Book Summary | The Age of Agile - Stephen Denning

 

Book: The Age of Agile: How smart companies are transforming the way work gets Done

Author: Stephen Denning

 

One of the popular words in today’s corporate world in any discussion is Agile. It may be on the culture of work, the projects that we drive. Today organizations are connecting everything and everywhere, all the time. They can deliver instant, intimate frictionless value on a large scale. They are creating a world in which people, insights and money interact quickly, easily, and cheaply. In software development, there is no option but to purse Agile Management.  The shift is nonnegotiable. If management won’t support Agile Management, the best developers go elsewhere.

 And since the software is eating the world and become more central aspect of every business model, the pressure for changing from within the organization is never ending.

Agile Management is about working smarter than harder. Agile is about understanding and interacting with the world with a different mindset. Business success in the twenty-first century increasingly depends on becoming quick as the rapid shifting and unpredictable context in which organization operate. Becoming an agile organization is an increasingly urgent necessity for companies in today’s digital economy. The principle of Agile management is empowering small teams, that will add value to the customers through bottom-up innovations. There are many case studies and research, that Innovations generated by agile teams had fuel growth. Innovations that happen from the top-down trends to be orderly but dumb. Innovation that happens from that happens from the bottom-up trends to be chaotic but smart. Agile means embracing fundamentally different assumptions. In organizations that have embraced agile management, self-organizing teams are continuously providing new value for customers. When Agile is done right, the teams are working within a business model in which organization is generating value for the organization itself as well as customers.  Agile is about generating more value from less work. The driver of sustained success is the Agile Mindset.

Three Core characteristics of Agile

1.    The law of small teams

Agile practitioners share a mindset that work should in principle be done in a small autonomous, cross-functional teams working in short cycles on relatively small tasks and getting continuously feedback from the ultimate customer or end-user. 

 

2.       The law of the customer

Agile practitioners are obsessed with delivering value to customers. The firm adjust everything – goals, values, principles, processes, systems, practices, data structures, incentives, - to generate continuous new value for customers and ruthlessly eliminates anything that does not contribute. The law of the customer is a single message, delivered consistently, every day all the time. Agile teams take initiatives on their own and interact with other agile teams to solve common problems.

 

Agile Small team – Common Practices

1.       Work in small batches

2.       Small cross functional teams

3.       Limited wok in process in agile management, teams learn to focus on an amount of work that can be brought to completion in each short cycle.

4.       Autonomous teams

5.       Getting to “Done”

6.       Work without interruption

7.       Daily standups

8.       Radically transparency

9.       Customer feedback each cycle

10.   Retrospective reviews

 

Rule of the customer – Practices by Agile teams.

§  Target

§  Constantly experiment

§  Partner with start-ups

§  Increase product malleability (turn a physical product into a digital product)

§  Focus

§  Innovate in short stages

§  Evaluate

§  Be willing to disappoint

§  Deliver value faster

§  Customize

 

3.       The law of the network

Agile practitioners view the organization as a fluid and transparent network of players that are contributing towards a common goal of delighting customers. A network is a group or system of interconnected people or things. An organizational network is a set of teams that interact with and collaborate with other teams with the same connectivity. A network model of organization is key to making the whole organization agile.

 

Assumptions of Networking:

1.       Network has a compelling goal

2.       The network comprises small groups

3.       The groups have an action orientation

4.       The network is the sum of the small groups

5.       The network legal framework stays in the background

Reviews - Continuously Monitor Progress to drive business:

Every month the program manager reports out on metrics of the accounts, measuring different aspects of the service. The group is learning to become a data informed business.  Done is having the right measures. The teams see this data and monitor it, both when they are testing it and as soon s it goes live. They use the metrics to drive the business forward.

 

Four components of a market creating value proposition: Need, Approach, Benefits per costs, and Competition (NABC).

The four Management Traps

1.       Maximizing shareholder value

Shareholder value is the dumbest idea in the world. Shareholder value is a result not a strategy. Short-term profits should be aligned with an increase in the long-term value of a company.

2.       The trap of buy back of shares.

Market leadership can translate directly to higher revenue, higher profitability, greater capital velocity and correspondingly stronger returns on invested capital.  

3.       Cost oriented economics trap.

Cutting costs could lead to a permanent loss of expertise. – Dell case study an interesting eye-opener.

4.       The trap of backward-looking strategy.

Transformative ideas are ideas that change our frame of refences.  Agile Management offers a financial critique of current management. Shareholder value thinking is a trap that inexorably leads to a preoccupation with the short term and ultimately destroys shareholder value.  The emerging age thus offers the possibility of a great awakening – a foreshadowing of a transformation in the way our organizations and our society functions. The emerging age offers a promising path forward. It’s the work of many minds, hearts and hands.        

The difference between winners and losers is not the matter of access to technology or big data. Both the successful and unsuccessful firms generally have access to same technology and data, which are now largely commodities.  The difference lies in a different way of running the organization that deploys technology and data more nimbly.

Bottom-line:

The central theme of this book – the corporations must radically reinvent how they are organized and led and embrace a new management paradigm. A principal role of the top is to identify and support champions throughout the organization.  

I would recommend reading the case study of how Microsoft deployed Agile and then read the chapters for easy navigation and connect on the principles.