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Manage Agile Conference

October 17th, 2018

Enabling agile leadership

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Your speakers today

Dr. Philipp KoloBCG, Principal, München

Dr. Erik LenhardBCG, Associate Director,

München

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1 Agile requires changes from everyone including top leaders

2 Leaders play a critical 'make or break' role

3 Leaders' role if often underestimated5 key messages for today

4Building the mindset & muscles requires changing

ingrained leader behaviors

5Getting this right is key to 'unlocking' the value of agile –

some examples on "how to"

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The importance of leadership in agile transformations

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Agile@Scale: Several dimensions to be revisited for a comprehensive Agile approach

Purpose,

Strategy & Priorities

StructureGovernance &

funding

Technological

enablers

Measurement

framework

Processes Leadership &

talentCulture &

behavior

1

2 3

4 5 6

7 8

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Agile demonstrates early success but organizations encounter culture clash when trying to scale

Source: Interviews, BCG analysis

We are clear that the full transformation could take two years but

we know we need to show success early and often

We are making a huge investment, we need to prove that it works

We put the best people on the first Agile team– the kind of people who won't give up

when things don't go well right away

Agile pilot team needs to be exempt from the typical performance review process or it

would not work– we work with appropriate parties to make sure that this happens

We need to find a way to consistently reward teams over individuals – it is a real problem

when we scale

Leadership says they support Agile but do not show up at showcases

or they look for on-time and on-budget rather than value delivered

It is almost like a merger situation: Agile team and the rest of the organization have

two different cultures

Organizationsdemonstrate

Agilesuccess early …

… by creating the conditions for impactful

pilot projects …

… but encounters culture clash when

trying to scale across org

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Implications are broad: Agile affects how organizations work

Operating model Roles of Teams & Leaders Leader behaviors

Flexibility

Fast, tangible output

Self-organizing, cross-functional

teams

Customer feedback

Sprint 1 Sprint 2 Sprint 3 ...

...Drive impact

Enable &

energize people

Visible

commitment to

Agile; leaders

with one voice

Acknowledge &

celebrate success

Greater emphasis

on issue-resolution

path than on

status

Use KPIs to drive,

and where

needed, reset

focus

Reinforce

accountability

Empower

teams

Champion

new behaviors

Create culture

that accepts &

addresses bad

news

constructively

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Culture is the single largest challenge for Agile@Scale; followed by other people—related issues

1. Respondents were able to make multiple selectionsSource: VersionOne, 11th Annual State of Agile Report, 2017; versionone.com

43%

Lack of management support

47%Lack of experience with agile methods

Company philosophy or culture at odds with core agile values 63%

45%

Lack of business/customer/business owner 41%

General organization resistance to change

Insufficient training

31%

34%

Inconsistent agile practices and process

20%

Pervasiveness of traditional development

34%

Fragmented tooling, data, and measurements

15%Regulatory complaince and governance

19%Ineffective collaboration

Challenges experienced Adopting and Scaling Agile1

9

Culture eats strategy for breakfast –

but leaders eat culture for dinner

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Why it matters: Senior leaders can make or break a transformation

4

17

19

25

31

0 10 20 30 40

Sufficient funding

Employee buy-in

Effective communication

Clearly defined milestones & objectives

to measure progress

Commitment of senior management

1. % respondents, top five answersSource: Economist Intelligence Unit Survey

Question: For the initiatives that succeeded, what was the

single most important factor in determining success?

Question: For the initiatives that did not succeed, what was

the single most important factor in determining failure?

Engaged and enabled leaders

are critical for success1...

...and lack of commitment by senior

leaders is a primary reason for failure1

14

15

18

20

28

0 5 10 15 20 25 30

Lack of clearly defined milestones & objectives

to measure progress

Lack of commitment bysenior management

Insufficient funding

Poor communication

Employee resistance

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Agile requires leaders to deploy new mindsets & behaviors

Command and control Empowering and coaching

Decisions through hierarchy Autonomy through alignment

Success defined by size of team Success defined by value delivered

Big, perfect, slow Pace over perfection

I am not sure what is going on.

