View
1.547
Download
0
Embed Size (px)
DESCRIPTION
Agile methods have improved project performance, but that doesn't seem to roll-up at business level. There is a need to create 'butterfly effect' to amplify smaller actions into large outcomes. In this presentation made on 20-Aug-2011 at Agile Hyderabad 2011, I examine some of the issues that need to be addressed to enable hi-end agility in large R&D enterprises.
Citation preview
Achieving High-end Agility in Large R&D
Enterprises Tathagat Varma
PMP, PRINCE2, CSM, Sr. Member IEEESr. Director Business Ops, Yahoo! R&D India
Disclaimer: these are my personal views
Topics• A Decade of Agility• Business impact• Enabling Hi-end Agility
What is Agility?• Agility is the ability to change the
body's position efficiently, and requires the integration of isolated movement skills using a combination of balance, coordination, speed, reflexes, strength, endurance and stamina.
• In business, agility means the capability of rapidly and efficiently adapting to changes. Recently agility has been applied e.g. in the context of agile software development and agile enterprise.
• http://en.wikipedia.org/wiki/Agility
Where is Agile used today?
…and where it is not?
Why do they adopt Agile?
And the results are showing…
Aa
But…
Large teams?
Distributed teams?
Large companies?
Company-wide?
Successful?
Scalable?
So…
…with Agile?
What are the barriers to agile adoption?
…and what are the concerns?
Meanwhile…
What’s up with business
?
Reported profit margin for S&P 500 for last 25 years is only 5.5%
http://runningofthebulls.typepad.com/toros_running_of_the_bull/2010/07/valuation-update.html
IT Operational Budget as Percentage of Revenue: 2006-2011
Source: Computer Economics, 2011
And the software budget is?
IT Budgets in Fortune 100 companies
77% of IT budgets to just maintain status quo
http://blogs.sungard.com/as_cloud/tag/top-cloud-computing/
Let’s do some math!1.6%
IT Budget
19%
Software
0.3% Of Revenue
‘Savings’ if Agile delivered…
2x: 0.15%
5x: 0.24%
10x: 0.27%
Loss in Agility
Business ~5-6%
Portfolios
Agile Projects 2-10x (?)
A typical large company
StrategyPortfolio
Projects
Planning Horizon and Execution Cycle
Strategy3-5 yearsPortfolio1-3 years
Projects3-6 months
Sprints2-4 weeks
Planning Onion
High-end Agility
“Ability to turn the Titanic”
“Ability to shut-down Fukushima”
Agility @ scaleAgility @ light-speed
Agility across the organization
“Butterfly Effect”
What is this?
Butterfly Effect• “Predictability- Does the Flap of a Butterfly's Wings
in Brazil Set Off a Tornado in Texas?” – Edward Lorenz, 1972
• The butterfly effect is a term used in Chaos Theory to describe how tiny variations can affect giant systems, and complex systems, like weather patterns. The term butterfly effect was applied in Chaos Theory to suggest that the wing movements of a butterfly might have significant repercussions on wind strength and movements throughout the weather systems of the world, and theoretically, could cause tornadoes halfway around the world.
• What the butterfly effect seems to posit, is that the prediction of the behavior of any large system is virtually impossible unless one could account for all tiny factors, which might have a minute effect on the system. Thus large systems like weather remain impossible to predict because there are too many unknown variables to count.
Who is this man?
Mohamed Bouazizi
And who is this man?
Enabling Hi-end Agility
Hi-end Agility
People and
Teams
Product Creation Process
End-to-End
Execution
People and Teams• Cross-functional Teamwork• Cross-silo Collaboration• Cultural Transformation
Cross-functional Teamwork• Not just the traditional development
teams• Business planners, strategists, financial
planners, marketing, sales, customer support, manufacturing, partners…everyone needs to be involved
• There are no “chicken” in this game!
Cross-silo Collaboration• No man team is an island• Silos lead to agency theory at work –
“optimized parts, suboptimised whole”• Cross-silo, or horizontal efforts ensure
collaboration with all relevant stakeholders not just a given project but for the entire business
• Get as many fingerprints as required
Cultural Transformation• Engineering teams ‘understand’ concept
of agility to an extent – other groups might not!
• Impedance mismatch between Agile engineering teams and traditional business teams
• Needs a centrally coordinated change management effort
Product Creation Process• Planning process• Decision-making process• Innovation networks
Planning Process• A long-term strategy sets the direction
and pace, but could also limit agility• Need to stay focused but flexible to
changes• A way to planning could be– 70%: long-term strategy– 20%: short-term mid-course adjustments– 10%: play by the ear
Decision-Making Process • Perhaps the bane of large organizations!• Quickening-up the process is key –
irrespective of the outcome of decision• More communication leads to faster and
better decisions (and buy-in)
Innovation Networks• Productizing innovative ideas is true
agility!• Democratize innovation• Make it safe to fail• It takes a village to raise a child • Rapid resolution of ideas
End-to-End Execution• Agility at project-level• Program Management• Communication
Agility at project level• Faster validation of hypothesis• Minimize WIP (Work In Progress)• Improve leadtime
Program Management• Lockstep all functions required to build
and launch the product• Provide, manage and ensure two-way
linkage between strategy and operational plans
• Optimize the ‘whole’, a la Lean
Communication• Highly underrated at team level• Execs need actionable communication
So, where is Agile in Gartner Hype Cycle?
Conclusions
• There is loss of agility in large organizations – project-level benefits don’t amplify at business level
• This is not just about applying agile / lean principles to software development team alone – we need to create ‘butterfly effect’
• Hi-end agility can be achieved by creating interlock of people, process and execution on top of project-level agility
References• State of Agile Development Survey 2010,
http://www.versionone.com/pdf/2010_State_of_Agile_Development_Survey_Results.pdf
• http://www.ambysoft.com/surveys/• http://www.wealthscribe.com/?p=70• http://anagilestory.com/2011/07/20/can-agile-work-in-big-organizations/• Predictability: Does the Flap of a Butterfly's Wings in Brazil Set Off a
Tornado in Texas? – Edward Lorenz, 1972, http://eapsweb.mit.edu/research/Lorenz/Butterfly_1972.pdf
• Why Agile doesn’t sell with Management, 21-Jul-2009, http://managewell.net/?p=550
• http://www.wisegeek.com/what-is-the-butterfly-effect.htm• http://managewell.net/?p=1118• http://www.infoq.com/interviews/larman-scrum-large-organizations
Thanks!
Twitter: @tathagatvarmaBlog: http://managewell.net
Email: [email protected]:
http://www.slideshare.net/managewell