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Where Can An Agile Transformation Lead Your Company?

Brady, CEO of Theorem & Managing Partner at Halmos Ventures, is a serial entrepreneur & technologist on a mission to transform innovation.

Agile software development has a long history with clearly defined best practices for continual, rapid product innovation. So why should agility get siloed in product development? 

The entire organization benefits when it operates in a state of resonant agility. Once the organization goes through an agile transformation, the agility is palpable throughout; it manifests itself through a cadence of operations centered on pace and flexibility, where decision-making is pushed to the edges for fast, low-friction forward action.

What Makes Agile Organizations More Competitive

Organizational and operational agility reflects the current pace of change in a digital world. The legacy way of business process optimization was to approach business processes as a machine: building them to complete complex tasks with machine-like consistency. These machines could execute the tasks they were designed to complete, but they don’t pivot well to changing circumstances. Today, organizations need to act more like organisms that respond organically to micro- and macro-events as new realities emerge.

Having this elasticity in their business model lets organizations adapt and scale faster than legacy practices allow. In an agile organization, leadership sets the strategy, but the decisions on executing that strategy are made by smaller business units. The people closest to the ground have the highest fidelity of information and understanding of the practical issues at play. Having decisions made at the lowest level possible allows for smart decisions to be made quickly.

Supply chain management, a growing concern across companies, provides a valuable example. In the old way of operating, senior managers decided where and when to move operations and manufacturing for the entire organization, which often resulted in blanket approaches to cost reduction through offshoring. This left product lines vulnerable to diminished quality control and an inability to respond to rising labor costs or shortages. 

In an agile organization, cross-functional teams centered on a single product line can make supply chain decisions that better meet the specific needs of that product line. Instead of a top-down, one-size-fits-all supply chain framework, the cross-functional, product-centered team has a highly adaptable, and thus more secure, supply chain.

How An Agile Organization Differs From Agile Development

The rituals of Agile development are largely procedural and tactical. In contrast, organizational agile transformation is driven by and reinforces cultural norms that make staying agile possible. A development lead can compel team members to participate in the process of daily scrums and weekly sprints. Agile development doesn’t address the task of building genuine collaboration or a culture of accountability.

In contrast, an agile transformation requires cultural support to move the organization into a state of resonant agility. The state, in turn, reinforces and strengthens norms of collaboration and accountability that an agile culture encourages. An agile culture takes a broader view, beyond providing a prescriptive process for building something specific. It pulls together stakeholders from multiple functional areas to tackle an issue through organic, collaborative analysis.

Five Dimensions Of Resonant Agility

When an organization has completed its agile transformation, its agility shows up in different ways across five critical dimensions.

1. People: The archetype of sought-after talent moves away from formal credentials or deep domain expertise, and instead is focused on entrepreneurial drive with strong competence around thinking and learning as the critical skills needed to excel in cross-functional collaboration. Leadership takes a servant model approach to enable and support teams; it doesn’t see its role as providing disciplinarian oversight. Middle management is minimized so decision-making can stay at the edge, where the people closest to the customers are.

2. Process: The cycle time for learning and decision-making moves fast. Instead of year-long pilots to test hypotheses, narrowly-focused ideas get executed and tested in weeks or months. The Agile development mentality of working in sprints is alive in the agile organization, which operates with a repeatable cadence of experimentation, learning, and verification.

3. Structure: Command and control hierarchies can’t adapt quickly. Agile organizations have a flatter org chart. Leadership sets strategy and targets. The teams and people closest to the customers and market have the responsibility to decide how to implement strategy and reach targets, with clear lines of accountability for meeting targets. 

Because they’re closer to the addressable market for each product line, they’re better positioned to understand the pain points of customer experience that often come from upstream decisions. Customer experience and product decisions shift downstream. Teams don’t operate in silos, but in a collaborative, transparent environment where ideas, resources and support are shared.

4. Strategy: Leadership clearly articulates strategy with guideposts for teams empowered to take action in a more flexible model around those clearly defined goals. There is greater lateral sharing of resources, including people, funds and ideas. With greater transparency among teams, everyone has a clearer understanding of how each team contributes to and is responsible for achieving organizational goals. The result is a cross-pollination and inter-team collaboration that enables organic action, fuels innovation, and requires less redundancy in resources and effort.

5. Technology: Next-generation technologies are purpose-built, not broad platforms that force conformity instead of innovation. There’s no one platform or suite of tools for an agile organization. Teams work with an organic tech stack that gives them the flexibility to use the best tool for the job, and everyone’s job is different. IT teams are transformed from enforcer to enabler. They help teams adopt tech faster with a focus on outcome optimization, without a single-minded focus on risk mitigation.

Agile Transformation Requires A Cultural Commitment

To achieve a true state of resonant agility, leadership needs to demonstrate a commitment to the cultural shift necessary to make an agile transformation successful. Operations and organizations built around agile principles push authority out as far as possible to the edge and with a broader sense of collective responsibility. That model won’t work without a strong cultural transformation motivating the potential that can be achieved by an agile transformation.

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