A business
leader’s guide to agile
Agile
promises rapidly evolving software and substantial business benefits, but it
requires new habits from everyone: from IT and from business partners.
Agile development has largely
become synonymous with digitization: senior business leaders have realized that
their companies cannot take full advantage of digital tools and technologies
without having new, amped-up processes for managing them. The value of these processes
is immense.
Senior executives need only look at two recent examples
in the banking industry to understand what’s at stake: ING and
South Africa’s Standard Bank have
both incorporated digital technologies and agile ways of working into their
operations, and both are achieving positive results. ING is releasing software
features to its web and mobile sites every two or three weeks rather than five
or six times a year. As a result, the company’s customer-satisfaction scores
are up by multiple points. Standard Bank has improved the quality of its new
mobile applications by finding and fixing potential bugs earlier in the
software-development process—building more trust with employees and customers
in the process.
What may be less clear to senior executives is the role
they can play in jolting their own business units and IT organizations to break
from the status quo and realize similar advantages. “This was one of the
toughest challenges,” says Mike Murphy, CTO at Standard Bank. “A lot of
staffers at the bank were comfortable with the ways things were. They didn’t
want to change their daily routines. They were focused on simply getting the
job done.”
Senior executives often tend to assume that after they
set overarching digital goals, it’s up to IT to deliver on them quickly through
a range of initiatives. In their view, agility is something for R&D
engineers and software developers only. The business units hold fast to
tried-and-true methods for communicating with IT—throwing their requirements
“over the wall” and waiting for IT to build and deliver finished products. The
IT organization ends up operating with limited information from the business,
the business units lose their opportunity to steer technology development
toward desired goals, and agility stalls.
Agile
development cannot be a priority solely for the technology
organization. Senior business executives must include it on their agendas as
well, thereby signaling the importance of making the required technology and
cultural changes. The top team’s attention will make it clear that software
development is a joint process. It entails frequent interactions between
business and IT groups, and it requires widespread acceptance of a
test-and-learn approach.
Senior executives need to actively promote agile
concepts across business and technology teams and to link those concepts
directly to business-related outcomes. Because of the unique perspective the
CIO and other technology leaders have—with one foot in the C-suite and another
among the technology stacks—they can help senior executives establish six work
habits that promote joint ownership of the software-development process, daily
collaboration among business and IT stakeholders, and a culture of continuous
learning.
Creating agile habits
In discussions in the boardroom, on the shop floor, and
everywhere else, senior business and technology leaders should emphasize the
following six habits, which are critical for companies to realize the promise
of agile.
1. Put some skin in the game.
In an agile environment, some business-unit leaders will be tapped as product
owners—that is, the business-unit stakeholders most accountable for shaping the
products. These leaders must make the development and success of a product
their highest priority—and they must be given the leeway to do so. That might
mean shifting schedules and commitments so product owners can attend key agile
meetings: scrums, sprint reviews, and sprint planning sessions (see the sidebar
“Speaking agile”). Additionally, senior management may need to redeploy
resources so that business units can assign product owners to individual
agile-development initiatives.
Product owners not only set the aspirations and vision
for the product but also colead decision making about features and development
goals with colleagues in IT. They should be able to live in two worlds. They
must have some understanding of technology and the ways it is transforming their
industries. They must also have a strong sense of market needs and the product
features that would be most valuable to end users. (Typically, that’s not an
issue for most product owners who come from the business, because they interact
more frequently with end users than IT managers do.) Product owners can pair
this market knowledge with the engineers’ feedback on the technical feasibility
of specific product features to create a clear development plan.
2. Shape the product together.
Under traditional approaches to product development, IT leaders interview
business-unit leaders once to collect business requirements—for instance, what
novel features are required in the new software or applications being created,
and on which platforms will the new applications need to run? IT managers
capture these requirements in jargon-filled documents, and the next time they
reach out to the business unit, it’s with a mostly completed prototype in tow.
By contrast, agile product development is less about
taking orders and more about sharing information. The business and the IT
organization must codevelop
products every day, side by side, in an ongoing process. Senior
business leaders can establish this level of collaboration by investing in
tools to improve interactions—for example, visual aids instead of lists of
requirements.
At one company, a product owner from a business unit and
a technology leader used sketches to trade feedback on software under
development. IT professionals sketched a prototype that the product owner could
page through. The product owner could circle what he liked or draw alternative
versions of the elements he didn’t. The team refined the design together in a
way that everyone could understand and contribute to.
