50+ Agile Values and Principles Tutorial 2019
What is Agile? Most people think it is a process, a set of practices, and even tools. But it is none of those things. Agile is nothing more and nothing less than a set of values and principles.
As it relates to success, Agile is the enabler that harnesses the power of employees and feedback from customers for successful deliveries in a frequent manner. This tutorial explains the 50+ Agile values and principles used in company with best examples.
I purposefully include Agile values and principles in this blog as a reminder and refresher. It is important to read and internalize the Manifesto for Agile Software Development if you are serious about understanding an Agile state of mind and truly want to “be Agile.”
The key change within the manifesto I would encourage, both in the values and principles, is to replace the word “software” with “product” or “services,” depending on your context. The reason is that the iterative and incremental nature of Agile can work well beyond software and into any creative and knowledge work, whether it be products, services, or other types of work.
Agile Principles 1:
“We are uncovering better ways of developing software by doing it and helping others do it. Through this work we have come to value:
Individuals and interactions over processes and tools
Working software over comprehensive documentation
Customer collaboration over contract negotiation
Responding to change over following a plan
That is, while there is value in the items on the right, we value the items on the left more.”
The last phrase helps you understand the authors’ intentions. They are not saying there is no value in the items on the right, but instead that there is more value with the items on the left. It is important to strike the right balance. As you evolve toward Agile, you will find that you will learn more toward the items on the left.
Agile Principles 2:
Principles behind the Agile Manifesto
We follow these principles:
Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.
Welcome changing requirements, even late in development. Agile processes harness change for the customer’s competitive advantage.
Deliver working software frequently, from a couple of weeks to a couple of months, with a preference to the shorter timescale.
Business people and developers must work together daily throughout the project.
Build projects around motivated individuals. Give them the environment and support they need, and trust them to get the job done.
The most efficient and effective method of conveying information to and within a development team is a face-to-face conversation.
Working software is the primary measure of progress.
Agile processes promote sustainable development.
The sponsors, developers, and users should be able to maintain a constant pace indefinitely.
Continuous attention to technical excellence and good design enhances agility.
Simplicity—the art of maximizing the amount of work not done—is essential.
The best architectures, requirements, and designs emerge from self-organizing teams.
At regular intervals, the team reflects on how to become more effective, then tunes and adjusts its behavior accordingly.
Agile Principles 3:
Enabling Agile with Processes and Practices
The goal of an Agile process, method, practice, and technique is an attempt to absorb the Agile values and principles and put them into practice. As part of the spot of being Agile, an enterprise needs to embrace the Agile values and principles and apply Agile processes, practices, and techniques that support the Agile values and principles that enable it to deliver customer value in an incremental manner.
The Agile processes and methods include Scrum, Extreme Programming (XP), Dynamic-System-Delivery Methodology (DSDM), Feature-Driven Development (FDD), Test-Driven Development (TDD), Lean Software Development, Kanban, Scaled Agile Framework (SAFe), Disciplined Agile Delivery (DAD), Lean Startup, and Value Flow Quality (VFQ).
This blog also introduces you to the customer-value-driven (CVD) framework that applies a discovery and incremental approach that focuses on engaging customers in each aspect of the product journey from identification and recording the idea, revealing it for priority, refining it, realizing it, releasing it, and reflecting on its value for the customer.
In addition, a further array of innovative Agile practices can be applied in various parts of your Agile galaxy in an attempt to ensure Agile is occurring at all levels of an enterprise.
This expands the groundwork done by a number of Agile innovators that established many of the current Agile processes and practices. By highlighting the many processes, frameworks, and practices do not imply that anyone is better than another or others not discussed here.
There is no one correct process or methodology. What you will find is that what suits your working environment and your type of work is the best for your company. My goal is to harness you with a collection of Agile concepts, mindset, processes, practices, and techniques to enable you to more effectively help your enterprise discover and deliver customer value.
Agile Principles 4:
Engaging Your Customers and Employees
Success factors in creating a thriving business are the level of engagement from the people within and around your enterprise. In other words, do you have a culture where customers and employees are engaged?
I’m not talking about the lip service that is prevalent today. In some cases, you see quite the opposite, where employees are disenfranchised and customers are rarely engaged.
Instead, the goal is to have a culture and practices in place that truly gain the benefits of engaging with customers and employees. By applying a dash of employee engagement and a pinch of customer feedback, a company draws its power from an Agile culture and, I contend, becomes a thriving company.
When you have a riveting focus on the customer, you have the basis for a relationship where you can truly understand what the customer wants. When you have a sharp focus on employees and provide them with the ownership to make decisions and own their work, you will begin to understand the value an engaged employee base can provide
Agile Principles 5:
Focusing on Outcomes
Becoming Agile should not be an end goal. Becoming Agile should be a means to an end. The end goal is the desired outcome of achieving better business results. The Agile mindset and practices, therefore, should be an enabler for better business results. This end goal is often lost in the enthusiasm of becoming Agile.
An outcome is defined as the result of a particular action or, in Agile’s case, an Agile transformation. Since moving to Agile requires a change in skills, process, and culture, it involves effort. The whole point of the effort is to achieve better outcomes for the company.
To achieve better business outcomes, you must deliver products that customers like. The output is the delivery of a release or the number of releases. An outcome is how many customers either bought or used the product. Often people focus on outputs because they tend to be easier to measure or are a carryover from a more traditional mindset.
Agile Principles 6:
Do You Have the Recipe for Success?
Moving to Agile is not about achieving an Agile milestone. Instead, Agile and the CVD framework is about achieving better business outcomes. A move to Agile is a move to a culture focused on customers and what they identify as valuable as well as on engaged employees who create that value. It is a shift in mindset.
Then you add the enabler of Agile and the continuous and adaptive nature it brings. This can lead to better outcomes such as an increase in customer satisfaction and customer revenue. This can be the differentiator between the success of your organization compared to the success of other organizations. Do you have the recipe for success?
This recipe consists of a spot of being Agile (culture), a dash of employee engagement, and a pinch of customer engagement for a taste of better business outcomes. The areas of Agile culture, employee engagement, and customer engagement will be expanded further in subsequent blogs
Agile Principles 7:
Building Your Agile Galaxy
As simple as it may seem, to establish the Agile landscape and reap the positive business outcomes requires a combination of Agile processes, roles, and the all-important culture. For Agile to work well, all levels of the enterprise must play their part in the Agile journey and toward the delivery of customer value. This journey includes having an Agile culture and practices applied at all levels.
Finally, establishing Agile implies a strong cultural element that focuses on how individuals and organizations must behave and operate to truly focus on a customer-value-driven approach. To be specific, Agile processes, practices, and techniques and those playing the roles must operate within an Agile cultural context and that context must exist at all levels of an enterprise.
Agile Principles 8:
The landscape of the Agile Galaxy
It is the landscape where all Agile processes, roles, and culture live that have a focus on delivering customer value. It helps us understand where Agile is adopted.
