Agile: a low-risk solution for digital transformation

Businesses that adopt an Agile approach are more responsive and better organised – crucial attributes when it comes to a successful digital transformation

Business leaders have arguably never been under more pressure to adapt quickly and efficiently, with the need to properly utilise technology a requirement and no longer a choice.

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

Already adopted by a number of organisations – including Apple, IBM and Microsoft – Agile relies on a wide-reaching set of principles, including early and continuous delivery, cooperation and embracing change. 

By pairing digital and Agile transformation together to create Agile digital transformation, companies can get the best of both worlds, benefitting 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,” says Simon Morris, VP of Solution Consulting UK&I, ServiceNow. “When it comes to digital transformation, adopting an Agile strategy offers business leaders more choice, with the opportunity to meet challenges faster, or identify and exploit competitive advantages more efficiently. 

“Our research shows that Agile organisations score higher on just about every metric compared to non-Agile organisations, with customer loyalty ahead by as much as 20% and market share up by 11%. Businesses that adopt this approach are more responsive, better organised and quick to recover – all crucial attributes when it comes to delivering a successful digital transformation.”

“I would argue that the word transformation implies a clear and finite ending, when really a company’s digital journey never ends,” says Helena Nimmo, CIO at Endava. “The key to successfully implementing an agile strategy for continued innovation isn’t in digital transformation. A more nuanced and bespoke approach, which I call ‘digital acceleration’, provides such agility and allows leaders to protect their businesses while simultaneously allowing them to innovate with more flexibility and understanding of their internal and external stakeholders.

“There is always another step forward in the digital journey. Remaining agile and being able to re-examine, update, and improve the use of digital technologies as an ongoing, continuous process is a much more helpful way to implement any digital strategy.”

Agile approach a low-risk solution for digital transformation

With many businesses needing to change quickly and efficiently, a continuous incremental delivery approach can get features into product teams and end users’ hands more quickly 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, enabling the approach being taken to be adjusted as required in flight,” he adds. “An agile approach provides a low-risk solution as it splinters digital transformation into short, manageable phases where the team learns from their results before moving on. This leads to fewer mistakes, and projects usually end up delivering more value in less time.”

Research by IDC has shown that an Agile approach makes digital transformation faster, more effective and more adaptable,” adds Morris. “For business leaders under pressure to transform rapidly to remain economically viable in troubled economic times, Agile is vital to ensuring digital transformation is effective within the right timescale.”

Company culture among biggest obstacles

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

“Achieving this shift in mindset isn’t simply a matter of deciding to be Agile,” he adds. “Rather, managers need to be prepared to move from yearly cycles of leadership with annual budgeting processes, to fast-moving decision cycles. This means that leaders have to decide to ramp up or sunset initiatives in the space of weeks, days or hours. 

“Digital acceleration allows for more agile delivery versus digital transformation, without undermining longer-term strategic thinking,” says Nimmo. “That said, with either, there will always be inherent risks that shape decision-making in technology. In order to combat these risks, we need to understand what the core objectives of both the business and the technology are, as well as their wider context. 

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

“This shows that businesses need to keep building and improving on existing capabilities, rather than overhauling entire systems that could potentially open them up to further risk.”

Controlled risk crucial to success of Agile approach

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

“If companies are looking expand into unchartered territory – be that big data platforms, cloud optimisation, or even the metaverse – balancing the risk versus rewards comes down to any decisions being made and implemented when the timing is right, as part of an ongoing journey rather than for the sake of it,” Nimmo says.

“When considering a digital acceleration roadmap, companies need to look closer at solutions that offer the most value. Adopting technologies purely because they’re new is counterintuitive and companies should be sure that their plans will bring significant value to existing processes.”

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

Agile isn’t just throwing caution to the wind, Houghton adds. “It's important to de-risk the risks as much as possible,” he says. “There’s lots of planning and design around a scrum team so they can make the agile approach a reality. Constant review and iterative correction are crucial, as this keeps delivery closely aligned to the goal.”

Along with taking controlled risks, good communication is key in order for an Agile approach to succeed. It’s important to highlight the benefits of the Agile approach with team members.

“Communication is central to Agile because it is a team sport,” Morris concludes. “Leaders should ensure that employees at all levels understand its benefits and why the business is adopting the approach.

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

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