Why Agile transformations usually don’t work - part 4 - Transparency

2 minute read

This is the fourth and last post in a series about making large organizations more agile. I encourage you to start with the beginning.

In the previous posts, I presented why large scale “Agile” transformation usually fail. Part of the solution is about giving people the time to learn and a safe environment. That’s not enough though.

A squirrel with a helmet

Provide the data

I explained how Management by Objectives harms experimentation. I presented alternatives like Salary Formula, Badge Based Compensation and Merit Money.

An interesting commonality between these compensation practices is that they are transparent. When all this is public, people know what to do if they want to increase their income. For example : get a badge by learning something new, or collaborate with others to get monkey money. That’s great, but they should also know how to increase the profits to get a bigger cake for everyone !

Management By Objectives is not only about compensation. It also cascades business objectives all the way down to everyone in the company. If we get rid of MBO, people still need to know what is important.

Let me introduce Objectives and Key Results, aka OKRs. Intel invented OKRs. Nowadays, among many other companies, Google is famous for using them.

A visual comparision of MBO and OKRs

💡 OKRs have nothing to do with compensation !

OKRs match this experimentation mindset. OKR objectives should be ambitious, with room for overachievement. OKRs also provide Key Results, which let people measure how well they are doing ! As OKRs are public, teams get a full understanding of the context of their actions.

To max out the value of OKRs, we should make as much data public as possible. Financial figures can really help teams to know if they are doing a good job.

The end result is that teams can take informed decisions. They can measure the impact of their work at their scale, but also on the full organization.

Compelling mission

A last good point of OKRs is that they make very good higher level backlog items. Both Team Epics and full products can be OKRs. Even the company’s mission can be an OKR. Check Toyota’s mission, for example, “Better cars for more people”. This provides invaluable guidance for everyone to take day to day decisions.

In fact, a clear and motivating company mission statement is not only good but mandatory. Without it, people will go in all direction, resulting in very slow progress. It’s an absolute pre-requisite for self organization to work. This is particularly a challenge for business-to-business companies. One symptom is when developers succumb to Resume Driven Development.

💡 Self organization does not work without a clear and compelling mission.

To summarize

Organization’s initiatives to become agile fast are doomed. They can at best expect small productivity and visibility improvements.

The benefits of being agile include lasting continuous improvement and business resiliency. Unfortunately, this cannot happen in a day. The road starts with the following :

  • Creating a safe environment by getting the compensation issues out of the picture
  • Providing a clear goal and all the data people need to take informed decisions
  • Finally, leave the time for the people to learn

I discovered another fun fact while looking for references. People from lean manufacturing have been arguing the same thing for decade ! The good news though, is that we ripe improvements all along the way !

This was the last post of a series about making large organizations more agile. Next week, I’ll present an idea to apply the Mikado Method to refactor organizations one step at a time !

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