Agile Transformation: Fit for the Future
As a company’s products and circumstances grow more complex, it needs to evolve in order to handle new challenges. When a company sees that its current structure cannot manage these difficulties, it’s clear that change is necessary. Many companies are now turning to agile transformation to become more effective and flexible.
The goal of agile transformation is to replace traditional hierarchical structures with flexible, dynamic, and also collaborative ones. This change has an effect on the entire organization and its culture, not only on the tools and methods used.
Agile transformation – a definition
Agility, a term from sports, describes the ability to quickly change direction and position without losing control. For companies, agility means being able to create value in a rapidly changing and uncertain environment (VUCA) to stay competitive in the long term. Agile transformation can be the key to this. Agile frameworks provide proven methods to enhance a company’s agility. However, each company must interpret and implement these frameworks in its own context to achieve the best results.
It’s a change that involves the entire organization:
- Processes: To adapt to new challenges quickly and create value faster, organizations need to enable decision-making where the information is and actively remove bottlenecks in the process.
- Products: Business value hypotheses must be validated by direct customer feedback. Modularization allows agile teams to independently create customer value.
- Culture: Collaboration, innovation, and continuous learning should be integral parts of daily work, not occasional add-ons.
EFS Consulting views an agile transformation as successful when a company has developed structures, processes, and a corporate culture that enable continuous and targeted improvement and development.
Change vs. transformation
In the corporate world, “transformation” and “change” are often used interchangeably, but they represent fundamentally different approaches.
Transformation is a deep and ongoing process that redefines the entire company, creating a new organization. It is future-oriented and focuses on adapting to the ever-changing business environment.
Change management, on the other hand, is a temporary effort aimed at implementing specific changes to achieve a defined goal. It is more reactive, addressing current challenges or opportunities.
Agile transformation vs. digital transformation
Although agile transformation and digital transformation are two separate concepts, they are closely linked in today’s business world. Successfully implementing both transformations creates a future-proven company that can adapt to changes and leverage new technologies.
Agile transformation focuses on developing corporate culture, management structures, and collaboration processes to achieve greater flexibility and responsiveness. It emphasizes on customer orientation and iterative working methods. While digital tools like collaboration platforms and video conferencing systems support these new ways of working, they do not built the core of this transformation.
Digital transformation, on the other hand, aims to integrate innovative technologies to automate processes, network information, and increase efficiency. Digital solutions such as a new software and cloud computing are central to this transformation.
Step by step towards agile transformation within companies
Three layers of agile transformation
Agile transformation is a multi-layered process that involves the entire organization. To manage this complexity, EFS Consulting considers agility under three main aspects:
- Agility as process improvement (effect: low but quick wins)
- Agility to develop better products
- Agility as a cultural shift in a company
Starting an agile transformation with a clear goal is crucial. Following the principle of “Start with WHY”, it’s important to first identify the problems to be solved and the potentials to be unlocked through the transformation.
Assessing the current situation and defining what the agile transformation aims to achieve forms the foundation for the transformation vision, goals, and a clear roadmap. This foundation enables effective communication. Transparent communication throughout the process is the key to success. Employees need to understand why change is necessary and be taken into account in order to show support.
1. Agility as process improvement
When a company realizes that its current structures are no longer sufficient to meet the challenges of the current environment, it makes sense to pursue change. Increasingly, companies are turning to agile transformation to regain effectiveness and flexibility.
The following points are essential for establishing good processes and structures:
- Clarity about the value chain and customer journey
- Establishment of end-2-end responsibility
- Information according to the flight altitude
These points do not depend on any specific agile framework.
2. Agility to develop better products
Products should be high-quality, quickly brought to market, and incorporate the latest technology. The market and regulatory conditions change rapidly and it can be surprising which features are crucial for making purchase decisions.
To meet these demands, it’s important to test the assumptions behind product development, develop products as modular as it makes sense for the specific circumstances and prioritize effectiveness over efficiency.
EFS Consulting recommends:
- Check hypotheses about product benefits: Instead of assuming customer needs and buying behavior, validate them through testing and feedback.
- Build products modularly: This approach allows a flexible development and adaptation to new requirements.
- Effect over efficiency: Focus on developing a product that provides the desired benefit for the customer rather than just optimizing development costs.
3. Agility as a cultural shift in a company
An agile transformation often aims to boost employee engagement, increase the attractiveness of the workplace for future employees, and promote innovation and change intelligence within the company. However, these goals can only be achieved if the transformation is implemented comprehensively and consistently.
This includes the following:
- Anchoring agile values and principles at each level of the hierarchy: Agility is not a top-down approach; it requires the active participation of all employees. Management must exemplify agile values and create an environment that encourages initiative, collaboration and continuous learning.
- Considering all levels of cultural agile transformation: Agility affects not only work processes but also the corporate culture. New behaviors, communication styles, and decision-making processes must be established.
- Focusing simultaneously on product and organizational development: Agility is not a one-time project but a continuous process. While product development must be agile, organizational development must also be prioritized.
Checklist before starting the agile transformation
The list contains necessary conditions, but additional efforts may be required to ensure success. EFS Consulting strongly recommends before starting an agile transformation to…
- Clarify the reasons and goals for the agile transformation
- Determine the capacity available and needed for the change effort (internal resources and need for external support)
- Clarify the allowable decrease in productivity during the initial phase
- Build a dedicated transformation team with clear responsibilities
- Develop a communication strategy
- Conduct initial training, empowerment activities, and role-specific training opportunities
- Hold workshops for value stream analysis and defining responsibility areas
- Establish structures (roles, ceremonies, and artifacts)
- Establish Communities of Practice (CoPs)
Conclusion
Agile transformation is not a one-time project, but a continuous learning and adaptation process. Companies that successfully manage this process are well-equipped to tackle future challenges and seize new opportunities. EFS Consulting offers comprehensive support in agile transformation to prepare your company for the future.