3. Cheer for your own team.
Leaders in the C-suite and the heads of business units have a critical role to
play as evangelists for the software products they codevelop: they must hold
product owners from the business units accountable for the successful rollout
of any new release and its effect on the business. They should encourage
product owners and IT engineers to educate their business colleagues about the
benefits of new software and reasons to adopt it. Agile teams can share
introductory videos at the launch of a product, demonstrate it at town-hall
meetings for employees, and listen to their colleagues’ frustrations with and
ideas about it. All the while, they should explain that this input is
valued—and demonstrate that it is by incorporating feedback into product
revisions. Such transparency, encouraged and modeled from the top down, can
produce a culture in which joint efforts at problem solving, rather than
complaints about IT, are the norm.
4. Think like a user.
Sometimes,
senior business leaders may very well be the users of the product they are
shaping—if it’s an executive dashboard, for instance. But usually they are not.
To help build software and products that transform the way a company operates
or appeal to customers, product owners from the business must be
unwaveringly committed to
users’ needs. Senior executives can encourage this kind of outlook
by asking targeted questions during product reviews. Who are the users? How are
they using the product? Do they primarily work in an office or remotely? What
are their biggest frustrations? Software-development teams should also think
through these questions as they design tools and experiences to ensure that
they are addressing the idiosyncrasies of end users.
5. Learn to live with ‘good enough.’
Senior executives are typically a risk-averse group. Traditional
product-development models emphasize multiple check-ins at various stages of
development—a time-intensive but comprehensive way to ensure that products
include all the desired features and don’t contain bugs and other flaws. By
contrast, agile development emphasizes a test-and-learn approach—for instance,
releasing a minimally viable product that delivers value to end users in the
short term but is expected to change on the fly.
In this case, chief information officers may need to
help senior business executives come to terms with the release of a good-enough
product by redefining their expectations
and thresholds for risk. A CIO could, for example, highlight
agile success stories—instances where a company released a good-enough product,
shifted strategy midstream in response to feedback, and ultimately delivered a
winning solution. In addition, the CIO can be open about accepting minimally
viable releases refined by IT line managers—prompting similar behavior across
the company. And at least initially, technology leaders could press for
time-to-market schedules that give the business units no option but to pursue
good-enough products.
The CIO should also help senior business leaders
understand that even under a good-enough approach, agile teams will not deliver
everything immediately. The process is actually more rigorous than most
executives can see. Agile teams must work exhaustively to collect feedback to
determine what’s working, what’s not, and how to make incremental improvements
that will enhance the product or the customer’s experiences with it. And they
must repeat this process over and over again.
6. Broaden the mandate.
As scrum teams
ramp up their performance and experience, they will inevitably bump up against
slower teams and processes elsewhere in the organization. These slower teams,
such as high-volume sales organizations, use more traditional, rigid work
processes. To maximize the impact of agile methods, senior leadership must
consider ways to transfer lessons from agile teams to different areas of the
company. Working with the CIO and other technology professionals, senior
business executives can identify the processes and products that are most
critical for delivering business value to customers and consider which agile
principles would help to speed things up.
Closing the gap
Agile requires a commitment of time and attention, which
can be jarring to business leaders already juggling many priorities. But with
some guidance from CIOs and other technology professionals in the IT
organization, senior business executives may gain a more digestible view of the
shift from traditional to agile development processes. Senior business leaders
will better understand the technical terms associated with agile, and can help
identify the technologies and skill sets required to operate successfully under
an agile model. Perhaps even more important, business executives can turn
anecdotal evidence into hard metrics reflecting the ways agile work flows
create positive business outcomes—for instance, a more engaging customer
experience, streamlined internal processes, and a thriving, collaborative
corporate culture.
There should be no order givers or takers, no “us versus
them” dynamic between the business units and the IT organization. There should
be just one team, building innovative software that transforms the work of those
who use it and enables ever-closer connections to customers and business
partners.
July
2017
By
Santiago Comella-Dorda, Krish Krishnakanthan, Jeff Maurone, and Gayatri Shenai
http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/a-business-leaders-guide-to-agile?cid=other-eml-alt-mip-mgi-oth-1707&hlkid=41ef23943cd14977946ab13afddd4f0f&hctky=1627601&hdpid=9cb55b21-424e-4b40-b351-372c0cbdef36
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