The Age of Agile: How Smart Companies Are Transforming the Way Work Gets Done

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Publisher: AMACOM
Published: 2/8/2018
Agile began emerging many decades ago, but truly took off in the software development industry. Sparking dramatic improvements in quality, innovation, and speed-to-market, the Agile movement is now spreading quickly throughout all kinds of companies. It enables a team, a unit, or an enterprise to nimbly adapt and upgrade products and services to meet rapidly changing technology and customer needs.

Book Summary - The Age of Agile: How Smart Companies are Transforming The Way Work Gets Done by Stephen Denning

Key Insights

Management expert Stephen Denning explains the origin of agile management practices, which came from developments in the organization of the U.S. Army in Iraq. Agile management was first adopted by the software industry, who were bogged down by the lack of flexibility in their management practices. In an uncertain and rapidly changing world, agile management leaves behind some of the core philosophies of traditional management to allow companies to move faster and focus on the future. Agile management allows a company to work more quickly and flexibly on short-term projects and focus on the customer.

Key Points

Agile management began its life during the War in Iraq.

In 2003, General Stanley McChrystal was struggling with a perplexing problem in Iraq. The U.S. Army was highly trained and had better equipment, but could not defeat insurgents on the ground. His task force was, by all measurable accounts, the best it could be. And yet, they were losing to poorly armed, poorly trained terrorist militias.

But McChrystal was an acclaimed commander, and he wouldn’t sit down and accept defeat. He began to realize that despite being well-trained, his task force was not flexible enough to defeat a highly adaptable insurgent network. The task force waited for word from their distant commander before acting and missed opportunities because commands weren’t coming from someone on the ground. It was impossible to communicate well with the FBI and NSA, and none of the task force teams were working collaboratively. He realized that to defeat the insurgents, he would need to adapt some of their methods.

McChrystal’s agile management method focused on creating small collaborative teams. Decisions were made based on competence, not rank - someone close to the action didn’t need to wait anymore to make an important call. He put TVs and electronic communication at the forefront and had daily briefings to keep teams up to date. His new strategy formed the foundation of agile management - rather than a hierarchy, McChrystal created a network.

The basic principle of agile management is flexibility.

Meanwhile, tech and software companies were struggling with outdated management strategies. Technology changed daily, sometimes hourly, but out-dated management kept companies from embracing growth and change. On top of that, there was little room for flexibility. Companies could be put out of business because of their inadequate response to the rapidly shifting market.

Software companies looking to agile management to solve their problems. They created a network of small teams to focus on limited-scope projects. This meant better communication, more flexibility, and more opportunities for success.

Traditional managers, however, often struggle to implement agile management principles. Three main principles make up the foundation of agile management - by following these “laws,” traditional managers can shift their practices toward flexibility and agility.

The first principle of the Agile Manifesto is the “Law of the Small Team.”

In agile management, the small team is king. Teams should consist of seven to twelve people, and be cross-functional. Each team member should bring unique skills and areas of expertise. These teams should have the autonomy to get work done in a way that works best for them. Once management has set a goal or assigned a task, the details are up to the team itself.

Working in small batches or cycles is another key feature of this principle. A team should be assigned a small project, and given full permission to work only on that project until its done. Focusing on multiple priorities can lead to hold-ups in the production line. Instead, the team should have a shared goal.

Communication is important within the team. Teams should hold daily meetings to report on progress and discuss challenges. Information within each team should also be publicly available, to reduce confusion and increase transparency.

At the end of each project, a team should have a customer and internal review to discuss strengths and weaknesses. Data should be collected, and teams should consider how to improve efficiency and better serve the customer for the next project.

The second principle is the “Law of the Customer.”

In the 1950s, businesses believed that their focus should be on making a profit. They were serving shareholders, not customers. But larger global markets and stiff competition mean that customers have more ability to choose the competitor. As such, they have to be the focus for a company to be successful.

The principles of customer-focused behavior include targeting a small audience. You can’t appeal to everyone - it makes more sense to find a target audience and please them. Experiment with new products to find the best possible options, and make sure the products you make are malleable so your customers can use them however they need.

Make sure your products are well-designed and simple. It’s okay to make changes but innovate in small steps to ensure customers aren’t overwhelmed by dramatic shifts.

Focus on the customer’s perspective. They want flexible, simple products they can tweak to their individual needs. Make sure you innovate often enough to keep your product on the cutting edge, unnecessary changes.

The third principle is the “Law of the Network.”

Obviously, your teams can’t exist in a vacuum. This is where networks come in. Like General McChrystal’s network of soldiers, your network will be large, adaptable, and consist of small collaborative units. This model is the most flexible, and the most agile.

But what does it mean to create a network? Basically, the small, collaborative teams you build will fit together, like gears. Though each gear operates independently, the combined work of all the gears keeps a machine running. Though these teams don’t necessarily work together daily, they all work toward the same goal. The role of management in this system is to make sure teams have the support they need, are collaborating with other teams as needed, and share a common purpose. Management will likely also take on the delegation of projects among teams.

As a manager, having a large network might seem impossible. It can be easy to think that hierarchies are the only way to control large companies. But companies like Spotfiy and Microsoft’s Development Division have huge teams that are run as networks. Even if you have 1,000 employees, you can operate an effective network as long as your teams are running smoothly.

How do you shift from top-down to network-style management? There are a few approaches. You can take the “big bang” approach and remove upper management. If you work for a marketing company, for instance, this might look like removing all departments and assigning everyone to a cross-functional pod. Your manager would no longer be your manager, and you would likely no longer work on the same accounts. That sudden change can lead to a lot of confusion among staff who are accustomed to a traditional hierarchy.

You can also take a bottom-up approach. That means creating teams at the lower level and only changing the management hierarchy at the end of the transition. That can lead to resentment on the part of upper management and can cause tension for lower-level workers who don’t have a model for their work.

The best approach is a combination of top-down and bottom-up, where managers and one or two departments are selected to lead the transformation. This can reduce tension because it’s like an experiment - one department tries a method and reports back to the larger organization before huge changes are made. This was the case at Microsoft, where the Development Divison shifted before the rest of the company, with the support of the CEO and upper management.

The Main Take-away

Agile management strategies come from contemporary military tactics. They focus on flexibility by creating networks of teams to take on small projects centered on transparency and collaboration. Though these strategies can be hard to conceptualize and implement for traditional managers, they often increase productivity and allow companies to make necessary changes in an uncertain world. The strongest companies are the most adaptable companies; agile management teaches teams how to be flexible and customer-focused in order to get the job done.

About the Author

Stephen Denning worked for decades in a management position at World Bank. He has consulted with governments and large organizations on their management strategies. He has written many books on business, as well as a novel and a volume of poetry.


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