Learnings from agile transformations at mobile operators
Agile is eating the world. Everyone, from software development startups to the public sector, are embarking on agile journeys. But what is agile – really? And how do you make sure you succeed with your agile transformation? In this blog post, we share our learnings from client engagements and tell you about the five pitfalls you need to avoid, and how you can turn them into success factors.
Agile is an approach used to increase value creation, decrease time-to-market, and minimize risks and waste. While it started in software development, it is now being applied to many different kinds of work and spreading far beyond IT. In fact, 90% of senior executives claim they want to be agile but very few believe that they are (Source: Forbes). With this level of hype, some people hail agile as the next revolution, while others are skeptical to these, sometimes evangelical preachings. But agile is a greatly misunderstood concept. To truly understand what it means, we need to start with the traditional problems that agile methods are trying to solve.
In the picture above, we see a traditional process from customer demands to a finished product, and the resulting (often) disappointed customer. There are three problems with this approach:
• Long time to market. The process takes too long, while market conditions and the customers’ needs might change in the meantime.
• Unhappy customers. Due to the long time and the long distance between the people who create products and the end users, misunderstandings occur, and the wrong product is created.
• Wasted resources. Products that customers don’t want, big projects that fail, and a lot of time spent on activities that don’t create any value. All of this leads to a huge waste of resources.
These problems arise due to four core flaws in the traditional model, shown below.
Transforming a traditional company into an agile one, with cross-functional autonomous teams organized in value streams with full mandate to continuously deliver value to customers is… no easy task. It requires big changes in how the company operates and thinks about things. It requires company-wide changes in how decisions and prioritizations are made, how divisions and teams are organized, how competences are developed, how the company interacts with its customers, and how everyone, including managers, think and act to create a culture that breeds autonomy, problem-solving, learning, collaboration and transparency.
In addition, agile transformations often expose other flaws in the company. Do we really know how things are going? Are our KPIs measuring what we need to know in order to improve, or are we incentivizing short-term wins at the expense of long-term health of the business? Who really creates value? Do we have control or just the illusion of control? This will naturally cause conflicts and force you to deal with difficult problems.
While an agile transformation may sound like a daunting task, one should not think of it as a one- off, “big bang” style change, but rather as a journey that starts and never ends. Agile transformations are not about transforming an old company to a new, updated, agile version – they are about changing the company culture to one of continuous learning and improvement.
All agile journeys are different, but it is common to start with agile pilots, usually in the IT department. After successful pilots, the next step might be to transform the whole IT department. Then, agile might spread to other parts of the company and true collaboration between divisions will start to happen. At this stage, agile may become a company-wide strategy, changing everything from governance and steering to recruiting and leadership. And that’s when the true journey starts.
Five common pitfalls and how to turn them into success factors
Transformations, including agile transformations, are complex, and there are many things that can go wrong. The following are five common pitfalls that you should avoid, based on our experience from various client engagements.
Pitfall no. 1: Having a one-dimensional focus
The transformation is considered a technology project (e.g., upgrading tools or architecture), a change in ways of working (e.g., using Scrum) or a reorganization (e.g., cross-functional teams). The transformation is expected to implicitly lead to improvement in other areas, but the transformative changes are not realized due to a narrow focus on only one aspect.
Success factor: Treat agile transformations as a balance between technology, ways of working and organization.
The right technology (e.g., a microservice based architecture) can free the teams, enabling autonomy and speed. Organizational changes can create more collaboration and customer orientation. It is only when you combine these with changes to ways of working and culture that you get the full benefits of an agile transformation.
Pitfall no. 2: Driving the transformation from IT with too little engagement from business departments
The transformation develops from pilots in agile software development within IT, to a transformation of the whole IT department, but overlooks the need for engagement from business departments. As a result, the business departments don’t feel enough ownership of the project, and the transformation fails to support business goals.
Success factor: Treat agile transformations as a company-wide matter
You cannot break silos by working in a silo way. Therefore, an agile transformation must involve people from several parts of the organization and from different levels. Instead of having a small design team with limited insight into the daily workings of the organization, involve as many people as possible. This way, you can ensure that no serious design flaws are implemented and increase ownership and engagement from the start.
Pitfall no. 3: Running the transformation as a multi-year program with a scope that is too large
The transformation tries to achieve everything at once, in a big-bang fashion. The scope gets too complex, leading to a loss of momentum and too little focus on quick wins.
Success factor: Transform the company toward continuous learning and improvement
Agile is all about delivering value continuously in small batches. Apply this to your agile transformation too. Think about how you can change the company culture to enable continuous changes rather than relying on massive transformation projects. A big project can be used to kickstart the journey, but make sure you create the right conditions for the journey to continue after the project.
Pitfall no. 4: Not establishing a baseline
Before the transformation, it is clear that things need to improve. You already know that things aren’t working, so why would you want to spend time measuring exactly how bad things are? You just want to get started with improvements. Well, when the dust has settled and people are fully focused on delivery, the first sceptics will appear – sometimes from high above. Then you will want to have something more than testimonials and survey results showing an increase in employee satisfaction.
Success factor: Be clear on exactly what improvements you expect to see, and gather data
Before the transformation, make sure you define what it is you want to improve, and gather as much data and facts on the current situation as you can. Plan ahead for the need to defend the new way of working, especially against people who dislike the “fluffiness” of agile and want hard facts and details. This way, you avoid having to spend energy on keeping the transformation alive and can focus on taking the next steps.
Pitfall no. 5: Underestimating the importance of the agile mindset
The transformation focuses too much on agile practices like Scrum and Kanban, and too little on the mindset and culture. This is sometimes referred to as doing vs. being agile. While tools and processes can help bring clarity and safety to beginners, you will never get the full effects of an agile transformation until people start living and breathing the values that are at the core of agile.
Success factor: Cultivate an agile mindset through trainings and leadership
Agile is a mindset that seeks continuous learning and improvement, embraces uncertainty and changes, embodies collaboration and transparent communication, and always focuses on creating value for customers. It requires a lot of time and effort to transform a traditional company culture in which people are afraid to make mistakes, take no initiative outside of their role description and stick to “the way things have always been.” This culture change can happen partly through trainings, but nothing will really change unless managers at all levels start embodying the changes they want to see in the rest of the company.
Johannes is a Consultant at Northstream