Agile Transformation, Organizational Culture and Climate (Part 2)

Agile Transformation, Organizational Culture and Climate (Part 2)

In the first part of this article, we defined what Agile transformation is and what Organizational Culture and Organizational Climate are in that context. We also saw how Agile Transformation is a 3-dimensional change that affects the Execution Culture across (X-Axis) and deep (Y-Axis) and also the Climate/Mood (Z-Axis) of your organization.

We elaborated how the leadership in ALL execution teams that partner in this transformation has the responsibility to carry themselves and their teams through this cultural shift. At the same time, its the HR leadership’s responsibility to sense the Organizational Climate as the cultural shift occurs and support the teams with appropriate interventions to maintain a healthy environment of learning and growth.

Having an appreciation of how Agile impacts people, their roles and their responsibilities is key to designing how Organizational Climate is assessed and how as an organization you respond to it. The remainder of this article focuses on how Agile Transformation impacts the focus areas of assessment and also the intervention areas from the assessment.

What to assess in Organizational Climate for Agile Transformation?

Typical assessments of Organizational Climate focus on how well people understand their roles, their growth trajectories, skill requirements, confidence in the leadership and the effectiveness of the feedback process that leads to professional growth. It would also look at feedback on compensation and benefits, rewards programs and other softer aspects like diversity, values and alignment.

It will now be evident, that with Agile transformation inverting the ownership model in your teams, the traditional notions of growth, skills requirements and definitions of leadership will change. Assessing the team’s confidence of the leadership has to shift from their ability to direct, to their ability to coach. This also needs to be paired with finding out if teams are sensing an increase in their ownership domain as well as their comfort with it. It will be important to understand how collaboration between people of different skill sets are affecting team morale and power distances. Quite paradoxically, if you sense your organization doing very well and comfort on all these change dimensions, you could well assume that Agile transformation is NOT going right; it could also be a indication of fear to communicate the reality in your organization — a fundamental flaw that will kill your Agile Transformation journey.

How to engage the organization with Organizational Assessment?

A redesigned Assessment framework that accommodates Agile mindsets will help the HR organization support the leadership to influence the Climate. The lazy approach to use the Climate assessment is to ask leadership to go easy on those areas that are causing discomfort to the teams even if they are “growing pains” of the journey. E.g. if the teams complain that managers are not engaged in the day to day tasks of the team and resent the “aloofness”, a direction to managers to revert to be more “engaged” will be the exact opposite of what should be done to drive Agility. Conversely, if managers are complaining that there is lack of clarity in their “vertical growth”, it may a good sign and call out the need to refine the roles and responsibilities of the management layer towards and incentivizing servant-leadership.

To re-iterate from the last article, the Climate is the effect and NOT the cause – so, it derives that each team now has to have its own understanding of the climate and work on what behavioural aspects to change. The teams themselves or the managers on their own may not be able to chart the next steps — Agile coaches must be engaged to help understand which pains are Agile friendly, and help the teams navigate them. Unfortunately, Agile Coaches are not considered part of the people leadership and kept away from understanding these aspects. HR leadership has the opportunity to influence this unfortunate status quo.

Another key aspect of the Organizational Climate is rewards and recognition. As organizations move to Agility, the move towards team goals, and collective ownership takes precedence over individual glory. Its important to appreciate this shift and use the Organizational Climate to gradually shift the organization to become more accommodating to losing “individual glory” and promoting “team success”.

In conclusion, the transformational journey to Self-Management using Agile as a framework is a long and arduous one. It requires enlightened leadership to guide the teams to the new Organizational Culture and partner with the HR organization that’s keeping a close watch on the Organizational Climate.

There are NO shortcuts, but with team work from ALL the leadership, the complexity can be handled step-by-step, iteration by iteration, quarter by quarter. Its a like grand orchestra and when there is alignment between the players and the conductor, you will hear the initial cacophony transform into a symphony that your organization will wonder how you ever lived without.

 

Agile Transformation, Organizational Culture and Climate (Part 2)

Agile Transformation, Organizational Culture and Climate (Part 1)

As organizations take on the Agile transformation journey, there are significant impacts on two key dimensions — the Organizational Culture and the Organizational Climate. This two-part article is an attempt to provide clarity on these aspects. It establishes who in the organization owns the Culture and Climate respectively and are accountable to the success of the transformation.

In the first part, we will focus on the definitions of these terms and how they are related. With a firm foundation on the definitions, we will then elaborate on the ownership aspects in next part.

Let’s start with the key question. What is Agile transformation and what changes does it bring?

