Today’s economic shifts favor teams using agile approaches
The incremental cost of the digital sale of a song, web-series, e-book, or software, is zero. Small teams can produce billion-dollar intellectual property with very little overhead or working capital. Similarly, most business improvement ideas in traditional businesses require effort but little capital. However, aligning a team to the market is not a simple exercise. Pulling the best work and ideas out of each of your team members is neither easy nor intuitive. It is not a matter of hiring ‘top talent’, rather, structuring the work and daily interactions to ensure each team member delivers their best contribution. Studying why agile software development teams beat waterfall approaches in terms of speed, cost, and quality, gives some insight into the elements that drive improved performance.
The Mass Manufacturing Paradigm
Mass Manufacturing represented a paradigm shift from small owner-operators with few to no staff to large organizations with potentially hundreds of people contributing labor to a single item produced. When Henry Ford put assembly workers on a line he produced cars more quickly, but he also completely changed how other companies approached manufacturing, design, quality, engineering, and management. Forward-looking business owners outside of the auto industry took note of Ford’s methods and recognized how they could apply standardized work to their industries. These leaders quickly outclassed their competitors on unit costs and product quality.
Mass Manufacturing Management
I believe Mass Manufacturing was fundamentally a management innovation. A production line aligns the efforts of a huge group of people, all with different micro-perspectives, skills, and duties. However, assembly lines are not the only way to achieve alignment, agile software development teams extract a lot more skills, creativity, and innovation.
Is agile the manufacturing revolution of 2017?
Adopting agile approaches allows skilled teams to out-compete completion on cost, quality and speed. If you aren’t the first to go agile then you might not survive long enough to catch up. Remember, there were many cobblers, blacksmiths, etc. who looked at Ford and said ‘that’s fine for cars but my business is fundamentally different so I don’t need to worry.’
Drawing a line between ‘agile’ and ‘Agile’
Like many other management strategies before it, ‘agile’ has spawned an offshoot consulting industry offering to sell the secrets of the ‘Agile’ method. Training consultants have difficulty selling general theory & principles so they opt for rigid processes and recipes they can spell out in jargon-filled workbooks.
‘Agile’ Jargon: Acceptance test-driven development (ATDD), Backlogs (Product and Sprint), Behavior-driven development (BDD), Business analyst designer method (BADM), Continuous integration (CI), Domain-driven design (DDD) …
Here is the lower-case agile manifesto, agile approaches started life jargon-free:
· Individuals and Interactions over Processes and Tools
· Working Software over Comprehensive Documentation
· Customer Collaboration over Contract Negotiation, and
· Responding to Change over Following a Plan
The manifesto is a little abstract and software focused, here is my view of agile:
· Work with customers to prioritize and translate needs into SPECIFIC deliverables
· Team members volunteer to own individual deliverables creating COMMITMENT
· Publicly post individual deadlines to create ACCOUNTABILITY
Let’s look at what happens when you remove Specificity, Commitment or Accountability
S x C x (0)A = Agree on what & who BUT without Accountability deadlines slip
S x A x (0)C = Defined plan BUT without Commitment there is no ownership
C x A x (0)S = Who & when BUT the Specific work doesn’t meet the project’s needs
DNA for all recent management movements
This formula, Performance = SPECIFICITY x COMMITMENT x ACCOUNTABILITY, is actually embedded in a lot of other management movements. For example:
Case example: A consulting practice applying this abstract ‘agile’ formula around the world – Partners in Performance
Partners in Performance (PIP) is a consulting company that uses team alignment tools to improve their client’s operations. Its founder, Skipp Williamson is world leading expert Organisational Behaviour and is laser focused on extracting performance out of teams.
PIP does not do anything branded ‘Agile’ where the buzz words are more important than the delivery of results day in and day out. But they do rescue a lot of Agile projects and bring a performance edge to them. The key in everything they do, operations, sales, capital projects, etc. is helping teams focus intensely on Specificity x Commitment x Accountability.
PIP has delivered $10bn in EBIT uplift, and $40bn of capital reductions over the last 4 years. (results)
Some quick highlights from their founder’s individual work
– US$300m per year EBITDA uplift for a global nickel producer, US$100m per year improvement for a major back-office processing company across 20 countries in 15 months, US$20bn in capital design improvements, … 100m annual improvement… 100m cost reduction… 75m cost saving…
Partners in Performance publishes a lot of very insightful material on how they deliver these incredible results. Essentially every engagement comes down to creating Specificity x Commitment x Accountability in critical client roles.
I used SxCxA to lead teams to deliver hugely profitable projects across legal teams, maintenance operations, procurement and chemical systems control. This formula helped extract great ideas and efforts from experts because they gained personal satisfaction from their ownership stake. I am a huge believer because I have witnessed the compelling results and happy team members who are reinvigorated and invested in their organization’s success.
Marketplace solution designed to encourage projects to follow the formula Specificity x Commitment x Accountability
Golio, www.golio.io, was designed to create a virtuous cycle where people following the agile work philosophy quickly advance to the top of the rankings. This platform connects task or story-driven project management to individuals’ public profiles and layers in a feedback system.
Individuals all self-optimize, this is human nature. Good incentive systems are designed so individual goals and overall goals are aligned, i.e. we bonus sales people on sales numbers and everyone wins. The system was designed so that through self-optimizing the overall project performance will improve. Golio is designed to
– reward leaders for creating Specificity through feedback scores
– contributors volunteer to complete tasks creating Commitment
– public deadlines & deliverables generate Accountability for leaders and teams
Mass manufacturing started by putting a few people in a line which aligned everyone around a common goal. Today, teams applying agile approaches align their efforts to develop new solutions to open-ended problems. This alignment is driven by Specificity, Commitment, and Accountability rather than using a paced moving assembly line.
If you look around and you cannot put your hands on specific deliverables, if individuals are not committed to finding solutions, and there are no public highly-visible deadlines then there is definitely room for your team to improve. Someone following SxCxA may already be competing with you and beating you on quality, cost and speed.