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Can AGILE enable a full scope transformation approach and realise expected benefits more successfully? Transformation Assurance 1 Need for speed in benefits delivery to remain in pole position 4

2 Agile delivery – the pervasive solution for maximising project 5 benefits?

3 Scaling agile in order to comprehensively realize 6 organizational benefits

4 Embedding agile in a full scope transformation approach 8

5 When to act – common risk areas and early warning 9 indicators

6 Our point of view 11

7 Contacts 12

2 Scaled agile transformations Nowadays everyone is talking very, others have been seriously a combination of all these factors about agile and its great potential struggling to quickly deliver the was the problem? for quickly delivering value to expected benefits – or to deliver In this article we will give an organisations and customers. anything at all. Why is this so? answer to 1) why agile projects, Anyone following this discussion Have these organisations suffered and especially large-scale agile might get the impression that a lack of agile education and programmes, often struggle, agile is a silver bullet. experience or made inappropriate and 2) how the challenges and use of agile methods and tools; risks of agile delivery can be Although some organisations did they encounter resistance overcome to ensure smooth and have demonstrated success in to cultural change, or was there continuous product delivery and agile project or programme deli- just a lack of discipline? Maybe realise the expected benefits.

Scaled agile transformations 3 1 Need for speed in benefits delivery to remain in pole position

Figure 1: Agile Methodologies Used Increasing market demands are Source: VersionOne: 10th Annual State of Agile Report transforming the way organisations respond to customers’ needs. To address the drivers, which are mainly centred SAtern on speed of delivery and business value Feature-Driven Development (FDD) Agile Unified Process (AgileUP) created, organisations are adopting agile Agile Modeling I Don’t Know practices at a rapid pace. According to Lean Development th Other VersionOne’s 10 Annual State of Agile Itrerative Development Report, Scrum (58%) and Scrum/XP hybrid (10%) are the most commonly used agile methodologies. The remaining 32% of respondents practise either one or a combination of more than a dozen other Scrum agile methodologies, adapted from the market or iteratively self-developed. Custom Hybrid (multiple methodologies) Scrum/xp Hybrid

This recent ambition brings new risks maximise the benefits promised from as organisations, people and processes them, advanced project or programme evolve to learn and adapt to the new way management practices and governance of working. Hence, for transformation need to be put in place. projects and programmes to deliver and

4 Scaled agile transformations 2 Agile delivery – the pervasive solution for maximising project benefits?

In addition to rapid realisation of business There is no doubt that, when properly The advantages of agile delivery value and benefits to customers and end implemented and managed with the right practices, especially in the IT and users, such studies commonly highlight controls and governance protocols, agile sector, have the following agile related advantages: can be successful in quickly delivering been proven, and many organisations functionality and maximising benefits. have even adopted agile as their default • Greater control over time and budget, However, to implement an agile project project delivery method. There are also with the focus on prioritising and an organisation has to adapt and realign studies, such as those published by The refining scope in a more flexible way, culturally to satisfy stakeholders that Standish Group1 and Ambysoft2, which and thus delivering on time high-quality solutions are being delivered argue that agile projects are more and that business risk is being effectively successful than traditional ones. • Engaging business stakeholders mitigated. throughout the delivery life cycle (not just at the beginning) In addition, agile delivery typically affects businesses differently depending on their • Cross-functional and self-organising size and how they integrate the agile teams facilitate better utilisation of component into business operations and resources established project delivery methodology. Even though agile projects are commonly • Incrementally designing solutions with reported to be more successful than customers creates relationships and traditional projects, the fact that agile opportunities to build trust has been used typically in small or mid-sized IT project environments has a • More transparency with respect to considerable effect on project complexity, project progress, obstacles, risks, issues and consequently the chances of success. and dependencies

1 The Standish Group, CHAOS Report 2015 2 Ambysoft, IT Project Success Rates Survey 2013

Scaled agile transformations 5 3 Scaling agile to comprehensively realise organisational benefits

