“Success today requires the agility and drive to constantly rethink, reinvigorate, react and reinvent.”
– Bill Gates
ISG Research finds that the adoption rate of agile-based development in Forbes 100 firms is increasing by 30 percent every year. Companies often find agile development practices effective when the problem they are trying to solve is complex, when solutions are initially unknown and when product requirements are likely to change—conditions that exist for many product development functions regardless of industry, including marketing, strategic planning and supply chain.
It’s no secret that internet companies or “digital native” enterprises have an advantage when it comes to implementing agile development practices. Because they are free from the burden of legacy systems, they can construct their architecture in a modular fashion and create micro-services that allow for flexible, independently deployable software systems. Instead of building everything themselves, they can simply use APIs to make changes to the specific component of the application architecture. Unfortunately, legacy systems for large or more well-established companies don’t allow for this option.
But, even for companies with the digital-native advantage, setting up an IT shop that supports agile principles at an enterprise level is not easy. The problems tend to get particularly sticky when agile methodology stretches beyond the borders of the IT organization. In fact, for many companies, the biggest barrier to agile development is organizational structure. This is because agile is not only about developing products faster and cheaper, it is also about how a company organizes its teams, how teams collaborate with each other, how it sources work to third-party providers and how it plans and budgets.
Very often, a small team inside IT will kick off an agile project without a problem, but as team members work to make it an enterprise-wide initiative, they face an increasing number of stakeholders—finance, security, legal—each with its own perspective. Agile, by its very nature, embraces uncertainty – something business units like finance are generally averse to.
So how can an organization extend the key tenets of agile beyond IT’s development pods?
- Rethink organizational structure. Set up several small agile teams throughout the enterprise that like to work in dynamic environments and that are self-sustaining, innovative and unafraid of failing. Make sure these teams are focused less on creating a design free of issues and more on embracing issues, fixing them and moving ahead. Staff each of these teams with a scrum master. To minimize the time spent coordinating people, break a large project into several small, stand-alone projects. Several small agile teams each working on its own specific goals will result in faster deployment of the larger project.
- Understand where agile practices fit best. Not all projects or initiatives are suitable for agile methodology. An application that supports a poorly structured process, for example, will not translate well to agile development until the process itself is optimized. To identify projects that are conducive to an agile environment, consider the modular nature and complexity of the project, the desired functionality, business outcomes and budgeting. Projects for marketing campaigns that need fast development or rapid releases of new features have shown to benefit from agile development practices.
- Infuse agility into your sourcing. Define your sourcing agreements so providers support agile development practices. The performance metrics by which you measure service delivery should focus on the pace of releases, progress of development or sprints, velocity and continuous improvement. Regardless of the pricing model, work to define outcomes that you can track with each development project. One popular way of managing pricing is to align it with pods or story points.
- Proactively manage change. Like any change, the adoption of agile development practices may be met with resistance or face initial hurdles. Teams—especially those outside of IT—may be reluctant to trade in the traditional development methodology they are familiar with for agile practices they are not. Effectively managing change will include sharing stories about successful deployment of agile projects within the organization. Educate key stakeholders on the advantages of agile before you launch major initiatives. Engage experts who can conduct workshops that will help raise awareness and create agile methodology evangelists throughout the enterprise.
ISG helps companies design the organizational structure and attitude to increase their agility. Contact me to discuss further.About the author
Ankur Bansal brings considerable experience in Sourcing Advisory, IT Strategy and program management. He has 16 years of experience and has served clients in Financial Services, Retail and Telecom verticals. His international experience includes stints in United States, Japan, Belgium, Singapore, South Africa and Thailand.