How to transform an organization

To me, the big theme of this year’s Scan-Agile conference was that transforming individual teams to agile is not enough – the entire organization needs to change. Converting a team to, say, Scrum is a waste of time if the increased output and flexibility cannot be used by the organization. It can be even harmful if it puts more pressure on other places of the organization. (And of course, it may be impossible for the team to change if the organization doesn’t.)

Based on the teachings of the conference, if I had to transform an organization, how would I do it? Here’s how:

  1. Can you draw the value stream map? If not, simplify your product offerings until you can.
  2. Draw the value stream map. Find out where the bottlenecks are.
  3. Slow down the value stream to the speed of the bottleneck.
  4. Find ways to speed up the stream at the bottleneck.
  5. Go to 2.

Any process changes, e.g. the introduction of agile development practices or beyond-budgeting principles, should have the goal of improving the value stream. If the change cannot be justified by looking at the value stream, it should not be made.

I don’t know much about value stream mapping or theory of constraints, but I think I ought to. I hear The Goal is the book to read.

I have only tinkered with process changes on the team level. You with more experience, please tell me, did I understand things correctly?

5 thoughts on “How to transform an organization

  1. Vasco Duarte says:

    good summary of one the trends that were present in Scan-Agile. In the panel that was a clear theme. It’s not enough to do Agile at the team level, changes should expand to other areas of the organization. The flip-side is that if Agile ideas do not spread to other areas of the organization then Agile will not stick….

    Another aspect worth highlighting was raised by Dave Snowden: if we don’t understand the theories behind what we are trying to do we are doomed to miss cfritical aspects and fail the application of these ideas at some point.

  2. Antti Tarvainen says:

    I definitely agree with Dave Snowden (see e.g. https://tarvainen.wordpress.com/2007/06/22/no-substitute-for-understanding/ ) but I do wonder, how does one know if he understands the theory or not? Dave Snowden has probably quite a bit higher bar for understanding the theory than what most of us do.

  3. Antti, you are definitely on the right track. I totally recommend you to check out “The Goal”.

  4. Pirkka Jokela says:

    Personally, I would start any organization transforming by reading this:
    http://www.fieldbook.com/Ghost_stories/purpose006.html

    And I think you really need to read it, because you seem to think that if an organization can be shown that change would result in more income, the change is automatically welcomed. :-) The only one who wants a change is a baby with a wet diaper.

    On the other hand: you’re absolutely right about the importance of changing the whole organization and not just living in an agile bubble.

  5. Antti Tarvainen says:

    Pirkka, thank you for the link! I finally read the article and found it very thought-provoking. And yes, I admit that the viewpoint I presented on my blog post was very narrow.

    I would, however, contest your view that nobody wants change. People outside core groups want change. Even core group members want change if their organization’s capability is not enough to provide for them.

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