dimanche 9 août 2020

Why are mindset and values important in Agile transformation?

 


PART 1: Why are mindset and values important in Agile transformation?

Many people ask me about Agile transformation.

To introduce this topic, as first part, I propose you a quick synthesis of:

- What does being agile mean?
- Why do main companies want to adopt Agile?
- Why are Agile mindset and values important to Agile transformation?

My second article about frameworks and systemic approach in Agile transformation will come soon. Stay tuned!


What does being agile mean?
For starters, a reminder of what being agile means:
- To be able to adapt to change.
- To put the users at the center of what we do and focus on users' problems to be solved.
- To foster collaboration and self-organization.
- To deliver earlier and regularly valuable and working increments of product.
- To maximise the value delivered to the users.
- To collect users' feedback regularly and adjust depending on.
- To reflect frequently and improve continuously.
- And so on.

Why do main companies want to adopt Agile?
It can serve multiple purposes:
- To be more resilient in order to survive particularly in time of crisis.
- To adapt to customers/users behavior change.
- To satisfy customers/users through early and continuous delivery of valuable and working products.
- To continuously improve customers/users satisfaction by being open to feedback and adjust depending on.
- To innovate in order to retain and to catch new customers/users.
- To be time-to-market and to remain competitive.
- To gain agility in ideation, decision and execution.
- To improve performance.
- And so on.

Why are Agile mindset and values important?
When we talk about Agile, we first talk about Agile mindset and Agile values. Because it's a way to focus on the prerequisites and establish better environment conditions necessary to implement Agile according to many years of experience. It's not just fancies of a group of people.

Collaboration: If you have already managed projects or products you must know how silos or rigid contract relationships or lack of collaboration can be negative and blockers for a project or a product implementation.

Collaboration with users: According to the Standish Group study, 45% of software features are never used because they do not match with users' expectations and needs. M. Pepy, ex president of SNCF company, explained that only 30% or 40% of digital applications are really used.

So collaborating very closely with users allows us to ensure we respond to users' problems and to avoid this waste of time and money for companies.

Trust & confidence relationship and transparency: Are you familiar with the watermelon effect? Watermelon is green on the outside and red on the inside. This symbol is usually used for relationships between companies and their outsourcing partners. But it also happens when team members are afraid to escalate problems on the project and instead show green KPI.

In this case, you have to understand why it happens. 
Transparency is necessary to have real status, to have a visibility of all impediments to be solved in order to manage correctly your activities. And to have transparency you need to create a relationship of trust and confidence. And of course, visual management can help.

Individuals and interactions: Because building products around motivated and competent people works much better.

Self-organization: In order to simplify and bring agility in the processes of decision and execution. It is the strategy that some corporates like Accor have decided to adopt to gain agility following covid crisis impacts. 
Indeed, a lot of companies have understood that too many levels of hierarchy and decision making avoid them to have agility in decision and execution. It was particularly true during this covid crisis. The goal is to foster local decisions and actions to gain this agility. How? By helping local teams, that do and know, to self-organize.

- Deliver earlier and regularly working software: In order to satisfy our users. It allows us to ensure what we deliver matches with their expectations, collect their feedback and adjust early and frequently.

Change adaptation mindset: The current crisis shows us that it is not possible to follow a fixed and long term plan in this context of uncertainty and unpredictability. We need to adapt to change, to adopt experimentation mindset, fail and learn and adjust fast, be capable of adjusting depending on contexts and customers/users behavior changes, and so on.

- Reflect and encourage discussions regularly on what went well, what went wrong, what could be improved are the prerequisites for continuous improvement.

In conclusion, we have to focus and work first on mindset and values as prerequisites to establish better conditions to Agile transformation. We have to push the organization to question and make them understand WHY these mindset and values are important. We have to build our Agile transformation around these mindset and values before defining the way we will do it.

There are multiple Agile practices, frameworks and methods. According to me, all are relevant and complementary. As I said to my teams, we have to take them like a set of "tools" that we can use depending on your context and your needs.

