How to make product development a more efficient process and significantly boost your revenue growth along the way
For instance, agile development is aimed to remove the uncertainty around the end product by deploying the software in multiple stages. If your startup wants a transportation solution, the engine and the seats would be made first. The cushions, the tapestry and other add-ons would come later. The basic goal would be met in as little as a week and is called a sprint. The client can see what they are getting at an earlier stage since each version would be deployed. They do not have to wait for the end result.
In the old model of development (called the waterfall model), you would spend years building the car and giving it to the client. The feedback, alignment and adjustment would come later.
The key motivators for adopting agile development
A global survey of 1,300 IT and business leaders, carried out by CA Technologies found agile to play a critical role in accelerating decision making and speedy delivery of the right products and services to the market. The customer experience is also improved, thereby, staying ahead of the competition.
The findings include a 60 per cent higher revenue and profit growth for companies who adopted and leveraged agile in all compartments of the organization. Additionally, 78 per cent believed that their organization benefited from agile working across the company.
Examples of tech companies who have found positive results with agile development
According to a HP survey of 601 development and IT professionals, the other motivators of adopting agile methodology are:
1. Spotify – The problem with Spotify was, “What’s the point of having 20 million songs if your users are spending most of the time searching for music instead of listening to music?”
The solution was the “Discover Weekly” – a playlist every Spotify user receives on Monday which has 30 songs crafted according to the taste of each listener.
A small agile team was responsible for this invention. They categorized 20 million songs catalog-wise, categorized the listening habits of their users and via machine learning offered a weekly playlist from that analysis.
The Spotify users loved it. A pilot study on 1 million (1 per cent) Spotify users showed the response to be positive, with 65 per cent of participants finding a new favourite song in the personalized playlist.
To enable this, Spotify created agile management where the team did not need to create any detailed cost-benefit proposal nor seek approvals from the higher management before trying out the idea. The agile team had radical transparency among the team members. They would test alternatives and learn from the experience, with a tight focus on the user experience. Within a few weeks, the lean cross-functional team developed a quick prototype, tested in on their staff and then the users. This is how the “Discover Weekly” was born.
2. VistaPrint – When marketing company VistaPrint conducted an evaluation of their waterfall method, they realized the teams were taking more than 60 days to take an idea to the deployment stage. From these 60 days, the amount of actual work totalled only 40 hours.
An analysis showed that they were suffering from feedback swirls, unclear decision making and long creative lead times that were responsible for taking the process two months to deliver, instead of 40 days.
The reason for switching to agile was to reduce the project lead time. They adopted a culture that promoted team collaboration, information sharing and transparency among the teams and internally within a team. They introduced daily stand-ups, retrospectives to review what worked and what failed, and creating informational touch points improved their team building.
In a span of five months, their lead time decreased from 40 days to 15 days. In another five months, this time was reduced to 7 days, thereby an 83 per cent overall improvement.
3. TCS – According to an Economic Times story, TCS plans to move to agile delivery completely by 2020. That for them will be a market differentiator.
With offices in over 46 countries, TCS has more than 10,000 scrum masters, which is the largest pool so far. They are changing their infrastructure to making the workplace more collaborative. Also, they are ingraining the agile methodology in their service delivery architecture.
4. IBM – IBM, one of the biggest technology companies for creating computer hardware credits agile scrum for improving their business operations. According to IBM’s Harish Grama, the vice president of rational product development and customer support, the three most important factors affecting the implementation of agile are:
IBM’s development processes underwent a transformation over the last 5-6 years, to make 70% to 80% of the development agile. While the small startup projects are agile, the products with a large customer base adopt an iterative approach. According to Grama, one cannot mess up a longer development cycle due to a longer user validation period.
How does an agile startup look like?
Typically, an agile startup employs small teams to focus on delivering iterations in a short time span. Rather than waiting for 8-9 months to deliver a piece of software, they release the minimum viable product and keep improving feature-by-feature, using feedback and the market response.
Scrum is the most famous and widely used agile framework, with Amazon, Microsoft, Spotify and other larger companies being its loyalists.
The developers are broken down into small teams known as scrums. Each scrum takes ownership of a specific feature or a piece of software. Then, scrums build the features in short iteration cycles, the sprints.
Scrum framework has the following three important components:
1. The product backlog – This is where the ideas come from. The product owner, the main stakeholder lists down the features to be implemented. While the product manager is customer facing, the product owner interacts internally with the development team.
