„Houston we have a Authenticity Problem“
Motivation & Goal
My impression is that there is still no general understanding and awareness of the importance of real and effective leadership as the relevant key component of a successful agile transformation. Since I have so often experienced how comprehensively planned and designed transformations have been rendered ineffective by hierarchical command & obedience and outdated notions of leadership, I no longer want to keep my observations behind the scenes and take the shadowy existence of leadership transformation out of the equation.
You may want to develop an awareness of the main reasons for the failure of agile transformations, if leadership is not given equal importance to agile methods, processes and structures. In addition, I would like to outline important impulses and approaches to solving this problem in order to confront it with determination.
Digital Transformation (DT), 4th Industrial Revolution (4IR) or New Work (NWX) are terms for a new global reality of markets. They are the occasion for a journey called “Agile Transformation”, to which more and more large and medium-sized companies in particular are setting out or have already set out on in recent times. A journey away from an existing economic order with a traditional way of realizing innovation and value creation through hierarchies, management cultures according to “Command & Obey” and powerful process corsets. The new world is a diametrically opposed concept to the existing system. It emphasizes agile principles such as self-organization, personal responsibility and bottleneck orientation in a complex environment. As promising as this approach sounds – no company from the “old world” really wants to find its way into and arrive in the “old world”.
Table of contents
For this reason, I ask myself the question what are the reasons for this and what has to change in the end so that these companies can survive and grow in the new economical order in the future? I want to deal with the question in a factual and reflective way, why so many transformations never really start or fail and obviously do not become a saviour for ailing and pressured companies?
1 What can be observed in agile transformations?
When I started to think and write about the things I have been observing for a long time, I almost didn’t come to any point or comma. There are simply too many events that can be observed on transformation journeys of companies of all sizes. For this article I will limit my focus to structures, processes and methods – i.e. with the “WHAT” and the approach – i.e. how to change.
It is not uncommon for companies to prepare for the transition to agile working methods with elaborate “playbooks / cookbooks” in order to describe how the future agile landscape with its roles, processes and methods should look like. Trainings and entire “curricula” for Product Owners, Scrum Masters or developers and other team members are created and held. Elaborate product organization and operating models, newly created by renowned management consultancies, reflect the existing complexity of the corporate reality and create a new parallel, hierarchical process organization that needs to be brought to life.
Furthermore I can observe that the focus of agile transformations in most companies is clearly on the employees and the roles of the process organization. In the end, it’s the people who are supposed to create high quality, fast and maximum customer-relevant value with this approach. What at first sounds like a logical consequence, I would like to put to the test in the course of this article.
In fact, I do not experience any offers and consistent support for executives and company managers for dealing with the agile working method, principles and design of corresponding environments. Top management – usually the sponsor of “agility” – monitors and controls. All too often they do not see themselves as an affected part of the change, but rather as “road block” removers, drivers and announcers. They are also the ones who later assess the results in terms of what change is still necessary and who still needs to optimize and improve. They understand this as their contribution to the success of an agile transformation, especially since a transformation project is often only one of many parallel activities and priorities of the company.
2 How do corporate leaders respond to the challenges of agile transformation?
The spectrum of reactions of managers regarding the handling of an agile transformation is very broad. Certainly always depending on the personality type of the respective executives, I find the predominant tendency to “manage” an agile transformation de facto always present. According to extensive interviews and surveys, only an absolute minority of managers see themselves as “creators and cultivators”. Ultimately, a transformation is viewed like a project with a budget, a schedule and a scope. And this is what needs to be managed.
„We are managing the sh** out of the transformation“
This compelling statement originates from a department head at Europe’s largest electronics retail group who was directly affected by the agile transformation. As a former “Silicon Valley veteran” he had this irresistible openness, inconvenience and clarity in his statements, which often spoke directly from my heart. Unfortunately, this has not only been true for this company, but in fact in all the agile transformations I have been privileged to meet.
But what is actually meant by “managing the sh*** out of a transformation? The desire is clear: to create control, access and the ability to act. It is a fact that for most of these unforeseeable undertakings there are no clear and above all measurable results. After all, people have always been used to focusing on “output” and not on outcome. So you control agile transformations in the same way as you used to control scope-oriented projects. It’s not about what is achieved (outcome) but what has to be delivered/ done (output). Unfortunately, this already violates one of the most important agile principles: bottleneck orientation – output minimization and outcome maximization.
