Why “Business Agile” Is Tanking International IT Businesses

By: Rachel Burger,Project ManagementResearch Director, Targetprocess

The cover of Harvard Business Review’s May issue featured a perfectly distributed multi-colored Slinky, a chapeau to its headlining article: “Agile At Scale.” The authors argue that an Agile-based business “is better able to read changing conditions and priorities, develop adaptive solutions, and avoid the constant crises that so frequently hit traditional hierarchies.” Who would say ‘no’ to those benefits?

HBR isn’t the only business publication taking note of Agile’s emergence into the enterprise. Looking at Google trends, international interest in “Business Agility” has increased 70% over the past five years. This joins search term counterparts like “Scaled Agile,” which Google labels as a “breakout” keyword with an increase of 370% in search queries over the same term.

Such a fevered interest in the new-ish management philosophy attracted members of the IT community (Agile’s original application, as detailed in the Agile Manifesto, centered explicitly on software development). Standbys like Jira and “visionary” tools like Targetprocess took note, pivoting into the hot market.

CA Technologies, a 42-year-old software company known for mainframe solutions like CA IDMS, intuited the market change as early as 2015. They changed their tagline to “business, rewritten by software.” CEO Mike Gregoire explained, “How do you take the power, the connectivity, the innovation available and turn it into better products and services? Software… We see Agile as being central to success. Not just for developers but for all businesses that need to succeed in today’s Application Economy. It is central to digital transformation.” Gregoire’s insights preceded Business Agile Fever, setting CA on a path to secure itself as a first-to-market software leader in the wake of business-driven interest in Agile at scale.

But Agile transformations haven’t always been smooth. The U.S. Air Force directly tied its failure to modernize the F-22 to avoidable communication errors linked to scaled Agile methods. Air France attempted to use Agile at scale to assuage its troubled labor relations two years ago—the French government just announced that it wouldn’t bail out the still-struggling airline. Even on a smaller scale, IBM faced a massive backlash when it called off its entire remote working program under the guise of “self-directed teams.”

Examples like these are tough to find, in part because few want to acknowledge that Agile isn’t a good fit for their business (disclosing management practices that didn’t work isn’t industry standard). All the groundwork for business Agile derives from the philosophy’s core values. Organizations like the USAF, Air France, and IBM attempted to apply a framework without them, and they suffered for it.

CA Technologies had its own challenges. The company was recently acquired for $18.9B, but technology industry analyst Eric Jhonsa further pointed out that CA's software and services bookings have an average duration length of more than three years, yielding a large base of recurring revenue streams. In other words, new products—almost all of which are DevOps and Agile-based—haven’t really been the source of revenue for the software giant.

And if it was struggling, how much of management’s pivot to business agility damaged the business itself? There were signs that CA wasn’t a healthy company, including an average 3.9 out of 5 in customer product reviews at G2Crowd. Its Glassdoor reports an average overall company rating of 3.4 out of 5 stars with even lower marks for senior management and career opportunities. An Agile mindset hasn’t helped with discontented feelings tied to management. Though prioritizing individuals over tools and processes is a core tenet of Agile, CA systematically replaced thousands of legacy workers with offshore talent. Three rounds of layoffs since 2014 included the most recent cut of 800 employees in 2018.

Known as the “Modern Software Factory,” CA’s latest marketing venture makes an intrinsically anti-Agile promise: That one can produce high-quality software using a prescribed system.

Change is exceptionally challenging to manage within large enterprises. And it’s critical to prioritize responding to change, over staying the course. A truly modern, Agile business should display diversity in leadership at all levels. CA is only just now investing in subscription models for its services.

There’s great irony in the misapplication of business Agile by a company that simultaneously claimed to sell Agile-at-scale software, which led to significant managerial difficulties. Many failed Agile endeavours all make the same classic mistake: They miss the nuance of Agile’s foundational philosophy, choosing buzzwords over creed.

Agile is not a framework. It is a mindset with derived methods. Before “doing Agile” across any business, an enterprise must first consider the most difficult yet necessary changes needed: They must encourage growth mindedness, trust their teams to do good work, prioritize the customer, and prize iterative improvement.

Push “pause” on business Agile, just for a moment. Learning a new method is easy; instituting a mindset shift for those methods to work is challenging. Before buying scaled Agile software, trying out NEXUS, LeSS, or SAFe, or even introducing the team to “business Agility,” take the time to understand the foundational psychology underpinning the philosophy. Without it, an overly prescriptive business Agile approach is sure to serve as a roadblock to business instead of serving it.