Agile transformation is the process of an organization changing its discovery and execution approach from a Command-&-Control, Top down, Upfront Planning driven model to a Team Oriented, Collaborative, Just In Time and Iterative model. As you can see, its a complete inversion of the principles and – and hence the usage of the word Transformation. A change as dramatic as this runs broad (X-Axis) and deep (Y-Axis) into the organization’s fabric, and challenges the fundamental mindsets with which people do their daily jobs.

Let’s start with the X-Axis (breadth).

 On the breadth side of the equation, the transformation brings people from different parts of the organization (erstwhile reporting structures) into single teams. These team members now work by directly communicating with each other instead of through their “reporting structures”. This is only the beginning — as the journey matures, teams realize the need to bring in wider variety of people into the Agile team to effective. Such pressure coming from the “bottom of the hierarchy” will challenge the organizational design. If the transformation has to succeed, existing organizational silos will need to be broken to make the teams more effective. At this stage the same leadership that was “excited” with Agile, starts resisting the change given its discomfort with the comforting barriers now giving way.

Now for the Y-Axis (depth).

 The depth side of the equation is all about management styles, transparency and delegation. With the inversion of the execution model, the decision-making power on day-day execution shifts from erstwhile managers to the execution teams themselves. Teams will require greater autonomy in decision-making and transparent flow of information to facilitate the decision-making.

Information and decision-making that used to be the prerogative of the managers in the Command-&-Control world, and gave them a sense of power is now diluted. Managers now are required to focus more on aligning the teams’ direction to the organization’s goals and help remove impediments from the team’s pursuit of these goals set. Such a shift demands managers to communicate more outwards to the stakeholders and negotiate on alignment rather than on controlling inwards. On their part, teams are also now accountable to goals than to execute assigned tasks. As a consequence, the measures of performance also shifts from one of following plans and orders to meeting goals — a significant shift.

This shift in the operating model that demands a change in the mindset deeply influences employees’ daily work experience. This is the new Organizational Culture. Both managers and team members will experience discomfort and exhilaration in equal measure adopting to this model. While teams will fear responsibility and enjoy autonomy, managers will resent lack of control but enjoy liberation from the mundane. The organization is shifting to a new culture of self-managed teams and light (agile) management structures.

The leadership (managers at ALL levels up-to-the C-Suite) are responsible for owning up to this discomfort and taking the leap of faith that the shift to self-management is for the greater good of the organization. They are the OWNERS of the Organizational culture.

Is that all to the story? No. Your Organizational climate, the Z-Axis completes the picture.

 The Z-Axis (depth).

 As you can see from the above, the transformation WILL lead to major changes and challenge people at various levels — their hard skills, their soft skills, their definition of success and growth drivers – both up-and-down the organizational hierarchy (Y-Axis) and across the “department” verticals (X-Axis). Given the impact across so many dimensions, people across the organization will perceive this change with different lenses. The prevailing mood in the people will be directly impacted positively as well as negatively by this change. This constant “flux” in the mood from time to time as the organization transforms is your Organizational Climate. So, even as the Organizational Culture is changing, the Climate will also change. What’s important is to realize that the Climate is the “effect” and the Culture is the “cause”.

Who is responsible to sense the Organizational Climate? This is where HR has a pivotal role. The execution teams will be too busy with the culture to also focus on Climate. Its the responsibility of the HR leadership to provide a real picture of the mood swings and help the executive. In the next part of this article, we will explore the specifics of the HR Leadership in designing the Organizational Climate Assessment, and how they can be an active participant in the organization’s strategic journey.

 

Fix these to Improve Accountability and Ownership

Fix these to Improve Accountability and Ownership

Many tiles of our verandah roof had broken, and the place was looking run down. Due to the pandemic, we had been putting off the repair work.

One morning when I stepped out, I found all broken and missing tiles replaced and the verandah looking beautiful. Later, I learned that the gardener, Ajay was working on them the previous day, and my husband assumed that I had instructed him to carry out the repair work. Guess what! I had not even mentioned it to Ajay. When Ajay came, I asked. He responded, “Madam, I had some time yesterday, not much work due to the rains. This was looking bad, and water is coming into the verandah, so I replaced them”. Ajay works as a gardener at our house, and this work is certainly not a part of his responsibilities!

What Ajay demonstrated here was a great sense of ownership. He perhaps felt empowered enough to source the tiles and fix them.

Often, business owners and managers voice their concerns about the lack of accountability and ownership in their teams. They would like to see Ajay like the sense of responsibility in each of their team members. Despite processes, command, and control, and incentivization in place, the ownership does not happen.

Here are some of the factors fixing which are likely to drive up team accountability and ownership.

  • Understanding and alignment with the purpose of the organization/project.

  • Clarity of self and other team members roles and responsibilities

  • Empowerment to hold each other accountable to meet the commitments made

  • Culture of appreciation and feedback

  • Clarity on Key Performance Indicators and linkage of employee’s responsibility/work with the same

  • Minimal and relevant metrics and data and cadence with rhythm around the KPIs

  • People with the right skills and attitude in jobs of their interest.

