Operational agile management concepts in non-IT-technical business areas

Approaches and implementation


Seminar Paper, 2019

13 Pages, Grade: 1,3

Anonymous


Excerpt

Table of contents

List of abbreviations

List of illustrations

List of tables

1 Introduction
1.1 Issue statement
1.2 Goal and approach

2 Concept of agile management
2.1 History
2.2 Scrum methodology
2.3 Benefits and implementation

3 Approaches in non-IT/-technical business areas
3.1 Agile human resources at ING
3.2 Agile marketing at a Fortune 500 company

4 Conclusion

List of references

Management summary

Agile concepts originate from project management in software development and today stand for a modern way of work management within an organization. Especially the most famous concept of Scrum has made its way out of technical departments to other dynamic business areas such as human resources or marketing. The implementation of agile in new business areas can be illustrated with the cases of ING bank and a fortune 500 company. This paper leads to the conclusion that agile practices are necessary in order to compete within the speed of tomorrow’s business world.

List of abbreviations

Abbildung in dieser Leseprobe nicht enthalten

List of illustrations

Illustration 1. Challenges with implementing Scrum (Scrum Alliance, 2017, p.°21)

List of tables

Table 1. Favorable and unfavorable conditions for agile

1 Introduction

1.1 Issue statement

The term “agile” is one everyone’s lips these days (Edelman, Heller, & Spittaels, 2016). Agile stands for getting things done fast, keeping customers happier and enjoying team work (Rigby, Sutherland, & Takeuchi, 2016b). What began as project management tool in software development, nowadays represents a modern way of work management within an organization. Success in IT- and other technical projects led managers to ask themselves if agile would be promising also for other activities and operations. Eager to bring innovations faster to markets than competitors, many organizations are moving from traditional, sequential methodologies to the iterative concept of agile (Rigby, Sutherland, & Takeuchi, 2016a). Thus, the question arises whether the principles of agile management concepts are applicable to new business areas and if so, what approaches for implementation exist so far.

1.2 Goal and approach

This paper commences with describing agile management in general. For this purpose, the following chapter investigates its origin and general principles, uses the Scrum methodology to explain the approach further and mentions benefits and implementation challenges. In the third chapter, case studies from two different business areas are given to illustrate how agile concepts can be implemented. Agile marketing and agile human resources are discussed here. Then the paper concludes with some summarizing points and an outlook on the topic.

2 Concept of agile management

2.1 History

Until the 1990s, a traditional waterfall approach dominated the process of product development in the software industry, which relied heavily on predictive planning, extensive documentation, tight control and eventually a product that was strictly conform with original specifications. But this approach was slow, wasteful and demoralizing for developers. This is why there was a need for a faster and more flexible approach. Over the next few years, several alternatives to waterfall approaches have emerged. Some of the most important ones include extreme, adaptive, and dynamic project management as well as so-called Scrum. These approaches all describe projects which are realized as an iterative process rather than a pre-set plan (Rigby, Berez, Caimi, & Noble, 2016). The creators of the new concepts joined forces and came up with the term “agile”. As a result they drew up the “Manifesto for Agile Software Development” in 2001, which states four principles of agility: (1) individuals and interactions over processes and tools (2) working software over comprehensive documentation (3) customer collaboration over contract negotiation and (4) responding to change over following a plan (Beck et al., 2001).

As agile management concepts gained popularity over the years, a group of large firms came together in 2016 in order to see whether they could agree on what “agile” stands for in their companies. Together, they defined four basic elements of the agile mindset that represent the essence of agility for them: (1) delighting customers (2) descaling work (3) enterprise-wide agility and (4) nurturing culture (Denning, 2018, p.5). How these elements can be achieved by organizations is explained in the following.

2.2 Scrum methodology

Scrum is used to further illustrate the approach, as according to VersionOne, this methodology is currently the most employed one at companies (VersionOne Inc., 2018, p.9). The first component of the Scrum methodology is roles. A small cross-functional team represents the core of a project. It consists out of five to ten people and is self-organizing. The so-called Scrum Master is traditionally assumed by a project manager or team leader. This person is typically responsive for enacting the Scrum values and practices and to remove impediments. Finally, there is the product owner, who is usually a functional unit manager and therefore knows which requirements are needed to realize the project and how the sequence of builds should progress (Cervone, 2011, p.10).

Process is the second component of the Scrum methodology. It is characterized by five main activities: kickoff, sprint planning meeting, sprint, daily Scrum meeting, and sprint review meeting (Cervone, 2011, p.20). The most important one is the sprint itself, which is an iteration of 30 calendar days or less. At the end of each sprint, a “done” increment must be delivered. Therefore, sprints build the frame of agile working (Maximini, 2015, p.29).

The last component are artifacts, which include product backlog, sprint backlog and burn down charts. The product backlog is basically a list of requirements for the project. This artifact is mostly a major deliverable of the kickoff or sprint planning meetings. Sprint backlogs represent the subset of product backlog items as part of the work for a particular sprint. A burn down chart aims to provide information in an easy and comprehensive manner by showing the current progress within a project (Cervone, 2011, p.21).

