Agile working or an agile work organization aims at maximum flexibility of companies while simultaneously improving employee satisfaction. According to a study by the management consultancy Borisgloger Consulting, over 80% of managers rate agile methods as particularly positive.
Agile working methods – how companies increase their flexibility
Ever faster changing markets and the increasing complexity of economic activity require an increase in corporate efficiency and faster reaction times.
However, the classic top-down approach to managing companies limits the ability to adapt to a dynamically changing market environment. Companies that give their employees more responsibility and greater scope for action unlock previously untapped creativity and innovation potential.
Agile working in the company leads to accelerated decisions. This paves the way for increased dynamism in product development, the optimization of work processes, and an improvement in customer satisfaction. Last but not least, by expanding the scope for action, management shows appreciation towards the self-organized teams.
The concept of agile working promises significant increases in efficiency, improved customer loyalty and higher employee motivation.
Where does the word "agile" come from?
The term "agile" goes back to the Latin "agilis" ("active, mobile") and to the verb "agere" ("to make, do, act").
In an economic context, "agility" refers to a company's ability to adapt quickly and flexibly to constantly changing circumstances both inside and outside the company.
"Agility" refers to an ability and skill, a behavior or a mindset.
- As a skill, agility describes a potential for action.
- Agility as a skill encompasses ability and actual application.
- Agile behavior is expressed through actions that are directed towards the outside world.
- "Mindset" refers to a state of mind, way of thinking or mentality.
The origins of agile working methods
The beginning of the “agile movement” is dated to February 2001. At that time, 17 software developers met in the US state of Utah to discuss the development of more flexible working methods in companies. The participants in this meeting of the digital economy developed a “Manifesto for Agile Software Development” (“Agile Manifesto”), which describes the working methods of agile teams in four guiding principles and 12 principles. (The principles of agile working methods are now also practiced by companies outside the software industry.)
The Agile Manifesto is based, among other things, on the concept of agility developed by the American sociologist Talcott Parsons in the mid-20th century. Parsons had found that agility is of crucial importance in stabilizing social systems.
Some characteristics of agile methods such as team orientation and flexibility are not fundamentally new for companies. However, against the background of information technology, digitization and globalization that characterize today's economy, agile working methods are of highly topical importance and of particular importance in the implementation of corporate strategies.
The intention of agile working methods
In view of the ever-shortening product and innovation cycles (also due to digital technologies), only those companies that significantly reduce their reaction speeds will be able to survive on the market in the long term.
Agile methods aim to improve the adaptability of companies against the backdrop of megatrends such as New Work, digitalization, globalization, and demographic change. Many proponents consider agility to be a 'magic formula' for accelerated decisions, innovative ideas, and greater employee satisfaction.
Agile working methods correspond to flat hierarchies and communicative openness between the various departments of a company. Self-organized employees make all essential decisions independently. In doing so, they are guided by the company's mission statement, defined missions & agreed goals.
Principles of agile working methods
A company structured according to agile methods consists of self-organized teams that are aligned with a common corporate vision.
- People and interactions are given priority over processes and tools.
- The product is becoming more of a focus. Documentation is reduced to the absolute minimum.
- Customer benefit is at the center of all considerations. Cooperation with customers (including through involvement in product development) takes priority over lengthy contract negotiations.
- Responsiveness to change is more important for an agile organization than the implementation of rigid plans.
Advantage of agile working methods compared to traditional work organization
Agile working methods replace the “mechanistic” counter-concept, which involves a detailed definition and repetition of work processes as well as long-term plans.
Although traditional top-down organizations have proven to be effective in managing existing business, top-down management is no longer able to meet the flexibility requirements resulting from rapid market changes.
The most important elements of agile working methods
Agile working is associated with certain forms of work organization, collaboration, and planning. In addition, agile working requires a specific orientation of the corporate culture.
Self-organized teams
An agile team consists of a maximum of ten employees. Limiting the number of self-organized employees ensures sufficiently direct and intensive communication. Self-organized teams can work together on a permanent basis or for a limited period of time from the outset.
Self-organized employees make all key decisions independently. In doing so, they are guided by the corporate mission statement, defined missions and agreed objectives.
- The team decides on the appropriate distribution of work, jointly removes obstacles and continuously implements improvements.
- The team also independently monitors the work results.
In view of the extensive self-organization of agile teams, each team member must have a high degree of personal responsibility.
Successful participation within self-organized teams requires voluntary commitment from each individual. Working in an agile team requires identification with agile work and enthusiasm for the team goals.
The communication of self-organized teams
Regular check-ins increase the frequency of communication, ensure a regular exchange of knowledge within the teams and serve to link goals and tasks.
The retrospectives, which take place at least quarterly, promote internal communication and team processes and support the company in adapting to changing market requirements. Agile working also includes communication across teams and departments.
Value orientation
Agility should create value. Every task aims at a concrete value contribution. The interests of companies and customers are balanced in the work of agile teams.
Involving customers in teamwork
Involving customers early in the product development phase enables earlier and more accurate analysis of customer needs.
Step-by-step approach to planning
Agile planning involves a step-by-step development of goals and the implementation steps derived from them. Plans that are too long-term do not fit into a fast-moving market environment.
Accordingly, the planning of the individual agile teams also takes place continuously and in stages. The current plan only extends to the end of a time interval lasting several weeks at most.
