It’s a challenging environment for businesses. Markets are becoming increasingly saturated, as advancements in technology and globalisation continue to reduce the importance of economies of scale and lower barriers to entry. For many industries, competition is at an all-time high and customer power is on the rise, as consumers have access to more substitute products and services than ever before. The upshot is that customers increasingly expect companies to do more to win their loyalty, their needs are becoming more complex and changing at an unprecedented rate.
To thrive in today’s fast-moving markets, organisations need to be more nimble, customer centric and possess strategic agility – the ability to swiftly adapt the enterprise business strategy to meet and take advantage of changing customer needs and market trends.
Why do organisations fall short of their strategic goals?
As organisations grow, it becomes increasingly difficult to maintain strategic agility and execute a successful business strategy. This is because large organisations are often burdened with legacy systems, red tape and complex structures, making it difficult to quickly mobilise resources and teams to take advantage of changing market trends. As a result, after strong initial growth, many large organisations find themselves in a period of stagnation, struggling to maintain market share, as smaller, more nimble competitors beat them to the punch in driving innovation. So what’s the key to reversing this trend? Often the answer lies in decentralisation, empowerment and fostering a culture of trust and continuous improvement within the organisation.
Why is Scaled Agile beneficial?
This is where Scaled Agile comes in to its own. Through re-organising around value streams, implementing design thinking and DevOps practises to build robust continuous delivery pipelines and empowering those closest to the customer (Agile teams) to make tactical decisions on behalf of senior management, organisations are able to re-capture their strategic agility, by embedding customer-centric thinking and enabling continuous value delivery.
Adopting a Scaled Agile approach often acts as an enabler for the successful execution of an organisation’s strategy, but if it isn’t implemented carefully, it can hinder the organisation’s competitiveness. One challenge organisations often face is how to effectively distil the business strategy through the agile release trains (ART – a team of Agile teams) and ensure harmony between strategic and tactical decision making. To overcome this hurdle, senior leaders should focus their efforts on these three elements:
- Breaking down the business strategy: to ensure the business strategy is effectively distilled through the organisation and drives tactical decision making, you can’t just produce a strategy statement and hope everything falls into line. The business strategy needs to be broken down into digestible chunks, which you can do by using strategic themes. These themes comprise different business objectives which reflect the strategic intent of the organisation. Essentially, they act as the bridge between the business strategy and the enterprise portfolio of projects and programmes. Ensuring each initiative on your portfolio roadmap is aligned to one of your key strategic themes means you can be confident of the link between your transformation initiatives and the enterprise business strategy. Any further breakdown of these initiatives into more detailed requirements, right down to the user-story level, should be vertically traceable back to the strategic themes – this is evidence of a strong link between strategic and tactical decision making.
- Implement demand management practices: more often than not, organisations have an infinite number of initiatives they could pursue, but only finite resources. How can you ensure you prioritise the right initiatives? And utilise the resources in the most efficient way to achieve your strategic objectives? The answer lies in establishing rigorous demand management practices. Using tools such as the lean business canvas and lean business case helps organisations assess the merits of each proposal or initiative against a wide variety of criteria, including the proposal’s alignment to the strategic themes of the organisation. This ensures the enterprise portfolio is optimally configured to achieve the strategic aims of the business. It also helps ensure continuity between the wider business strategy and the ART, by making sure each initiative (or ‘epic’) fed into the ART’s backlog, has clear traceability to the organisation’s strategic themes.
- Constant communication: one of the most overlooked methods for distilling the business strategy through the ART, is constant communication. Senior leaders should share their latest thinking and the business vision with the ART as much as possible. A prime opportunity is the program increment (PI) planning event, a two-day planning event involving the entire ART, where the delivery objectives of the ART and each agile team are agreed ahead of the next PI. At the start of each PI planning event, a good chunk of time should be dedicated to walking through the business vision. Crucially, senior management should highlight any significant changes they have observed in the business environment over the course of the last PI and how this has impacted the organisations strategic direction. This ensures everyone in the ART is on the same page and provides individuals with the strategic context they need to make good tactical decisions.
Although most organisations will be excited about the prospect of a scaled agile transformation, the sheer size of this change and the commitment to successfully land it can’t be underestimated. Any enterprise-wide transformation is challenging and senior leaders have to be prepared for ‘change fatigue’ – once the buzz of excitement around the initiative has faded and the hard work that needs to be put in becomes apparent, people can become a bit jaded. This is particularly relevant where organisations have struggled to implement agile in the past.
It’s critical to maintain momentum and energy through this phase to be able to lock in early changes and establish a continuous improvement culture. To keep your transformation moving forwards, senior leaders need to remember three things – the first is to identify and promote quick wins to celebrate success and show it works. Secondly, keep the benefits and the messaging simple and communicate them regularly so people are clear on the direction they are heading towards and aren’t overwhelmed by the change. Most importantly, keep a core team energised so they can project that energy through the change and keep it moving when the wider team is flagging.
Times have changed, traditional hierarchical structures and methods of delivering change are outdated and too ridged to enable organisations to transform and innovate at the pace they need to. Adopting a Scaled Agile approach can help organisations re-capture their entrepreneurial spirit by breaking down functional barriers and shifting the focus of the organisation back onto what’s important – the customer. Transitioning to this approach is challenging – it requires a change in process, structure and mindset. But once fully embraced, the results can be incredible.
Helping companies execute their business strategy through embedding agile practises is one of our core capabilities. Get in touch if you would like to learn more about implementing or optimising your organisation’s agile delivery framework, [email protected]