Scrum In Finance, How financial institutions can survive the post COVID financial crisis- By Abdallah Abu Sheikh
Agility in Finance,
Given the instability we are living today, along with the challenges capital markets are facing, a huge shift in market dynamics is to be expected for the years to come. Investor appetite will change, conventional cash pools will dry up and with it a whole new market order will take president.
In such times conventional methods will not work and will not deliver the results they had in conventional times. There is no handbook for such situation and thus no rules. This is a time where adaptability will beat discipline and institutions, individuals, products and economies that are not agile enough to adapt will soon be left out.
The following is part of a research paper I am developing with some of the industry experts on finance and investments. It basically covers how using the scrum methodology mainly originating from the Toyota production system and then redefined and applied with enormous success into IT and software development.
Below are major takeaways from my paper on how scrum and agility can be applied in finance.
- Decision taking speed . Agility is at the heart of any scrum team Scrum teams are naturally small, cross functional and marked by very intimate communication style. Financial institutions should allow the same flow to happen by decreasing team sizes, increasing communication and allowing decision making power to shift down the corporate pyramid. Maintaining this functional pace might sometime institute a need of restructuring the decision making hierarchy and allowing for a more flat organizational structure.
- Single sourcing truth. A major part of the team being cross functional is for everyone to be able to cross plug into any task on the production line at any time, which means that everyone should be kept on the same level of task specific knowledge. That forces the institution to have a single source for data that democratized and open for everyone” Having a single source of truth to plan technology investments eliminates debates over competing data sets. This also will ultimately create a higher sense of responsibility in the team allowing people more ownership to tasks and deliveries.
- White label. An Important fact of scrum is that the biggest crime is waste. Waste in time, waste in effort or waste in productivity, any kind of waste ultimately leads to all kinds of financial and operational losses due to the opportunity cost attached. In order for you to avoid waste in time most of your projects building blocks should be white-labeled and templated so that they can be treated as reusable assets on future investments and projects eliminating redundancies and duplicate efforts.
- Keep it simple stupid . Sophistication and agility are arch enemies The more people you have working on a project the more likely it will become subject to complications and more prone to error . The decision should be made by the least number of people capable of making the decision and based completely on merit. Study all means of possible of dissolving decision making processes and building set standards of approval to allow decisions to be made further down in the organization.
- Come to full stop. Being Agile means perfecting the process before perfecting the product, when an issue occurs in the process al other activities should stop everything else and focus on solving the problem, while it might sound more hurdling on the long term it will allow for a smoother operation with no stops as opposed to fallacies in the final product that will take 40-80% more time to fix than correct in the first place.
In summary
Companies and individuals that are agile to adapt to market situations in such unprecedented times have a great advantage over those who are stiff and cant adapt. While this situation is a threat to many it carries a promise and opportunity to many others and it all depends on how agile and ready you are to make the change
-AAS
22 April 2020