Here’s how I think of agile.
Traditional software development has the problem that it gets feedback only after it has lost its ability to make relevant changes.
Agile on the other hand aims to get the feedback quickly while still having room to maneuver.
The upper right-hand corner of the chart is the sweet spot for development. It is the place where learning is possible and true innovation can occur. This is the heart of agile development. If your agile process leads you to the lower left side for whatever reason, you are doing it wrong.
I’ve pessimistically drawn both arrows’ ends’ in the lower right. From innovation point of view, the goal of course is to stay as long as possible on the upper right, and for example Facebook has kept in that general area for admirably long. But there seems to be a very real gravity that takes successful products down on the chart. This is The Innovator’s Dilemma: successful competition in an established market requires sustaining innovation, and companies that invest heavily in it tend to lose their ability to change direction. (Example: Nokia’s phones in 2000-2010.)
But while the individual products and product families are brought down by gravity, a company may escape it by cultivating disruptive innovation. Apple and 3M show that it is possible, but it appears to be very hard, since there are not many companies like that.