
- Describe how the business and functional levels will enable the corporate vision through the new agile ways-of-working and value streams
- Know your financials. If you want to enable value streams and improve your financial management processes, you need to know how your resources are allocated and what it will cost to transform
- Ensure that the organisation is aligned with the initiative (structure, processes, metrics, methodologies, development/delivery cadence)
- Align the final transformation roadmap with key stakeholders and revise if needed
This is not a one-size-fits-all, or end-2-end solution, but some preliminary steps we would recommend you take before embarking on your agile journey. The most important thing is not whether you go agile, stick to business-as-usual, or implement agile frameworks to improve certain functions in your organisation – it is that you are completely clarified with the above-mentioned checklist, and thoroughly understand the impact of change throughout the entire organisation.
 Referring to the three levels of an organisation: Corporate, business and functional
 SAFe framework – lean budgets (https://www.scaledagileframework.com/lean-budgets/)
 With the condition that the organisation is retrospectively learning from previous transitions, and maintain the structures and governance