The hype cycle surrounding Agile is almost deafening, with exponents advocating the virtues of the movement that grew out of software development circles to fundamentally change how many products and services are developed today.
Its staunchest advocates create the impression that it’s something that can be applied with equal success to any organization. New research from INSEAD explores whether that’s really the case. The paper also outlines some of the key organizational characteristics that render them suited to Agile.
Modularity is key
For instance, the authors argue that business process modularity is a crucial element of success with Agile or when innovations are built from the bottom-up with the help of practical input and feedback from customers.
When services can effectively function without too many interdependencies it can be highly effective, but the same cannot be said about a more complex environment, such as in a bank. The authors cite the example of Dutch banking group ING, who managed to turn its multichannel service development processes into Agile, with each small team tasked with completing a clear outcome, such as the development of payment systems, with those teams fully responsible for the delivery of the project.
Agile also appears to work best for more developmental initiatives than routine day-to-day operations. It works best when change is a regular occurrence rather than something done sporadically.
The authors argue that any decision about whether to utilize Agile should be based upon a clear assessment of the innovation goals of the business and indeed the very nature of the business itself.
Outsourcing Agile
Of course, if you’re not ideally suited to Agile in your own organization, you can still garner some of the benefits by partnering with organizations that are better suited to it. The paper highlights the example of technology alliances and targeted acquisitions to help feed the innovation pipeline.
It’s also important to consider the longer-term requirements of the organization as in order to be effective, there will need to be a balance struck between new opportunities and the availability of talent to develop and exploit those opportunities. Ideally, these resources will be fully utilized without ever being spread too thin.
Similarly, if you have under-utilized talent, this can result in a lot of effort being spent with little really to show for it. Ultimately perhaps the most important lesson from the paper is that Agile should always be viewed as a means to an end rather than an end in itself. As such, it’s important to consider whether it’s really appropriate for your organization given its current and desired state.
