How STRG Became An Agile Service Organisation
Working agile saved our a$$ during the Covid-19 lockdown. Could it save yours?
The Digital Revolution has disrupted global business in countless ways. The COVID-19 pandemic has forced companies to adapt even more. Only the most agile businesses are able to profit from technology’s constant flux, to show customers that they are getting their money’s worth, and to keep their own workforce productive and motivated.
In 2019 STRG took a giant step forward by adopting a “Scrum” framework for Agile software development. Since then, we have not looked back – our productivity has increased, our clients are more satisfied with our transparency, and our work output has hardly suffered from the COVID-19 sh*tstorm.
An Agile mindset now pervades every aspect of our work. Our ultimate goal of becoming a complete Agile Service Organisation is at hand!
What does that mean for our clients and our future?
Read it, or call me Jürgen Schmidt +43 699 1 7777 165
Becoming Agile in the New Millennium
Over a hundred years ago, Henry Ford disrupted the Industrial Revolution by introducing the assembly line. His innovative factory could churn out a new automobile faster than its paint could dry. His radical re-organisation of labour into simple, repetitive tasks was perfectly suited to the mechanical commodity being produced. And it also perfectly satisfied the growing mass market demand for lower priced, quality autos.
As the economy shifted from industrial production into information technology services, this 20th century labour concept was slow to adapt. Service organisations that continued to manage themselves with assembly-line methods found out that they couldn’t keep up with the rapid pace of change. Their staff took no ownership for overall customer satisfaction and their management hierarchies became complex and unproductive.
Over the last few decades, management methods have evolved, especially in the field of software development. Yet even a modern method such as “Waterfall” bears some resemblance to its industrial forerunner — each deliverable phase of a project must be completed on the development “assembly line” until the next one can begin. First design, then planning, then implementation, then testing, then rollout.
For complex, multi-layered digital IT projects, this can have negative results. The longer a development process goes on, the higher the risk that the finished product will be redundant or incompatible. The client is often kept in the dark between signing the contract and receiving a finished product. And the developer is financially liable when the project doesn’t go exactly according to plan. Quite often, this causes increased stress on the development staff, creates a need for rigid hierarchy, and results in clients’ expectations not being satisfied.
“With Waterfall, the final result and its development phases are defined in advance and a linear route is mapped out,” says STRG’s process manager, Jasmin Müller. “If there are any detours along the way, it is very costly to step backwards. If a client changes the original concept or wants new features during development, the entire project comes to a halt while the original contract terms are renegotiated.”
Agile with Scrum
“Scrum” is a modern management framework that enables Agile business practices, especially for software development. Like its Rugby namesake (the “scrummage”), where team members lock their arms and heads together as a unit in order to gain possession of the ball, a Scrum development team works together toward a common goal, yet each member makes independent efforts at moving the entire team forward.
By “huddling” together during brief “daily Scrums”, the entire team is kept aware of what each member has completed, what issues might have arisen, why progress might get stuck, and what the target is for the next 24 hours. The “Product Owner” – a team member who functions as a proxy for the client – plays a critical role on the team, yet there is no management hierarchy among the team members, who are diverse in their skill sets and experience. Rather, the team self-regulates and self-organises the backlog of tasks required to complete a project. The team itself sets incremental biweekly or monthly performance targets called “Sprints.”
Scrum is a simpler working framework which is much more adaptive, better suited to complex projects, and increases internal and external transparency. In our complex business, an ultimate product often cannot be strictly defined from up front. A detailed concept is planned with primary and secondary targets, KPIs and a timeframe, but in actual development it is a constant process of learning and adjustment, for both us and our client. To quote a fixed-price at the beginning is a recipe for disaster – there is no way to know in advance how much effort will be required.
Scrum allows us to work in shorter “Sprints” towards a project goal, learning and reviewing along the way until an “Increment” can be completed, reviewed and approved by the client. The client, via the Product Owner proxy, has full transparency on a regular basis throughout the development process and understands the ROI all along the way. “When they get our monthly invoice,” says STRG’s CEO, Jürgen Schmidt, “our clients know exactly why the hours have been billed and what has been accomplished, because they have reviewed every Sprint or have taken part directly in the daily scrums.
“With Waterfall, the customer was able to have such oversight only on a quarterly basis, at best,” adds Schmidt. “After such a long interval, it’s quite hard for the client to understand the hours we’ve billed or to see our productivity.” What’s more, the cash flow is better matched up to project outlays, which eases the stress on the entire organization. “Without that top-down stress, everyone’s productivity increases and we can focus on delivering value to the customer.”