Although many private businesses SAFe represents a framework of Agile was originally developed and public organisations are trying integrated patterns based on lean for software development to maximise the full potential of agile and agile principles with the aim of projects in which the customer’s within small and mid-sized IT projects, synchronising the delivery of multiple end needs could not be fully few of them manage to successfully scale autonomous but aligned agile teams agile practices to large transformation within larger organisations. On an defined at the beginning. These programmes and finally to enterprise overarching level, EPICs4 representing projects usually affected only level. enterprise portfolios (that allow one or two functions, e.g. client calculation of ROI and are usually facing management or sales. However, Indeed, managing and coordinating development initiatives on the customer project work, and ultimately the fast side or internally) have to be planned. if you want to gain significant delivery of high quality products, benefits from adopting agile in becomes much more complex in a The primary delivery instrument bringing your business transformation programme environment comprising a together developed artefacts of individual combination of several projects that may teams is called Agile Release Train. projects and programmes, you overlap and be built by teams of teams Within an Agile Release Train release need to be able to scale your (or teams of teams of teams). To address cycle, regular programme increments agile delivery to enterprise level this challenge, scaling frameworks such (completed product artefacts) are used and adopt it in strategic business as SAFe (Scaled Agile Framework, the to ensure that the intended business most dominant approach), LeSS (Large objectives are met. initiatives. Scale Scrum) and DaD (Disciplined Agile Delivery) have evolved in the market3.

Figure 2: SAFe – Scaled Agile Framework Source: Authors’ illustration derived from SAFe

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eature Team eature Team eature Team eature Team eature Team 3 We consider SAFe, LeSS and DaD to be the most commonly used scaling frameworks based on our market experience. However, there are a number of other scaling methods and approaches available.

4 SAFe defines EPICs as significant initiatives that help guide value streams toward the larger aim of the portfolio. They are investment intensive and far ranging in impact. EPICs require a formulation and analysis of cost, impact, and opportunity in a lightweight business case, as well as financial approval before implementation.

6 Scaled agile transformations LeSS scales up Scrum activities on planning, coordinated Scrum events, the basis of the team-of-teams concept and a managed organisational agile which addresses practices, such transformation. as Scrum of Scrums5, agile release

Figure 3: LeSS – Large Scale Scrum Source: Authors’ illustration derived from LeSS

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DaD represents a process decision learning as well as solution and risk-value framework that adopts and tailors agile focused delivery of IT and software strategies and principles from existing artefacts within an organisation. methods, with the focus on people and

Figure 4: SAFe – DaD – Disciplined Agile Delivery Source: Authors’ illustration derived from DaD

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5 Scrum of Scrums enables collaboration between IT eier multiple Scrum teams. Each team identifies one team aer member to attend the Scrum of Scrums meeting to eature Team and eature Team and eature Team and Technica coordinate work with other Scrum teams. Architecture Owner Architecture Owner Architecture Owner perts

Scaled agile transformations 7 4 Embedding agile in a full scope transformation approach

Typically, such transformation You need to be clear about the benefits Large strategic programmes that programmes have been run in a and the drawbacks of agile (compared to transform the whole business, or at traditional waterfall-oriented approach the traditional approach) to make sure it least significant parts of it, require a in the hope of achieving aligned, is the appropriate method to be used so full scope transformation approach management controlled product delivery that a programme can successfully deliver that covers delivering and driving and acceptance; the drawback of a slower the intended business benefits. Problems change aspects throughout the whole time to market is taken into account, and with delivery will not be fixed by just transformation life cycle. Such cover the initial product is only delivered many moving to agile. Some methodologies challenges along all disciplines from months after project start. can hide problems, such as poor target operating model design to the communication and poor quality delivery; complete rollout of a solution into With the growing vogue of agile, these agile brings these issues to the forefront, the organisation, accompanied by well-known traditional practices have so it may often be thought to be the cause organisational change, stakeholder been heavily disrupted, in most cases both of the problem. and communications management. top-down (‘management wants to follow the agile trend’) and bottom-up (‘agile There is no one-size-fits-all methodology, gives more autonomy to the teams’). however, and each delivery methodology However, agile cannot be enforced in has its pros and cons depending on the line with a textbook implementation nature of the programme. Consequently, approach. The factors given below are each and every programme will need a among the most prominent obstacles slightly different approach. Organisations to adapting (or even substituting) agile need to be aware of this if they are to fully in traditional delivery approaches and understand when it is appropriate to use structures6: agile and how to scale product delivery within a large-scale transformation • Organisational and company programme. Furthermore, often philosophy or culture at odds with traditional project and programme core agile values, and/or lack of management frameworks have been management support for cultural established in organisations for many transition years with high effort. To integrate and scale fast delivery, these traditional • Insufficient personnel with the frameworks need to be adapted with necessary agile knowledge and agile principles, e.g. towards a hybrid experience approach.

• Inconsistent and/or ineffective Having realistic expectations about what agile practices, methods and tools and when the project team will deliver, throughout the organisation as well as focusing on the right priorities to deliver the desired business outcomes, will build confidence in the new agile method. However, various obstacles will need to be overcome on the path to successful agile project delivery.

