In the last 20 years, the most successful technology companies have leveraged Agile culture and techniques to grow and evolve, creating the digital age in which we all are now. These tech giants have dominated the new means of production (software development) and are now disrupting traditional industries like transportation, finance, logistics and retail. Companies like Amazon, Google, Spotify, and many others are leading the way.
They have been using Agile frameworks like Scrum as an alternative to traditional management from the second industrial revolution; they have been able to avoid the silo-based top-down command and control structures. They instead have adopted a team-based structure, creating networks of small, dedicated, cross-functional, autonomous high-performance teams that can address complex problems creatively and collaboratively, producing impressive results at a much lower cost and much much faster.
Agile and Scrum have not stopped there, industries like finance have been trying to adopt agility as part of their digital transformations, to catch up with the staggering speed of technology innovation and changing market demands. Many of them have found the profound implications of the change but also the opportunities and the cost of not pursuing the change.
Agility Beyond Software Development
Many of these companies are not only creating networks of Scrum teams for technology but they have realized that a similar approach can be applied to more traditional business processes and customer experiences.
For example, after transforming most of the software development and IT operations to Agile, one of my customers, a large bank in Costa Rica, has now started an agile transformation for many of their units including human talent, personal and business banking, marketing, and many others.
The leaders work together, just as the first Scrum Teams, with the mission of accelerating innovation, reducing costs, and improving customer engagement. These leaders launch Scrum teams. People are mobilized. Full guidance and support is provided.
Company leadership understood that if they wanted to have creative, collaborative and high- performing teams taking care of their customers, they first needed to break the silo-based tribal culture and the bad habits that type of culture engenders.
Complete value streams and experiences are being transformed by these leaders. Not only are they seeing better business results but staff morale and engagement is also on the rise.
Time for the Service Centers to Catch Up
Service centers are not too different from banks or other organizations adopting Agile. They face the challenges of how to innovate and improve the speed of delivery, quality, reduce customer turnover, and create more value for their internal or external customers.
The opportunity to deliver lower costs and better services only increases as leaders realize that digital transformation is more about people, structure, and culture than it is about technology.
Despite these challenges and the rapid expansion of Agile around the world, many of the leaders of service centers still think of Agile as a project management methodology, or something only software teams do (nothing further from the truth).
Agile helps dramatically reduce bureaucracy and increases creativity and collaboration. Kenneth Gonzalez is the Operations Manager at Re:Sources, an 800 person shared service center in Costa Rica. His responsibilities include Payroll, Accounts Payable, Billing, and some HR services.
He has been looking for alternatives to evolve the traditional operating model that for 20 years has been used in shared service centers in Costa Rica. For him, the challenge is how to consolidate the efforts of the different silos toward a common goal: improve customer experience by delivering the highest quality product or services while also leveraging efficiency. Costs, not surprisingly, decline as a result.
After attending the recent Agile Transformation with Scrum@Scale workshop, held in San Jose, Gonzalez realized that Scrum is a vital tool in this mission. But it comes with a cost: The directors and managers need to evolve their leadership style and practices, step back and allow the people to self organize to solve problems instead of always having the answers.
“I think that Scrum is something we can implement, but we as leaders need to understand what our new role is, learn to step back and become coaches for the teams, let them figure out how to solve problems and make their commitments to deliver value in short iterations,” Gonzalez says.
“This is a challenge in traditional organizations established many years ago where the directors are used to setting the goals. Many times those goals are not attainable leading to failure or, through sacrifices, not sustainable over time,” he adds.
For Gonzalez and many shared service center leaders and collaborators I have spoken with, the opportunities for collaboration are clear. The need to become Agile inside service centers is very real. The opportunity to deliver lower costs and better services only increases as leaders realize that digital transformation is more about people, structure, and culture than it is about technology.
As Gonzalez points out, leaders need to take the time to learn Agile and their new role in this type of organization. An incremental improvement over the traditional hierarchical structures of command and control management – from 100 years ago – is no longer viable.