The role of Scrum in digital transformation - part 1

by Brendon Livingstone on 18/10/2016 10:00

The role of Scrum in digital transformation - part 1

Everyone is talking about digital transformation and many organisations are making change to better prepare their organisations to take advantage or respond to our digital world. I was curious to find out how prepared organisations are to deliver digital transformation initiatives and how Scrum can help.

A couple of weeks ago our Certified Scrum Training partner Rowan Bunning of Scrum WithStyle was with us to deliver Certified ScrumMaster and Certified Scrum Product Owner training. So I grabbed 30 minutes with him to understand his thoughts on the role of Scrum in digital transformation. His points were comprehensive and compelling, as you will see.

Brendon: Organisations are increasingly focusing on transformation to meet customer expectations and respond to disruption. With the organisations you work with how prepared are they for transformation?

Rowan: I work with a number of organisations that are very conscious of the need for transformation. Some work in industries that have a lot of exposure to disruption, such as the media industry and bricks-and-mortar retail. Some are looking around and saying "who is going to be the Uber equivalent in my market?". The key challenge in this space is to build the capability to manoeuvre, while also keeping integrity in your products and quality in your delivery.

There is often the pressure to go faster and cheaper. If you think about the word “transformation” however, weren’t not talking about just doing the same thing you always did faster and cheaper.

In digital channels, not only are you competing or being compared with global players like Google and Facebook but generations who have grown up as digital natives have high expectations as to user experience and how rapidly your organisational will respond to their needs and interests. If your organisation’s response to customer feedback is to prepare a business case for next financial year and wait for approval six months later, you’re looking woefully unable to respond to change in a way that meets the expectations of today’s customers.

Being successful in the competitive digital world requires an ability to deal with a range of new uncertainties including how users will behave in respond to new digital offerings. This is often fickle and unpredictable. Dealing with this requires an ability to manoeuvre in response to customer feedback. If there’s a 'type of cheaper' required here, it’s cheaper cost of change – to “turn on a dime, for a dime” as Americans would say.

Turning on a dime (or a New Zealand 10 cent coin for that matter) requires quite different development techniques that take some time to learn and a good deal of discipline to apply consistently.

Changing the way that your business operates to a digital model is going to involve learning new ways of operating. That’s going to require time and support to learn. As are the techniques to create a strong, sustainable Agile capability.

Many organisations with an immature Agile capability haven’t yet learned and habitually embedded solid disciplines around the technical practices (such as test-first development, integrating continuously and relentless refactoring) that underpin genuinely sustainable agility. As a result, organisations incur rapidly increasing amounts of development debt that is usually called “technical debt”. This slows down forward progress and makes the system increasingly costly to enhance and maintain. This is the opposite of good Agile which is about building quality in, not cutting corners and not incurring technical debt.

The big lesson from Lean is that a constant, almost obsessive, attention to quality actually improves productivity and reduces cost overall. This may seem counterintuitive until you consider the cost of detecting and fixing a defect. Does it cost more, less or about the same if you do it six months after when it was introduced compared within one day of it being introduced? Some people have found that it costs as much as 24 times as much to find and fix a defect months later.

With Agile and Lean, flexibility and rapid response to change does not necessitate lowering quality. The Agile approach is to start with a minimalist set of features done to high quality standards and iterate whilst keeping the product working and potentially releasable every step of the way. This turns out to be a very powerful risk management approach.

Faster and cheaper through cutting corners was never what Agile or Lean were about and we should be careful that pressure, incentives and lack of support with learning new skills doesn’t unintentionally encourage short-sighted shortcuts.

I would say that most of the organisations I’ve come across commonly are not well prepared for digital transformation. They may be latching onto buzzwords but haven't done the work to build a solid delivery capability required for dealing with change whilst sustaining high quality and velocity.

This can lead to a situation where there’s concern that they’re rushing it, they’re going to deliver poor quality, they’re introducing lower standards to security or user experience, and that they might compromise the brand.