  • Provision for employees to develop new skills and capabilities

  • Trust and autonomy vs Micro-management and bureaucracy

What else would you add to the list?

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Are you In-Control or Controlling?

Are you In-Control or Controlling?

Many rules were originally created for quality and productivity control in order to improve people’s effectiveness and efficiency. Over a period of time organizations started losing common sense and started focusing on processes over people. The levels of trust dropped and with that productivity, innovation, and joy of working went down.

Instead of being in control by treating employees as adults and providing them boundaries of engagement to operate within, managers started controlling through irrelevant monitoring and control pushing the attention of employees away from the real job.

While some rules are essential, most require to be re-looked in the organization.

Here are some rules for you to reflect upon whether you are trying to be in-control or controlling.

Work Timings Tied to outcome or time spent at work
Dress Code Appropriate but individual’s choice or detailed dos and don’ts
Appraisal Individual contribution-based or relative to others
Project Spend Decision At discretion based on boundaries or requires levels of approvals
Delivery Agile or Rigid process based
Meetings Solution searching or Fault finding based
Root Cause Analysis What went wrong or Who to blame?

What would you like to add to this list?

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Ownership. A skillset or mindset?

Ownership. A skillset or mindset?

Do you know that the 4x100m sprint relay record is faster than four times the 100m record and even quicker than the 400m race? With additional steps of handing over the baton, something that needs to happen with much precision being a potential point of failure, should we not expect a delay element in the flow that slow things down? How is then the sum of four turns out faster than four times one?

 

According to the Track & field experts, the secret is in how runners prepare for their leg. In the 4×100 m relay, only the first runner has to start from a stationary position. The next three runners have the advantage of a running start, after which they need to exchange the baton in the “exchange zone” which is a 20-meter zone. Typically, a world-class runner starts running in the exchange zone and hits close to top speed after 10-meter. The baton exchange takes place usually in the second half of the exchange zone. So effectively the following three runners have the advantage of hitting close to top speeds before taking the baton.

 

What do we see in a typical business context when a set of people, representing different functions, have to work together along a value chain? The result is either achieved with high stress or is suboptimal, primarily when the organization has grown too big or scaled fast. Why? Because the focus quickly shifts to processes to achieve efficiency. Traditionally designed processes introduce SLA at each handover point. The Operations team gets in the action, adding measurement and tracking systems so that when the result is not favourable, they can trace precisely who in this value chain failed to deliver and initiate corrective action. In turn, the focus shifts to defining SLAs, keeping in mind process capabilities. The teams rally themselves around their personal or departmental goals. In the bargain, the customer expectations on delivery time, quality of service, or in some cases, the experience gets compromised.

 

One of our clients from the e-comm industry was facing the same challenge. At one point in the engagement, it came down to addressing longer working capital cycle and reduced customer experience. As it would be with any supply-chain business, the number of functions involved from sourcing, category management, warehousing, customer support, and 3-tier logistics including last-mile delivery partners – the chain was long. What we realized is that though the team was highly motivated and committed, processes were reasonably straightforward, SLAs defined, and delivered at each stage, the results weren’t satisfactory. Everything looked healthy in parts, but the sum of all wasn’t what business was looking to achieve.

 

We took the approach of creating a multi-disciplinary team to break-down the silos and to bring everyone’s focus on a single objective. We implemented some critical rituals to improve collaboration, sharpen the focus on the end goal, encouraging them to share their challenges so that group as a whole can come together to solve it. In short, we were building a genuinely self-managed team. Very soon, we saw the group becoming more proactive in resolving each other’s problems with little or no help from us or “management”. No one was talking about individual SLAs and how they are doing their best. Instead, the focus was on how the team as a whole was meeting organizational KPIs. And the performance improved on both KPIs dramatically in less than three months.

 

The same set of people, who were earlier involved in the end-to-end process were part of this newly formed team. They were broadly using the same infrastructure, processes, and technology. There was no additional training provided on functional skills. Then, how did the performance take a dramatically favourable turn? Was it just forming a multi-disciplinary client-focused team that did the trick?

 

It was that and something more. With increased transparency, trust, and autonomy; a new behaviour emerged. Every team member was preparing themselves better for her part of the process. Earlier they were operating with a chess-clock of their own that starts when a transaction hits their table and ends when they pass that to next person in the chain making sure this handover happened within their defined SLA. Like a relay team, no one was now starting from a “standing position”. Armed with complete transparency about each transaction, information on hand about challenges others could be facing; they were anticipating and preparing to run their leg even faster to adjust for the lag if any, in the previous leg. Unlike relay teams, it wasn’t part of our game plan and neither we were consciously coaching people on it during our engagement. Strong alignment to the purpose and shared commitment towards the outcome had triggered a sense of ownership, shaping their response.

