Monday, December 7, 2015

Three Aspects of Agility Measurement

Business agility is the capability to adapt to changes.

Nowadays, “VUCA” (Velocity, Uncertainty, Complexity, and Ambiguity) is the new characteristics of the digital business, and the speed of change is accelerating. Therefore, agility - the business ability to sense, response, and take actions to changes, is a strategic imperative for companies’ surviving and thriving. But if you can only manage what you measure, how to measure business agility in order to continue building and improving business change capability and maturity?

Agile values and principles are best measured via linking what you want to achieve and top goals. We have a set of well-defined values and principles based on Agile Manifesto. Values and Principles are about what we believe and how we think. Neither of these is really amenable to direct measurement. And you will always have to tie these together to get the big picture of your organizational agility. In agile, measure directly what you want to achieve, what your organizational goals are like, such as go to the market time, cycle time to develop a feature, anything that you truly want to see results from. Some of the key measures of Agile effectiveness are Creating Value, Timely delivery, Teamwork and Productivity for the work done. In traditional command and control organizations, agility is very hard because they aren't built on trust, and there's often a great tension between the business and the delivery teams. It stops them becoming "fully" agile, and the business wants the comforting illusion of certainty and Gantt charts rather than capability. You can only progress overall as fast as the whole system you're operating in.

Measuring culture will help organizations understand “change inertia” and speed up agile adoption. Culture is the number one barrier to an Agile or overall digital transformation. So, measuring it although tough, is rather crucial and necessary. The goal measuring agility is to understand what it means for people. A person who looks at the values and principles and considers them to be self-evident truths about how the world of software development works, then that person probably has an agile mindset. If this person also has good knowledge of many techniques and practices, with insight about the set of principles and philosophy behind it, and it is also critically important that he or she gain the understanding of the contexts in which they are appropriate, and then that person is likely to be agile, and collectively, the true agile culture - the collective mindset is built on. Because culture is the collective mindset and behaviors. To measure culture variable, the pertinent question to answer is "How agile are we?" Overly rigid organizational structures - fixed plans, processes, and purposes cause an organization to resist external change up to a point, but eventually the stresses become too large and failure is inevitable. There are many corporate examples of this - where organizations are unable to adapt to major disruptive change because of their rigid inflexibility and lack of agility.

Measure the expected business agile traits such as resilience and transparency. One of the agile goals is to improve business resilience. For example, some Agile organizations support and encourage the idea of highlighting "mistakes" by those who made them and actually in some ways rewarding those team members. This, in turn, reduces risks and promotes feedback, learning, and transparency. In essence, the twin goals of an Agile transformation are to increase value received and decrease risk. An organization at any scale that can retain an overall sense of vision and purpose, can communicate effectively, continuously improve, reflect on its own limitations honestly and respond to change dynamically. It is simply more likely to thrive and survive. Agile transformation a journey and you can make a judgment on where people and organizations are on their journey, but none of that really matters unless collaboration is in place and business initiative is being delivered. You start there and move onward and upward.

The goal of agility measurement is to keep track of the most value-driven factors to lead business success. In most organizations, "value realized" is based on enhanced competitive advantage, and is usually measured in financial terms. These are usually increases in revenue/company valuation/user base or reductions in costs. What it really comes down to is an organization providing a culture that aligns its working with the Agile manifesto via a few important business aspects – interaction, iteration, improvement, and collaboration etc. You build a lot of trust and respect by letting people come up with what works best for them, and ultimately improving business agility and maturity.


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