Does it mean that we have just to strictly follow these frameworks to succeed in Agile transformation? I propose you to address this matter in my next article and see why a systemic approach is necessary particularly for Agile transformation in big companies.

-- Agnès Vugier

jeudi 30 juillet 2020

How to make your model more resilient and be capable of managing in time of crisis?




How to make your model more resilient and be capable of managing in time of crisis? That's the question I will humbly try to address in this article in this period of uncertainty and unpredictability.

This covid crisis has impacted a lot of people and companies. Unfortunately, a lot of them have lost their jobs and have been constrained to fire and stop their activities.

And on the other side, some companies have succeeded in continuing and even developing their businesses.

Below is my analysis of the characteristics of companies that have shown more resilient business models and have been able to manage and lead in this time of crisis.

- Customer-centric: They put the customers at the center of what they do and listen and focus on users' big problems to solve.
Take Amazon: simple and efficient services, focus on the major problem of people nowadays ie. the lack of time, the need to have things accessible very easily, very quickly, by delivering and repaying very easily and quickly for instance. 
That also means to take into account users' feedback loops because the best and the cheapest ambassadors and marketing strategy are still satisfied customers. 
See Amazon's popularity statistics: https://www.oberlo.com/blog/amazon-statistics  

- Data-driven: In order to know their customers, personalize customer experience and adjust their offers, they need metrics and insights and to be data-driven.

- They avoid dependencies by diversifying their activities and customer segments as possible: no single type of activity, no single channel, no single stuff. And they can manage their main activities by their own means. Once again, look at the Amazon model. 
For instance, Airbnb, that was considered as a disruptive collaborative platform, is now in difficulties. Their main activity is only based on vacation rental online that is fully blocked by lockdown and covid crisis.
Furthermore, a lot of clothing brands have to stop their activities because they concentrated mainly their efforts on physical stores and haven't invested enough on multi-channels and particularly on customer experience online. 
In the case of european neo-banks and fintechs in difficulties right now, they focus on a particular segment of customers and base their model on a few types of revenues related to in-store payments. Refer to article of Stéphane Houin (in french): https://www.usine-digitale.fr/article/tribune-quand-le-covid-19-revele-les-faiblesses-de-la-fintech-europeenne.N987344 

- They build an ecosystem of multiple partners. It is a way to diversify their products and services, acquire new users and experiment quickly. For example, Amazon has more than 2.5 millions of sellers on its marketplace. And Zhong An, the asian insurtech with 500 millions of customers and 8 billions of contracts, has more than 300 partners in addition to its own activities.
To know more about Zhong An, I recommend you the well-done podcast of Frédéric Panchaud (in french): https://www.podcastics.com/podcast/episode/story-un-assureur-inconnu-avec-500-millions-de-clients-32192/ 

- They cultivate an experimentation mindset: be capable to test quickly a new idea/product/service and decide quickly to launch it or to stop it. 
For example, Zhong An can test a new product in 5 weeks.

- They listen to opportunities and are ready to act when they appear like Microsoft Teams, Zoom and Klaxoon with their digital and collaborative platforms that have caught opportunities due to lockdown and necessity to work remotely.

- They continue to innovate and create new products and services depending on contexts and opportunities like BlaBlaCar and its new micro mobility offer BlaBlaRide: https://polandin.com/48403125/blablacar-to-offer-ebicycles-escooters-in-poland  
Saint-Gobain continues to invest in Research & Development of Innovative Materials in order to support sustainable development and energy transition policy. If you have time, here the link to very interesting podcasts about this topic: https://www.saint-gobain.com/en/hidden-power-materials-podcasts  

- They are capable of pivoting ie. that their organizations are able to adapt and to change quickly, with auto-organized teams and local decisions of people who do so know. 
Facing covid crisis, a lot of companies have pivoted to make masks with what they already have on hand like Michelin or Lego: https://www.geekwire.com/2020/face-mask-making-efforts-covid-19-crisis-reveal-really/  
Another example, Saint-Gobain has launched "Glass Loft Protection" product, a health protection glass in order to help companies to ensure their customers and employees health protection: https://www.saint-gobain.com/en/transparent-reception

- They start to do from their current situation and learn to do with what they have because we don't have access to unlimited budget. 
It corresponds to the first Effectuation principle. Indeed, the five principles of Effectuation are:
- Start with your means.
- Act in terms with affordable loss.
- Create partnerships and co-create with different stakeholders.
- Take advantage of surprises.
- Create your new world in order to control it and not just cope with it.

