Agile frameworks (e.g. Scrum, Kanban, XP), individuals’ roles & responsibilities, processes & tools, metrics & reporting, burn-up charts, estimation techniques, backlog prioritization, agile engineering practices, agile maturity models etc. – all of them are important attributes of a typical agile transformation. However, NONE of them are first-degree-of-importance system variables that are responsible for transformation success. Most of them, are good superficial lagging indicators of agility but they are all corollary (secondary or tertiary) to another much more important system variable.
What is the most important system variable that defines a company’s agility? It is Organizational Design – the most critical element of organizational ecosystem that defines most of its dynamics.
When organizational leadership decides to take an organization through an agile transformation journey (it could take years, sometimes), it [leadership] needs to acknowledge that real, sustainable agile changes are only possible if deep, systemic organizational improvements are being made. For that, leadership needs to be prepared to provide to its organization much more than just support in spirit, accompanied by organizational messages of encouragement and statements of vision. Leadership must be prepared to intimately engage with the rest of an organization, by doing a lot of real “gemba” (genchi genbutsu (現地現物)) and change/challenge things that for decades, and sometimes for centuries, have been treated as de-facto.
What does it really mean for leadership to engage at System Level? First, it is important to identify what a system is: what are a system’s outer boundaries? For example, one of the most commonly seen mistakes that companies make when they decide on “scope of agile transformation” is limiting its efforts to a stand-alone organizational vertical, e.g. Technology – and just focusing there. Although this could bring a lot of local (to IT) success, it may also create unforeseen and undesirable friction between the part of an organization that has decided to change (IT, in this case) and parts of an organization that decided to remain ‘as is’ (e.g. Operations, Marketing, HR, vendor management). For example, if Scrum teams successfully adopt CI/CD, TDD or other effective engineering practices that enable them deliver PSPI (potentially shippable product increment) at the end of every sprint, but business is not able to keep up with consumption of deliverable (too many approvals, sign offs, hand-overs red tape) then the whole purpose of delivering early and often gets defeated. Then, instead of delivering to customers soon, in exchange for timely feedback, teams end up delivering in large batches and too far apart on a time scale.
A successful Agile Leader must treat an organization, that he wants to transform, as a sushi roll. Just like seaweed alone does not provide a full spectrum of flavors and does not represent a complete, tasty meal, one single department (e.g. IT) is not sufficient enough to participate in agile transformation efforts. Other organizational layers need to be included as well in a transformation journey. On-point!: a slice does not have be too thick. In fact, if organizational slice is too thick, it might be too big to “swallow and digest”. But still, even when sliced thinly, an organization must include enough layers that constitute a complete ‘sushi meal’.
Note: A great example of treating an organization as a sushi role, while making it more agile, is Large Scale Scrum (LeSS) adoption.
So, what are some key focus areas that every Agile Leader must keep in mind, while setting an organization on agile transformation course?
- Location strategies. Geographic locations.
- HR policies (e.g. career growth opportunities, compensation, promotions)
- Budgeting & Finance
- Intra-departmental internal boundaries and spheres of influence
- Organizational Leadership Style
- And some other areas that historically have been considered as …untouchable…
All the above listed areas are defined by Organizational Design and can be better understood through self-assessment, done by organizational leaders at all levels.