The purpose of establishing your own Agile-galaxy construct is for you to understand where along both the delivery and hierarchical axis you have Agile-related elements (such as concepts, mindset, practices, processes, and techniques) being applied and where in relation to this landscape they are occurring.
Where is Agile primarily being implemented? What Agile practices are being applied? Where do we see an Agile culture and the behaviors being adopted?
Whether you are in the midst of your Agile transformation or you are looking to begin the journey, it is beneficial to have a living Agile galaxy related to your enterprise. This will help you understand where Agile is occurring and where you need to focus next. It is very reasonable to approach an Agile transformation in an incremental manner.
For each increment, you should reflect on what practices are being applied, what roles are applying it, and the current state of the culture from an Agile perspective. You may consider it a heat map of where Agile is occurring. As you plan the next increment, you can use this as input on where you want to go next. Let’s more fully explore your Agile galaxy.
Agile Principles 9:
Holistic Process View of an Agile Galaxy
The goal of building your Agile galaxy is having Agile applied at all levels with a focus on delivering customer value. However, what tends to be common is a propensity to initiate Agile at the team level. It is not surprising that Agile has lived through its first dozen years with a more-or-less team focus. The reasons are several folds.
The evolution of many of the early and current Agile processes, practices, and techniques are primarily focused on the team level. There are few Agile elements focused on the beginning of the delivery axis (such as recording and refining ideas). There is less focus on the Agile culture regarding behaviors and mindset.
Many Agile coaches tend to be experienced mostly at the team level with few who have substantial experience at the enterprise level. It is also much easier for management to ask the team to make the change to Agile without themselves committing to the Agile change.
Because of these reasons, it is not uncommon to primarily see Agile practices occurring in the bottom right corner of the Agile galaxy. Because of this team-centric view of Agile, companies have Agile elements in action at the team level, and they have fewer elements as they move up along the hierarchical axis toward middle management, then senior leadership, and finally toward the beginning of the delivery axis in valuing ideas.
Agile Principles 10:
Using the Agile-galaxy context
A more holistic and healthy Agile galaxy is where an enterprise has Agile elements occurring throughout the galaxy, both on the delivery axis and the hierarchical axis. This way the concepts, mindset, practices, processes, and techniques being applied are Agile-related, and the company does not experience the tension of the pace difference when one part of the enterprise runs as Agile and the other part runs as traditional.
While newer processes and practices are being established beyond the team level, I contend that there needs to be a fundamental shift toward approaching Agile in order for companies to take the most advantage of the business outcomes it can bring.
Holistic Roles of the Agile Galaxy
Similar to the Agile process elements, a more holistic and healthy Agile galaxy is where all members of an enterprise play their role within an Agile context. This means that the roles that are both along the delivery axis and the hierarchical axis are contributing to the delivery of customer value. Those playing the roles would apply the Agile concepts, mindset, processes, practices, and techniques.
Because of the team-centric view of Agile in many companies, those playing the team-level roles have engaged in applying Agile concepts, processes, and practices. However, levels of management and operational roles (HR, finance, marketing, and so on) within an enterprise along both the vertical and horizontal axis tend to play a lesser role in Agile and the incremental and customer value-driven focus that is needed.
A more holistic and healthy Agile galaxy has people in all quadrants of the galaxy who have adapted their roles to apply Agile with a focus on delivering customer value. Organizational functions must all play a role in transforming to Agile. Each role or function must be structured such that they can readily adapt to the changing needs of customers and conditions of the marketplace.
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What Does Your Agile Galaxy Look Like?
When I explore the concept of the Agile galaxy with colleagues, I often witness “a-ha” moments. For so long now, Agile has been implemented at the team level that for some it is a new revelation when they look above their current Agile horizon and realize there is more territory to cover.
Roles at all levels in the enterprise must play their part in the creation of customer value. The need to have Agile processes, practices, and techniques for all levels in the enterprise is becoming apparent to many. The good news is many people are starting to make the connection that it does take an enterprise to establish an effective Agile galaxy focused on delivering value to the customer.
Hopefully, this blog helps you in that journey to evolve your current Agile implementation toward the enterprise level, cultural level, and the customer-driven level where it needs to be.
Agile Principles 11:
Activating an Agile Culture
A move to Agile implies a change to the organizational culture. It is a cultural disruption that takes effort and that is never painless. Adopting Agile is more than a matter of learning skills or understanding a process; it requires adopting a set of values and principles that require a change in people’s behavior and the culture of an organization.
A culture change implies a behavioral change in people in response to a change in the values and assumptions of their organization. In other words, they need to assume a new way of thinking.
It also asks them to measure different things, with a particular focus on customer value and the activities focused on obtaining customer value. This kind of culture change takes time. This is why I suggest that you think of your change to Agile as a cultural journey.
Agile Principles 12:
Agile is a disruptive innovation where the Agile values and principles require a significant change of mindset and behavior to the culture adopting it. I discuss the concept of this significant change as crossing the Agile chasm in my blog Being Agile.
The chasm represents a leap from the old mindset and ways of thinking to a specific cultural mindset of “being Agile” in order for the enterprise to fully realize the business benefits Agile can bring.
To help an enterprise put the Agile values and principles into action, various Agile processes, methods, frameworks, practices, and techniques (in other words, mechanics) have been created. However, without a commitment to the Agile values and principles, you may find that you are going through the mechanical motions without grasping the benefit of uncovering better ways of working.
As an example, a retrospective can mechanically occur with no actions for improvement upon completion. Without embracing Agile principles, the objective of tuning and adjusting behaviors can be forgotten.
Some Agile implementations have adopted the outer ring of Agile processes while not embracing Agile values and principles. Without embracing the values and principles, you cannot achieve the behaviors necessary for an Agile mindset.
Those companies that are “doing” Agile have not actually adopted the values and principles and not made the mindset shift to actually “being” Agile. Such companies continue to look at Agile as a set of skills, tools, and process changes, but they have not made the integrated behavioral and cultural changes. They have not made a significant change of mindset required to make the leap across the Agile chasm.
Agile Principles 13:
The culture of Agile Values
Everyone in the organization should understand and embrace the Agile values and principles. Although many people are aware of them or have seen them at one time or another, few remind themselves of what it means to be Agile on a regular basis, particularly when they are buried in the mechanics of doing Agile.
It is beneficial to periodically review the Agile values and discuss them at a deeper level. Here is a deeper look at the four polar pairs of agile values declared in the Agile manifesto.
“Individuals and interactions over processes and tools.” This value helps us understand that the way we work may adapt over time. It also ensures that a predefined process or tool does not dictate how we interact.
“Working software over comprehensive documentation.” This value helps us understand what the customer values as well as the business perspective of the product we are building. I often replace the word “software” with “product” or “service” since not everything built is software.
“Customer collaboration over contract negotiation.” This value helps us understand the importance of the customer relationship and the collaboration that is needed to get to what the customer finds as value.
“Responding to change over following a plan.” This value helps us respond to the changes in customer needs and market conditions, and apply an inspect-and-adapt approach with customer feedback to lead to customer value.
