Or “trademarks.” See Michael Bazigos, Aaron De Smet, and Chris Gagnon, “Why agility pays,” McKinsey Quarterly, December 2015. Whereas most traditional companies struggle to meet their targets (falling below the 100 percent rate), all agile companies in our sample, bar one, surpassed their targets: rates ranged from 90 percent Overall, our research indicates that agile transformation can reduce time to market by at least 40 percent. Wouter Aghina is a partner in McKinsey’s Amsterdam office; Christopher Handscomb is a partner in the London office, where Jesper Ludolph is an associate partner; Daniel Rona is a partner in the Budapest office; and Dave West is the CEO and product owner of Scrum.org. The third focuses on developing technology systems (such as better mobile-checkout apps) to improve the processes that will support customer experience teams. Companies often struggle to know which functions should be reorganized into multidisciplinary agile teams and which should not. The goal is to ensure that managers responsible for specific parts of the P&L understand how cross-functional teams will influence their results. Alternatively, functions might have little formal engagement with the teams after collaborating with them to establish certain boundaries. But many large companies, no matter how fast they can code programs, can deploy software only a few times a day or a week; that’s how their architecture works. Operational-performance metrics vary by sector. 1 Michael Bazigos, Aaron De Smet, and Chris Gagnon, “Why agility pays,” McKinsey Quarterly, December 2015. But different business areas required different approaches, and Bosch’s first attempt to implement what it called a “dual organization”—one in which hot new businesses were run with agile teams while traditional functions were left out of the action—compromised the goal of a holistic transformation. Functional priorities are necessarily more fully aligned with corporate strategies. As the pressures mount to find innovative ways to remain competitive in today’s rapidly changing environments, agility is no longer just desirable but becoming essential. 12. those considering an enterprise-wide agile transformation are questioning both the potential of such an undertaking and the outcomes they should seek. 8. For example, the redesign of an entire R&D department with 9,000 employees, the complete redesign of an international bank’s operations in one country, and the overhaul of a national telco. 6. They intend to improve propulsion systems to launch rockets that can carry at least 100 people. It coordinates through daily team-of-teams stand-ups. Once the front end of the business was moving at speed, it was time for the back end to make the leap, so SAP shifted its group working on internal IT systems to agile. Understanding your company’s agile maturity today is an essential step in shaping your journey to enterprise agility. Either if these will be small adjustments or major shifts in direction, making them sooner rather than later will certainly give any business the competitive edge. At 7:30 AM each frontline agile team holds a 15-minute meeting to flag impediments, some of which cannot be resolved within that team. It’s also best to have a mix of teams in the pilot (eg. Truly agile organizations combine both: a strong backbone or center provides the stability for developing and scaling dynamic capabilities. So they typically launch an initial wave of agile teams, gather data on the value those teams create and the constraints they face, and then decide whether, when, and how to take the next step. Autonomy was embedded by creating small, cross-functional teams with full end-to-end accountability for specific missions and products. The management team decided to move aggressively. Tom Fleming, Jason Inacio, and David Pralong, “All in: From recovery to agility at Spark New Zealand,” June 2019. Jeff Sutherland is a cocreator of the scrum form of agile innovation and the CEO of Scrum Inc., a consulting and training firm. Agile teams are best suited to innovation—that is, the profitable application of creativity to improve products and services, processes, or business models. cookies, McKinsey_Website_Accessibility@mckinsey.com, When the customer experience starts at home, Linking employee engagement to customer satisfaction at Starwood, All in: From recovery to agility at Spark New Zealand, the limited number of enterprise-wide cases that are currently sufficiently mature, given the pioneering nature of such full-scale transformations, the lack of a single measure of impact—impact depends on industry, and measurements need to be taken across a combination of metrics, given the complexity of impact, the difficulty in tracing the impact of marginal output (for example, additional product features resulting from more agile development) on financial results. Using enterprise agility to meet rapidly changing customer needs can result, unsurprisingly, in a better customer journey. three years old. Senior leaders should be in charge of all strategic directions but not of everything having to do with the operational aspects – team leaders and department heads should tend to that. Scaling up shifts the mix of work so that the business is doing more innovation relative to routine operations. The scaling up also brings agile values and principles to business operations and support functions, even if many routine activities remain. “Strategy evolved from an annual project to a continuous process,” Hieronymi says. To create the ‘agile impact engine,’ we collected outcome data on 22 companies across six sectors that completed agile transformations at the business-unit or enterprise level (excluding organizations that implemented agility solely at the team or squad level or within just one function). An organization is part of a larger and more intricate system that has to move along with it. Run a pilot – Pilot your approach across a few teams or single business areas initially before a wider roll-out. Agile organizations can quickly redirect their people and priorities toward value-creating opportunities. As a result of the company’s new, agile setup, it could respond to its competitors’ new-product releases within one week, as opposed to several months: it cut time to market by as much as 70 percent.
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