If you follow the advice in this book, your organisation will be the better for it

— Dave Farley, author of Continuous Delivery

@sriramnarayanwww.agileorgdesign.com

Organizing for Business Agility

A curious case of too many late-

stage defects

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Desk-checks

3

“You mean they simply interrupt us

during the course of work?”

—Test Lead

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Barrier 1: Scripted collaboration

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“We have to log all defects into the

defect-tracking system”

— Test Lead

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Barrier 2: Doing Agile

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“We won’t get credit for it”

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Barrier 3: Narrow KPIs

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When a measure becomes a target, it ceases to be a

good measure.—Charles Goodhart, former advisor to the Bank of England and

Emeritus Professor at the London School of Economics

Targets turn informational metrics

into motivational metrics. Use with

caution.

Why do we encounter activity-

oriented KPIs?

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Barrier 4: Functional Org Structure

Some structures encourage process

and tools over individuals and

interactions

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Wait! Are we overdoing it? Motivated

people with a can-do attitude can

get past these non-issues.

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In general, systems influence

behavior more than individual

attitude. Therefore, the operating

model matters.

Non-conformance!

Tailorings and Deviations

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Barrier 5: Governance by excessive

process standardization

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“Could we at least go through the

end-to-end test scripts beforehand?”

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Barrier 6: Vendor KPI

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Why are vendor KPIs so narrowly

defined?

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Barrier 7: Activity-oriented

outsourcing

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These barriers represent the

organization’s “ways of working”. In

a big organization, they cannot

usually be overcome by team

members or even managers.

Courageous executives need to step

in and sponsor change.

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So much for barriers within IT

But there are other barriers on account of how

various upstream divisions are set up to work

with IT

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Business IT

WHY I.T. SHOULD NOT BE SET-UP AS A “DELIVERY” ORG

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More Work is Funded

Lots of Output

Not much business benefit

Business comes up with other

hopeful ideas

A POTENTIAL PROBLEM

ITBusiness

More Work is Funded

Lots of Output

Not much business benefit

Business comes up with other

hopeful ideas

Pressure to be

more efficient

Delivery-only

transformation

attempt

BEWARE OF DELIVERY-ONLY TRANSFORMATION

ITBusiness

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Engg.

IT

Product

Digital

Business

Platform

BUSINESS-IT MORPHS INTO COMMERCIAL-PLATFORM

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Business

Product

Digital

IT

CommercialBusiness

IT

Tech

Older generation business Digital Business

A REVISION OF THE OPERATING MODEL

The operating

model serves

as a bridge

between

strategy and

execution. It

has several

dimensions.

COMMON QUESTIONS

• Align teams along products or channels?

• Product-centric or customer-centric?

• What is the alternative to funding projects?

• How do we handle BAU work?

• How do we help our people take on new roles?

• Do developers/testers report to product owners, delivery

managers or people managers?

• How does business need to play along?

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ORGANIZING FOR BUSINESS AGILITY

Move away from projects (and programs)

Funding for pods and outcomes rather than for projects

More product people than delivery people

Durable org aligned with products/brands/LOBs and capabilities

Long-lived, outcome-oriented, cross-functional, think-build-run, cross-

channel teams (pods)

Accountable owner owners. Hierarchy of outcome-ownership. Decision

rights and input rights. (Cleararchy)

Revised metrics, targets, incentives

Revised tooling regime

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DESIGN

PRINCIPLES

Govern for value over predictability.

(Aim for soft predictability.)

Govern For Value Over Predictability

Value

Soft Hard

Pre

dic

tab

ility S

oft

Ha

rd

Usual Aim

Usual Result Better Aim

Not going to happen

For best results, let purpose inform structure.

When the purpose is responsiveness:

Organize for responsiveness over cost-

efficiency

Design for intrinsic motivation and unscripted

collaboration rather than extrinsic motivation and

scripted collaboration

Autonomy | Mastery | Purpose

WHO IS DOING THIS?

WHO IS DOING THIS?

Digital natives

Sections of enterprise IT, Digital at companies

facing disruption e.g. finserv, media, retail

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DON’T ASK FOR A BIG TRANSFORMATION BUDGET

A big transformation budget will need to be backed up

a big upfront transformation plan. That’s a waterfall

approach to Agile transformation

Think of an MVP for transformation

Committing to “feedback-based-planning” is a change

of mindset from committing to an upfront plan.

“IT-only” attempts lead to transformation fatigue

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Initial Design

First batch of

Pods

Second batch of

Pods

Third batch of Pods

The operating model evolves

as transformation unfolds

Initial Funding

INITIAL DESIGN

A. Business capability mapping to delineate products, channels and capabilities.

B. Outcome mapping to translate strategy to high-level outcomes and suboutcomes

C. Systems mapping to map the existing systems landscape onto the identified products,

channels and capabilities.

D. Review existing portfolio of work to assess alignment with new organization

E. Review metrics, targets, incentives for alignment with new setup

F. Review changes to reporting lines in order to ensure appropriate balance of authority

along dimensions of product, horizontal-concerns and people management.

G. Initial cut of long-lived, cross-functional pods with shared specialists where unavoidable

H. Identify communities of practice and community leads

I. Identify ready and potential candidates for product owners, capability owners and

channel leads

J. Work on internal messaging.

K. Identify pilot pods for rollout.44

THE TIME TO ACT IS NOW

Cannot wait for “proven case-studies in my

industry segment”

Needs courageous executives.

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THANK YOU

www.agileorgdesign.com