Ordering Agile Values Exercise: In groups of three, rank in order of importance the values and explain your ranking. Share the reasons of your rank order with other groups.
Agile Principles 14:
Where Pluralistic-Green Supports Agile
The pluralistic-green organization strives to bring equality where all viewpoints are treated equality, irrespective of position and power. It uses the family as the guiding metaphor where all members are in it together and helps each other out. This is highly reflective of the expectation of an Agile team.
One of the breakthroughs of a green organization is empowerment. Empowerment is focused on pushing a majority of decisions down to the frontline (in other words, where the work is). This is directly aligned with Agile thinking where there is a focus on pushing down decision making to the lowest possible level where most information resides regarding the topic.
This leads to decentralized authority where employees are trusted to come up with the answers and think of better ways to solve problems.
Another breakthrough of a green organization is that it is a values-driven culture. There is an understanding that culture drives how an organization will live and breathe. The green organization understands that a shared culture where leaders play by shared values is the glue that makes those in organizations feel appreciated and empowered.
There is a focus on culture and empowerment to achieve extraordinary employee motivation. This values-driven culture described in the green paradigm is very much aligned with the importance of leading with Agile values and principles.
Leaders in a green organization are servant leaders. Servant leadership is common in Agile literature. Leaders need to listen to their employees, motivate them, empower them, and help them develop their own skills. When hiring for leadership within a green organization, look for the right mindset and behavior and ask if the candidates are ready to share power and lead with humility.
Agile Principles 15:
Where Evolutionary-Teal Supports Agile
The evolutionary-teal paradigm emphasizes that the organization moves beyond providing a vehicle to achieve objectives for others. Instead, it moves to provide what is best for the organization that adapts as circumstances change. Its metaphor is one where the organization is a separate living organism.
In a teal paradigm, titles and positions are replaced with roles where one worker can fill multiple roles. This is very much like the concept of the cross-functional team within an Agile team structure.
It is also emphasized by the notion of lightning-bolt-shaped teams where every team member has a primary, secondary, and tertiary skill or role so that they can adapt to the need of the organization. The emphasis is on getting the work done and not on specific titles or positions and the constraints one skill will have.
The evolutionary-teal paradigm emphasizes the capability to self-organize around the organizational purpose. The hierarchical structures are replaced with self-organization focusing on the smaller teams. This is aligned with the Agile principle of self-organizing teams. (In other words, the best architectures, requirements, and designs emerge from self-organizing teams).
In fact, one of the breakthroughs of moving to the teal paradigm is self-management where an organization operates as if there are no managers.
It is in the teal paradigm where we evolve beyond and become separated from our ego in order to better understand the wisdom of others. We have to learn to see our own world from the outside.
The analogy that Laloux uses is “like a fish that can see water for the first time when it jumps above the surface.” Once we can separate from our ego, we begin to understand how our ego has separated us from others. To a great extent, this is where the Agile retrospective helps team members see the views of others in order to improve and evolve into a more effective team.
Much like a move to an Agile culture is a leap across a chasm to a wholly different mindset, a move to the evolutionary-team paradigm. It is akin to crossing a chasm to operate in a self-managed way where mistakes are an opportunity to learn and grow, and where we strive for wholeness within ourselves and with others.
Agile Principles 16:
Reading the Culture
Most Agile transformations start with implementing the Agile mechanics of processes, practices, and techniques. These types of transformations tend to ignore the cultural aspects of Agile. Agile is a cultural change, consider starting your Agile transformation from a cultural perspective.
Reading the mind is akin to conditioning the soil prior to growing the seeds. It is worth taking a long hard look at the conditions of the fields, equipment, and people—an analogy for your Agile galaxy.
Strengthening the soil helps improve its physical qualities. This is similar to educating people about Agile values and principles and a customer-value-driven enterprise prior to any mechanical implementation. It provides employees with a cultural understanding of what they are trying to achieve.
What are some readiness activities you can do to begin activating the Agile culture? Begin by reading the minds or your employees with education on Agile values and principles and customer value.
Ask employees what an enterprise would look like that puts the values and principles into action. Highlight what more advanced organizations can look like by discussing the pluralistic-green and evolutionary-teal paradigms.
Ask what an engaged employee looks like in an Agile culture. Ask what an engaged customer looks like in an Agile culture. Also, start to examine levels of willingness and capability among the employee base so you understand the current level of commitment.
Agile Principles 17:
Assessing the Culture You Have
As you begin your readiness activities, consider understanding the culture that you have. There is a saying in the culture change circles that you should “meet them where they are.”
By understanding your Agile culture, you gain the benefit of having a baseline by understanding the pros and the cons of the culture, which helps you prioritize your Agile readiness activities ahead. It can be used in the future to see where you’ve made progress.
Below is an Agile cultural assessment survey based on desired Agile behaviors. It helps you understand where you are from a customer-value-driven, employee-engagement, customer-engagement, Agile-values-and-principles, and pluralistic-green-paradigm, and evolutionary-teal-paradigm perspective. For each statement, the participants choose an option that best aligns with their view.
They may also rate how they think their leaders view the statement. Or they can answer for both themselves and their leaders to recognize differences.
Agile Cultural Assessment Survey
We believe having the flexibility to collaborate and communicate with each other helps us be more productive.
We believe the working product is seen as more important than internal documentation.
We believe customer collaboration should be promoted along the way.
We are allowed to move beyond the plan and toward the direction of value.
We are focused more on satisfying (external) customers than on satisfying (internal) management.
We welcome change to requirements throughout the product development lifecycle.
We believe in frequent delivery in smaller increments.
We believe in business and development working together along the way.
We believe in trusting individuals and valuing employees’ opinions.
We believe in face-to-face communication and keeping teams collocated.
We believe that a working product is the primary measure of progress.
We believe in allowing teams to establish their own sustainable pace.
We believe in promoting attention to technical and business excellence on teams.
We believe in maximizing the amount of work not done.
We believe in the importance of self-organizing teams who have ownership and decision-making rights of their work.
We believe in regularly reflecting and committing to improvements.
We believe in simplified project management (lean plans, backlogs, no status reports).
We believe in cross-functional teams with lightning-bolt-shaped skills able to perform most of their work.
We believe in moving work to the team instead of teams to the work.
We believe that team members should interview future team colleagues.
We believe performance appraisals are done at the team level by team colleagues.
We believe organizational space should primarily be designed to make the team more productive, including quiet spaces.
This is not meant to be an exhaustive statement list and you may adapt it to fit your needs.
“What Culture Do You Have?” Exercise: Arrange to have a group of leaders together. Share the statements with them and ask them to choose their level of belief for each statement (from strongly agree to strongly disagree). Tally up the results and find the average score. Also capture the range of scores (3 at Strongly Agree, 2 at Agree, 4 at Somewhat Agree, and so on). Identify an area of improvement.
What Culture Do You Have?
There is a recognition that it is time to get serious about adapting to an Agile mindset and the behaviors and culture change it brings instead of a having a mechanical approach. A strong Agile culture must focus on how individuals and organizations behave and operate at all levels of an enterprise.