Of course, one must remain fair and keep in mind that managers have only the best intentions and motivation to bring about such a transformation successfully. But it also shows the helplessness of those responsible, who often seem to get lost in the confusion of new concepts, collaboration practices and agile principles and their extremely demanding, still existing daily work. Moreover, they themselves hardly have the opportunity or time to find their way neither in their new role nor in their new responsibility. The retreat to the structured management of transformation with the help of traffic lights, status and escalation rounds is therefore the logical consequence and well-known straw to which one can cling.
Return of the Excel monsters
The need to keep control over the progress of an agile transformation is often met with overly sophisticated (keyword: German Over-Engineering) and with automated Excel sheets that are loaded with conditional formatting rules. Contents are attributes like “Product Owner available (Y/N)”, “Team Vision available (Y/N)”, or even “Product Backlog filled (Y/N)” – in advanced versions also as fields with their own status list, which are carefully managed on separate tabs. This is intended to provide a holistic and good overview of the general transformation activity and support senior management in managing the respective problems and challenges.
Who among us is not afraid of these Excel monsters – unless you are a hardcore project manager? Status, steering board and escalation meetings cleanly round off the event. This approach is accepted and executed as a matter of course without flinching or questioning.
3 What does this tell us about managers in these companies?
For some time now, I have been concerned with the question of what this perceptible behavior allows for a statement about the responsible managers of these companies? Just to avoid misunderstandings, I would like to expressly point out that I will not allow myself to make any assessment or even judgement. Rather, I will try to formulate a hypothesis from the observations made, which I will then explain in the following.
Actually, there are even two hypotheses – adapted to the situation of the respective hierarchical circumstances and perceptual realities. Therefore, unsurprisingly, I divide those responsible for leadership into two categories as follows:
- Middle management levels (department head, divisional manager, head of …)
- Upper management levels (VP, Senior VP, C-Level, Managing Director)
Between the chairs
Michael E. Porter already described the strategy of sitting between chairs as a rather bad idea in the 1970s. How much this applies to the reality of middle management, especially in larger companies, is easy to determine with just a few conversations and observations. You often have disciplinary responsibility over 4-8 people in your direct reporting line with an overall leadership span of often 60 pax+
If this alone were not enough work to meet these challenges, they are often additionally assigned to specialist roles and competencies by upper management. In doing so, they should set the tone in terms of content and ensure that the initiatives and projects from the upper echelons are implemented completely, in time and as simultaneously as possible (keyword 10x priority 1). This involves not only putting their own teams on the “right track” but also managing the imponderables and dependencies with other areas and, last but not least, resolving contradictory and often conflicting activities or asserting themselves accordingly.
So and then there was also “transformation” … If I have understood Daniel Kahneman’s book “Thinking, Fast & Slow” correctly, then I have to state that in the absolute majority of these managers the predominant tendency must be towards “fast thinking”. They have no other choice than to react to the constant pressure to make decisions and judgements quickly and efficiently that explain their behavior. They simply don’t have the time to really get involved in something and reflect on it to arrive at an informed and well-founded decision. They are constantly under power and are for the most part in an absolute emergency state. These “errors and distortions – of fast thinking” as Kahnemann describes it, can be observed here very easily.
My hypothesis: Middle managers are driven from two worlds, each of which gets responsibility delegated away from both sides. The teams and their employees carry decisions and responsibility upwards ( “reporting makes free”) and upper management levels usually remain so generic, vague and high level in their statements that middle managers have to work out these gaps into a coherent and holistic picture under often high psychological and physical pressure.
FUBAR – Fu**** up beyond any recognition
Thus, they are made the absolute bottleneck for all the company’s lines of action and grinded to the point of being completely unrecognizable (FUBAR) between these two worlds. Now does anyone seriously ask why department heads, divisional managers & Co. don’t really get involved in an elaborate and often very uncomfortable discussion process to successfully shape an agile transformation? They are under enormous pressure to be able to answer questions, give status and have appropriate measures ready.Most of them do not really feel empowered by their bosses and are often not aware that their behavior tends to empower their employees less than more.
And at the top?
In my opinion, company managers in the upper echelons of management are not really to be envied either. They fight at the front line for the success, continuity and growth of the company. They are inevitably dependent on the participation and commitment of virtually all employees to achieve the goals they have set. They are the top of a hierarchical pyramid, which systemically in reality inevitably leads to the fact that they are challenged to understand complex facts, to make informed decisions and thus to spark effective action towards the organization. Seen in this light, they are an incredibly stressed part of a functioning machinery for the creation of value. Due to the new rules of the market (keyword 4IR), fewer and fewer people in positions of responsibility with the traditional way of working see themselves in a position to meet the current requirements of the markets and thus ultimately those of the customers. Agile transformation promises to remedy this situation, and consequently, it is attracting more and more attention and importance for corporate decision-makers.