The product owner decides which features should be given priority in the product backlog. Usually listed as user stories, they are hypothetical formats such as:
- To simplify my login as a Facebook user, I would like to use social authentication.
- For the safety of my users, as a fintech developer, I would want a two-factor authentication.
The user stories are left vague intentionally to give the team greater freedom in developing and iterating the features. The ideas which are taken from the product backlog are converted into a list of objectives termed as sprint backlog which is then executed and called as the sprint.
2. The Sprint – The meaning of agile is to accomplish small and focused goals at a quick speed. This sprint which does not take more than a few weeks is a short iteration cycle in which the scrum develops and deploys a specific feature. The scrum master supports the team members at all times.
The role of the scrum master is supportive and not of a project leader. He is a facilitator and not a manager, staying on the ground with the team and not higher in the hierarchy.
The scrum sets goals for the team. In the daily standup, each member answers the following questions:
- Which tasks did you accomplish yesterday?
- What are you doing today?
- Are there any roadblocks in the way?
The product manager decides the features, the scrum master breaks them down and ensures that they are implemented. While the scrum master has no say in the priority of the product backlog, the project leader is not allowed to share change while the sprint is on.
Let’s compare this to a fireworks display, Once the fuse is lighted, there is no messing around with how the fireworks were set up.
After the sprint is over, the product owner reflects on how it went.
3. Sprint retrospective – After the completion of the sprint, the product owner decides which features to deploy. The scrum reflects on the performance of the sprint and decides what to improve in the next one. The results of the sprint are saved in a sprint burndown chart.
The role of the sprint burndown chart is to note the number of sprints completed and the amount of work that remains in the product backlog. The difficulty of a new feature is measured in the form of story points.
Seemingly difficult, measuring the difficulty in implementing features is vital to gauge your team’s progress. This enables the sprint to get more efficient while keeping the project in perspective.
The greatest benefit of scrum is fluidity. The entire team can reorganize themselves depending on the obstacles that spring up in the sprint. After every sprint, you can introspect to improve the next sprint even before it starts.
How to destroy the barriers to agile behaviour?
According to the Harvard Business Review, here’s a table with the right conditions for agile.
Research by Scrum Alliance and published in Harvard Business Review has found that more than 70 per cent of agile practitioners report tension between their teams and the remaining organization.
No wonder why. Different departments follow different roadmaps and move at different speeds.
Here are the five techniques for destroying the barriers to adopting agile development:
1. Get everyone on the same page – Even if all the teams are not responsible for the agile processes, individual teams need to see and respond to the priorities quickly. For example, if developing a new mobile app is the top priority for the software development team, it should be on the top priority for budgeting, testing and software integration. In absence of this, the innovations will struggle in deployment. The entire organization needs to practice agile.
2. Don’t change the structure immediately. Change the roles – Organizations adopting agile may want to make major changes in their company structure, is a major myth. Cross-functional teams do require some amount of management, but largely require multiple disciplinary teams to learn to work together simultaneously instead of separately.
3. There should be only one executive for each decision – In an agile development model, only one senior executive should be responsible for commissioning a cross-functional team, appointing and replacing members, selecting the team leader and approving of the team’s decisions.
This executive is selected by the senior leadership to identify critical issues, design processes for solving them and there is a single owner for each such initiative.
The other leaders in the organization must stay away from overturning the owner’s decisions. While it’s alright to provide guidance if you don’t like the owner’s performance, don’t incapacitate him or her, instead, change the initiative owner.
4. Focus on teams rather than on individuals – A research by MIT Center for Collective Intelligence found that while the team performance is affected by the intelligence of an individual, the team’s collective intelligence is more critical.
Agile teams improve the collective intelligence by clarifying roles, teaching conflict resolution methods and allowing team members to contribute equally. The focus is shifted from output centric parameters such as utilization rates (how busy people are) to outcomes and team happiness (how engaged people are). The recognition system focuses more on team results than individual efforts.
5. Lead with questions and not orders – The agile methodology is based on creating cross-functional teams. This means, the kind of questions leaders ask in such organizations include – “What would you recommend” and “How do you suggest we test that feature?”
In an agile methodology, when each sprint ends, you get a chance to reflect and hit a reset button to improve the entire process and make it more efficient.
Those companies who learn to introduce the agile extension into a broader range of the organization will accelerate towards profitable growth.
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