'20 Years of Agile Innovation: A Look at How It Has Been Operated So Far [Jjinbit]'

[Image source=Pixabay]

[Asia Economy Reporter Jeong Hyunjin] Agile~ Agile~. Agile innovation, which started in Silicon Valley, USA, and has been attracting attention domestically for several years, is something you may have heard of at least once. Agile innovation refers to a work style where a small number of people are assembled to form a team for each project, quickly changing requirements according to the situation, and responding agilely to feedback. It can be considered a representative of efficient work methods.

Has Agile, which turned 21 in '21, truly settled?

Agile innovation turns 21 years old, becoming an adult, as of February 21 this year. What does that mean? Agile innovation began on February 21, 2001, when 17 software developers in Silicon Valley gathered to form the 'Agile Alliance.' It was an alliance formed to address problems with the software development methods of the 1990s and to change them. At that time, large-scale developers invested over 10 years to create a single software. As a result, efficiency was very low when developing small-scale projects.

So, software developers formed an alliance and proposed changing the software development method to prioritize individuals and interactions over processes and tools, focus on software rather than documentation, emphasize collaboration with customers over contract negotiation, and actively respond to change rather than strictly following plans. Subsequently, Silicon Valley companies such as Google, Meta Platforms, and Microsoft (MS) were the first to adopt this method, which then spread worldwide and entered Korea from the mid-2010s.

[Image source=Pixabay]

After 20 years of Agile innovation being handled in companies, has it truly settled as the 'real deal' beyond just the name? Recently, Boston Consulting Group (BCG) conducted a survey over the past four years targeting about 11,500 employees across more than 40 companies in 15 industries worldwide that have adopted Agile innovation. The survey aimed to check satisfaction with Agile innovation, whether it was properly introduced into the work environment, and in what environments it was effective. Let's take a look at what the adoption of Agile innovation over the past 20 years analyzed by BCG has shown.

Successful in 'learning organizations' that tolerate failure

One of the first characteristics of Agile innovation found by BCG is that this method worked well in 'learning organizations.' Learning organizations are characterized by not remaining stuck in past achievements or practices. Among respondents who felt Agile innovation worked in their organization, 9 out of 10 answered that their organizational culture encourages failure and that learning can be gained from it.

Looking at the survey results where 51 statements related to Agile innovation were given and respondents indicated agreement or disagreement, BCG analyzed that there were clear differences in responses between the two groups in several items. In particular, 93% of employees who responded positively to Agile innovation judged that their organization has a structure that develops expertise and enables knowledge sharing between teams.

[Image source=Pixabay]

In addition, whether learning, knowledge sharing, continuous development of knowledge, and training are freely conducted within the organization became key factors in judging satisfaction with Agile innovation. Based on this, it seems that Agile innovation was effective because learning organizations basically consist of employees thirsty for knowledge. BCG's explanation that "Agile fundamentally differs in prioritizing, structuring work, making decisions, and learning" appears to consider the basic characteristic differences of organizations.

Communication with existing organizations is key to Agile success

It would be great if Agile innovation were always successful, but there are quite a few cases where it is not. Based on the survey results, BCG pointed out that Agile innovation often caused problems by conflicting with existing work methods in large organizations. It is like trying to fit a square peg into a round hole. More than half of respondents answered that work is delayed due to organizational regulations or risk-related processes.

For example, cases mentioned include in-house lawyers taking too long to review contracts, IT staff delaying responses regarding approval of new digital services, and finance teams not flexibly providing budgets needed by Agile teams.

This means that when there is an Agile team within an organization, whether interaction with other organizations is well conducted and whether the organization accepts the Agile team are important factors in improving efficiency. BCG emphasized, "Agile cannot realize its potential if limited to individual teams," and "Effective interaction with organizations that have not adopted Agile methods is also necessary."

Source=Boston Consulting Group

All companies constantly call for organizational culture innovation and seek change. Agile innovation is one of them. Many companies confidently say they will 'do Agile innovation,' but there are quite a few cases where the change in work methods fails and only the name remains in Agile organizations. To truly improve efficiency and respond nimbly to customer needs, we need to look back. BCG's advice, "The core of Agile is to respond to change rather than follow plans," will be very helpful if taken to heart.

Editor's Note[Jjinbit] is short for 'Jeong Hyunjin's Business Trend' and 'Real Business Trend,' a corner that shows trends in corporate management such as organizational culture and personnel systems. The emergence of the MZ generation, the expansion of remote work due to COVID-19, and digital innovation all require innovation in organizational culture. Based on analyses from major overseas institutions that have not received much attention so far, we will deliver fresh and differentiated information and perspectives.