Agile: a low-risk solution for digital transformation

Business leaders have arguably never been under more pressure to adapt quickly and efficiently, with the need to use technology well as a necessity and no longer an option.

With economic pressures and the need for organizations to adapt to a digital age, an Agile approach can make digital transformations faster, more effective and more adaptable.

Already adopted by several organizations – including Apple, IBM and Microsoft – Agile relies on a wide range of principles, including early and continuous delivery, collaboration and acceptance of change.

By pairing digital and Agile transformation together to create Agile digital transformation, companies can get the best of both worlds, benefiting from a system that enables continuous improvement.

An ecosystem that is always learning and adjusting

“The biggest benefit for businesses is the flexibility it brings,” said Simon Morris, VP of Solution Consulting UK&I, ServiceNow. “When it comes to digital transformation, using an Agile approach offers business leaders more choices, with the opportunity to meet challenges faster, or identify and exploit competitive advantages more efficiently.

“Our research shows that Agile organizations score higher on almost every metric compared to non-Agile organizations, leading customer loyalty by up to 20% and increasing market share by 11%. Businesses that adopt this approach are more responsive, more streamlined and able to recover quickly – all important attributes when it comes to delivering successful digital transformation.”

“I would argue that the word transformation implies a clear and finite end, when a company’s digital journey really does not end,” says Helena Nimmo, CIO at Endava. “The key to successfully implementing an agile strategy for continuous innovation is not in digital transformation. A more nuanced and bespoke approach, which I call ‘digital acceleration’, provides that agility and enables to leaders to protect their businesses while simultaneously allowing them to innovate with greater flexibility and understanding of their internal and external stakeholders.

“There is always one more step forward in the digital journey. Staying agile and being able to reassess, update, and improve the use of digital technologies as an ongoing, continuous process is a more rewarding way to implement any digital strategy.”

Agile approaches a low-risk solution for digital transformation

In many businesses that need to change quickly and efficiently, a continuous incremental delivery approach can get features into product teams and end users’ hands faster than a waterfall approach, according to Ben Houghton , CTO at IRIS Software Group.

“This creates a feedback loop that quickly identifies issues or unintended consequences, allowing the approach being taken to be adjusted according to the flight requirement,” he added. “An agile approach provides a low-risk solution as it breaks down digital transformation into short, manageable phases where the team learns from their results before moving on. This leads to fewer mistakes, and projects typically deliver more value in less time.

“IDC research shows that an Agile approach makes digital transformation faster, more effective and more adaptable,” added Morris. “For business leaders who are under pressure to change quickly to stay economically viable in tough economic times, Agile is essential to ensuring digital transformation is effective within the right timescale.”

Company culture the biggest obstacles

Agile transformation is a serious undertaking that requires a lot of effort, so many teams struggle with the enterprise transformation process. The biggest obstacle organizations face is company culture, which can be deeply ingrained in the way organizations work, says Morris.

“Achieving this change in mindset is not just a matter of deciding to be agile,” he added. “Instead, managers need to be ready to move from annual leadership cycles with annual budgeting processes, to rapidly moving decision cycles. This means that leaders need to decide to increase or initiatives sink for weeks, days or hours.

“Digital acceleration allows for faster delivery compared to digital transformation, without undermining long-term strategic thinking,” Nimmo said. “That said, either way, there are always inherent risks that shape technology decision-making. To combat these risks, we need to understand what the core goals of both business and technology are, as well as their wider context.

“Our recent research found that the top three risk factors most impacting digital adoption over the next five years are remote and hybrid work; changing market context; and adapting to growth.

“This shows that businesses need to continue to build and improve existing capabilities, rather than overhauling the entire system which could potentially open them up to more risk.”

Controlled risk is essential to the success of the Agile approach

Part of taking an Agile approach is taking risks, so it’s important how organizations balance risk versus reward. With regular, consistent reporting and improved transparency, teams using Agile methodology are better equipped to deal with issues, but it’s also important not to change for change’s sake.

“If companies are looking to expand into uncharted territory — whether big data platforms, cloud optimization, or even the metaverse — balancing risk versus rewards comes down to any decisions made and implemented when the time is right, as part of an ongoing journey rather than for its own sake,” Nimmo said.

“When considering a digital acceleration roadmap, companies need to look more closely at the solutions that offer the most value. Adopting technologies because they are new is counterintuitive and must ensure companies whose plans will bring significant value to existing processes.”

“Agile management is about controlled risk,” says Morris. “However, most organizations will actually see large-scale, unexpected problems shrink as a result.”

Agile isn’t just about keeping the wind out, Houghton added. “It’s important to de-risk as much as possible,” he said. “There’s a lot of planning and design around a scrum team so they can make the agile approach a reality. Continuous review and iterative correction is essential, as it keeps the delivery closely aligned with the goal.”

Along with taking controlled risks, good communication is key to the success of an Agile approach. It is important to highlight the benefits of the Agile approach to team members.

“Communication is central to Agile because it’s a team sport,” concludes Morris. “Leaders must ensure that employees at all levels understand its benefits and why the business is using the strategy.

“Having a clear roadmap is also important. Agile businesses need to ensure that all departments and teams are united behind common goals, whether it’s delivering new products and services, or something else. Each department brings their own specialist skills – but leaders need to ensure that each team understands the end goal and supports the Agile approach.”

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