Scaled Agile
Agile Transformation Goals & Metrics
To avoid your agile transformation from failing, it’s most important to define goals and KPI’s – but above all measuring them! How and which you’ll learn here…
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According to a survey of Deloitte 76% of the respondents say, that agile transformation goals are not measured or made transparent in their organization.
Knowing that not-existing goals and metrics are one of the main reasons for failure of agile transformations, this number seems fatal.
But which goals should organizations define for their agile transformation – and more important: how to measure them?
With this article we want to help you defining your own goals and finding suitable KPI’s.
Agile transformations are not usually undertaken for no reason, although unfortunately there are always exceptions. However, the reasons are not always a “burning platform”, i.e., the imminent ruin of the company, to put it in its most dramatic form.
Failure means the range from not achieving primary goals to making the situation worse.
Often, however, it is simply that things have not gotten much better overall.
In one of my agile coaching projects, I was expected to achieve a fifteen percent improvement, meaning cost savings. I replied that you don’t start an agile transformation for that reason, as just reducing some overhead would be enough. Similarly, the effort required for an agile transformation was underestimated and the context of such a transformation was misunderstood.
And this brings us to the first “agile transformation fail”:
No clear and reasonable goals.
But in all seriousness, there are two goals that should be formulated for an agile transformation.
One goal is related to the Business Outcome (NOT output), while the second should be related to the transformation itself.
Because you cannot say that with the achievement of the first goal, the second is automatically achieved (and vice versa). The second goal is about the sustainability of a completed cultural change, which should ensure a good business outcome in the long run.
In many organizations that have gone into an agile transformation, the goals were often not clearly defined or very often referred only to the output.
The goal statement “we want to improve our delivery capability” is a nice touch, but still far from defining a clear objective.
The output-related objectives “we would like to deliver our products faster and produce them at a lower cost” also sound very obvious, but they are again still a long way from a clear definition of the objectives of an agile transformation.
They express that an agile transformation’s impact on an organization’s entire culture is significantly underestimated.
The consequence of this is that agile transformation falls far short and is exhausted in the reorganization of work processes, i.e., it ends where it should begin.
Goals provide clear orientation so that a temporary improvement in output – due to the weather, for example – is not confused with the achievement of transformation goals.
It is much better to have an ambitious goal and not (quite) achieve it than to do without clear goals and then gloss over even the slightest progress.
Clear goals are unfortunately often confused with classic project management, and it is made to seem that agile cannot or should not make any clear and binding statements at all. Even the introduction of “Agile Transformation Goals” and, consequently, the follow-up of the goals with the definition of an “Agile Transformation Metric” or at least the definition of KPIs for the agile transformation is often disliked and perceived as detrimental to the transformation. This is wrong and probably still stems from the fact that an agile transformation is seen as a grassroots bottom-up evolutionary process. Therefore, agile transformations today are strategically planned and managed top-down.
and thus, on the one hand, the scope of the statements is limited (adaptive) and the possibility is included to regularly review the statements (proactive) and to justifiably (!) adapt them to reality.
“Justified” means that this is not done arbitrarily, but that the environment is already observed very closely, and causes are analyzed. Yes, the potential to lie to oneself in the process cannot be denied. Therefore, it is even more important to have goals and, if possible, to substantiate them with clear and quantifiable KPIs.
Not having such goals is equivalent to losing orientation and context.
Organizations then find it difficult to identify where and how they can improve or whether they are on a good path at all.
The definition of “agile transformation goals” is, therefore, a basic prerequisite for gaining clarity in the organization about what the not-insignificant efforts and costs of an agile transformation should lead to. And of course, the transformation goals also include the setting up of “agile transformation metrics” in order to be able to track the degree to which the goals have been achieved.
So, now to the two goals themselves.
Business outcome goals as opposed to output goals are more strategic and target the company culture.
Or they directly target the generation of business value, which is not so different, because an agile corporate culture should focus exactly on “Business Agility” and “Customer Centricity”.
Yes, you read correctly, business outcome is a result of a certain corporate culture and not a goal to be achieved somehow, by whatever means. Because a constant and sustainable flow of value can only be achieved if the entire corporate culture is aligned with it. This cannot be delegated to individual departments or to isolated agile teams. A look below at goals for business outcome and their KPIs illustrates this and gives an idea of how complex increasing business outcome can become.
Examples of business outcome goals:
It is not at all easy to define suitable KPIs for such strategic business outcome goals. And, of course, the goals must be adjusted or redefined sometimes, e.g., set a focus every business year.
But imagine if such goals were not even defined in the context of an agile transformation. In SAFe – jargon, you could then say:
Or rather, the agile organization degrades itself to a pure output-driven feature factory.
Goals for the agile transformation itself should ensure that the whole endeavor is sustainable.
Agile transformations take time, often years. Over time, there is a significant risk of losing focus. Again, clear goals along a defined roadmap provide the necessary guidance.
If the business outcome does not really want to materialize, then a look at the goals of the agile transformation itself often helps to recognize what may be going wrong.
Defining goals for an agile transformation is quite simple but expressing them in KPIs and then measuring them is extraordinarily complex.
This is one of the reasons why many organizations refrain from doing so. Nevertheless, it is worth the effort, or rather, without such goals, agile transformation – if only because of their duration – often drifts into a certain arbitrariness after a few months and gets stuck on a formal level – namely the establishment of roles, events, and artifacts.
Examples of agile transformation goals:
For this, we have described 7 factors (vision, domain knowledge, cross-functionality, hard skills, soft skills, empowerment, acceptance). Article coming soon.
KPI for this would be for example:
You can read about this in detail in the article “How to develop an agile mindset”
A hot topic
KPIs for this would be for example:
KPIs for this goal would be, for example:
So Agile Transformation has its own challenges, in addition to what it is supposed to do: Supporting the business outcome goals. Nevertheless, Agile Transformation remains the tool and is not itself the purpose. Only the pairing of the business goals with the possibilities of the Agile Transformation tool, which requires proper handling, brings the company to its goal. Since mastering this tool or craft is anything but trivial, we have dedicated another article to this topic.
Goals are not meant to increase pressure but to give context and create orientation.
Especially in agile transformations, which can take quite a long time as a cultural change, we need a “continuous learning culture“ and it is good for it to be oriented towards clear goals with quantifiable KPIs. The introduction of “agile transformation goals” and the provision of an “agile transformation metric” with clear KPIs for an agile transformation is therefore not a contradiction to the agile mindset, but a means of promoting it through clarity, determination, and transparency. Measuring the success of an agile transformation is no less important than measuring the success of the enterprise.
To avoid your agile transformation from failing, it’s most important to define goals and KPI’s – but above all measuring them! How and which you’ll learn here…
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For scaled agile organizations it is frustrating when their project management tools don’t support their processes.
That’s why we developed scagile as an app which actively supports agile best-practices with features you haven’t even thought about and with which you’ll be able to create value flow across your entire organization.