Making the leap into Scrum
“In order to change an organisation, it’s crucial to get everybody onboard,” says Müller. “It is often said that everyone wants to change, but no one wants to be changed.”
At STRG, the impetus for change came internally. A few years ago, we held a company retreat and our developers made it known that the stress from inflexible deadlines and clients’ unrealistic demands required better planning and accountability for their productivity. “Every implementation was like a hunt,” recalls Schmidt, “we were working from one day to the other without a solid plan and often our defined targets would be derailed or unfinished.
“Something had to change, but at first it wasn’t immediately clear that Scrum would be the answer. We started off implementing some Agile processes in a pilot project – a small team working on our internal R&D project, STRG.BeHave, so there was no external client pressure. We presented our pilot findings at our staff retreat and their feedback was excellent. Everyone bought into the idea immediately!”
Thanks to a very profitable performance in 2018, Schmidt and the STRG management leaders were on solid ground with sufficient reserves to finance the structural change across the board. “At first, our productivity declined and this made me very nervous. There was no going back to our previous methods and we were burning through our cash reserves.”
It became clear that our contracts had to be amended so that our increased productivity and flexibility under the Scrum framework were reflected in our bottom line. Though Agile software development is a standard practice abroad, it is less common in Austria. “It took a lot of effort to convince our domestic clients that they will benefit from a flexible billing structure instead of signing a guaranteed, fixed-price contract,” says Schmidt, “but most of them came to see the advantages of transparency, adaptability and being integrated in the development process.”
Because the client is represented by a Product Owner proxy on our Scrum development team, a mutual “us-versus-them” mindset is averted. “Many customers don’t have the deep knowledge necessary to direct a software development team,” says Müller. “It entails much more than just knowing what you want in the end. Like an interpreter, the proxy conveys information between the client and the team. The client doesn’t have to get weighed down with the smallest technical details, yet remains completely in the loop.”
Scrum as a pandemic “vaccine”
By the time the COVID-19 pandemic forced global business into lockdown, STRG’s staff was already well equipped to adapt to working from home, having set the structural changes in motion the year before. “I was so relieved that we had already gotten Scrum working before the lockdown began in March 2020,” says Schmidt. “There’s no way the transition would have worked in the midst of this crisis, when every business was only concerned about keeping afloat, not growing.”
Though our staff suddenly had to adapt to the virtual office, the tools were already in place to make this possible. Daily Scrums could be done by video conference, and our JIRA workflows were already fine-tuned for how we practice Agile/Scrum.
“Actually, our best quarterly performance ever was the first quarter of the lockdown!” boasts Schmidt. “While other companies were putting their staff on part-time schedules or hibernating entirely, we were working our butts off trying to keep on top of all our projects. Our productivity and quality output were never better.”
By year’s end, however, a new wave of even stricter lockdowns reduced morale as winter set in. For the developers, who were already used to Scrum, it was far less difficult than it would have been, but for the business development side, marketing, and client relationship management, it became much more difficult.
Schmidt realized that “it wouldn’t be possible to switch permanently to remote office and we all needed that in-person contact.” STRG vacated its former co-working office space and leased a new top-floor location in Vienna’s trendy 7th District. As the lockdown rules are eased and more people get vaccinated, staff are now able to strike a perfect balance between working remotely and “IRL.”
By now, the Scrum mindset is deeply embedded in our development teams and we are well underway to becoming a completely Agile service organisation, from head to toe. “Even our Board has a daily Scrum and this has improved our communication significantly,” says Schmidt.
Transparency + flexibility + fairness = happiness
At the end of the day, any process change must be measured by performance. For the business owner, it’s the cash flow and the bottom line. But the Scrum team has other currencies for measuring performance: “Did we meet our deadlines?” and “Are our clients happy?”
“Transparency is critical to keeping our clients happy,” agree both Schmidt and Müller. “Our happiest clients are those most involved in the project, are aware of the costs and benefits at every step along the journey, and have the flexibility to change their planned route if necessary.” Partnering with an Agile Service Organisation is the only way to go.
By adopting Agile development framework, STRG practices what it preaches. If you’re thinking about making the leap to Agile and interested in learning more from our experiences — or if you’re looking for full transparency and cooperation in a software development partner — let’s have a chat!
Just call me or write an email to email@example.com Mobile: +43 699 1 7777 165