Consider understanding the culture that you have by establishing the 3-D version of your Agile galaxy. Also, consider completing the Agile cultural assessment survey initially with some of your trusted colleagues and then branching out to other teams.
Agile Principles 18:
The second challenge is that the term “customer” is being applied to a number of people “in” the company who are “not customers.” For further clarification, a customer is someone external to the company and meets the conditions previously stated (has a choice and pays).
When you incorrectly title someone a customer when they are not, your company will not really be customer-value-driven as you are not using actual customer feedback to drive toward customer value.
Customer engagement focuses on establishing meaningful and honest customer relationships with the goal of gaining continuous customer feedback to truly identify what is valuable to the customer.
The key to engaging customers is to gain their precious customer input and feedback. The input and feedback should be the basis for driving the majority of your decisions and setting the direction of a product.
If you start driving with certainty, either pretend or arrogant, you can be led to the wrong planet, moon, or satellite because you are flying blind and missing the signs that steer you toward value.
The question is, “Who do you want steering your spaceship?” Do you want someone internal to your company that embraces certainty but is wearing blinders, or do you want someone who embraces customer feedback and continually adapts (that is, steers) their way toward customer value?
Customer Feedback Bull's-eye
The customer provides the most effective feedback to help shape product direction toward customer value. The customer provides both inputs for ideas of value and feedback for validating the product in its process of getting created. It is critical to engage customers. Look around you at your teams.
Are you and your teams directly applying customer input and feedback toward customer value? If not, then you are probably guessing, and this means that it is time to methodically engage with customers.
Within an Agile context, the customer is the most important voice in shaping the direction of the product. Your goal is to identify and engage customers, which can help you shape the product journey. Not all customers are created equal. Some customers are committed to your product, while others may have mild interest. Some customers use the product in one way, while others use the product another way.
This is where the importance of customer personas comes into play. If one user uses a computer to program and another uses a computer to work on spreadsheets, you have two different customer personas who use a computer. The primary message is to understand that there are various types of customers in your customer journey.
Since you may have multiple customers, you need someone to engage with the various types of customers. Within an Agile context, the product owner is meant to be the voice of the customer and should be educated on how to engage, solicit, converge, and prioritize feedback from customers.
As you look beyond customers and product owners, you must recognize that there are people within the company that is engaged in bringing a successful product to market. I term these people the stakeholders.
They contribute to the success of the product by providing a healthy environment to work, crafting a strategy or vision, identifying product and services ideas, understanding the marketplace, engaging with customers at some level, or building the product. Now that you are familiar with customers, product owners, and stakeholders, the next step is to establish your customer feedback bulls-eye.
Agile Principles 19:
Customers in a Value-Driven Enterprise
What the customers see as progress is not the standard project documents, a project plan that indicates the task completion, or status reports. Rather, customers see progress as tangible working product functionality. They purchase a working product, not the plans, status reports, and other administrative items.
Customers delight in seeing the working product in action and the inspect-and-adapt approach allows customers to consider and adjust their needs until they are transformed into a valuable working product. Progress is not advanced until a piece of functionality is built with quality, meets the customer acceptance criteria, and is available for review by the customer.
Functionality equates to value for the customer and ultimately means delivering business value. This implies that you have to continuously engage with the customer to get there. Engaging with customers only while gathering requirements and approaching product release is not enough. You need to continuously engage with customers as you are actively building the product throughout its life cycle.
Agile Principles 20:
Learning Your Way to Customer Value
The concept of learning what the customer finds as valuable is an important mindset in the journey of customer value. It allows us to shed the dangerous attitude of pretend or arrogant certainty and allows us to really explore what the customer needs.
When you fix customer requirements up front and plan the path to delivery without continuously engaging with the customer, you might stick to the plan with success, but you will incrementally veer away from what the customer finds valuable.
The question is, “Is it better to stick to the plan or adapt toward customer value?” How many people have seen companies decide to stick to the path of pretend or arrogant certainty, inevitably creating a product that few customers want, ergo missing customer value? While this may sound obvious, have you ever encountered companies where the plan rules?
The moment you engage with customers on a continual basis, the plan will not survive. Is it better to deal with a changing plan and deliver something the customer actually wants, or is it better to stick to the plan and end up delivering functionality the customer does not want? Keep in mind that if you are not listening to your customers, your competitors will be.
The better approach is to incorporate the concept of learning what is customer value. This is a discovery method of gaining incremental information through various methods associated with getting customer feedback and taking what you learned to continuously adapt toward customer value. Continuous learning of customer needs is important to get closer to certainty.
Agile Principles 21:
Enterprise Anti-patterns of Attaining Customer Value
Value is in the eye of the beholder. Smart people will say that the beholder is the customer. While in most companies, there will be a saying similar to “the customer is king,” some have lost their way and have somehow forgotten the importance of customers and their feedback. The result is enterprise anti-patterns that impede customer value. There are a number of anti-patterns on why this occurs and the following are four:
Believing that you can pretend to know what the customer wants upfront with certainty. This Pretend Certainty anti-pattern has the consequence of limiting options and being blind to customer needs.
Focusing primarily on driving efficiencies through cost-cutting and applying high utilization of people. This No Room at the Innovation Inn anti-pattern has the unintended consequence of a lesser focus on the customer with little room to innovate and adapt.
Sub-optimizing for the comfort of having a well-established plan and set of well-defined processes. This Sub-optimizing for Comfort anti-pattern has the consequence of limiting change at the expense of adapting to customer needs.
Engaging a few customers to represent the customer pool. The Few and the Missing anti-pattern has the consequence of missing customer needs.
When you are a startup, you realize the importance of being customer-value-driven because if customers don’t buy the product, the startup goes under.
That doesn’t mean that a startup has the right product, culture, or processes to become successful; it is that they know that without understanding customers’ needs, their hopes for a successful product or service are slim. Because of this and their small size, most startups will stay very close to the customer or potential customer.
When companies become larger, there is a greater chance the anti-patterns that impact customer value will exist. There is a likelihood of adding more processes, which results in more steps away from employee to the customer. As companies grow, there are tendencies to put more controls in place to manage cost and, unfortunately, this leads to restricting change.
A company begins to optimize for its own processes and plans. This distances itself from customers. As a company grows, there needs an explicit action to remain close to the customer. The question for you is, “Do you see these anti- patterns affecting customer value in your enterprise?”
One of the Agile values is responding to change over following a plan. While there may be a high-level benefit to a plan, responding to changes from customers is where there is more value.
Agile Principles 22:
Customer Challenges of Understanding Value
Another primary reason why it can be challenging to get to customer value is that many times the customers don’t really know what they want. They think they know what they want and they will attempt to provide their best guess on what they are looking for.
There are a number of reasons for this. First, customers cannot always articulate their needs at the moment you ask. Instead, they may provide an idea that may solve their most current issue, which may not really lead to their biggest need. Second, customers are not aware of the options or possibilities so they tend to gravitate toward what they know.
