More and more companies around the world swear by the value of agile methodology to stimulate change in organisations. Take these four steps to make sure you don't fall into the most common traps, writes Jo Winding Harbitz.
Agile transformation, or agile change, is among the management concepts that have gained widespread traction in recent years. PA Consulting's new report "The Evolution of the Agile Organisation" describes how organisations can succeed in securing competitive advantage through organisational agility. Here are the steps that will help you succeed.
For successful agile transformations, a common position must be established that it is safe to take interpersonal risk in a group. This means that a culture must be created where allowing questions, admitting mistakes, exploring new ideas and challenging the status quo is allowed. In other words, psychological security must be the foundation of the organisation. PA's experience is that if organisations fail to establish such a culture, there is a risk that agile initiatives will just end up as theoretical tools.
So how can you create psychological security? Managers must show the direction they want to go and make space for it on the road to the goal, rather than imposing performance management through strict control regimes. In addition, leaders must "walk the talk" by showing courage and openness. Creating psychological security takes time. It requires great effort and will from everyone involved. When you succeed, however, the reward is a cultural change and an essential basis for the organisation’s further success.
In a world of continuous change in customer needs, rapid technological shifts and increased CSR requirements, organisations need to become more agile in developing products with the end-user at the centre.
On the other hand, many organisations that use agile management principles have unresolved potential. Several claim that they operate them smoothly but use only some agile tools and concepts. Unfortunately, they continue to operate in the same way as they did before. In order for an organisation to be agile, all the core principles, processes and standards must be the basis of what everyone in the organisation does. It is important that these are undisputed, so that there are no limits on the agility of the organisation.
In order for digital transformations to succeed, it is important not to jump straight to the solution, but rather to spend time mapping and really understanding the customer's needs. This will provide a basis for designing good customer-centered services and tools that users both need and want to use.
Combining agile and design-oriented methods is very effective because they complement and strengthen each other. The two methods have a lot in common in that both focus on what the customer's needs are. While agile has good processes for delivering to meet customer needs, design thinking is useful for understanding those customer needs. In many companies, agile initiatives end up only being applied to the ICT department and product owners in the business.
In our experience, design methods contribute to organisational agility when they are implemented throughout the organisation and support the company's journey to digital transformation.
In change processes, it is necessary to give decision-making responsibility to those who are close to the customer and who know their needs and challenges best. It is the top managers who ensure that those who work closely with customers have the best possible environment to do their job. With increased decision-making responsibility among these employees, they will be empowered to understand the challenge – and not just to come up with solutions. This will give you an agile organisation that can create value.
The last point is perhaps the most important one. An agile transformation must be solidly rooted throughout the organisation. There is a common perception among many that this embedding must start with senior management.
We agree that the ideal scenario for a smooth transformation is one where everyone, including senior management, is on board from the start. However, this is rarely the case. There is no need to wait for the go-ahead from senior management, but there is scope for middle managers to inspire and start their own initiatives in their areas. When management sees that something is working and is producing good results, they will listen and follow suit.