As a result, in some organisations Agile gets a bad name as a way of legitimising cutting corners and this can lead to quite a lot of pushback against Agile. Ironically, the people who are pushing back are often those who are concerned about what proper Agile and Lean has always advocated: relentless focus on sustainably high quality and release readiness.

Brendon: Does Scrum and related approaches help organisations who need to change at more regular and faster rates?

Rowan: Yes, it certainly does. That's really the intention of Scrum – to optimise the organisation to be able to constantly integrate work in very small adjustments with tight feedback loops to ensure that quality isn’t compromised.

Let me explain with a conversation I recently had with the Chief Digital Officer (CDO) at a large Australian organisation. He’d recently come into the organisation and was really pushing the ideas of getting new offerings out to customers early and iterating, using concepts like "Design Thinking" and "Iterative Development".

His initiative to build capability and follow rapid approaches with their digital projects was creating tension with the Chief Information Officer (CIO) and other senior IT people, whose interests were in areas such as high quality, security, scalability, data integrity and cost of ownership.

I've seen that in quite a number of organisations, the tension between the CDO and CIO or the business and IT. There are different interests in play there and they're both important. The key thing to understand is that with a solid Agile capability, manoeuvrability and quality are not mutually exclusive.

We do need to be able to ensure high quality and not do things that cut corners and incur a lot of technical debt. We do need our technology to be scalable and secure.

At the same time, we need to appreciate that there's an inherent, unavoidable uncertainty in the market and in public-facing offerings, especially when organisations introduce new business processes as they try to meet the expectations of digital natives and others who are trying to interact with the organisation in new ways. There's is whole lot of potential that your first offering won't actually be attractive to these people - it might not be the right thing to offer. Finding that out early, rather than investing a huge amount of time and money building the wrong thing is a really key capability to have.

That's exactly where Scrum comes in, together with a lot of the Agile-related approaches that have been popularised more recently, such as “Lean Startup” and “Design Thinking”. Many of these approaches basically emphasise different strategies around a Scrum style of iterative development and feedback. Lean Startup frames it as repeatedly validating business hypotheses and Design Thinking emphasises designing from a starting point of empathy with the customer. Both are highly complementary with and in many ways similar to Scrum’s empirical approach. The key is that both require us to have the capability to pivot or to change direction at a low cost of change which is exactly what Scrum is designed to help us with.

Scrum will help achieve the outcomes that the CDO needs – to get things out early, be able to iterate and be able to validate whether these new adventurous offerings are going to be successful.

At the same time, the Scrum approach can help satisfy the needs of the CIO and senior IT people who are concerned about not cutting corners, not lowering quality and to do those incremental releases with integrity.

So, rather than it being a competitive win-lose argument between CDO and CIO around early experimentation and iteration vs upholding quality and avoiding increased risk, Scrum provides a way to make it a win-win scenario, thus achieving both the CDO’s and the CIO’s outcomes.

And if we can achieve both of those outcomes, fast iterations while having high quality, then you're going to be more successful with digital transformation.

That doesn't come overnight though and Scrum is a great way to raise the awareness of what improvements need to be made across all aspects – across teamwork, across technical practises, and across the way we set up projects or non-project based product development and actually govern the success of them. Scrum essentially creates transparency and shines the light on the strengths and weaknesses in different areas so that you can tune them up and raise the bar to be more successful in a rapidly changing digital world.

In other words, you can have your manoeuvrability and quality cake, and eat it to, but only if you invest in learning how to bake a good cake. If you don’t, you’ll be serving raw cake batter to your guests whilst making out that it's what real cake is. Unfortunately, I’m seeing a lot of organisations who haven’t invested in learning the new skills and habits that Agile development requires producing something more like batter or a half-baked cake.

In part 2... 

In The role of Scrum in digital transformation - part 2 I ask Rowan how Scrum makes a difference for digital transformation and where organisations should start. 

Recorded webinar: Overcome common Agile problems using Large-Scale Scrum

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