A rumored quote by Henry Ford highlights this mindset, “If I’d asked customers what they wanted, they would have said ‘a faster horse’.” Third, the landscape of customer needs changes regularly. Customer value can be an elusive target and changes constantly. If customers have to wait six months or a year for what they want, they may have moved on and now want something different.
This is where the advantage of discovery and incremental mindset comes in handy. This way, you can learn what the customer wants. A corollary to this is that the customers don’t know what they want until they see it. By initiating demonstrations, customers can see what they said they wanted and can respond toward what they really want.
Inversely, when building something that is considered innovative, showing the customers something that is incrementally being built offers them the opportunity to respond toward customer value.
Is Customer Feedback an Integral Part of Your Customer-Value Engine?
This blog walks us through many aspects in understanding customers and the importance of their feedback. A customer is very specifically defined. Customers have a choice and they pay money to your company. Some organizations apply the term “customer” too liberally to those internal to the company.
While such people are stakeholders, they are not the customer. This is an important mindset shift, and this message needs to be shared with all of those within the enterprise.
Customer feedback provides the direction that steers the customer-value engine toward the direction of customer value. Customers see progress as a working product and delight in seeing the working product in action.
The discovery and incremental approach allow customers to reflect on and adjust their needs until they are transformed into a valuable working product. Believing that progress is best realized in the form of a working product is an important mindset shift to embrace.
Identifying what the customer finds as valuable is a learning opportunity and an important mindset in the journey toward customer value. It allows us to shed the dangerous attitude of pretend or arrogant certainty and really explore what customers need. At the end of the day, it is important to make the customer king. You just need to ensure the customers are guiding you by gaining their valuable feedback along the way.
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One of the Agile values and two of the Agile principles specifically focus on the importance of employees. The Agile value states, “Individuals and interactions over processes and tools.” The Agile principles state: “Business people and developers must work together daily throughout the project” and “Build projects around motivated individuals.
Extracted from these values and principles are collaboration, motivation, and trust. These are the key values of an Agile culture where employees matter.
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Mechanics That Tune the Engine of Customer Value
Applying the analogy that a company is the engine of customer value, we realize that an engine needs mechanics. employees are the mechanics that make your customer-value-driven engine purr.
A mechanic that feels ownership of the engine is motivated to work on the engine, enjoys collaborating with others on the engine, is empowered to improve the engine, and is trusted to make the changes in a safe environment. As a result of this ownership, you will find that you have an engaged and happy employee.
An unhappy employee will be disengaged and allow the engine to sputter. When employees are disengaged, they take long lunch hours and will not stay in the office a moment longer than they have to. More importantly, they will not engage their minds to solve problems effectively. They may not contribute to and may even impede their company's success.
Happy employees continuously look for ways to improve the engine. Frederic Laloux writes that pluralistic-green organizations, which focus on culture and empowerment, achieve extraordinary employee motivation.
The study “The Impact of Empowered Employees on Corporate Value” reveals that employee empowerment within the corporate culture is a “potential source for sustained superior financial performance.” Employees can be a company’s greatest assets. They can be the mechanics that keep the CVD engine purring to move the company forward.
Just saying, “Our employees are our most valuable assets,” is not enough and has become a standard cliché. Can you back it up? Here are areas that you can explore to gauge if your enterprise believes that employees matter.
The COMETS within Your Agile Galaxy
COMETS stands for Collaboration, Ownership, Motivation, Empowerment, Enthusiasm, Trust, and Safety—the values that an organization must embrace if they believe employees matter. These values should be nurtured and become part of an Agile culture that values its employees and understands their importance for the success of building customer value.
It is important to understand that when the term employee is used, it applies to all employees, from team members to executives. All levels should be exhibiting collaboration, ownership, motivation, empowerment, trust, and safety (just in different ways).
For example, ownership implies a bounded authority where executives have ownership of work at their level (for example, strategy) and teams have ownership at their level (for example, user stories in backlog).
As you explore each value, what actions and behaviors would you expect to see? The following is a quick definition of each of the attributes of COMETS. Collaboration is the ability to work with someone to build something. Ownership is feeling that you have the right to control and enjoy an area of work or work item.
Motivation is a willingness or desire to do your work. Empowerment is the belief that you have the right to set the direction of something. Trust is confidence regarding an expectation. Safety is having the belief that it is safe to learn and take risks.
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COMETS form the building blocks to self-organization. Key to having an Agile environment where employees are engaged and believe they matter is establishing a culture where employees have the ability to self-organize around the work. Self-organizing teams are defined as a group of people who have autonomy and a common purpose for deciding how to build something in a collaborative manner.
The Agile manifesto calls out self-organizing as one of its principles, “The best architectures, requirements, and designs emerge from self-organizing teams.” There are two mindset shifts involved in having self-organizing teams become part of the culture.
The first mindset shift is for management to understand that those with the most knowledge (that is, the team) should be the ones deciding the technical evolution of the business needs. This means less dependency on management.
The second shift is for the team to be aware that accountability and responsibility of completing the work falls on them. As you can see, teams gain flexibility in deciding how to build something within their bounded authority, but they also gain the discipline of accountability and responsibility for the work.
Within an Agile context, self-organization requires several key elements. The first is that there is a common purpose for the work to help guide the team (such as release goals and sprint goals). The second is that there is a bounded authority on the work the team owns and they are empowered to determine how to build the product.
The third is that the team uses a build-inspect-adapt type model (applying one of the Agile processes). Inspecting requires both verification (testing) and validation (customer feedback) to help build in the direction of customer value.
The primary benefit of self-organizing teams is that when employees feel they own the work, they tend to have more passion. Consequently, they are likely to invest more of their time and energy.
The implication is that the company may gain the benefit of stronger employee commitment and performance, leading to potentially superior financial results. Now let’s explore the building blocks of self-organization (that is, COMETS) in more detail.
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Collaboration from an Agile and business perspective is defined as two or more people creatively working together with a common purpose to produce a positive business outcome. Within the context of self-organizing teams, it is important for team members to collaborate. Notice I used the terms “creatively” and “positive” in my definition.
Collaboration is meant to produce an outcome. It is meant to bring people and their knowledge together to create something new or different. If two people are not being creative, then it is just two people doing something operational.
Collaboration in my definition is meant to be positive. There is such a thing as “bad” collaboration when not everyone has the same common purpose. “Good” collaboration relies on an environment where people honestly align with the common purpose and willingly accept new knowledge in an open and trusting manner to create something new.
From the employees’ perspective, collaboration provides them with the opportunity to team up with people pursuing a common purpose and to learn from each other along the way. Effective collaboration requires employees to connect with people and with their inner selves. It teaches them to work more effectively and can lead to a high-performing team.
It is important not to confuse collaboration with communication and coordination. Collaboration is a two-way action where two or more people work together to produce a positive outcome. Communication is a one-way action of sharing information in writing, speaking, or another medium. Coordination is often a one-way action of bringing together various elements to enable an activity.
