The term agility has been on everyone’s lips for a couple of years now and is associated with various aspects of work. “Agile leadership”, “agile organization” and “agile methods” are just a few examples. But if you take a second look at the conversations and discussions about agility and agile ways of working, you will quickly notice that most of the time there is only a very vague understanding of agility and the importance of the way it works. Workpath’s recent New Work survey (the evaluation will be published in Workpath Magazine shortly) also found that “agility” is THE buzzword in 2018. In order to benefit from agility and agile ways of working, however, it is precisely this understanding and the implementation of agile methods and processes that is extremely important. With this article we want to shed light on the topic and define agility as well as give tips on how agile work can be put into practice in your organization.
“The greatest danger in times of turbulence is not the turbulence, it is to act with yesterday’s logic” Peter F. Drucker
Agility is defined as a company’s ability to adapt to a constantly changing environment quickly and to grow with the change. This ability to adapt to today’s volatile and complex market can lead to great competitive advantages if you manage to react to changes in an adequate manner.
To successfully implement this, you need both a dynamic ability and a stable component within your company – a haven of peace, so to speak, or something to hold on to while the company is constantly changing. Often this stable component is the vision, the culture and core company values that are derived thereof. The dynamic ability is especially difficult for large, established companies, as they are often based on rigid management hierarchies, processes and structures.
Core elements of an agile network organization:
value creation centring, focus on individuals and interactions, continuous learning
Where does the term come from?
Agile working has its origins in software development. In 2001, a group called the “Agile Alliance” met in order to jointly define the essential principles for agility. These included representatives of Extreme Programming, SCRUM and DSDM. Their aim was to help companies to think about new, more flexible ways of working. This resulted in the “Agile Manifesto of Software Development”, which sees people as the most important resource. Above all, it focuses on values and culture and turns away from rigid process thinking.
But not only software companies can be agile. The elaborated twelve principles for agile work can also be interpreted more generally and can be adapted to almost any company.
On the whole, the point is that people and interactions are placed above processes and tools and that the product itself is more focused on without having to spend much time on detailed documentation. The focus is on creating added value for the customer. The primary goal is to satisfy the customer and to work with him ⎼ much more important than to negotiate long contracts with the customer first. This approach and way of thinking therefore is important in order to concentrate more on reacting adequately or quickly to the constantly changing environment instead of following rigid plans.
What are examples of agile methods?
An example of an agile method is Scrum. It is a framework for project and product management and comes from software engineering, but is also used in non-tech companies. Scrum helps to plan iteratively and incrementally, which contributes to the fact that initial ambiguities can be removed quickly on the basis of intermediate results and the plan can be continuously adapted and further developed. Detailed plans are only created for the next sprint (short interval). A Scrum team consists of six +/- three people and three roles: the Product Owner, the Scrum Master and the rest of the team developing the product. The Product Owner prioritizes business requirements and the Scrum Master is responsible for managing processes and removing obstacles.
Another method for more agile work is Open Fridays, where employees from all departments of the company meet voluntarily in a certain rhythm, for example every other Friday. Here, employees can suggest topics that they feel are important and would like to work on. Each participant writes his topic on a post-it, introduces it to his colleagues, so that teams can spontaneously form around selected topics. They then work on their topics for a fixed period of time in order to introduce them to the remaining colleagues at the end of the Open Fridays. Know-how is shared between people who normally don’t work together and problems that often don’t get any attention are solved. In addition to many new ideas that emerge, the cooperation within the company is also strengthened and silos are broken up.
Also the introduction and implementation of an agile target system, such as Objectives and Key Results (OKRs), support the incremental planning and control of the company and the target-oriented personnel management. In addition, transparency and communication are increased and the meaning of the work is clarified, since each employee has insight into the goals of each company level and sees what his or her work pays for and was involved in the goal itself.
But why does everyone want to work agile?
Among the many advantages that agile work brings with it, one should first mention a higher productivity due to more focused work. This increased focus is due to the fact that one improvement after the other is carried out iteratively and one can therefore concentrate on one task after the other. Resource allocations are better comprehensible due to increased transparency, cross-functional teams and more communication across departments and meet with more acceptance among employees. This creates a culture with more morality and togetherness, which makes it easier both to retain employees and to convince new or potential employees to join the company. In addition, by continuously adapting to the market instead of rigidly adhering to a direction of innovation, the company works more innovatively. In addition, employees are also given more responsibility in agile work. As a result, employees are more motivated in their day-to-day work.
So agile work has many advantages. Now the only question that arises is: why not every company already does it this way? The main reason for this is that many companies quickly encounter seemingly insurmountable hurdles on their way there.
Why do companies fail to work agile and what must be followed to prevent this from happening?
At the company level, there is often a lack of an agile target image. These include a clear, long-term vision that is not, like most visions, arbitrarily interchangeable – i.e. focuses generically on market leadership or sales figures – but one that relates specifically to the company and, for example, focuses on its own products or services. The entire company should work towards this vision and have the same understanding of it. Only in this way can a mission, a strategy and an operational roadmap be derived that point employees in the right direction.
This promotes self-organized teams that can make their own decisions – based on the vision – quickly and close to the customer. For this it is necessary that each individual process and task is critically scrutinized and contributes its own ideas, instead of only assuming an executive function. This is also referred to as “intrapreneurial thinking”. The most important value-adding activities and decisions in agile companies are always aligned with the customer and are not simply determined top-down according to the wishes of management. The key to team-based, decentralized network structures with personal responsibility is therefore customer proximity. In an agile working environment, teams are formed around the creation of value for the customer. This also ensures that all tasks create added value for the customer and that every employee has a direct influence on the goals and key figures.