Many consider agile transformation to be an existential strategy of the future, not least because the consulting industry has massively upgraded at all levels for this profitable growth market. No matter whether McKinsey, BCG, Accenture or whoever. All of them are now capable of agile transformation and ultimately sell it as a consumable end product for companies of all sizes and industries. If you look closely at these products, as described at the beginning, it is in fact most of the times about structures, processes and methods. In my opinion, this creates a clear expectation of senior management for agile transformation: It is clearly defined and can be managed.
This brings us back to the Excel monsters described above. They are the tool of choice with the intention of creating this manageability. The more information they have about status, progress, etc., the better the supposedly resulting insights for necessary management decisions.
My hypothesis: Upper management levels naturally have the intention to equip their company for the competition and performance of the future. For this reason, they evaluate, among other things, agile transformation as a proven means to achieve this goal. Like any measure, this one is often delegated into the organization and is not mentioned with waving flags. Thus, in my opinion, they easily lose the perception of being part of this transformation themselves and usually stay out of the operative events. Nevertheless, they remain responsible for the success of a transformation in front of the supervisory board, shareholders or stakeholders – accountable, as they say. For this reason, they need to know what and how things are going in order to meet their responsibilities and therefore, all too understandably, insist on seamless project planning and management in the role of sponsor.
4 Why do agile transformations fail?
Why transformations fail, never really start or simply do not come close to the desired effectiveness is definitely not easy to answer. Most of the time, they are well designed and managed, but a real paradigm shift does not seem to succeed despite all efforts. Structures have been changed, new processes introduced and new agile methods are used as much as possible. What is missing, however, is a significant increase in the performance of teams and employees in terms of output and outcome of their work.
New playing field and old rules
My impression is that the situation of employees has even deteriorated in part compared to “before the agile transformation”. Before, very few of them knew how the game worked, but now all the rules and conditions have changed for them. In other words, they are mostly still inexperienced with the new approach and this creates additional uncertainty. However, middle and upper management still play by the “old” rules in this changed environment. On the one hand, the teams are told that they are now ” empowered & autonomous” and should, for example, design their products and make decisions themselves. In the same breath, however, the hierarchical management levels or project managers tell them exactly what, how and by when they have to do something. They should practice openness and transparency and still face closed management circles and only sparse and selective information flow. Many product managers / owners and employees in teams tell me that they are not even sitting at the table when making critical decisions about their product and that priorities are sometimes changed at short intervals, seemingly at will and without justification.
„Houston we have a authenticity problem“
If you look at the whole event in this way, the conclusion that the contents and principles of the agile work paradigm are preached on the one hand, but are not taken into account in the actual ” doing” is obvious. Thus the fundamentals of the agile principles and the actually applied practice often fall apart massively, which ultimately leads to an authenticity problem of the responsible managers. So what they say and what they ultimately do are “quite another cup of tea”.
And this is exactly one of the most striking predetermined breaking points of the whole topic. While the way employees, teams and overarching professional roles, the way they work together and their approaches have completely changed, managers usually behave exactly the same as they always have. This certainly not intentional, unconscious behavior of company managers and executives not only creates rejection and mistrust, but also causes great frustration and resentment among the employees concerned. The bottom line is that it reduces credibility and significance of the agile transformation ad absurdum and makes failure very likely.
Of course, it would be absolutely frivolous to reduce the failure of agile transformation to a lack of leadership and to attribute the responsibility for it solely to company managers and executives. However, I personally think it is worth more than just reflecting on it and creating a general awareness and sensitivity for it. If you want to change behavior, you have to understand people – or as Simon Sinek put it so aptly: “If you don’t understand people, you don’t understand business” (external Youtube link).
What do “understanding people” and successful agile transformations have in common?
This question can only be answered if we ask ourselves what was the ultimate goal of the whole transformation? Companies have to change in order to be able to meet the requirements of the market and thus their customers. It is all about fast, customer-relevant and high-quality innovation. The most successful companies of the current time like Google, Apple, etc. show us quite openly how to do this today. They have small, autonomous teams that set out to change the world with a maximum degree of empowerment, interdisciplinarity, craftsmanship, a common concern and a large portion of courage and intrinsic motivation. Only when these conditions really prevail and the teams are able to develop freely within the existing parameters, the space for the “necessary magic” to conceive, design and deliver great products is created.
