Agile Vs. Waterfall | Facts

Agile isn’t the new kid in the house anymore.

For most companies, an agile transformation still feels like a leap of faith. These transformations require companies to redesign organizational structures, alter operating models, build new capabilities, and change long-established ways of working. And the expectations are sky-high, agile promises to double speed to market, boost customer satisfaction and quality, increase efficiency, and reduce costs. 

Okay, you're probably tired hearing about this everyday, here i compile some real facts:  

A 55% Acceleration in Time to Market

A top-three North American financial institution compared speed of execution of agile projects and waterfall projects. The company first identified three phases that apply to both agile and waterfall projects: up-front preparation until start of development, development and testing, and the final integration testing and preparation for release and then compared each phase in the two project types. The agile projects achieved a 55% reduction in time to market, driven largely by decreases in the up-front preparation time (of 65%) and the development cycle time (60%). Final integration testing and preparation for release saw a 20% reduction because there were no late-stage issues and changes.

Threefold to Fourfold Increase in Speed to Revenue

A large global wealth and asset management company dramatically accelerated time to value when launching an innovative product in the market. In the past, product launches of similar size and complexity using traditional ways of working had taken 15 to 18 months. Using agile, the company was able to go from product idea to national launch in just five months. As one top executive said, “This speed to customer value is unheard of in our organization and in the industry. We beat our top competitors, and just imagine the P&L acceleration.”

Cost Decreases of 25%

A global financial services company investigated how agile affects efficiency as measured by project costs. First, the company analyzed drivers of project costs and found that the main driver was the number of departments involved, how many groups had to work together to achieve the objective. When compared with the company’s past waterfall projects, the agile pilots, which were organized around collaborative teams empowered to make independent decisions and move quickly, had led to cost savings, but the company wanted a more finely grained view. After curating waterfall project data, aligning and refining comparable dimensions, and adjusting for complexity, the company found that agile projects were lowering total project costs by as much as 25%.

A 50% Increase in Quality

A major North American financial institution used this method to analyze agile’s effect on the defect rate. Using a baseline of comparable projects, the company discovered that products created with waterfall had 65 defects of severity 1 or higher after release, but products created with agile had just 34. The company also found that 15% of defects in waterfall projects were the result of misunderstood requirements, compared with just 1% to 2% for agile projects.

Improved Predictability

A global media and entertainment company looked at the schedule slippage and budget overruns of both waterfall and agile teams. The average schedule slippage was 67% less for agile teams than for waterfall teams just over three months compared with almost nine and the agile teams consistently delivered at or under budget. By comparison, waterfall teams had an average budget overrun of 45%.

A 30% Boost in Employee Engagement

A major bank measured the improvement in employee engagement by anonymously polling teams, asking whether team members were “excited about the work” they were doing, rated on a scale from “strongly agree” to “strongly disagree.” Before the agile transformation, around 60% “strongly agreed,” but the scores increased to more than 90% after 14 weeks of working in an agile fashion. Interestingly, the results for agile projects fluctuated during that period. Scores were sky-high in the first four weeks but then dipped for several weeks to less than 50% (in other words, below the initial readings) as employees came to grips with the challenges inherent in new ways of working. Once employees got their feet beneath them and began to appreciate the benefits of agile, engagement levels shot back up, stabilizing at approximately 90%.

Change is hard at first, messy in the middle but gorgeous at the end.

Go Big or Go Home!