Doing vs. being: Practical lessons on building an agile culture

 

Here is an excerpt from an article written by Nikola Jurisic, Michael Lurie, Philippine Risch, and Olli Salo for the McKinsey Quarterly, published by McKinsey & Company. To read the complete article, check out others, learn more about the firm, and sign up for email alerts, please click here.

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Four global success stories offer insights and lessons learned on achieving organizational agility.
Around the world, a growing number of organizations are embracing agility to improve delivery, increase speed, and enhance customer and employee experience. Indeed, in the time of COVID-19, many organizations have accelerated their shift to agile. Our recent research found that agile organizations responded faster to the crisis, while those that do not embrace agile working may well forfeit the benefits of speed and resilience needed in the “next normal” after the COVID-19 pandemic.In essence, agility at an enterprise level means moving strategy, structure, processes, people, and technology toward a new operating model by rebuilding an organization around hundreds of self-steering, high-performing teams supported by a stable backbone. On starting an agile transformation, many organizations emphasize and discuss tribes, squads, chapters, scrums, and DevOps pipelines. Our research shows, however, that the people dimension—culture especially—is the most difficult to get right. In fact, the challenges of culture change are more than twice as common as the average of the other top five challenges (Exhibit 1).Shifting culture requires dedicated effort. Unfortunately, many organizations on this journey struggle to articulate their aspired agile culture and bring it to life. This article demystifies culture change in an agile world through four practical lessons drawn from real-life success stories from around the world.

Lesson 1: Define the from–tos

Each organization is unique. Accordingly, each needs its unique culture to power the new agile operating model. Organizations building an agile culture should base their approach on aspirational goals. They also need to understand their current culture, including the behavioral pain points that can be used as a starting point to articulate three to five specific mindset and behavior shifts that would make the biggest difference in delivering business results.

At New Zealand–based digital-services and telecommunications company Spark, one of the first steps the leadership team took in its agile transformation was to launch an effort to articulate the cultural from–tos. Spark boldly decided to go all in on agile across the entire organization in 2017—flipping the whole organization to an agile operating model in less than a year. From the beginning, Spark understood that the change needed to be a “hearts and minds” transformation if it was to successfully enable radical shifts to structure, processes, and technology.

Spark’s culture change started with its Sounding Board, a diverse group of 70 volunteers from across the organization. These were opinion leaders—the “water cooler” leaders and Spark’s “neural network”—not the usual suspects visible to management. The Sounding Board’s role was creating buy-in for and comprehension about the new model and designing enablers (behavioral shifts and new values) to help employees along the agile journey.

An early task for the Sounding Board was to identify the behavioral shifts teams would need to thrive in the new agile operating model. Members used their experiences, inspirational examples from other companies, and Spark’s work on culture and talent to define these shifts. And to help inform what changes were necessary, the Sounding Board sought to understand mindsets (those underlying thoughts, feelings, and beliefs that explain why people act the way they do) that were driving behaviors.

The from–to aspirations were then shared with different groups, including the top team, and distilled into four key themes. Each theme had to resonate with colleagues across the organization, be both practical and achievable, be specific to the company (that is, not derived from general agile theory). The resulting articulation of from–to behaviors allowed Spark to understand and compare its existing cultural reality with the desired end state (Exhibit 2). 1

Finally, to set up its from–tos as more than words on paper, Spark made culture one of the agile transformation’s work streams, sponsored by a top team member and discussed weekly in transformation sessions. The work stream brought culture to life through action. The from–to changes were incorporated in all major design choices, events, and capability-building activities. The work stream aligned fully with other culture initiatives that would help to move the needle on cultural change, such as diversity and inclusion.

Melissa Anastasiou, the team member who led the company’s culture workstream, observed: “Like many organizations, the company’s experience has been that culture change is hard and does not happen overnight. It takes collective and consistent effort, as well as a genuine belief in and understanding of the ‘why’ at all levels of the organization. Setting a clear and purposeful vision for what great looks like—and ensuring that this vision is authentically bought in from bottom to top that is, from shop floor to C-suite—put us in the best possible position to deliver the change to full business agile.”

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Here is a direct link to the complete article.

Nikola Jurisic is a senior expert in McKinsey’s Dubai office, Michael Lurie is a partner in the Southern California office, Olli Salo is a partner in the Helsinki office, and Philippine Risch is a partner at Aberkyn.

The authors wish to thank Christopher Handscomb, Jelle Maddens, Andrew St. George, Dorottya Svab, Tal Shavit, David Pralong, Laura Furstenthal, Marcus Sieberer, and Daniel Rona for their contributions to this article.

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