Structures: changed distribution of tasks between management and agile teams
In an agile work organization, significant parts of the responsibility are shifted from management to the self-responsible agile teams.
While management continues to define the company's mission statement and strategy, the agile teams determine the operational approach. The teams therefore determine how the company's strategic goals are to be achieved based on their greater proximity to the market and customers(bottom-up planning).
- The task of management is changing from instruction and control to encouragement and support of employees.
- Clear guidelines and objectives take the place of small-scale planning.
The necessary culture of trust for agile working
A "culture of allowing failure" (culture of trust) gives team members a feeling of security. Employees are encouraged to express innovative ideas - without having to expect negative sanctions if an idea does not prove to be suitable in retrospect.
The existence of a culture of trust is one of the essential prerequisites for the successful work of self-organizing teams. Trust promotes the ability to make rapid changes when parameters change within or outside the company.
Any cultural change that may be required presupposes that the culture of trust is supported and lived by all hierarchical levels of a company.
Agile organization and corporate strategy
An agile approach requires an agile strategy at company level.
- Foundation of such a strategy is a vision that takes into account the specific characteristics of the respective company (for example, its products and services).
- Missions, strategies, or operative roadmaps are derived from such a company-specific vision, which serve as a guideline for members of agile teams.
Risks: What can jeopardize the success of self-organized teams?
Different suitability for agile working methods
Agile working is not equally suitable for all employees.
- Agile working methods require a high degree of professional and personal skills from all team members. Self-organized employees must be capable and willing to work independently, make far-reaching decisions in line with company guidelines and continuously develop themselves. However, some employees are completely satisfied with fulfilling the requirements they receive in the best possible way.
- Only employees with mature personalities can meet the requirements of an agile team. However, while younger employees are still in the process of maturing, older employees are more mature, but often no longer as "agile" as required.
- Agile work also requires a strong team orientation.
Agile methods: not very useful when detailed specifications are necessary
The concept of agile working is less suitable for production departments, where it is precisely defined which employee performs which activity in detail.
Frictionless transition from top-down to bottom-up?
For many years, numerous companies have moved away from bottom-up approaches. Companies are usually managed according to the top-down principle. A rigid 'implementation culture' has often been created, which hardly allowed any contradictions from employees, even if they were constructively intended, and sometimes even rigorously sanctioned them.
Companies have often withdrawn authority from their employees under the top-down principle. Instead, a large number of rules and detailed control mechanisms were introduced.
The reversal of a top-down to a bottom-up organization should take place gradually in order to limit the risks associated with such a transformation. The necessary development of a sometimes limited basis of trust requires, above all, a fundamental rethinking on the part of the managers – especially in management.
Without such a rethink, critics point out, the introduction of agile teams could prove to be nothing more than an extreme form of "selection of the best with a turbo-capitalist mindset".
Even if an agile work organization is introduced as far as possible, hierarchical organizational elements remain in place. The final decision-making right and thus the power in the traditional sense therefore remains with the company management.
Under what conditions can agile working work?
The first agile team in a company should not be entrusted with overly complex tasks to ensure the success of a pilot project.
A shared understanding among team members of agile work in the team lays the foundation for team success. As part of a kick-off workshop, obstacles on the way to the goal can be identified and solutions developed.
A key to the success of an agile team is a regular communicative exchange between the team members. Tasks and progress of the Agile Team can be visualized on a presentation wall.
A continuous change in the team composition contributes to new ideas and the maintenance of the innovative strength of a team.
Various measures support the success of agile working:
- In-house trained or external agile coaches support the employees of the agile teams.
- Training measures for agile teams, workshops, or e-learning support are also helpful.
- By involving the agile team in the selection of new employees, cooperation within the team is promoted.
Companies outside the software industry also report positive experiences with agile working methods. Self-organized teams are used successfully in the following areas, for example: Marketing and Sales, Product Development, Human Resources and IT.
Successful methods of agile working
An introduction to Scrum & Kanban
Scrum
The most common method of agile working was named after a term from rugby, "Scrum" ("scrum"). 80 percent of all companies in Germany that have agile teams work according to the Scrum methodology.
- A daily short meeting ('Daily Scrum,' lasting no more than 15 minutes) serves to align on status.
- Within the team, the "Product Owner" is responsible for prioritizing tasks, evaluating task completion and the required resources.
- The "Scrum Master", the manager of an agile team organized according to the Scrum method, ensures compliance with the team rules and is also a coach for the Product Owner and the other team members.
- Both the Product Owner and Scrum Master have influence over the team due to their expertise. However, neither functionary has a superior function vis-à-vis the other team members.
Kanban
The Kanban method is used by 17 percent of all companies working with Agile teams.
- In contrast to the Scrum methodology, fixed management and moderator functions are dispensed with. Instead, the progress of work is documented on a "Kanban board".
- Meetings between team members play a lesser role with Kanban than with Scrum. Therefore, the team has greater autonomy when using the Kanban methodology compared to Scrum teams.
Conclusion: Well-prepared agile working provides more flexibility for companies
Agile working is an answer to the increasing complexity of market challenges, to which companies must find an efficient response. Self-organizing agile teams can significantly increase a company's adaptability through rapid decisions and by involving customers in product development.
Agile teams make decisions about their approach and the resources required within the framework of the corporate mission statement and corporate strategy. The control tasks are carried out by the agile team itself.
