Leading the Digital Business Culture
Digital Business arises from the combination of four major forces—cloud, mobile, social, and data—along with the rapid expansion of internet-connected devices. Digital business allows us to create new opportunities that blur the lines between the physical and virtual worlds. To take advantage of this rapidly changing environment, organizations have switched to techniques such as Agile development. Discussions, articles and conference sessions often focus on the techniques, theories, and practices of Agile development, often glossing over the cultural issues and barriers to success. In addition, speakers and discussion leaders often miss the context—how these approaches fit into the larger system of business, including strategy, planning, and program and project management. Leaders must continue to integrate Agile development into the larger context of program/project management, governance, security, and operations. To get the maximum benefit in speed, learning, and responsiveness possible with Agile development, leaders need to create a culture of safety and trust to allow teams to experiment, innovate, and learn. Leaders must learn to let go—embracing the culture where leaders exist at all levels of the organization.
Organizations often start implementing Agile development in vacuum; that is, they take great pains to set up their development environment to operate with agile principles. While this is a radical shift, software development does not occur in a vacuum. Without changes in the supporting environments—project management, governance, security, and operations—the organization cannot make the cultural shift necessary to enable the velocity and quality gains possible with agile techniques. The organization will look like a small team of children trying to pull an obstinate elephant—there’s just too much friction or too many roadblocks for agile development teams to deliver value across the organization.
One example is project management. Traditional project management efforts develop a highly-defined scope of work for the effort. This rigid baseline generally requires months of detailed planning efforts to achieve the required specificity to support detailed cost and schedule estimates. Project managers manage this baseline with rigid change control focused on the triple constraint of scope, cost and schedule. Most organizations make the switch to Agile development because they cannot survive a planning period that takes up a third to half of their business cycle in traditional waterfall approaches. In Agile development, work begins after a few weeks of planning. In addition with Agile development (we’ll use Scrum as an example) efforts are time-boxed, with the schedule and cost fixed for each short iteration, or sprint. The scope of each sprint can vary depending on the velocity of the team, with the specific work items, or user stories, prioritized by the empowered user representative, or product owner. The combined effect is that Agile development embraces uncertainty and change, so project management approaches must be altered to account for the uncertainty and change. Holding on to the traditional project management approaches will slow down teams and insert unnecessary roadblocks into the process.
One technique used by organizations to overcome this barrier is assigning project reserve based on the cone of uncertainty. The cone of uncertainty is a graphic depiction showing the increasing accuracy of estimates as the details of a project become known over time. Agile projects start with only a few weeks’ planning, so these organizations assign a high initial reserve (100 percent or more) at the start of work point to account for the inherent uncertainty of the project at this stage. The teams give up reserve over time as the project becomes more certain. This approach has seen its greatest success when combined with a “fail-fast” approach (attacking the hardest technical problems or highest risk items first) along with complete transparency of reporting the team’s efforts and progress across the organization. Traditional project management experience would argue that by assigning so much reserve up front, the project portfolio would see a mass consumption of the reserve. Counter intuitively, this is not the case. One Federal agency that put this practice into use saw very little use of the reserve—only 5 percent across the portfolio in the first year after initiation, across a dozen projects.
The shift to digital business and agile techniques require leaders to pivot from the traditional command and control mentality. Leaders must learn to let go, embrace change, accept small failures, and emphasize learning. Digital leaders must focus on protecting change agents on their teams and throughout the organization. This is especially key in the public sector, where command and control is the natural organizational state, and leaders battling among themselves to protect their fiefdoms is the norm. Successful leadership in digital business requires leaders to don their suits of armor to protect and defend the vulnerable disruptors driving positive change from the slings and arrows of detractors, resistors, and skeptics. Attitude is also key—leaders with a calm attitude amidst the storms of change will maintain the safe environment necessary for innovation and flow.
Looking forward, digital leaders can continue to extend their reach beyond technology by embracing start-up thinking. Public sector agencies have traditionally decided on what digital services they will provide to constituents either on their own or with help from surveys. What if they used experiments and A/B testing to determine what digital services the public wants, similar to approaches outlined in The Lean Startup by Eric Ries. Digital leaders that embrace change and start-up thinking can partner with their business units to more rapidly deliver digital services based on real evidence of public desire—reducing delivery times, eliminating wasteful development efforts, and reducing spending.
In the end, it all comes back to digital leaders’ ability to create a culture of safety and trust that allows for experimentation, innovation, learning, disruption, and—a term rarely accepted in the public sector—failure. Without that culture, the leaders will not be able to keep pace with the rapid change of today’s digital world.