Improving efficiency and reducing waste are more important than ever in today’s economic climate. The pace of change has accelerated in recent years and this has meant companies have been required to be more agile in how they react to both internal and external pressures.
These pressures often require an organisation to “change”. Whether this be a change of scope, direction, or service offering. As we know, not all changes are optional and are often imposed through new regulations or policies.
As covered in the Progressive Finance Function insight paper, today’s world is too complex for traditional, large-scale transformational programmes that tend to use Waterfall methodology – a sequential, non-iterative development process.
Although there is a place for these approaches (i.e. where the delivery path is proven and all requirements are fully known), in today’s landscape this is rarely the case. Too often customers’ needs will change during a project and companies need to be ready and capable of quickly responding.
By focusing on smaller, more manageable improvements that can be delivered quickly, we enable the ability to consistently deliver what is of most value from the customer’s perspective. Again, this could be both internal or external.
For this reason, progressive organisations are embracing two focused change management approaches: Lean and Agile.
Although Lean and Agile are different, they have significant overlap when it comes to how they allow companies to capitalise on effort and deliver value.
Lean is often seen as something that is only related to process redesign. This is not the case and although it originated from manufacturing it encompasses a lot more. It ultimately provides a way of doing more with less – whether this is people, time, equipment etc. It also should not be seen just as a way of reducing staff. Often the most successful Lean approaches have shown that eliminating waste allows organisations to create new work or explore areas that previously, they would not have had capacity for.
Many tools and techniques are available and support Lean including 5S, Kaizen and Value Stream Mapping. They are regularly used within project teams that may not be following a specific Lean mandate.
The critical factor with Lean is ensuring value is focused from the point of the ultimate customer. Listening to customers is important and seems obvious, but companies can too easily lose sight of what the customer truly wants and needs.
To be successful in implementing Lean there needs to be mindset change at all levels of an organisation. It’s more than just a set of tools and starts by defining value – often expressed as a product, service or both.
The principles are that all effort adds value and that an approach is adopted to not only identify and remove waste or rework, but also to ensure continuous improvement.
A key element in making your organisation Lean is to ensure there is a robust method in place for everyone involved in a process to provide feedback. The method must also involve a clear approach to address any items that are raised. Too often, companies ask for ideas and feedback from those best placed to identify improvements, only to then ignore. This is a typical example of wasted effort and will result in employees that feel disempowered.
For an organisation to be Lean, all the various elements need to be working together with full support from top down. Every employee must have a clear understanding of goals and how they link to the company objectives as well as a transparent method of measuring performance.
As with any change, there is a period of adjustment and learning. However, Lean is focused on ensuring effort is spent delivering true value and therefore delivers results extremely quickly.
Agile methodologies have been around for several years in various guises but are often thought of as solely for software development. It’s true that this is one of the main areas but they’re by no means exclusive and can be powerful within all areas of an organisation.
The key thing to remember with Agile is that there is no right or wrong approach, more a set of principles that ensure “value” is delivered in quick, regular increments. This is where Agile compliments Lean perfectly. Value could be defined as a new product feature, a new process step or even something that allows a concept to be tested before going live.
Another factor is that there are many different types of Agile methods – Scrum, Kanban Development and Crystal Clear to name a few. Each have different elements but overall are looking to deliver the same result.
You may have been involved in some form of Agile development without even realising it. Key characteristics include short daily meetings (often called huddles or stand-ups), managing a list of requirements that need to be constantly reviewed and reprioritised and delivering improvements in set, regular intervals.
Communication is critical to the success of Agile with teams often being co-located to enable real-time discussions and resolution. In today’s world where this is not possible there are a plethora of tools available including web-conferencing and global document housing. You also need to ensure team members feel empowered and that teams are self-organised. As alien as this may seem, not having a dedicated “leader” drives groups to be more accountable and work collaboratively.
Using Agile requires a change in mindset from traditional project management. While methods like Waterfall put a lot of focus on scope and use it to determine costs and timeline, Agile focuses on value and uses it to determine the quality and constraints of development.
This is one of the main reasons the use of Agile has grown so rapidly as it suits customer centric, fast-paced environments where adaptability is critical. Can you remember the last project that you delivered where the outcome was identical to the original scope?
Whether you are trying to improve a process, implement a new system, optimise your organisation or perhaps do all three, adopting a Lean and/or Agile approach will provide sound principles and a framework to ensure success.