Four functions that may help your company become more agile
Agile is a hype. Or a necessity in a VUCA world? Both may be true. But the point is that every business wants to become more agile and adaptive nowadays. To be faster, more cohesive, and better address customers’ needs.
Great aspiration! A lot of methods and frameworks are available for this aim. The most popular among them is Scrum. But there is a problem. Scrum was invented as a framework for product development via one team. Could it help to make our large, bureaucratic, hierarchical organizations more agile? Is it really helpful in this field?
In my opinion, yes. It may be helpful for enterprises. But not just from the Guide. We need to understand the grounds of Scrum and adapt them to enterprise reality.
The essence of Scrum is the collaboration of four rolls around one product through the PDCA cycle. Each roll realizes its function (its natural purpose to the whole system). The Product Owner is accountable for maximizing the value of the Product. So, firstly he/she must identify customers’ needs and define the Product Goal for the Team to meet them. Then ensure that the Team clearly understands what to do. Clarify any point if needed. And finally, verify that the result meets the Goal and that the customers are happy. All these actions I call the Entrepreneurial function of the team, business, or organization.
Developers are accountable for Product creation. They should have all skills needed to proceed whole end-to-end development process. That’s why development teams should be cross-functional, and not all Developers should actually develop the Product. But all of them should contribute to the final outcome and customer satisfaction. Their function I call the Production.
The Scrum Master of the Team is accountable for establishing all processes and for the Team’s effectiveness. So, he/she needs to know how to organize everything, then measure and improve the existing system. Also, he/she is responsible for the quality of interaction between all roles. So, this is the Organizational function.
And finally, somebody needs to find money to sponsor all these activities. And, of course, this capital should grow. So, it’s not enough to monitor only processes and the Team’s effectiveness. Somebody needs to ensure the Team’s efficiency and the growth of the business. This is the accountability of Stakeholders and the Investment function.
So then, for the company or project thriving, all these four primary functions should be fulfilled and act as one (Scrum) team. For this reason, the Scrum Guide clearly describes their zones of accountability and requires collaboration through a strict iterative lifecycle with special events. It may seem difficult at first sight, but it’s just a variant of the well-known PDCA cycle. It means that firstly the work should be planned, then done, reviewed, and improved for the next iteration. As a result, we get an iterative process improvement and value creation, making our company more agile.
Summarizing all the above, from my point of view, for implementing the “Scrum way of working” in an enterprise, you should decide who is accountable for each function in your company and organize their work on all levels through the PDCA cycle with high level of transparency and collaboration.
You may say that it’s easier said than done. But fortunately, every enterprise already has such an experience. Let’s remember its early days.
Every company begins with an idea, a hypothesis about unmet customer needs, and a plan for their satisfaction. It means that somebody has previously thought about it, i.e., has performed an Entrepreneurial function.
In a new company, usually, an owner does this. With its growth, the situation becomes more complicated. The Entrepreneurs’ function may be delegated to one or several departments. Or maybe even lost among plans, budgets, and KPIs. But the thing is that any business needs somebody to explore customer needs, form and test hypotheses to find new profitable parts of the market. So, look at your marketing or sales departments. Are there people who clearly know what your customers need? Choose someone who may be your “voice of the customer” on a daily basis. He or she would be the Product Owner or the Leader of the Entrepreneurial function in your company.
Moving on. After identifying the customer’s needs, somebody should take some specific actions to satisfy them, i.e., to perform the Production function. It could be done by producing a physical or digital product. Or by providing services. Depending on the sphere, it could be the result of the work of development, pr, legal, or any other team.
And again, at the stage of a startup, this function and the people responsible for it can be simply defined. But at the following stages, it may not be so clear. Sometimes it’s hard to determine the end-to-end value stream, sometimes, who is accountable for it. Sometimes it requires the collaboration of several departments which aren’t perceived as one function. Consequently, we have a lot of problems with their cooperation and meeting deadlines.
To remedy the situation, someone needs to decide who is accountable for the end-to-end process of value creation and create cross-functional teams or value streams for its development and improvement. This is the responsibility of Organizational function.
The need for this function arises with the growth of the number of people and processes in the company. When a small agile team in a garage turns into a complex multilevel system, it needs somebody to organize and coordinate effective collaboration within its parts. We call them Managers.
Yes, in theory, the primary role of a Manager is to organize an effective flow of value to customers. But in practice, in most cases, managers focus on the effectiveness of their departments, local goals, and KPIs. As a result, nobody feels responsible for the whole system’s productivity and end-to-end lead time.
Thus, all Agile frameworks recommend eliminating silos and creating development value streams for improving product workflow. And it doesn’t matter whether you have a development process or not. It may be the cross-functional teams of copywriters, designers, and/or professionals in pr, hr, or any other field. The point is that to improve production, you need to organize the end-to-end flow of value creation. And decide who is accountable for its management and development.
Finally, you need to think about realizing the Investment function in your enterprise. We usually mention it while talking about startups when the role of Investors is evidently crucial for business growth. They not only decide which project deserves investments and give the money for business development but also ensure business efficiency and return on investments through monitoring, analyzing, and improving processes of money creation.
This function also should be clearly defined in enterprises. Not only in the form of monitoring and analyzing the company’s financial condition and commercial efficiency of its processes but also through defining what projects or initiatives should be promoted for business growth.
Usually, the C-level of enterprises is accountable for this function. But not all executives want to fulfill this role. In turn, some of them should be accountable for Entrepreneurial and Organizational functions. Thus, it’s better to choose one of the ExCo to lead and develop it.
Finally, when you define the leaders of all four primary business functions, you’d better organize their collaboration as one (Scrum) team. For this, they should have one clear goal for a period, define tasks needed to achieve it, organize the work process in short iterations, and plan milestones for analyzing and improving it. Visualizing end-to-end workflow and using process metrics may significantly improve your results. But this is the topic for the following article. Please, subscribe.
