The global pandemic has called for businesses to rethink the way they function and come up with new business strategies. Due to unprecedented technological innovation and the increasing uncertainty of the world today, business leaders recognise the importance of being more adaptive, innovative and resilient. So, what’s the solution? While it may not be suitable for all businesses, adopting an Agile methodology can be a great way for many companies to become more resilient.
In this post, we’re going to cover all you need to know about the Agile mindset and offer a case study of this methodology in practice.
We spoke to Daniel Razniewski, an expert in Agile methodology. This semester, we have suggested an 18 hours course in Business Agility to ESEI students to become a Professional Scrum Master in two days. The course will prepare students for an end of course exam at ESEI, as well as provide them with the skills needed to thrive in an Agile work environment. Successful students will be given a certificate as proof of their performance.
Click here to find out more about this particular course: SCRUM
What is the Agile approach to business?
Since the technological revolution, and the mainstreaming on the internet, modern approaches to business have emerged. They aim to offer solutions to challenges posed by technology and a rapidly changing work environment.
One such example is the Agile approach. Daniel explains that “Agile has become somewhat of a buzzword recently, although it is not a new concept.” In fact, “the Agile mindset has been around since 2001, when it was created within the field of software development and adopted by other fields later,” he adds.
“The Agile methodology allows companies to respond to complex situations quickly in order to meet the business’ needs or goals,” explains Daniel.
In order to do this, the mindset is based on some core values. These enable businesses to be better equipped to tackle uncertainty and change. Ultimately, this leads to the improved well-being of the company and its workforce.
Each framework follows Agile’s core values in order to reach the same goal, yet in their own specific ways.
What are the four core values of the agile manifesto?
The Agile manifesto sets out the four core values of what it means to be Agile. These are:
- Individuals and interactions over processes and tools. Valuing individuals above processes enables a better response to change or demands. In this way, teams are encouraged to communicate more effectively. As a result, they feel more involved, responding better to complex situations and working more cohesively.
- Working software over comprehensive documentation. Traditionally, businesses produced a large amount of documentation surrounding the development and plans of a product or service. Yet, this can lead to a delay in production. Agile methodology seeks to streamline the process of documentation, offering a quicker route to getting the work started.
- Customer collaboration over contract negotiation. Traditional business models involve spending hours negotiating the finer details of a project at the beginning, but not checking in with the client again until the final product is delivered. However, the Agile method calls for the customer to be engaged and collaborate throughout the entire process. This saves time and improves customer satisfaction.
- Responding to change over following a plan. Responding to change is traditionally seen as the source of unnecessary expense. Yet, the Agile approach recognises that the flexibility to make changes improves a business. This is because the business can adapt quicker, therefore gaining additional value.
What are the benefits of being Agile?
According to research, in 2020 a total of 71% of companies globally had adopted Agile. There are a number of reasons why an ever-increasing amount of businesses are turning to Agile – these are mostly due to the number of benefits it provides. Let’s explore:
1. The ability to adapt quickly
One of the most important benefits of Agile is the ability businesses have to adapt to complexities, change and uncertainty. This adaptability largely comes from increased communication with customers at every stage of the development process.
“The team and customer can provide feedback, review costs and then adapt and rework plans at any level. This customer response is very beneficial to the company,” Daniel explains.
2. Increased customer satisfaction
As a result of this collaboration, the customer is likely to be much happier with the end result of the project.
This is because the company has gained a deeper understanding of the customer’s needs, learnt from their own mistakes and reevaluated their approach as the project progressed. The result? A satisfied customer.
3. It’s cost-effective and low risk
The ongoing collaboration between company and customer ultimately saves the company time, money and risk. As Daniel explains, the central idea of Agile is “to fail quickly and cheaply, learn from this failure and adapt.”
This makes the process very attractive to companies who are looking for a cost-effective and low-risk business model.
4. A more committed workforce
Involving employees at every level through better communication results in individuals feeling much more committed to the project or business. “Involving the team in decision-making during the projects leads to more trust and feelings of courage, focus and commitment,” Daniel says.
This provides a shift at a mental and cultural level and encourages employees to stay working for the company longer term.
What’s an example of an Agile business?
The best way to wrap your head around this concept is to look at an example of it in practice.
The most well-known and successful example of the Agile methodology can be found in Spotify. The largest audio streaming subscription service in the world with around 286 million users and 1600 employees, Spotify’s success comes down to its focus on its employees.
The company initially used the Scrum framework of Agile, which it introduced in 2012, before switching to Agile Scaling. The aim was to create a people-driven, autonomous framework, emphasising the importance of culture and network within the workforce.
In order to do this, the company created different teams to help manage communication and collaboration better. They now have 30 Agile teams across four cities with three different time zones.
The teams specialise in different areas, yet communicate between themselves to share knowledge, make improvements and adapt to changes. Each group member has autonomy and is encouraged to play a key part in decision-making processes.
The result of implementing an Agile Scaling method has not only made Spotify achieve its goals quicker, but has also shifted the mindset of its employees.
The effective management of teams, as well as increased communication and autonomy has resulted in workers feeling more connected to Spotify and its projects. Ultimately, this has increased customer satisfaction as teams have been able to respond to customer needs much more quickly and effectively.
As Daniel explains, “the importance of well-managed teams and effective collaboration is fundamental to the success of Agile models. Companies need everyone to coordinate together from operational workers to HR, software developers to management.”