2.3 Benefits and implementation

The main advantage of agile management concepts and particularly the Scrum methodology is simplicity (Cervone, 2011, p.22). However, evidence from companies show that there are numerous other benefits of this methodology, such as the ability to manage changing priorities, project visibility and increased delivery speed or time to market (VersionOne Inc., 2018, p.2).

In order to assess whether agile is applicable business areas outside of software, managers need to have a look at several variables. Table 1 illustrates some important conditions where executives can evaluate whether businesses are suitable for agile or not. Exemplarily, on the one hand, some C-suite activities like performance assessments, press interviews, visits to plants, customers and suppliers, are not suited to agile methodologies due to several unfavorable conditions. On the other hand, product development functions, marketing projects, strategic-planning activities, supply-chain challenges, and resource allocation decisions may offer potential to apply agile as conditions are more favorable (Rigby et al., 2016a).

Abbildung in dieser Leseprobe nicht enthalten

Table 1. Favorable and unfavorable conditions for agile (Rigby et al., 2016a)

Although managers will probably find areas where agile can offer benefits for the company and its stakeholders, barriers to implement agile management concepts can still occur. Illustration 1 portrays some of the major barriers, particularly for the Scrum methodology.

Abbildung in dieser Leseprobe nicht enthalten

Illustration 1. Challenges with implementing Scrum (Scrum Alliance, 2017, p.21)

We can observe than mainly organizational issues cause barriers to change from traditional management approaches to an agile approach. Another main barrier is resistance to change from an employee’s perspective (Scrum Alliance, 2017, 21-22). The obvious challenges when it comes to implementing agile lead us to think about if it is still attractive to strive for agility in non-IT/-technical business areas, but the following case studies will demonstrate how barriers to implementing can be destroyed.

3 Approaches in non-IT/-technical business areas

3.1 Agile human resources at ING

As described previously, agile concepts are characterized by short cycles, regular reflection and course correction. Human resources departments traditionally work in annual (or quarterly) cycles, which is not in line with the speed of agility. Applying agile to human resources management, the services stay the same but become more responsive to the ongoing changes in the culture and the work style of the organization (Gothelf, 2017). In broad terms, agile in HR can be termed as “agile lite”, because general principles are applied without adopting all the tools and protocols from the tech world, such as e.g. Scrum (Cappelli & Tavis, 2018).

An example of building agile into HR is the global banking group ING. Web and mobile technologies disrupted the banking sector, which is why ING needed to become nimbler and more user-focused in order to serve its customer at every point of its financial journey. The company’s approach was to launch a pilot agile transformation at the headquarters of ING’s largest unit. The first step was helping senior leaders and the board envisaging a new agile system for deployment, development and assessment of talent (Barton, Carey, & Charan, 2018). ING made all their staff members re-interview for their job, where 40% of these ended up in new positions or parted ways with the company afterwards. In fact, numerous employment relationships endings occurred not due to irrelevant skill sets, but due to a lack of a specific mindset. At ING, the HR team had to play a main role in understanding how this mindset looked like and how to determine which employees possessed it, who could be trained, and who had to be let go (Gothelf, 2017).

3.2 Agile marketing at a Fortune 500 company

A need for agility is also observable in marketing. Similar to HR, this business area cannot react fast enough using current ways of doing things. Sometimes it may be difficult for marketers to know what is important for customers. The worst case would be that companies bring a meaningless and non-consumable product to market (Accardi-Petersen, 2011, p.41).

Before implementing agile management concepts, the marketing team of a fortune 500 company faced several issues including unclear objectives, underutilized digital strategy and dwindling innovation, which all resulted in a lack of customer centricity. At first, the VP of the group saw the root cause problem in the silo structure of the organization, while in reality the issue raised from a flawed operating model. That was when the leadership team decided to launch an agile initiative. Although staff was familiar with the concepts of agile software development, they did not see a relevance to marketing. (PwC, 2014, p.10)

The leader’s approach was to establish a pilot to help team members develop a better understanding of agile and its benefits. This pilot was built around mobile marketing. The initiative followed a typical Scrum methodology: after a two-day workshop, where the fundamentals of agile management concepts were introduced, cross-functional teams were formed. These existed out of mobile developers, data analysts, campaign managers and others. Afterwards, two-week sprints were mapped out with corresponding milestones. (PwC, 2014, p.10)

[...]

Excerpt out of 13 pages

Details

Title
Operational agile management concepts in non-IT-technical business areas
Subtitle
Approaches and implementation
College
Reutlingen University
Course
Advanced Management Concepts
Grade
1,3
Year
2019
Pages
13
Catalog Number
V500320
ISBN (eBook)
9783346021670
ISBN (Book)
9783346021687
Language
English
Tags
agile management, advanced management, approaches, implementation, agility, scrum, human resources, hr, agile hr, marketing, agile marketing
Quote paper
Anonymous, 2019, Operational agile management concepts in non-IT-technical business areas, Munich, GRIN Verlag, https://www.grin.com/document/500320

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