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Feb 14, 2018 @ 09:02 by Daniel Scheck

8 Business Challenges Your Company Can Address In Becoming More Agile

Agile ways of working help companies overcome a number of challenges. This article tries to simplify the term agility and gives examples for the challenges that can be addressed through agile project management.

In recent months, we’ve seen a steady increase in demand for agile coaching. Our clients are increasingly realizing the value of agile projects and agile organizational divisions. However, in their zeal, organizations need to ensure that agile principles and tools are not just implemented but also thoroughly understood and embraced by their employees.

In helping our clients implement agile, we’ve come to rely on a framework that helps bring together agile transformation with the business challenges that arise. These business challenges can be clustered into four categories – covering both internal and external dimension.

Figure 1: Business challenges solved through agile ways of working

Internal Business Challenges Adressed

1. Silo Mentality

One of the main advantages of agile transformation projects is its tendency to disrupt silo mentality within corporations, because it forces people to work in cross-functional teams. This is especially true for larger companies where extensive hierarchies and structures built in the past to better coordinate activities is now superfluous and makes working less effective than it could be otherwise. 

2. Risk-Averse Mentality

Corporations tend to have a myopic focus on achieving immediate or obvious outcomes. Yet, failure can often provide even more value to a final product in terms of their learning effects. An agile encourages prototyping feedback and constant iteration (i.e. ‘failing’) to constantly adjust the product’s development.

3. A Waterfall Culture     

Conceptualizing a product’s development as a constant work in process, and that should be released as soon as possible in order to get early feedback is known as a Minimal Viable Product (MVP). It is the best way to find out quickly if a project carries adequate value from its intended users, and it also instructs on where development should focus. 

4. Slow Time-To-Market

Technological or innovative competitive advantages mean nothing when a company can’t capitalize on getting these innovative products to market before competitors do so with inferior quality products that nonetheless introduce these innovations sooner. Agile projects’ focus cutting out waste, like cumbersome bottlenecks or the ‘too many cooks in the kitchen’ effect enable the entire process to move faster, resulting in a significantly improved time-to-market.

External Business Challenges

1. Rapidly Changing Customer Needs 

Technology is giving companies a new ability to provide products that better suit their customers; and conversely, customers are coming to expect better products from their favorite companies. It is no longer enough to create a product and reassess. Instead, Agile’s customer-specific design process – and obsession with their feedback - constantly refocuses product development on their evolving and ever shifting preferences. 

2. Ever-Growing Competitive Pressure

The advantages that the biggest companies enjoyed in the past have been swept away by a wave of digital technology, meaning that they cannot simply survive through sheer size. Agile ways of working force these companies to reform their organization into something lean, that values speed and innovation over tedious processes, strict policies and slow workflows. 

3. Preserving And/Or Building An Image 

Some of our clients see it as almost indispensable to be perceived as an innovative brand. Part of this branding effort must be to introduce agile ways of working, making agile principles a core value of the company. Talking about and living these values allows organizations to show that innovation is at the core of their business and lived in the day-to-day work environment.

4. Increased Competition For Agile Employees      

Innovative people want to work in lean environments that give them the freedom to be innovative and act fast, so creating such environments that value and respect the principles of agile working also creates work environments that are attractive to innovative employees - a crucial deciding factor for talented, prospective employees that are nowadays able to choose from a range of different offers.

Becoming more agile is most certainly not a universal remedy and it might not be a fit for every project. We do however strongly recommend that companies that face the above mentioned issues to investigate the business value they can derive from adopting agile ways of working. Yet clearly becoming an agile organization not only yields business value but also makes work more enjoyable and therefore can create tremendous value for your employees. Both of these factors need to be considered in a decision making process. 

Daniel Scheck is a digital transformation analyst consulting companies on digital innovation, change management as well as organizational transformation like the introduction of agile project management.

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