Why [Agile] Transformations Fail?

WARNING: This opinion piece can be considered provocative and trigger some people, but I honestly believe that we must face some uncomfortable truths to do better and be better, as individuals and as good corporate citizens.

Why do we keep hearing about failed enterprise-level Agile transformations?

A lot of articles and opinion pieces have been written about it, so what’s different about this one? This one might surprise you with a very simple explanation it offers, and that is - they fail because they are not executed in a true Agile spirit. In other words, Agile transformations fail because they are not done the Agile way.

One of the very premises of Lean-Agile mindset is that new products (and by extension, any transformative changes) should be delivered in an iterative way, with a consistent and continuous focus on delivering incremental value to the customer* and on continuous optimization of ways of working.

*Note: you can view the concept of "customer" as the ultimate beneficiary of that value, which could mean many different things in different contexts.

How do we ensure what we do / deliver is valuable to our customers? We ask them! Not once, at the very end, but right at the beginning as we create our to-do list (also known as product backlog). Because we have such a close relationship with our customers (and we are very intentional about it!), we follow their needs as they evolve and change, and prioritize our backlog based on what they place most value on in the moment. We then deliver small, value-add increments of product / service (what I call Minimum Valuable Increment], obtain our customer’s feedback on them, learn from it, improve and start working on the next one. We also make time to regularly reflect on how we can improve our ways of working to deliver value to the customer sooner, while keeping ourselves in an optimal state of flow.

OK, so now that we understand the key transformative elements of Agile ways of working (and thinking) versus traditional delivery approach, where the customer gets to see the final product only at the end, how does this apply to Agile transformations and their seemingly inevitable failure?

Enterprise transformations often follow a similar path / scenario. An organization identifies a need to change their ways of working in order to meet its newly defined strategic goals. They would hire an external consulting firm specializing in enterprise transformations to recommend a new operational model and create a transformation strategy. They then either hire temporary transformation implementation resources or create internal project teams (or both) to execute the strategy across the organization within a set timeframe (typically 1-2 years). At the end of this cycle, all the external resources leave, and project teams are repurposed for other projects or operational activities. Soon enough, though, many “transformed teams” would find themselves going back (at least partially) to their pre-transformation ways of working.

So what went wrong? Well, a few things, if you ask me, which I will explore with some thought-provoking questions below.

• Who is the ultimate transformation “customer” in this scenario? Those who initiate the transformation, or those whose ways of working we are looking to transform? If the "customer" is external to the organization, do they have a say in when and how the transformation is executed and whether its goals align with their priorities (or address their real pain points)?
• When transformation needs are identified, are they validated against the challenges teams working towards achieving organization's strategic objectives actually face, or are we mostly relying on consulting firms to tell us what our organization’s problems are (and how to solve them)? How do we ensure that those same consulting firms really tailor their recommendations to our organization's context, culture and strategy and truly act in the organization's best interest? You get where I’m going with it.
• “Know your customer (‘s needs)!”. In this case, knowing where your real pain points are, and how they impact your ability to meet your strategic goals (using verifiable data, of course), can take you on a very different path. Maybe all you really need to address your biggest challenge is to introduce distributed decision making in areas that are often "blocked"? Running a small experiment (spike / focus group), involving delivery teams in its design to encourage accountability, linking the expected benefits to strategic goals, anchoring it in clear effectiveness measures and a solid feedback mechanism, may take the organization one proven (!) step closer to meeting its goals. Needless to say, it will also cost the organization significantly less and will result in higher employee engagement and performance levels.
• Transformations are not once-and-done projects with predefined timelines, and they don’t have to necessarily result in reorganization. Transformation is a continuous process of change, and its effects must be carefully, intentionally and continuously preserved. Do we have clear measures to continuously track the effectiveness of the transformation on our ability to meet our strategic goals, and do we adjust them as we evolve our ways of working?
• Before changing ways of working, consider focusing on changing ways of thinking first. If a change in the way a team operates does not resonate with some / most of its members, it is highly unlikely this change will stick. Introducing new concepts iteratively and experimenting with them until teams experience their positive effects will ensure adoption is effective.
• Any change is difficult - for some more so than others, but difficult for all nonetheless. Recognizing it, showing empathy and compassion towards those who struggle during times of change, is crucial for maintaining an optimal environment for change. Change exhaustion is real and is very detrimental to any organization. That’s when you start losing people - some physically (attrition), some mentally (apathy or burnout), including your star performers. Reorganizations, albeit may well be necessary at times, is probably the most stressful type of change, not only for those directly impacted by them, but also for those who have been interacting with them. If this is something that has to be done as part of the transformation, organizations who value their employees' wellness should invest in continuous and pro-active change management support across all levels and equip their leadership teams with adequate coaching support, as employees will heavily rely on their leaders to guide and support them through challenging times.

Is there another way?

An alternative view of and approach to transformation is seeing it like a product / service delivered to the organization (i.e. all its employees and customers) as “the customer”. Applying Agile ways of thinking and working to this approach, the organization looking to transform would be focused on the following:

1. Achieving clarity and agreement across all its employees and customers on the need to change, anchoring it in data-based understanding of the real pain points and their impact on the organization's ability to achieve its goals.
2. Creating a backlog of “things to improve” based on feedback from its employees and customers (or their representatives/ delegates)
3. Prioritizing most impactful and valuable changes, implementing changes incrementally (emphasis on small increments), while continuously evaluating their effectiveness.
4. Refining the change implementation processes to increase their effectiveness, and monitoring their impact on the organization’s performance in terms of its effectiveness in meeting its strategic goals (using employee and customer surveys, for example).
5. Finally, to ensure these changes are truly embedded in the organization and become part of its culture, new behaviors and practices need to be reflected in the organization’s values, behavior competencies and performance evaluation frameworks applicable to all levels of employees (leadership and individual contributors alike).

If you have read thus far and think the above makes sense, here is my challenge to you. Next time you are thinking about making a major change in your life, whether at work or in your personal life, try to apply the Lean-Agile thinking outlined above (understand the real need, start small, get feedback, reflect, adjust and keep iterating), and see where it takes you.

As always, I welcome your thoughts and opinions on the above.

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