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Beyond Software
By Michael Sherman, Stephen Edison, Benjamin Rehberg, and Martin Danoesastro
thinking companies are taking advantage Queuing Delays. Handoffs from one
of the same agile techniques that have specialized employee to another create
transformed software development. Now internal queues; each order or task
they are successfully deploying these slowly churns through the system in a
techniques in other core business units, linear fashion, delaying the speed of
from marketing to human resources to end-to-end customer service.
finance. When companies implement agile
across their entire organizations, ways of Rework. Each time theres a handoff
working improve dramatically. Agile from one specialized worker to another,
methods are more collaborative and the chance that rework will be required
creative and can be more efficient than increases because individual employees
other business models. But companies responsible for a single isolated task
must first understand why their current have little understanding of how their
business structures need to change. work fits into the larger whole. This
rework culture can be especially
problematic in complex environments
The Downside of Traditional, where errors in the details can create
Specialized Roles big problems later in the process.
Most large, hierarchical organizations are
structured around silos and specialized Lack of Ownership. When individuals
functions. Its not uncommon to see com- are assigned only discrete tasks, no one
panies organized in such a way that a sin- is ultimately responsible for the custom-
gle customer need (such as processing an er outcome. This generates frustration
order) requires action from more than ten for customers because finding the right
person to fix a given problem may be Create cross-functional teams. To get
nearly impossible. started, organizations should create
cross-functional teams of approximately
Companies that rely on overly specialized five to ten employees eachsmall enough
roles create meaningful inefficiencies that to collaborate closely but large enough to
can damage the customer experience. (See possess the necessary skills to execute
Exhibit 1.) Customers forced to endure de- successfully. These agile teams perform a
lays owing to multiple handoffs or rework given process from beginning to end, batch-
will soon take their business elsewhere. Yet ing tasks to increase productivity and
many large companies find restructuring parallel processing to maintain forward
difficult because their organizations are momentum. Individual employees handle
bogged down by a large and highly custom- multiple steps to reduce overall work time
ized product catalog, disparate IT systems, and avoid the delays that come from
or poorly integrated M&A activityall of excessive context switching. With brief,
which bolster the need for specialized re- regular interactions, the teams resolve
sources. While displacing deeply en- questions quickly rather than throwing
trenched processes and practices can be issues back over the wall.
difficult, companies that successfully incor-
porate agile beyond software see transfor- Because many companies are still orga-
mative results. nized around highly specialized functions,
however, the shift toward agile often re-
quires consolidationfrom large numbers
Getting Started of specialists to small teams of cross-
To implement agile across an entire busi- trained individuals. In a cross-functional
ness, teams need to work together differ- team, for example, one employee may tack-
ently than in the past. Siloed employees no le tasks A and B, which were previously
longer perform discrete, predefined tasks handled by two employees. (See Exhibit 2.)
in isolation. Instead, cross-disciplinary, col- Over time, as employees undergo addition-
located teams collaborate in innovative al cross-training, roles can be further con-
ways to enhance the customer experience. solidated. Of course, role consolidation has
By working iteratively and incorporating its limits. In some areas, specific expertise
feedback to continually improve, agile is required (in the case of a lawyer or spe-
teams across all functions have the poten- cialized engineer, for example). But these
tial to transform the business from the in- specialists should work with cross-function-
side out. To capitalize on the many bene- al teams to support customers. By reorga-
fits of agile, companies need to take four nizing into these more productive teams,
key actions. organizations can dramatically reduce the
SPECIALIZED
SKILLS AND A B C D E F
ROLES
SPECIALIZED
TASKS 1 2 3 4 5 6
WORK TIME 2 hours 2 hours 2 hours 2 hours 2 hours 2 hours = 12 hours of work to
process a single request
WAIT TIME 2 days 2 days 2 days 2 days 2 days = Up to 10 days of waiting
AB Number of tasks
managed in parallel 12 45
by cross-trained
FA Individuals BC individuals
manage 3 6
multiple roles
and tasks
EF CD Work time 4 hours 3 hours 2 hours = Fewer work hours
organizations can enhance operations team members test and learn from experi-
at all stagesfrom R&D to launch to ments and, finally, determine what they
customer care. can accomplish in the next sprint. These
techniques can dramatically accelerate the
Agile backlogs and dashboards can be pace at which marketing organizations in-
used to organize work and track novateand teams have much greater
progress, enabling teams to prioritize awareness of their overall impact on the
tasks, eliminate bottlenecks, and business and its customers. While agile cer-
identify automation opportunities. emonies alone wont make an organization
agile, they can certainly encourage the
Agile techniques, such as A/B testing right behaviors on a daily basis.
and a test-and-learn approach, encour-
age teams to analyze user data and Automate relentlessly. While all the actions
focus their priorities accordingly. outlined thus far can improve the customer
experience, they wont necessarily lower
Many best-in-class marketing organizations costs. To do that, teams need to find ways,
have begun to use agile techniques to expe- where possible, to automate the end-to-end
dite the development of new initiatives. process. Every time team members must
(See The Agile Marketing Organization, BCG perform a high-frequency manual task,
Focus, October 2015.) For example, some they should explore options for automating
leading organizations appoint a scrum the process to eliminate inefficiencies.
master, who leads rapid sprints to develop Agile teams can also analyze the ways in
integrated marketing initiatives, apps, and which customers use various digital chan-
websites. Each day, the team holds a nels and develop self-service options to
15-minute standup, in which members streamline interactions. Automation not
brainstorm ways to unblock activities and only reduces the overall volume of work
keep one another on track. Along the way, that needs to be completed, it allows teams
Stephen Edison is a principal in the firms Dallas office. He is a member of the Technology, Media &
Telecommunications practice. You may contact him by email at edison.stephen@bcg.com.
Benjamin Rehberg is a partner and managing director in BCGs New York office. He is a core member of
the firms Financial Institutions and Technology Advantage practices and the global leader of the software
and agile topic within the Technology Advantage practice. He specializes in technology and operational
issues in the financial services industry. You may contact him by email at rehberg.benjamin@bcg.com.
Martin Danoesastro is a senior partner and managing director in the firms Amsterdam office. He is a
core member of BCGs Financial Institutions practice and the global leader of the digital and agile topic
within the People & Organization practice. You may contact him by email at danoesastro.martin@bcg.
com.
The Boston Consulting Group (BCG) is a global management consulting firm and the worlds leading advi-
sor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all
regions to identify their highest-value opportunities, address their most critical challenges, and transform
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