Coordination can promote a more effective collaboration outcome, and communication can be used to share the results of the collaboration. Combined with ownership and empowerment, collaboration allows employees to own and change the direction of the work. This leads to happier employees who feel their abilities are being put to good use.
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Ownership is probably the most important factor in gauging whether employees matter. Ownership is defined as having the authority and the resources necessary to do work effectively. When employees feel ownership of their work, they typically take more pride, put more effort, and bring more quality to their work. Within the context of self-organizing teams, each team understands what work it owns within its bounded authority.
In which scenario will a person put more effort? Is it to maintain a rented apartment or maintain an owned home? If you don’t own something, you are likely to invest less effort. When you own a home, you will likely take better care of it and be more likely to invest time and money to improve it because you feel the pride of ownership.
In fact, you are more likely to protect and defend it. If employees feel ownership of their work, they will much more likely be willing to invest extra time and bring high-quality labor to the work.
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There is a strong link between successful companies and those companies whose employees describe themselves as motivated. Motivation is a construct of internal and external factors that drive how people behave. A motivated employee may put in more effort with a greater focus on quality.
Employee motivation methods have been explored for years due to the possibility of increased company success. In the context of self-organizing teams, the goal is to provide employees with reasons to be motivated.
What are the drivers of employee motivation and what does it mean to an employee? Early notions of motivation tended to focus on the extrinsic motivation methods to engage employees, while more recent research recommends exploring the intrinsic motivation methods that are better suited to engage employees.
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The extrinsic motivational methods focus on motivators that come from outside the employee. In the early twentieth century, extrinsic motivation techniques were characterized by the use of both rewards and punishments.
The carrot-and-the-stick method is an early example of an extrinsic motivator. It refers to a cart pulled by a donkey. A carrot is tied to a stick and dangled in front of the animal just out of its reach. As the donkey moves forward to get the carrot, it pulls the cart. If the donkey isn’t motivated by the carrot, a stick hits the donkey’s backside to move it forward.
The modern version of the carrot and stick is called the Expectancy Theory (that is, if you do something, you can expect a reward). While advanced, today’s performance systems are mostly based on tangible rewards and punishments. There are many extrinsic motivators related to tangible rewards such as money and grades as well as psychological gains such as recognition and celebrity.
These types of motivation are external elements outside of the employees in an attempt to motivate them. Many employees are well aware of these obvious ploys to motivate them.
There are some benefits and risks of extrinsic motivators. The first is that they may promote employees’ doing activities needed to gain the reward, but this will often have only a short-term change because the moment the reward is gone, the activities and behaviors may stop. Instead, consider intrinsic motivators.
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The intrinsic motivational methods focus on those motivators that come from inside the employee. These are driven by an interest that exists within the individual. In this case, the motivation to engage in an activity or behavior arises from within the employee because it is intrinsically rewarding and not because of an external prize.
There are intrinsic motivators related to a sense of value, meaning, progress, and competence. These types of motivation may be driven by enjoyment, curiosity, ownership, autonomy, and pride. What are specific examples of intrinsic motivators?
They may involve contributing to a team (for example, building a product), to a cause (such as increasing the number of women in leadership), or to a movement (for instance, being Agile). They may involve gaining mastery in a domain (for example, Agile and Java programming).
Intrinsic motivators are best applied when identifying an employee’s consequential purpose. The more consequential the purpose, the more self-motivated an employee becomes. In relation to an Agile culture, it may mean that you have a feeling of ownership of the work. It may mean that you have autonomy in your work, such as deciding what work you do, how you do the work, and what the pace of the work will be.
There are major benefits of intrinsic motivators. Employees are often more creative when they are intrinsically motivated. This can lead to more innovation of products. If the intrinsic motivation has to do with competence, there can be higher quality in the products being built. Intrinsic motivators lead to a long-term change of mindset since the motivator is from within and doesn’t rely on an external reward, which can disappear.
Avoid mixing external motivators with internal motivators. It can be tempting to identify the intrinsic motivator and add an extrinsic reward to it. For example, when you offer a reward to something that an employee already finds fun, it often transforms the “fun” into work or obligation.
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Everybody has heard the term empowerment in organizations—typically to hype up a new initiative so that employees will feel empowered. However, it should be a core value of an organization’s strategy and not a trend that comes and goes. Unfortunately, this is not the case for many organizations.
Empowerment is defined as having the autonomy and accountability to organize and make changes to one’s own work and his or her surroundings. Within the context of self-organizing teams, team members are empowered to decide how to build their product (architecture, design, UX, development, testing, and more).
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One of the Agile principles states, “Build projects around motivated individuals. Give them the environment and support they need, and trust them to get the job done.” Trust is defined as having confidence in another person that something will get done. Within a self-organizing team, trust is developed among team members when they can rely on each other that work will get done or that help will be asked for.
Some people say trust is earned. I suggest that trust should be given. This is often seen as a change in mindset. Much of what you learn about trust is through negative experiences. This can teach some of us to start with a guarded view, which makes us believe that trust should be earned. It can feel safer, but this can be a less productive way of approaching trust.
You hire people who you trust can do the job. At the same time, either by your negative experiences or by the multiple levels of approvals, you build an environment where there is insufficient trust given.
Have checks and safeguards been added to replace trust? If you don’t trust, the safeguards are only a process layer that bandages the problem of trust and are often impeding the speed of delivery.
A better way is to start from a trust position. In the COMETS culture surrounding your Agile galaxy, is it better to start with a positive and approach-able worldview or from a negative and adverse worldview of those around you? Give your colleagues the trust and support to get the job done.
Trust is a critical element for healthy relationships, teams, organizations, and communities. Employees are your partners. Giving them the right environment, tools, and culture will help them thrive and, in turn, it will help the business thrive.
Accept the fact that everyone is indeed human and subject to faults. Also, before assuming that anyone is at fault, verify that you provided team members with the support, impediment removal, and lean processes that would enable them to succeed. Often the reason trust is broken is because the system, processes, or cultures around a team are broken. Always look to see what you can fix for a team or employees.
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Trust is developed through relationships with those around us. These relationships are at various levels and need to be developed and continually maintained.
In most workplaces, there is more complexity to building a trusting environment beyond your peers and manager. Relationships can include intra-team trust from team member to team member and inter-team trust from team member to a member of another team, team member to direct manager, and team member to the indirect manager.
In any of these scenarios, start from a trust position. Attempt to make connections with anyone you work with beyond work tasks. This helps employees gain familiarity and empathy with each other. When it comes time to work together, emphasize listening skills to reduce misunderstanding.
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There are two types of safety that factor into a healthy and productive enterprise environment. The first is physical safety. A physically safe environment is where employees are free from physical hazards and can focus on the work at hand. This type of safety should be part of the standard workplace promoted by company and government regulations.
The second safety type is psychological safety, which is core to enterprise effectiveness. According to Google research, high-performing teams always display psychological safety. This phenomenon has two aspects.
The first is where there is a shared belief that the team members are safe to take interpersonal risks and be vulnerable in front of each other. The second is how this type of safety, along with increased accountability, leads to increased employee productivity and, hence, high-performing teams.
