Bartleby The fashion for agile management is spreading

, Modernización de Empresas

Executives need to be a cross between Spider-Man and Simone Biles.

AGILITY is such a modish word in modern management theory that it can seem as if the ideal corporate executive would be a combination of Spider-Man and Simone Biles, a gymnast. The concept has its roots in the idea of “lean management”, developed by Toyota in car manufacturing, and in the “Agile manifesto” drawn up by a group of software developers back in 2001.
Big software-development projects were (and are) notorious for producing costly, late and cumbersome results. The idea of agility was to focus on small, innovative and multi-disciplinary teams. Among the manifesto’s principles were that “individuals and interactions” were more important than “processes and tools”, and that responding to change was better than sticking to the plan.
Somehow, the teams concept acquired the name “scrum”. This moniker was clearly bestowed by someone who had never seen a real rugby game. An actual scrum involves 16 people pushing hard, getting nowhere and usually ending up collapsing or being penalised by the referee for foul play.
Management scrums aim to be a bit more mobile than that. In his recent book, “The Age of Agile”, Stephen Denning recounts how a team at Spotify, a music-streaming provider, developed the “Discover Weekly” service, which suggests new songs to users. The team pulled together a prototype within a couple of weeks and tested it first on their fellow-employees and then on very active users. All Spotify customers were offered the Discover service within just four months of the concept being created.
Another author, Simon Hayward, writes in his book, “The Agile Leader”, that the aim of agility is to bring the company as close to the customer as possible. Ideas can be tested on a small scale and abandoned if they fail to work. Feedback from the customer is essential at every stage. Teams work on small tasks in short cycles, achieving their immediate goal and quickly moving on to the next.
This way of thinking seems sensible enough for specific projects. But companies are now starting to test whether an entire business can become agile—corporate versions of the Chinese state circus. A recent article for the Harvard Business Review (HBR)* describes companies that have adopted an agile approach, including Bosch, a German electronics and engineering firm, USAA, an American financial-services company, and the health-information systems division of 3M, a multinational. Perhaps the most striking example is Saab, Sweden’s defence firm, which created more than 100 agile teams, covering software, hardware and the fuselage, to build its Gripen fighter jet.
These firms have helped show that transforming groups into agile companies is possible. But it is not easy, says Darrell Rigby of Bain, a consultancy, one of the HBR authors. Just creating teams is not enough; the leadership and culture of the whole company must change. Items such as budgets and employee pay have to be altered to reflect the much shorter timeframes of team operations.
A much bigger agenda lies behind the emphasis on agility. Some argue that the old, top-down corporate model, associated with Alfred Sloan at General Motors in the second quarter of the 20th century, is no longer relevant. Instead, companies need to adapt to a world that is VUCA (volatile, uncertain, complex and ambiguous) and which requires continuous innovation in order to keep up. Agile teams are the equivalent of in-house startups.
It is worth remembering, however, that many startups fail to gain traction. There is a danger that, while a firm’s best talent is off pursuing new ideas, the core revenue-generating business deteriorates due to neglect. Permanent revolution may sound an enthralling idea in theory but may lead to chaos in practice.
And what is the role of the chief executive at a big company in an agile world? Most of the innovation and big decisions will have been delegated down to the level of the team. The boss will of course still have an important role in allocating capital to the various teams. But will that role really justify the $10m-plus salaries that chief executives often enjoy? Indeed, if agility is really the characteristic of business success, then perhaps the very structure of a public corporation is not the most appropriate one. Small businesses, by their nature, are more likely to be agile. The best gymnasts, after all, don’t tend to be built like rugby forwards.

* “Agile at Scale” by Darrell Rigby, Jeff Sutherland and Andy Noble, HBR, May-June 2018

This article appeared in the Business section of the print edition under the headline “The A teams”


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