Why so many Agilists are grumpy

an economic model about stagnant change

For some years now many of us have the impression that in a lot of organizations an Agile transition is lingering. Last October Barry Overeem organized a discussion with Dave West from scrum.org about his blog "Has Agile Stalled ". In that discussion Dave rightly posed the question why is it that Lean is very successful in e.g. manufacturing industry and why is Agile much less accepted in the service sector? After 20 years of working intensively on developing Agile approaches for organizations, success is still limited. Some think that Agile is past its prime. What changed since Agile is the rigid and linear approach to project management. However, executive support for Agile approaches is still very moderate, causing Agile to stall. This makes some people rather grumpy. I think I have an idea to chew on.

Both Lean and Agile are focusing on delivering value for customers, eliminating waste, and supporting a culture of feedback and improvement. (I know, this is too simple, there is much more to it). Both are focusing on "products" and both are rooted in economic frameworks that consider cost, value, risk and customer value. Decisions made throughout the time of solution will determine the outcome. For example, a software development process with a lot of handovers and no regular end-user feedback, will be unnecessary expensive and will not have the intended quality. Agile approaches to software development address this cost and quality issue.

But there is a significant distinction between two types of "products". That distinction is characterized by the type of information between producer and customer. This can be symmetric, both have access to the same information; or asymmetric, the customer does not have the same information as the producer. When I go to the hairdresser, take a seat in front of a mirror and the barber is cutting my hair, the barber and I have the same information on effort, use of material and result. I can compare his effort, price, and result with other barbers. But when my car has a defect, I just must trust the mechanic. The information between me and the mechanic is asymmetric. In economic models this is called "Credence goods". The customer does not have the same information the producer has. Research indicates major market failures when it comes to credence goods, leading to all kind of inefficiencies, such as under- and overtreatment.

Lean is mainly focused at producing goods where the producer and the customer have symmetric information. Customers can judge the quality and compare prices. Lean principles can help producers to be more efficient and get an advance over competitors. Agile usually targets complex working environments, i.e. environments that have a certain level of unpredictability and typically produce credence goods like software. Agile approaches like Scrum all claim increased effectiveness. But customers have no way to check that. They can only indicate whether they are satisfied with the solution or not. But did they pay too much? Or maybe there are better solutions? This touches on one of the main principles of Agile: Trust! The customer must trust the producer's transparency.

To compensate for the asymmetric information position between customer and producer, a system of command-and-control has been designed. The main task of various management layers in organizations producing credence goods, is to give executives and customers the impression that the solution is effective and produced efficiently. This causes exactly what Dave West said in his blog post:

• Teams, the people who create the solution, and the customer are at a distance from each other, separated by management, and therefore not aligned:
• Half-heartedly support from executives: on one hand executives sponsor Agile but the teams are not trusted enough to eliminate a part of the command-and-control management layers;
• A career in management is still more beneficial than working as a professional. Both in income and status. An intermediate role between professionals and executives to address the asymmetric information position, is still considered crucial.

One of the irritations people have towards Agile is that is seems to slip into bureaucratic processes with lots of meetings and control mechanisms. This is not some kind of strange fiction, it really happens. Solving the problem of the asymmetric information position is not easy. Despite the high expectations, it seems that Agile is not able to deliver the same as Lean. Not there is anything wrong with Agile but sometimes Agile looks like the pacemaker on the wrong party.