What sounds like pathos is reality lived thousandfold for these teams especially in Sillicon Valley. Effective leadership has long been recognized there as the key success factor for creating the appropriate “high performing creativity environments“. Google even once abolished all managers, but this was recognized as a big mistake and was corrected by Executive Coach Bill Campell of the Goolge founders.
If you want to delve deeper into this topic, I recommend re:work from Google – an open platform where the company with all its learnings and insights. In addition, the books by Daniel Coyle “The Culture Code: The Secrets of Highly Successful Groups” and Marty Cagan “Inspired: How to Create Tech Products Customers Love” (also available as audio books from audible [unsolicited, unpaid advertising]).
If you take a closer look, you will see that Effective Leadership is all about creating an environment for working in a team. And this is exactly what managers in these companies are responsible for. They are “Servant / Supportive Leaders”. They are humble, have a balancing effect and serve the people in the teams and help them to be successful. They do not set the standards themselves but coach, inspire and encourage their people to come up with the best ideas and approaches. In general, there is a very clear idea of what good and successful leadership looks like and I am happy to refer to my “Effective Leadership Matrix”, which helps managers at all hierarchical levels to meet the demands of the new situation. It is also indispensable for data-based, personal development of managers, which is also used in the context of leadership performance coaching.
5 What are approaches to cultivate Effective Leadership?
Today, there is no doubt about the importance of leadership and its statistical correlation and causality to high-performance environments and teams. The fact is that it cannot be prescribed, but is based on the voluntariness of those being led. To be able to lead people does not result from authority and hierarchical elevation but from the fact that people want to join and be led by a leader. So I am a leader only if I also have “followers” in this sense. And people are only followers of people of whom they are convinced and who are worth it to them because it makes sense and is advantageous for them to follow them for very different motivations and needs.
Good and effective leadership can be measured concretely in terms of behavior and characteristics (see “Effective Leadership Matrix”) and, as in sport, it can also be trained to a large extent. This is exactly what training is all about. Managers can train their leadership skills and effectiveness in a structured way by going to the “workout” regularly and to the appropriate extent. Experience has shown that “Group Workout” is the key to success here and unfortunately, just like in sports, the following applies: A rolling stone gathers no moss 🙂
You can do that: Leadership Working Session
An intensive, open and regular weekly discussion as a “leadership working session” of about 1.5-2 hours of all managers in different working groups (about 8-12 persons max.). The groups are best mixed with all hierarchical levels and the format is prepared and moderated by an external coach. Neutral, external coaches are so well suited for this because they are not part of the system and this format only works if there is a high level of confidentiality, security and openness in the group. An external coach also has no internal ambitions to make a career in the respective company or brings along his or her own political agenda that would influence the dynamics of the group. Moreover, it has been shown that senior managers in particular find it much easier to be moderated by an outsider. Of course, the goal should be to replace the external coach in the medium to long term.
At the beginning of each journey there should be a “kick-off” for the leadership working session to discuss the background (“WHY”), approach (“HOW”) and goals (“WHAT”) of the regular format with the group. The first thing to do is to convince the participants of the sense and necessity of this format, to inspire and enthuse them for the mission and this journey. Allow 10-15 minutes for this with the maximum high-level executive they can get as a promoter – CEO, CTO, etc. This kick-off can also be organized as a big room event with all the executives or a specific area (if it’s not COVID-19…) to put even more weight and emphasis on this essential workout. It is also a clear public signal from the management how seriously they take the topic, what their own expectations of the leadership culture are and what significance these sessions have for the agile transformation as a whole.
Collect, prioritize and reference first topics
Furthermore, there is also a clever agenda point for collecting the first topics that burn or press. The idea is to let the group build their own prioritized backlog of topics that they encounter in their daily work and that have raised questions, doubts or problems. These topics are then assigned to the “Effective Leadership Matrix” in the next step, in order to have a reference to the data-driven development of leaders. In this way, we also ensure that they are not lost in the vacuum and fuss of everyday business. This creates a collective awareness of the challenges, strengths and weaknesses of each individual, while at the same time the group experience provides relief for the individual.
Through this kind of approach, we ensure that every colleague feels heard, understood and taken along and that they perceive the time-investment as a great personal benefit for themselves and their teams / employees. At the same time, these topics are all linked to the behavioral patterns and characteristics of effective leadership and therefore the group as a whole or each individual can face these topics in a structured way and grow with them.
