Deeper dive into agile and governance

Many have successfully implemented agile styles of working for small teams, but struggle when they encounter corporate governance procedures.

This is because “governance” is often implemented in a structured environment in which often rigid procedures and gates are applied to give us the illusion of control. Agile is often perceived as an unstructured, chaotic environment where there is no control.

Neither of these definitions needs to be true. A symbiotic relationship can be achieved that takes the best from both worlds and consequently gives a really powerful governance model. In order to do this, it is important to understand why we need governance. In essence, governance should help us to ensure that:

• Things are done right
  • Capabilities are fit for purpose
  • There is due care and attention towards budget and time constraints
  • Resource is utilized efficiently and effectively
  • Process and quality procedures are followed, and consequently statutory requirements are satisfied
    
    
• The right things are done
  • Portfolio, programme and project planning ensure that we do the most valuable initiatives for the organization.
    
    
• All stakeholders are satisfied
  • Senior stakeholders understand the initiative status and impact 
  • Delivered capabilities add value 

Things are done right
The reputation for initiatives overrunning, or not delivering, has caused many governance processes to concentrate on the time and budget components. This has led to often complex procedures for budget approvals and controlling change.  

Agile, done properly, actually helps to control budget overruns and delivery delays. Value - something real and tangible - is delivered incrementally. This provides early indications of progress, timescales and budgets. Hence, any potential overrun problems can be highlighted, and acted upon very early.  

The collaborative and iterative nature of agile helps to ensure stakeholder satisfaction. Stakeholders are involved throughout, constantly reviewing features and understanding current progress. This results in a high quality outcome.

If it all works as expected, appropriate governance has been integrated into the process. The role of governance is to ensure it is working (e.g. via health checks).

Agile teams are empowered to deliver against defined vision and goals. The teams will, however, be internal-facing, looking at delivery of the outcomes. Sometimes, because agile initiatives create a large amount of enthusiasm, teams may get distracted from the ultimate goals.  Whilst decisions should be made at the lowest possible level, agile governance should ensure that the initiative does remain aligned to its goals and is delivering early and frequently.  

It also needs to assess alignment to current business strategy, which may have changed since the last review. Including reviews at the end of some or all incremental deliveries is one way to determine whether sufficient value has already been delivered or that there is no longer alignment to current business strategy. In either case, the initiative may be terminated. This may be hard to do for those closely involved, so the external governance influence is very valuable here.  

The right things are done
Most organisations want to do more than their resources can accommodate. Consequently, you have to determine what will provide most value to the organisation at a specific point in time, often months or longer in advance.  In fact, initiatives should only proceed if they provide value based on the business environment at the time they are to deliver – this is at the heart of agile thinking. 

In many organisations, however, portfolio decisions tend to be made once or twice a year, typically in line with budgeting cycles. Often, specific programmes or projects are approved, and the budget is not available for anything else. Changing the priorities or adding new priorities becomes difficult, even when business change or experience indicates that the priorities no longer make sense.  

Agile thinking may provide us with an answer. Using the principles of trust, empowerment and prioritising based on current business value, we could assign overall budgets to leaders of business areas, who would then decide exactly what initiatives will be implemented, within the constraints of overall business strategy.  An initial plan can be created, where initiatives are prioritised using, for instance, the MoSCoW technique.

All initiatives are included in the plan, rather than eliminating them too early. The plan is reviewed and updated frequently throughout the year, considering changing business imperatives. Some initiatives that were originally planned as high priority may be of limited value in the new business climate and are therefore removed, or reprioritised. Even overall budgets can be reviewed more often, reallocating across operating units or increasing budgets if necessary or possible (sales are better or worse than forecast, costs are not as expected, etc.).  

Satisfied customers
In summary, rather than causing governance problems, agile can provide us with powerful new ways of implementing governance that will help an organisation become more flexible and responsive to its customers.
 

Find out more about agile with Directing Agile Change.

Read more about what is agile project management