Updated the 31th of July 2020:
To illustrate, I choose the french startup Germinal for whom I have a crush. They have taken the challenge to change their business model from agency to product subscription model.
Despite VC's proposal to launch fund raising, they decided to start with their own means and define their acceptable limits. One month later, their first subscriptions allow self-financing! Wish them that trend continues and to grow! See the post of Grégoire Gambatto (in french): https://www.linkedin.com/posts/gregoiregambatto_il-y-a-46-jours-nous-lancions-notre-produit-activity-6694887686160887808-RN4_

Updated the 4th of August 2020:
You can innovate and do differently with simple things: In restricted movement context during covid crisis, Saint-Gobain teams ensure virtual plants visits with simple GoPro and smartphone. See article (in french): https://www.saint-gobain.com/fr/nouvelles-visites-virtuelles-de-nos-usines

- They propose services simple, affordable, more inclusive, accessible to all like Amazon, Zhong An insurance contract model in Asia or mobile-money and mobile-banking in Africa that have literally exploded over the last few years.
Below interesting articles on mobile-money and mobile-banking in Africa: 
 
You also find this approach in Frugal Innovation that consists of:
- Doing better with less.
- Transforming adversity into opportunity.
- Making your solution "all-inclusive" ie. accessible to all.
I recommend you the excellent video of Navi Radjou to discover great examples of Frugal Innovation: https://www.youtube.com/watch?v=Dj2vvxisoKI 

Effectuation principles and Frugal Innovation approach have existed for many years and I find them even more relevant during this period of crisis.

- They make simple processes and automate as much as they can. For example, Zhong An has automated more than 95% of its processes. Again, refer to Frédéric Panchaud's podcast. 
Amazon has the same automation strategy to increase efficiency and to reduce costs. This kind of automation strategy includes also some drawbacks but I will not debate on this topic there: https://medium.com/swlh/what-amazon-doesnt-want-you-to-know-about-its-automation-strategy-9046dd9289aa
These companies that succeed are Tech companies that invest in new technologies (RPA, BPM, IA, Blockchain, Cloud, low and no code platforms and so on). Those who invested in digital before the covid crisis have coped better with this crisis because they are more prepared to work remotely and continue to deliver services and value to their customers.
By experience, "Digital Transformation" and "Agile Transformation" take a lot of time. I don't believe in big bang strategy but more in iterative, incremental and adaptative implementation step by step. Even in Agile adoption, we have to apply Agile approaches.
Moreover, even if I'm questioning myself, I will not handle here the compatibility of digital and substainable development.

- They ensure recurring revenues (through licensing, subscription model, maintenance contract and so on). 
Telecom companies ensure recurring revenues based on their customers' subscription. 
A large part of Google's revenue comes from its proprietary advertising services and it also makes money with its Cloud platform: https://www.investopedia.com/articles/investing/020515/business-google.asp
When you have no recurring revenues and you only sell time like some services companies, you totally depend on other companies' purchase orders that are uncertain during times of crisis. For example, read the excellent testimony of Maxime Topolov: https://www.linkedin.com/pulse/digital-agencies-change-your-model-die-maxime-topolov  

To conclude, according to me, there is not only one fixed model but a multifaceted model. Whether you are an entrepreneur or a big company, you have to: be customer-centric, listen and know your customers, propose all-inclusive products and services for a larger number of people, be able to adapt to changes and to pivot if necessary, continue to innovate and diversify your activities in order to avoid dependencies. As a big company you have to keep an entrepreneurial mindset with innovation, experimentation mindset and agile execution. As an entrepreneur, you have to learn of big companies on structuring your activities, industrialization in order to scale, and managing your profitability. And probably, we will face this crisis with collaboration, partnership, mutual support and solidarity.

-- Agnès Vugier