I don't trust the plans & updates.

I can't afford to be blind-sided.

I understand what the team is doing & why.

The team will find the best solution.

They will come to me if there is an issue.

From ... ... To

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Types of commitments leaders need to make

... the majority of our time is spent in meetings;

a small minority of our time is left for

unstructured engagement

... the majority of our time is dedicated

to team engagement, including walking the

halls & unstructured conversations

... we communicate regularly to our teams via

email and memos; we use video & alternate

channels for extraordinary circumstances

... we optimize for 2-way communication

and engagement, and limit emails and

memos to share critical details

... meetings structured around formal

presentations with supporting slides to guide

the discussion

... stand-up meetings structured around 3-5

topics for debate and discussion

emphasizing quick issue resolution

... we save time by providing detailed

instructions and direct guidance

... we look to our teams to provide

evidence based recommendations to our

questions and delegate decisions

From ... ... To

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How leaders act & create context is a key success factor

• What they talk about & how they behave in

meetings

• What accomplishments do they celebrate

and which heroes they make

• What projects they fund

• The speed and detail which leaders act

• What they measure and incentivize

• What level of rigor they use to track

progress

• Who they hire

• Who they fire

• Who they promote

Leaders shape culture & should be

mindful of the shadow they cast... ...with everything they do

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How we think about Agile Leaders makes BCG stand out

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How to agilize leadership?

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BCG view: Behavioral change results from context change

RightTypical, but wrong

To change what people do, change their mindsets,

feelings and values–but …

• Directly tackling mindsets/feelings/values is

useless and triggers defense mechanisms

• Also, mindsets are out of reach for

direct intervention

Desired behaviors spontaneously emerge when you

change the context

• Make desired behaviors the winning,

rational strategies

• For example, cooperation automatically occurs if

the context makes it an 'individually useful

behavior'Source: Y. Morieux (2011), 'Resistance to Change or Error in Change Strategy?' In: From Taylor to Today: The Multimedia Encyclopedia of Organization Theory, Erhard Friedberg (coord.), Research & Organization

Change

leversMindset

Context Behaviors

Change

leversMindset

Context Behaviors

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Source: The Business of Behavioral Economics, HBS Working Knowledge

Make a

plan—

yourself

Make it

visible

and social

Be accountable

to someone

else (peer)

Make it costly

(personal,

meaningful

consequences)

29%

80%

Success rate

4

3

2

1

5 Programmatic

leadership

coaching

Our approach leverages principles of behavioral economicsResearch shows success rates are greatly influenced by reinforcing mechanisms

Bespoke program

enhances impact &

sustainability

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What it could look like from leaders' point of view

Reflect on own leadership profile in coaching session

#1. Raise awareness on individual strengths vs.

areas for development vs. agile leader model

Immersion session: Get familiar with

Agile principles, hear from those with

Agile experience, draft agile leader model

Share findings in collective session(s)

to fine-tune agile leader model.

Translate into specific behaviors &

team routines

Assess self & peers

against new

leadership model

Share peer feedback results

during coaching session #2

& reflect on individual

development priorities

Benefit from regular agile mind

openers

Build individual

development plan in

coaching session #3

Progressively embed new

agile leader routines in

daily practices

Get regular nudges & peer feedback on new agile behaviors & routines (via Amethyst app)

1. eg, Agile KSS exercise, check-in / out of meetings

1

2

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4 key success factors for sustainable agile leadership transformation

Understand/align: Prioritized agile

success behaviors & gap from current

Commit: To daily "workout," including

individual & team action plans

Sustain: Support and resources to monitor

and enable individual and team success

Reinforce: Through targeted mechanisms

to ensure ongoing progress and impact

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