Psychological safety helps establish an Agile environment that promotes a safe space for employees to share ideas, discuss options, take methodical risks, and become productive.
An Agile mindset promotes self-organizing teams around the work, taking ownership and accountability, and creating an environment for learning what is customer value through the discovery mindset, divergent thinking, and feedback loops. Agile with psychological safety can be a powerful pairing toward high-performing teams.
However, accountability without psychological safety leads to great anxiety. This is why there is a need to move away from a negative mindset when results aren’t positive or new ideas are seen as different. If employees do not feel safe psychologically, they are less willing to share ideas and take risks. Instead, consider ways to build psychological safety paired with team ownership and accountability of the work.
Everyone has a role to play in establishing a psychologically safe enterprise. Scrum Masters and Agile coaches can educate and coach teams to apply psychological safety and accountability.
Leadership can provide awareness of the importance of a safe environment, give education on this topic, and build positive patterns in the way employees respond to the results of risks taken by team members and others. Employees at all levels must be aware of the attitudes and mindsets they bring.
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Understanding Employee Engagement
How do you know you have engaged employees? Organizations have used Gallup, Inc., for years to help understand their employees’ level of engagement. Gallup spent decades developing the Q12 instrument, which provides 12 well-honed questions measuring the extent to which employees are “engaged” in their work.
While some will say correctly that a manager or supervisor has the greatest impact on the level of a satisfied or engaged employee, Gallup indicates that it is realistic to assume that numerous people in the workplace can influence an employee’s engagement level.
Since a number of people may influence an employee’s engagement level, you need to address the culture in which the employee works. In relation to Agile, one way to gauge employee engagement is to discuss it in relation to the Agile values and principles, which provide strong guidance at both the individual level and the organizational levels.
Of course, there is the direct way. You simply ask them. Ask the employees if they feel they matter to the enterprise. Ask them if they feel they can collaborate. Ask them if they feel ownership of their work. Ask them if they are motivated. Ask them if they feel empowered to make changes to their work environment.
Ask them if they trust their teammates and their managers. As for them, if they believe they are allowed to self-organize around their work. This approach will require someone who is trusted to lead the people through the questions or it can be done in a self-organizing way where employees lead themselves through the questions.
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What Is Your Employee Culture?
When you look across your enterprise, what employee culture exists? Is the culture focused on self-organizing teams and aligned with the values of COMETS and the Agile values and principles? Do the employees feel ownership of maintaining the engine of customer value? Are they free to collaborate? Are they motivated to do their best?
Are they empowered and self-organized to determine how to improve the engine and build the customer value? Are they trusted to make the decisions and do what is best? Do they feel safe to take risks? If they are, congratulations! If not, you have an opportunity to embrace a culture where employees matter.
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Envisioning a Customer-Value-Driven Enterprise
What is a customer-value-driven enterprise? It is a company that optimizes for what the customer considers valuable and more specifically what the customer is willing to buy and use.
The core of a customer-value-driven enterprise is a mindset that understands the importance of discovery and incremental thinking that is continuously injected with customer feedback. The mechanics that support a customer value-driven enterprise are a CVD framework.
This framework serves to develop products and services around the engagement of customers in each aspect of the customer journey from identification and recording the idea, revealing it for priority, refining it, realizing it, releasing it, and reflecting on its value for the customer. This is why it is important to be truly engaged with customers and continuously get their feedback along the journey.
The CVD framework also relies on applying a discovery mindset to learn what is valuable to the customer. It leverages current Agile processes, practices, and techniques by emphasizing the importance of delivering incrementally and frequently so that you are minimizing the risk of delivering something that the customer doesn’t want.
A CVD framework also applies the adaptive Agile budgeting framework, which ensures budget goes to both the highest customer-value idea and the team(s) that can build the idea into a working product, enabling you to stay in touch with the customer and marketplace in a timelier manner.
Not only should you identify processes that are not directly assisting in identifying or creating customer value, you should also shed those processes that are constraining change. While some processes are unrelated or distantly related to customer value, there are others that actively restrict, delay, or ignore the signals that help us understand what is valuable to the customer.
At the heart of the CVD, the framework is establishing an engine for customer value. This engine emphasizes the importance of getting closer to the actual customer and of having a discovery mindset with experimental thinking.
It highlights the detriment of having too much certainty within an organization while regaling the benefits of challenging assumptions to better understand the initial perceived value and shedding those enterprise processes that are weighing down the organization.
I will not specifically call out the CVD framework from this point on as the intent is to place more focus on the culture and mindset of engaging customers and collecting their feedback. The goal is to build an organization that runs on a customer engine that optimizes for what customers consider valuable and optimizes its internal organizational processes toward a focus of delivering customer value.
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The Engine of Customer Value
The goal of a company is to have the willingness to truly engage the customer in every step, from idea to delivery and into reflection.
The thrusters within this engine include activities focused on learning about the current customers or potential customers via personas, capturing ideas from customers, getting continuous feedback from customers as the product is built, delivering to customers, receiving actual customer outcome data (in other words, sales or usage), and reflecting on the status of the customer value once it is in the marketplace to better understand the next steps of value.
This is what I refer to as the CVD engine that runs your business.
To keep this engine running well, you need two important contributors—the engaged customer and the engaged employee. Engaged customers ensure you move in the direction of customer value.
Engaged employees maintain the engine so the value is delivered with high velocity and quality. If all thrusters are firing well, the engine purrs, which increases the chances for successful delivery of customer value. If one of the thrusters is sputtering or missing, it reduces the success of the engine and, hence, reduces the potential value being delivered to customers.
What you are also trying to avoid is having an engine whose horsepower is diverted to many weighty systems that have little to do with the delivery of customer value. Effectively, what you are looking for is building an engine where every unit of horsepower is focused primarily on delivering customer value.
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Moving Away from Certainty
In many organizations, there is a need to act as if you are certain. In fact, the higher up you go in an organization, the compulsion of acting with certainty becomes greater and greater.
Statements like “That’s why we pay you the big bucks” are used to imply that the higher you are in an organization, the more you are expected to know all the answers. Certainty is an anti-pattern in getting to customer value and the polar opposite of what is needed to fuel a CVD engine.
Some people think they must act with “pretend certainty” for the benefit of their careers. Others have convinced themselves of “arrogant certainty”; they believe they know the answer or solution but don’t provide any solid basis for this certainty. Unfortunately, this arrogance can be interpreted as confidence that can be dangerous to the success of a company.
Nassim Nicolas Taleb refers to this as “epistemic arrogance,” which highlights the difference between what someone actually knows and how much he thinks he knows. The excess implies arrogance.
What has allowed certainty within companies to thrive is that there is a distance between the upfront certainty and the time it takes to get to the final outcome. There lacks an accountability trail between certainty at the beginning and the actual results at the end. Often the difference is explained away by the incompetence of others who didn’t build or implement the solution correctly.