„Vegas Baby – What happens in Vegas stays in Vegas!“
The moderator must develop modern, interactive formats for the identified topics prioritized by the group. They should provide maximum opportunity for active participation and be full of varied tasks for each individual or in smaller groups to work together. A central aspect is that a general confidentiality clause is given again as a basic rule at the beginning of each session. This creates a framework of trust to open up and be vulnerable together without having to fear career consequences and without being asked about “topics” outside of a session. Breaches of rules must not remain without consequences, otherwise the trust and the quality of the open discussion within the group will be lost and thus no real benefit will be generated.
It is absolutely clear that you should have loads of Super Sticky Post-It’s in all formats. The normal ones just fall off walls and brown papers too easily and are then usually nonassignable. Thick markers (I personally love Neuland pens – BigOne and Outliner [unpaid and unsolicited advertising] – at least one for each, moderation tape, and anything else you can use for moderation and creative work.
Tables away, form a circle of chairs or even better: please all stand up 🙂
In order to maximally activate and challenge your colleagues in these sessions, you should use the full range of group interaction methods that are currently “state of the art”. It is important that you create a space where interaction and movement is possible. The best way to do this is to have a room without tables – or simply to put them on the edge if possible. Depending on your preferences, you may want to create a circle of chairs or U-shaped chairs or, in the advanced version, you may not offer any seating for the participants. Please note, however, that there are always colleagues who may have a physical limitation that makes sitting necessary for them.
To generate interaction between the members of the group, the following workshop and moderation techniques are suitable:Short initial individual brainstorming session on a question, problem or term
- “1,2,4, all” with limitation of maximum number of results
- World Cafe
- Perfect World
- Lean Coffee
- Circle of Influence
It is advisable to design the formats in advance to the minute and to use a TimeTimer [unpaid and unsolicited advertising] or another chronograph corresponding to Time Boxed.
A nice side effect is that you can build up a whole library of interactive leadership workout formats that are not only reusable, but also provide a rich source of ideas and new formats. It also makes it much easier for new colleagues and moderators of these formats to get started.
Generic structure of a workout session
There is no common standard format for these sessions. They are very individual in terms of content, depending on the topic, also with regard to moderation and interaction techniques. Because sometimes it is important to open up a wide range of subjects and other times you have to focus more. Nevertheless, the following generic basic structure for a “Leadership Working Session” (120 minutes) has proven very useful in practice:
15 minutes| Welcome & Short Check-In
- 5 minutes buffer for the arrival of the participants
- Welcome and short introduction Goal of the workout
- One after the other: “Becoming present through voice”
- How am I doing?
- What’s on my mind right now?
- How have I been doing with my “Learning Objective”?
- Reminder of “House Rules
- “Vegas Baby!”
- Digital detox (no checking mails, phoning or anything else in the room -> please just get out!)
- … anything else you may find important with your group?
60 minutes| intro topic, exercise & way forward
- Open up, illuminate, exchange, negotiate, focus and prioritize topics
- Identify groups / personal learnings
- Define “way forward” – so what do we do with the knowledge?
20 minutes | Short open round of self-reflection about the session
One by one:
- what have I learned today?
- what surprised me personally?
- what do I want to do differently in the future?
- what is my development focus for the coming week?
10 minutes | backlog refinement
- Current topic sufficiently discussed (Y/N)?
- New topics available? Others become obsolete?
- Re-prioritize existing backlog => Topic for the next session
5 – 10 minutes | Check-Out
- “How was it?” (opt. NPS measurement of the event -> either electronically or by sticky dot)
- Short AAR (After Action Review) – what have we done and what can we as a group do better in the future?
- Concluding thoughts (who has which…)
- Feedback to the round
- Wishes and expectations for future sessions
So, this should be enough input for a start. Be creative! Have confidence in yourself and your colleagues! This format is really no ” rocket science ” and you will see how it becomes extremely much more relaxed and natural from the 2nd and 3rd time on.
Do you need help or do you have questions about this format or my article?
Anyone who believes he can make an agile transformation a success with the help of structures, processes and methods alone is wrong. Only those who have understood what the ultimate goal of the transformation is and how to create an appropriate environment will successfully bring structures, processes and methods to life. Transforming is therefore clearly a holistic approach to face the new reality of the markets and to prepare for it as a company. In my opinion, Agile Transformation consists of two essential components: Leadership and collaboration transformation. Only those who succeed in weighting both according to need and making the importance of both tangible for all people in the company will ultimately be able to make companies fit for a successful future.
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