 

Indeed, “a sum of four faster than four times one” is logical in the right culture, whether the context is sports or business. One can create a conducive environment and design specific game-plans for teams to take ownership, but finally, it works best when it comes from within. That is what differentiates winning teams from the rest.

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Our Tryst with Trust

Our Tryst with Trust

Ever wondered what’s the first thing that comes to your mind when you describe a great organisation? We asked this question to our friends and colleagues and 8 out of 10 responses were ‘TRUST’. So without any doubt, trust is what we all expect in order to create awesome workplaces. A closer examination of this magical sounding word reveals that it is a complex combination of behaviours and human dynamics. Teams at the workplace are a lot like trapeze artists. When a trapeze artist is swinging at 50 feet above the ground, the only thing that makes her/him confident to jump is the trust on the co-performer. In fact, trust and communication go hand-in-hand. If you have noticed, the trapeze performers call out to each other when they are ready to jump or catch. That communication is absolutely critical in timing as well. Similarly, at work too, people make better commitments only when they can trust their co-workers. For trust to be woven as the fabric of any organisation, communication is the thread and this thread needs to be strong and long!

 

At the workplace, at first glance, it appears as though trust is all about behaviours such as being honest in communication, not fudging reports, not forging bills, not faking expense reports etc. While these are of course essential behaviours to establish trust in the workplace, these are insufficient to describe trust in its entirety. What we saw above constitute the trust of character. Other critical aspects of trust include trust of competence, judgment and intention. To understand just one aspect, say, trust on competence, let’s explore an example of how a manager assigns work to a team member. When a manager tells a team member every single step of what needs to be done and how exactly it needs to be done, or simply put, ‘micromanaging’, it conveys subtly an implicit lack of trust on the team members competence. Instead, an approach of introducing the big picture, and enabling team members to jointly arrive at what needs to be done by when and then allowing the team member the space to accomplish it the way she/he thinks is best, conveys trust. And this, in turn, leads the team member to put her/his brain to work, instead of blindly following instructions. In our conversations with many managers, we asked them the reason for micromanagement. The feeling is of fear of failure by the team members. One might then wonder what if the team member repeatedly fails to deliver. Even then the approach is not to micromanage but to identify a role that aligns with the team members competence with corresponding impact on compensation. A compromise on competency match is never a solution. If no role exists that suits the competence, then its best to part ways instead of filling the team with members that just follow instructions.

 

What we saw is just one example – organisations are replete with everyday interactions that are opportunities to enhance or decrease levels of trust. For example, status review meetings are forums that reflect levels of trust that exist in the organisation. Now let’s look at some of the common impacts of low levels of trust in an organisation. When there are instances of misuse of trust, the typical reaction of an organisation is to design and impose controls. While this may be the easiest and quickest thing to do, often the long-term impacts are detrimental. Controls reduce the pace of the organisation. Let’s take the example of Travel Policies. This is something one can easily relate to. organisations typically build cumbersome travel requisition, approval, expense report filing, another round of approval of settlement and audit processes. All this to prevent misuse by some. Is it fair to subject all the employees to this ignominy for the infraction of a small minority of employees? Such controls not only cause bitterness and make one feel small but sometimes are just silly. If one were to do a simple cost-benefit analysis and factor the cost of the time wasted by the traveller, cost of the audit/accounts team, etc, and compare it to the estimated loss because of misuse of the policy, one would find it hard to justify the need for such a control.

 

In fact, what about all the policies, controls and penalties at workplaces? Do we really need them to be implemented as controls or could trusting workplaces replace them with guidelines? There is a common misconception that to build a trusting workplace is to encourage mediocrity. In fact, it’s just the opposite. A trusting workplace is a mirror of high accountability. In Semcostyle, we call this ‘Treating Adults as Adults’. As Ricardo Semler puts it beautifully – “Why is it that companies hire adults and when they join, impose boarding house rules such as when to come, what to wear, where to sit, etc and treat them like children ‘’? So, when we as leaders, practice the art of communicating the desired outcome and trust our colleagues to use their individuality in delivering, the result is bound to be unique. The missing element of trust would result in managers creating mere ‘lookalike photocopies’ of themselves without any originality! Isn’t that really mass production of mediocrity?

Like they say, ‘Practice makes you perfect’, the art of transparent, adult to adult communication can be practised until perfection. And once that becomes a way of life, it translates to trust at the workplace. And abra-ca-dabra, what you have just created is #MakeWorkAwesome! Let’s be those perfect trapeze performers at our workplaces with timed and clear communication trusting that our co-workers know their roles and will not let us fall or fail.

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