The truth is somewhere in between. Unfortunately, the concept of certainty is dangerous to an enterprise since it removes the opportunity of acknowledging the truth and allowing the enterprise to apply a “discovery” mindset toward customer value via customer feedback loops and more.
You also want to avoid the inverse, which is remaining in uncertainty due to analysis-paralysis. A way to avoid this is to apply work in an incremental manner with customer feedback loops to enable more effective and timely decision making. Customer feedback will provide you with the evidence for making better decisions. Applying an incremental mindset will enable you to make smaller bets that are easier to take and allow you to adapt sooner.
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Adapting toward Value
A healthier and more realistic approach is to have leaders who understand that uncertainty is actually a smart starting position and then apply an approach that supports the gaining of certainty. The reality is that the earlier you are in the lifecycle of the work product, the less customer information and certainty you have.
It is, therefore, incumbent upon you to have an approach that admits to limited information and certainty and then apply a discovery and fact-building approach toward customer value. This is why you must learn more about the customers and their needs for the new idea or feature you are building for them.
When ideas that are valuable to customers are identified, there are often some expressed and many unexpressed assumptions. It is important to tie assumptions to the idea that is perceived to be customer value and rigorously explore the assumptions. It is often faulty assumptions that lead you to believe something is perceived to be more valuable of an idea that it really is.
This can lead to work that is actually of low value to the customer, closing off options for a change too early or ignoring valuable customer feedback along the way.
Challenging the assumptions of perceived customer value helps you rationally discuss the progression of how you got to the conclusion of value. It separates what you think you know from what you actually know. By discussing the assumptions, major uncertainties at the time are uncovered.
By highlighting these uncertainties, it provides you with information that helps you think about how to validate the assumptions. By having a conversation around assumptions, it helps those involved with an idea have a better understanding of possible customer value and the work ahead.
Earlier I discussed pretend and arrogant certainty. A good way to uncover where the certainty is coming from is to challenge the assumptions that lead to certainty thinking. It can be quite dangerous for an enterprise to ignore the signals of too much-expressed certainty. This can lead a company to select lower-value work.
Shedding Enterprise Weight
As part of being a value-driven enterprise, it is important to remove any organizational processes or activities that do not directly link to customer value.
The goal is building a customer-value engine that focuses on delivering customer value—not the weight of non-value added activities. This can be particularly challenging when those within the organization sub-optimize for internal processes or, more dangerously, for themselves.
It is important to gauge what your organization is optimizing for. As you look across your organization, do you see processes that are too heavy? I have seen groups whose functions are no longer central to the delivery of customer value yet continue to enforce their processes on others. I have seen multiple levels of management approval where only one (or none) should be necessary.
How many of you have witnessed situations where the customer feedback clearly told you that you were moving in the wrong direction of customer value, yet because of in-house governance and processes, feedback was inhibited or ignored and the original plan was followed anyway.
Even when you spoke up, those “in-charge” choose to optimize for the process and not customer value. This is why the value “responding to change over following a plan” found in the Agile Manifesto is so important.
Do you see people who are focused primarily on building their own kingdom? Are you (or those within the organization) internally sub-optimizing for the preservation of the status quo, for ensuring bonuses, or for maintaining power positions rather than for satisfying the customer?
Some people are so entrenched in their internally sub-optimized culture that they do not allow themselves to see the need to change until it is too late. However, they presumably have been allowed and even rewarded to continue this behavior, so changes are critical to this mindset.
When adopting Agile, there is often a lack of awareness of the amount of non-value-added work occurring. Value-added work is requested and validated by customers to produce a working product.
Non-value-added work is work not directly adding value as perceived by the customer. Some non-value-added work is even less valuable than others. While not all non-value-added work can be removed, attempts should be made to make it as lean as possible.
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Management Closer to Customer Value
Every senior and C-level manager should be as close to customer value as the product owner, salespeople, marketing department, and development teams building products. I’ve been in some organizations where management and other significant company members have never seen the products their teams are building or met the customers those products are meant for.
If a company has dozens of products, I’m not suggesting that leadership must be close to all of the products, but they should be very close to the top 5 or 10 products, including those where there is an investment toward innovation.
The key is narrowing the gap between the employees and customers. The two-degrees-of-separation rule can be an effective means to determine how far away an employee is from a customer.
The further away an employee is from the customer, the less likely that employee understands what the customer considers valuable. Worse yet is the fewer employees understand customer value, the less likely they will consider customer value in their work and decision making. This can further lead to sub-optimizing toward their own work.
The goal is for all senior managers and C-level professionals to have witnessed the company products their teams are building or to have met the customers those products are meant for. This can be in the form of (and not limited to) attending product demonstrations as part of a sprint review, attending a customer advisory board, and visiting customers who are using products from the company.
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Are You Optimized for a Culture of Customer Value?
Moving to a culture where customer value is paramount is an important step in achieving an enterprise that is truly Agile and the business benefits it can bring. Applying a CVD framework and its customer-value engine allows you to focus your company’s horsepower primarily on delivering customer value.
Focus on the meaning of having an engine for customer value, the benefits of the discovery mindset, the risks of certainty too early, the strategies to methodically gain certainty, the task of challenging assumptions to better understand the initial perceived value. And, last but not least, focus on getting management closer to the actual customer.
It takes a smart leader to recognize the need to change and a strong leader to make the changes needed for an enterprise to optimize for the customer. This will often mean creating an enterprise where everyone is now one or two degrees closer to the customer. It will require a hard look at the current talent of managers and individual contributors.
Are people sub-optimizing for themselves? Are they bringing pretend or arrogant certainty to their work? Are they engaged with activities that focus on customer value? Are they promoting or passively allowing non-value added activities to occur at the expense of focusing on customer value? Have they actually seen or operated the top products of the company?
The answers to these questions can help you understand the enterprise you have. Once you understand this, you can adapt toward the customer-value-driven enterprise you need.
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Achieving Better Business Outcomes
I’m Agile, you’re Agile, everyone is Agile. Or folks think they are. But are they really? If Agile is implementing a mechanical process to you, then it’s not Agile. If Agile is pretending certainty without continuous feedback from customers, then it’s not Agile. If Agile is commanded from above with no ownership from teams, then it’s not Agile. Unfortunately, what is known as Agile in some places is certainly something, just not Agile.
Moving to Agile is not about achieving an Agile milestone. It is not a destination, but an enabler in achieving better business outcomes. As part of the CVD framework, the Agile culture and practices provide an adaptive mindset to discover and deliver customer value in an incremental manner.
From my journey through the professional world of Agile, I have discovered three primary success factors in achieving the chemistry for positive business outcomes
The first factor is applying an Agile mindset based on the Agile values and principles (both end-to-end and top-to-bottom) focused on customer value with practices that are best suited for your context and environment.
The second factor is the importance of engaging customers to learn what they consider valuable. The third factor is the importance of engaging employees who create that value.
I call this building an Agile customer-value-driven culture with a spot of being Agile, a dash of employee engagement, and a pinch of customer feedback—a combination that serves as the chemistry for better business outcomes.