A targeted approach, sequenced implementation and investment in culture are keys to a successful agile organizational transformation.
Agile delivery models are a hot topic in organizational design circles. Organizations everywhere are implementing agile capabilities and structures at pace – and for good reason. Done right, the results can be startling: more innovative solutions, brought faster to market, with lower development costs and with stronger team engagement.
However, many organizations experience challenges in implementing them. The learning curve is long and steep, often involving both foreseen and unforeseen disruption to the business.
Some organizations have even begun to implement wholly-agile organizational models. However, these all-agile models are rarely right for most workforces, and a more targeted approach tends to yield better business results for the majority.
Fast-followers have a lot to learn from the successes and failures of the early-adopters. Organizations that derive the most value from implementing agile organizations are clear about what outcomes they want from an agile delivery model. They understand what they really want to achieve, as well as which parts of their organizations they want to set up in an agile way, and in which order. For the best chance of success, they adopt a multi-speed approach – one that implements and integrates new agile delivery models alongside traditionally-organized business units.
Implementing agile organizational structures also means developing the right skills, cultures and behaviors, supported by strong leadership for the change. In a world where culture consistently trumps strategy, building the right culture will make all the difference to organizations in achieving their intended outcomes.
Agile organizational models address the need for speed
Winning organizations are applying agile organizational principles more broadly, so they can respond faster and more efficiently to market dynamics.
Agile meets modern organizations’ need for flexibility and speed. Innovative products and services are coming to market much faster and being adopted by customers much more quickly. Disruptors are entering markets at pace, with new categories of products that take radically different approaches to meeting user needs. Whole industries are transforming in their wake.
This transformation is powered by agile development. First evolved and perfected to support software development, agile principles focus organizations on meeting customer needs, forming multifunctional teams with delegated autonomy, prioritizing work, creating minimum viable solutions and learning to fail fast.
Many organizations have sought to exploit the potential benefits of the agile development methodology by applying it to organizational problems and their related organizational functions. By taking on the principles of agile organization, they become more flexible and focus energy more quickly on effective innovation, ultimately responding faster and more efficiently to customer demand.
Why agile organizational design is challenging to implement
The template for agile organization design seems simple. In fact, the internet is full of examples. However, these models are difficult to roll out at scale across established organizations. They represent a fundamentally different way of organizing work, people and careers. They, therefore, require a different model of leadership and a different culture that fosters ownership, empowerment and customer-centricity.
Existing workers will struggle to work in this new way. And for organizational leaders, a traditional transformation and management approach is ill-suited.