No doubt, agile working is in vogue. However, many agile transformation projects have not turned out to be success stories. In my view, false expectations of what the agile working model can achieve or an unsuitable framework frequently are the reasons for the failure of such change projects.
Here are some observations I made in the past, where and when agile working is NOT the solution to go for:
- Decisions should largely be the responsibility of the management team; employees are seen by management first and foremost as an operational or implementing unit.
- The company is familiar with what customers want; it does not have to be verified.
- Value creation processes are subject to only few changes, new processes are introduced rarely.
- Roles and responsibilities are clearly defined for each employee, and there are complementing individual targets.
- Cooperation between team members is not required at all for value creation, or only to a minor extent.
- The majority of the employees wants to work on an independent basis and would like to keep coordination with other team members to a minimum.
Of course, I have also seen successful transformations. Most of the time, the following accompanying circumstances were given beforehand:
- Customer needs and market conditions are subject to both strong and frequent shifts.
- The company's value creation processes are complex and require close cooperation of several employees with different professional backgrounds.
- The company is willing to discard individual target agreements.
- The company is willing to delegate decisions to those teams (i.e. employees) that have to bear the impact of their decisions and have the most extensive know-how for making such decisions.
- Employees want to take responsibility for a larger section of the value chain.
- Employees and managers promote transparency (as regards work done, errors made, company figures, etc.).
- Managers see themselves as servants, mentors and coaches for their employees.
- The company’s purpose and goals are known to all employees and managers.
It is fairly obvious that larger companies with overall more rigid processes than you may find in smaller companies have a harder time implementing a successful agile transformation. In addition, value creation in larger companies is often distributed among many teams, each of which is responsible for 'only' one step in the value creation chain. If individual teams switch to agile working in such settings, this way of working can hardly unfold its effect. Here, transformation should be understood rather as a new organizational architecture, as I described in one of my recent newsletters on circular organization (see my comments on further reading below).
In smaller companies or relatively independent divisions within larger corporate groups, a shift to an agile way of working can lead to a positive effect more easily, as the workforce is already more involved in decision-making processes, works closer to customers, and feels more responsible for the company's success.
Here is how you can tell – in my view – that agile transformation has succeeded (a slightly different definition of agile):
- Value is created by self-organized cross-functional teams.
- These teams always align their work to the needs of customers which they ensure through regular customer contact.
- They maintain effective and regular communication among them.
- They work at a steady pace over a longer period of time.
- They have a sound balance as regards the work load of their team members.
- They regularly reflect on their collaboration and continuously improve their processes.
This text first appeared in my newsletter 'Innovation on Wednesday'. It is published every other Wednesday. For subscription click here