6 Based on VersionOne, 10th Annual State of Agile Report

8 Scaled agile transformations 5 When to act – common risk areas and early warning indicators

There are many hidden pitfalls when implementing and adopting agile delivery practices in transformation projects and programmes at scale. The Organisational culture and governance • Product owner is only assigned limited following are a few considerations and not supportive of agile authority to define and prioritise questions organisations, sponsors and requirements and formally accept management should think about. • Silo organisational structures and product as ‘ready for deployment’ on implemented governance create behalf of the organisation. conflicts with cross-functional delivery teams and hinder self-organisation in • Risk and assurance functions are agile teams. not supportive of transparent programme status, resulting in a lack • Accountability structures are not clearly of transparency around quality controls defined, preventing the delivery teams and assurances; assurance is no from working towards common goals. longer providing proactive insight and challenge to programme sponsor and • Product owner, team members and senior management. business representatives do not have enough capacity and are still dedicated to business-as-usual activities, resulting in inadequate performance of agile ceremonies (e.g. planning meetings, daily stand-ups).

Figure 5: Common risk areas Source: Authors’ illustration

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Scaled agile transformations 9 Delivery processes, methods and tools • Delivery teams do not work closely People’s experience and discipline not not supportive of value-oriented, enough throughout an iteration due to supportive of agile fast-pace agile delivery non-focused collaboration and too little regular face-to-face interaction within • Limited confidence in the delivery • Key delivery elements such as the team. teams achieving the desired outcomes ‘definition of done’, quality criteria due to lack of knowledge or experience and acceptance criteria have not been • Team members are not co-located but with agile. consistently defined on an enterprise rather spread across different time level prior to the start of development. zones. If offshore resources need to • Product owners do not continuously be used, initially agile teams should update and prioritise product backlog • Inappropriate or non-defined delivery be successfully scaled onshore before items based on business needs, and KPIs do not support transparent considering an offshore model. In do not actively participate in agile reporting of the actual programme addition, a deliberate approach must be ceremonies (e.g. planning meetings, delivery status. employed to keep these team members product demos). fully engaged with the rest of the team • Underpinning technical foundations, and the project or programme. • Too many part-time team members such as architecture and data prevent efficient and effective governance, are not fully considered in • External delivery teams and vendors of product the agile delivery model, resulting in a are not fully aligned and integrated artefacts. non-streamlined delivery process. within the organisation’s agile delivery model. Members representing different • Relevant internal and external • Release planning across teams is not subcontracted organisations may have stakeholders other than business aligned and pre-determined due to a different objectives, hindering efficient end users are not involved in product different pace of delivery that hinders collaboration within agile delivery delivery (e.g. legal, compliance, risk, the creation of a coordinated product teams. internal audit). definition in line with the needs of the customer. • No formal change control has been implemented, resulting in a constant • Insufficient automated (regression) iterative spiral between end users and testing and delivery teams. techniques and tools hinder regular delivery of working product artefacts • Lack of an integrated benefits with the required quality without management within the overall delivery impacting production. approach chosen.

• Delivery teams are not interdisciplinary enough and/or consist of too many staff members.

10 Scaled agile transformations 6 Our point of view

As a new mindset agile needs to be Agile is about focusing on speed, value There is increasing dependence on embedded in the business and IT and functionality. It can generate agile-enabled business transformation organisation and among all stakeholders significant time and cost savings and programmes to remain competitive. involved − from delivery teams and improve flexibility. However, agile does However, lack of experience with agile business sponsors to those who monitor not deliver by default. It must be set up for and limited organisational commitment them. Both agile and (especially) scaled success – which involves the right culture, can deter the most seasoned agile require cultural adaptation and people and expertise, and processes, programme and project management realignment to make sure stakeholders methodologies and tools. You also need veterans from comprehensively are satisfied, the business vision is to be confident that your transformation adopting agile. realised, high quality IT solutions are projects and programmes have truly delivered, and that business risk (due to adopted these agile principles, and follow transformation) is effectively mitigated. them with maximum discipline.

To successfully embed and scale agile Agile practices are inherently designed to delivery practices in large transformation deliver increased visibility. Consequently, programmes, we consider the following governance and assurance functions also steps to be essential: need to fully experience and exhibit the same core principles as the agile delivery 1. Understand the origin of agile teams so that they can provide valuable methodologies insight and transparency on effective programme delivery. 2. Educate project workers, management and stakeholders in agile values, methods and practices

3. Build an effective agile culture and organisation

4. Understand agile success and failure

5. Build metrics to measure agile success and benefits realisation

6. Scale agile to the size of your projects and programmes

Scaled agile transformations 11 7 Contacts

PwC Birchstrasse 160 Postfach, 8050 Zürich

Marc Lahmann Director, Assurance +41 58 792 27 99 [email protected]

For more information: www.pwc.ch/ta

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