Success factors for implementing agile methods in large organizations
We have introduced agile methods in the product development of a leading insurance company which has a highly heterogeneous IT landscape, strict legal regulation and traditional working methods. The success speaks for itself: the company developed five product variants instead of one in a single year and did so while remaining 40% below budget.
Most organizations today are faced with the question of how to develop their business in a rapidly changing environment as well as keep pace with their competitors in the future. Agilization - from product development and operationalization to distribution - is a possible answer. But what does this mean in practice? We have assisted our client for over 12 months in agilizing product development using agile methods such as Scrum and Kanban, agile leadership and different scaling frameworks. Three concrete, process-related levers and targeted agile change were essential for success:
1. Introducing iterative development cycles
In the past, development cycles were often very long and not very flexible. Development was followed by complex acceptance processes, which usually resulted in lengthy amendments. The introduction of Scrum has made this process considerably shorter and more efficient. The development now takes place in short, iterative cycles (sprints) of two weeks. The review of individual functionalities and partial products is carried out after each sprint. Possible change requirements can thus be identified at an early stage and implemented directly in the next sprint. In addition, retrospectives of team collaboration take place after each sprint. Working in iterative cycles enables fast feedback on both the product and the collaboration; you can implement what you've learned in the next sprint as well as make improvements. The result strengthens a high-performance, self-learning organization.
2. Extension of cross-functional teams
In the past, products were developed in a sequential logic ("waterfall"). Functional teams presented each other with work statuses and focused solely on completing their specific requirements, but not on the success of the overall project. In our agile project, adding cross-functional teams enables all relevant perspectives to be brought together by representatives from business, IT, test and external software suppliers in each team and at each point in time. The members meet in their teams to discuss the details of the requirements and their specific perspectives. In this way, they ensure at an early stage that only concepts which are viable and feasible for everyone are developed.
All requirements become transparent and prioritized in a common product backlog. The teams can therefore take their to-dos from this list and convert them into sprints. The sprints are planned together so that the teams become aware of interdependencies and can manage them together and independently. In addition, the product owners of the teams share the development status in brief daily meetings and manage it on a Kanban board. Blockages in development thus become transparent at an early stage and can either be tackled jointly or escalated to the Chief Product Owner.
3. Test optimization and automation
Testing made up a significant portion of the total expenditure for other projects. Due to downstream test processes, many problems were often detected late, which meant that the cost of repair was high - the longer it took to discover the problems, the higher the cost. The integration of test experts into all Scrum teams and the addition of a Test Excellence Center, which supported the teams, made it possible to significantly optimize the testing process. The tests are now conducted at an early stage in a risk-oriented manner. Test driven development and test automation play just as important a role as the provision of daily builds by the external software supplier. In this way, problems can be detected at an early stage which minimizes the improvement effort towards the end of the project.
In addition to these important levers in the process, we have deliberately focused on cultural change. Our change program was based on two supporting pillars: enablement and empowerment.
Enablement included the execution of agile basic training courses for the more than 120 team members. We then conducted specific training and coaching sessions for employees in specific roles, such as the Scrum Master and product owner, and assisted individual managers in dealing with their new tasks and gaining an agile understanding of leadership.
An important aspect of empowerment was the provision of strong mandates to the team members and roles (e. g., product owners of the teams and chief product owners) so that upcoming decisions can be made quickly and, for the most part, autonomously. In addition, we have actively encouraged and promoted entrepreneurial thinking and action so that employees can truly accept and take on individual responsibility. And we did so successfully: for example, employees created and directed animated training videos on their own initiative.
Like any fundamental change, agilization is not something that happens entirely on its own, but it is definitely worth the effort: the organization becomes more flexible and stronger and - as a survey of project participants showed - the employees become inspired and motivated by the new scope it offers.