Agile has become mainstream. No research behind, just an observation on our side and by many others. Hardly any IT organization, which does not reach out for known Agile methods or roles. Many job descriptions are filled with Agile keywords (sometimes buzzwords). And since quite a while Agile is reaching beyond IT.

Purpose of Agile is far beyond IT

And this is exactly, where it belongs to. Still not common sense nowadays, where many not so experienced people believe in two wrong assumptions: Agile is mainly about or even coming from software development. No, this is plain wrong. Neither, nor – the purpose of Agile approaches has never been to create little silos inside something like IT (departments or even teams). It has always been the attempt to just close gaps between those, who needed solutions (a.k.a customers), and those, who created them (a.k.a developers, or even better: teams). Early approaches just did not put so much emphasize on everybody else in an organization. They dropped lots of the organizational reality. All the blockers, hurdles, overhead, politics etc. It needed Scrum, which introduced a product owner role, getting business back on board. Unfortunately this sometimes rather led to another split – especially with educated but bad guidance, trying to shelter teams from dysfunctional behavior (remember the “chicken and pig” story). And this shelter of course led to more dysfunctions (missing understanding of systems and complexity thinking?).

Though Agile’s popularity heavily benefited from the software development domain (the term was coined there), it has its true roots of course somewhere else. And we see most practitioners reaching out for these roots today. These are about the paradigm shift in product development, which Scrum was built upon (remember the HBR article “New New Product Development Game” from 1986). They are about a new understanding of organizations as systems and the focus on people and values, as it was elaborated more than 50 years ago by people like Peter Drucker and W.Edwards Deming. So Agile basically draws most of its original roots from something called “Lean”, another bad history of Western style interpretation gone wrong, with all the stories around the Toyota Production System behind.

So to make it crystal clear once again. Agile is not at all limited to Information-Technology. It has its roots in organizational backgrounds around the Toyota Production System. And it was always about whole systems thinking.

Still there are various interpretations around, not really helping to make progress. First, many see Agile approaches just for what they know it, as methods limited to IT. As outlined, this is wrong from its origin. And it is even more wrong from its status quo, where we are far beyond, what was known ten years ago. Now that we are clear, that traditional change management methods have an even higher failure rate (beyond 75% of initiatives fail!), than traditionally managed projects, Agile and Lean brought totally fresh approaches for change management to the desk. Not to talk about the term “Agile Project Management”, which rather can be treated as kind of oxymoron – something, which should actually even not exist due to its contradiction.

However, I believe apart from many Agile cargo cult discussions and approaches (any known in your environment?), we are slowly getting out of this long differentiation phase (see F. Glasl on his model for organizational development), shifting fast towards integration for a new being. Why? And what do we experience in many places?

  • Specific methods or practices are not so important anymore. Its not about “my method is best”. It is more about, what makes sense to our customers, in relation to our purpose? What works, but what does not, and what can we learn from this? What will we do next about it?
  • Looking at the emergence of new practices over the past 5-7 years, we see an explosion of alternative approaches, all targeting at the same thing – learning, learning, and more learning. Whether it is about the customer, the product and service, our own organization or about our individual positions.
  • The continuation of exponential change has led to even higher pressure to adapt. What worked yesterday, is highly irrelevant today. And this also counts for Agile.
  • The digital economy has become a massive driver of this exponential change. And we are even far beyond its initiation of the term, which was coined around 1996 and had grown towards big data anywhere, while young people grow up with this naturally (a phenomenon older generations call “digital natives”). No industry can rest assured, there won’t be a new disruptive competitor in the field tomorrow. And this influences even non-digital and traditional businesses. It is obviously not about becoming Agile. It is rather about the race for survival.
  • Traditional industries start to play around with Lean Startup concepts, trying more or less to buy an innovation culture outside their core organization (a.k.a incubators).
  • We see many other developments from non-IT origins heading into the same direction of reinventing the way we do business (Beyond Budgeting, Holacracy, Reinventing Organizations, Startup movements, even eXtreme Manufacturing at WIKISPEED, just to name a few)

New ways of organizing and running businesses

What this all leads to, is the emergence of a totally new type of economy. Speed of change, globalization, digitalization, the power of data-crunching algorithms, the power of young entrepreneurs, the world-wide power of very fast grown global enterprises, the freedom of knowledge work and creativity will not vanish (check out the acronym “VUCA world”). And what we experience today is probably just a starter. It is up to us – as individuals and organizations – what we make out of this. Besides all possible negative side effects (new potential threats for our privacy, like the NSA case) we have such a huge a variety of options as never before.

It’s no longer about mastering continuous improvement, it’s about mastering continuous change. (Stephen Parry)

But also never in business has the survival of the fittest been a better metaphor, than in todays competitive environment. This simply means, every single organization has to think about its survival over the next 5-10 years, if this will be feasible for certain industries at all (just consider the declining life span of the Fortune 500). However, the fittest organization will not be the one with most Agile methods installed. It will be the organization with best adaptive capabilities developed. The adaptive organization (of whatever size, and there will be more to say about this in further posts and dedicated publications) is able to sense and respond on various levels. It is able to  maneuver in the stormy sea of disruptive market developments, earning its profits from exploiting established business models, while at the same time discovering new options, at the time sensing the need for change. Sensing and responding on various levels includes strategy, management, innovation, operations and our day to day work with people – whether customers or employees (words to be mingled).

Over the longer term (nowadays longer is shorter than ever) this means we have to throw our procedures, our old habits, hierarchical thinking over board. Except for the case, we accept our organization to pass away. We need to provide engaging work places, where people can fire up both engines in synch – the one for getting more out of, what’s already on the desk today. The other in exploration for new offerings and opportunities.

Business Agility for Adaptive Organizations

There is no single complex system in nature, which employs a hierarchy. (Frederic Laloux)

All of this goes far beyond Agile. It targets at a holistic and non mechanical view on markets and organizations, where hierarchy has lost its place (by the way, a concept not employed by any complex system). It requires a new thinking and approach of running business and driving change. Adaptive Organizations are not about Agile in IT. They are about Business Agility. We will write much more about Adaptive Organizations, as this is a cornerstone of our service offering, which we deliver together with highly experienced partners in this field.

But for now, I’d be interested about your experiences and approaches with Agile beyond IT? What are your thoughts about growing Adaptive Organizations? How do you make your organization fit for the future?

Mike Leber
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