Excellence in building (and running) the product the right way does not ensure that the right product yields business benefits. Together, this calls for a culture of outcome-orientation and product-centricity. Aiming for business agility thus requires us to reconsider how we operate along different dimensions such as funding of development work, team structure, procurement, governance and decision making.

1. If you follow the advice in this book, your organisation will be the better for it
— Dave Farley, author of Continuous Delivery
@sriramnarayanwww.agileorgdesign.com
Organizing for Business Agility

2. A curious case of too many late-
stage defects
2

3. Desk-checks
3

4. “You mean they simply interrupt us
during the course of work?”
—Test Lead
4

5. Barrier 1: Scripted collaboration
5

6. “We have to log all defects into the
defect-tracking system”
— Test Lead
6

7. Barrier 2: Doing Agile
7

8. “We won’t get credit for it”
8

9. Barrier 3: Narrow KPIs
9

10. When a measure becomes a target, it ceases to be a
good measure.
—Charles Goodhart, former advisor to the Bank of England and
Emeritus Professor at the London School of Economics

11. Targets turn informational metrics
into motivational metrics. Use with
caution.

12. Why do we encounter activity-
oriented KPIs?
12

13. Barrier 4: Functional Org Structure
Some structures encourage process
and tools over individuals and
interactions
13

14. Wait! Are we overdoing it? Motivated
people with a can-do attitude can
get past these non-issues.
14

15. In general, systems influence
behavior more than individual
attitude. Therefore, the operating
model matters.

16. Non-conformance!
Tailorings and Deviations
16

17. Barrier 5: Governance by excessive
process standardization
17

18. “Could we at least go through the
end-to-end test scripts beforehand?”
18

19. Barrier 6: Vendor KPI
19

20. Why are vendor KPIs so narrowly
defined?
20

21. Barrier 7: Activity-oriented
outsourcing
21

22. 22

23. 23
These barriers represent the
organization’s “ways of working”. In
a big organization, they cannot
usually be overcome by team
members or even managers.
Courageous executives need to step
in and sponsor change.

24. 24

25. 25
So much for barriers within IT
But there are other barriers on account of how
various upstream divisions are set up to work
with IT

26. 26
Business IT

27. WHY I.T. SHOULD NOT BE SET-UP AS A “DELIVERY” ORG
27

28. More Work
is Funded
Lots of
Output
Not much
business
benefit
Business
comes up
with other
hopeful
ideas
A POTENTIAL PROBLEM
ITBusiness

29. More Work
is Funded
Lots of
Output
Not much
business
benefit
Business
comes up
with other
hopeful
ideas
Pressure to be
more efficient
Delivery-only
transformation
attempt
BEWARE OF DELIVERY-ONLY TRANSFORMATION
ITBusiness

30. 30
Engg.
IT
Product
Digital

31. Business
Platform
BUSINESS-IT MORPHS INTO COMMERCIAL-PLATFORM
31
Business
Product
Digital
IT
CommercialBusiness
IT
Tech
Older generation business Digital Business

32. A REVISION OF THE OPERATING MODEL
The operating
model serves
as a bridge
between
strategy and
execution. It
has several
dimensions.

33. COMMON QUESTIONS
• Align teams along products or channels?
• Product-centric or customer-centric?
• What is the alternative to funding projects?
• How do we handle BAU work?
• How do we help our people take on new roles?
• Do developers/testers report to product owners, delivery
managers or people managers?
• How does business need to play along?
33

34. ORGANIZING FOR BUSINESS AGILITY
Move away from projects (and programs)
Funding for pods and outcomes rather than for projects
More product people than delivery people
Durable org aligned with products/brands/LOBs and capabilities
Long-lived, outcome-oriented, cross-functional, think-build-run, cross-
channel teams (pods)
Accountable owner owners. Hierarchy of outcome-ownership. Decision
rights and input rights. (Cleararchy)
Revised metrics, targets, incentives
Revised tooling regime
34

35. DESIGN
PRINCIPLES

36. Govern for value over predictability.
(Aim for soft predictability.)

37. Govern For Value Over Predictability
Value
Soft Hard
Predictability
SoftHard
Usual Aim
Usual Result Better Aim
Not going to happen

38. For best results, let purpose inform structure.
When the purpose is responsiveness:
Organize for responsiveness over cost-
efficiency

39. Design for intrinsic motivation and unscripted
collaboration rather than extrinsic motivation and
scripted collaboration
Autonomy | Mastery | Purpose

40. WHO IS DOING THIS?

41. WHO IS DOING THIS?
Digital natives
Sections of enterprise IT, Digital at companies
facing disruption e.g. finserv, media, retail
41

42. DON’T ASK FOR A BIG TRANSFORMATION BUDGET
A big transformation budget will need to be backed up
a big upfront transformation plan. That’s a waterfall
approach to Agile transformation
Think of an MVP for transformation
Committing to “feedback-based-planning” is a change
of mindset from committing to an upfront plan.
“IT-only” attempts lead to transformation fatigue
42

43. 43
Initial Design
First batch of
Pods
Second batch of
Pods
Third batch of Pods
The operating model evolves
as transformation unfolds
Initial Funding

44. INITIAL DESIGN
A. Business capability mapping to delineate products, channels and capabilities.
B. Outcome mapping to translate strategy to high-level outcomes and suboutcomes
C. Systems mapping to map the existing systems landscape onto the identified products,
channels and capabilities.
D. Review existing portfolio of work to assess alignment with new organization
E. Review metrics, targets, incentives for alignment with new setup
F. Review changes to reporting lines in order to ensure appropriate balance of authority
along dimensions of product, horizontal-concerns and people management.
G. Initial cut of long-lived, cross-functional pods with shared specialists where unavoidable
H. Identify communities of practice and community leads
I. Identify ready and potential candidates for product owners, capability owners and
channel leads
J. Work on internal messaging.
K. Identify pilot pods for rollout.
44

45. THE TIME TO ACT IS NOW
Cannot wait for “proven case-studies in my
industry segment”
Needs courageous executives.
45

46. THANK YOU
www.agileorgdesign.com