The learning process is greater and a better product can be delivered to the customer if the teams have direct contact with it without the sales department acting as an intermediate instance, for example. In addition, long discussions across hierarchies are eliminated. In this way, silos within the company can be broken down and Taylorism, i.e. detailed prescribed processes with precise workflows, avoided.
Spotify, for example, has few to no centrally defined processes and standards. Work is carried out in groups of no more than eight people, the so-called “squads”, who decide and act completely autonomously, cross-functionally and self-organized. This means that teams at Spotify can work and react quickly and flexibly.
“Agile organizational cultures rely on frequent planning and feedback loops, crossfunctional transparency and autonomy for decentralized decision-making.” Johannes Müller, Workpath
How must the work culture change?
A stable culture is important for employees because it serves as a point of reference, but is often underestimated. It takes a long time to change and consolidate it. Culture must be used consciously. It is the key competence of a company and can create considerable competitive advantages.
An important aspect here is that agile work is not aimed at fine-tuning a product until it can be brought to market as a perfect product. Instead, products are introduced to the market and then constantly and iteratively aligned with customer needs. In such an environment, however, it is natural for mistakes to happen and for situations of failure to occur. In order for team members to have the courage to come up with new ideas, suggest improvements and make decisions, a culture of failure must be established. A “safe place” where one can develop freely and new ways of thinking are encouraged. The culture of failure says that it is part of making mistakes, because it is from them that the whole company can learn incredibly well. It is important that the mistakes and the conclusions drawn from them are shared and discussed. As soon as employees feel that failure is part of the process and is accepted, it leads them to leave their comfort zone and look outside the box.
A culture of trust is also very important. It is the basis for more freedom of decision in difficult and problematic situations and promotes rapid reaction to external and internal influences. Thus it forms the basis for self-organized teams. In this way, micromanagement, in which the manager constantly observes and controls his teams, can be avoided.
In general, this is nothing new. However, a culture of trust must be actively communicated and lived at all levels of the company.
How must the role of the manager change in order to successfully introduce agile working?
“Transformational leadership” is akey elementhere. According to a study by Kienbaum and StepStone, most employees want a transformational leader instead of a manager who only controls and delegates. In other words, a coach who acts as a role model, who is value-oriented, transparent and promotes independence. Managers should function like a mentor and transfer responsibility to the independently working employees, support them, promote them, help them with the further development and clarify the sense of the work to them.
Iterative processes instead of long-term plans
In order to be able to react quickly to external influences, the processes within the company must be designed iteratively. Nowadays, long-term plans no longer work. In addition, it is no longer possible to work on a product endlessly, to perfection, until it is finally launched on the market. This is due to the dynamics and complexity of the markets and the ever faster changing customer requirements. In addition, competition no longer emanates only from well-known and established market participants, but also from young companies and those from whom no competition was expected until recently. In June 2007, Microsoft boss Steve Ballmer was still convinced that the iPhone would not sell well. How wrong he was with it is at least now clear to everyone. Nevertheless, any company could have made this mistake. To avoid something like this, the management level, as well as all other employees, should always keep an eye on the competition and maintain their adaptability instead of stubbornly sticking to one direction.
The best way to set goals is to do it this way: Strategic goals are usually set by management levels, as they often have a better view of the big picture. Operationally, however, the bottom-up approach is the best way for workers to say how these goals can be achieved. All levels in the company should therefore work together.
How can I train self-organized employees and create networks between employees?
In order to support employees in their innovative work, it is helpful to train agile coaches or invite external coaches to support them in dealing with complex tasks. Workshops, e-learning and trainings with teams, i.e. formats to enable continuous learning, are also important. Another method is to involve the team members in the recruiting process of the HR department when a new employee is to be hired for the team. This makes it more likely that the team will work together faster and better and achieve the desired productivity. In employee development, a distinctive feedback culture is the be-all and end-all. The first step here is to help employees give and receive feedback better. A Quick Guide for successful feedback can be found here. Tools that serve as reminders as well as help to give successful feedback can be useful here. Workpath has a beta version for this, which is further developed in collaboration with the customers and ensures continuous development with 360° feedback.
At the process and operational level, companies often pay too little attention to team communication and communication across departments and teams. With simple methods and processes, this can be remedied. For example, the introduction of regular check-ins helps to increase the frequency and quality of communication, better link goals with tasks, and more openly share insights within the team. Retrospectives, which should take place at least once a quarter, also promote internal processes and help to adapt operations to the changing environment.
Finally, it’s also important to provide teams with common spaces in which people from different teams can exchange ideas. Joint events also promote cooperation and have greater effects than you can imagine.
To sum it up
Agility requires action and discipline ⎼ just like corporate success, it does not come by itself. There are many approaches to implement agile work. For example, internal coaches can be trained, external support can be brought in or new tools can be used that make structuring and organizing easier. Workpath has set itself the goal of shaping the working world of tomorrow and supporting companies in transforming themselves into an agile network organization and therefore offers a SaaS solution of the same name. It includes performance tools for OKRs, check-ins and feedback to establish and support common goals, continuous feedback, self-organization and focus.