Start-ups have the reputation of being quicker, smarter and more innovative than larger organisations. Their creativity and outside-the-box thinking is driving larger businesses to try and mimic start-up culture in their own organisations. Successfully adopting a start-up culture can add real value to a large business. It can improve ways of working and boost productivity. Many companies have struggled to do this due to their size and traditional operating models, but recently larger companies such as Dutch bank ING have had success in emulating this distinctive way of working.
Paul O’Shea, CEO of Kumoco, the management consultancy that specialises in Agile working and cloud consulting, outlines how large organisations can use Agile techniques to help establish a start-up culture.
Create cross-functional teams
Successful start-ups usually have a non-hierarchical structure and teams with diverse skills. Different views are encouraged in a work environment that provides the opportunity to challenge and share ideas. This promotes innovative approaches to solving problems.
In large organisations, a key barrier to creating cross-functional teams is business silos. These prevent ideas being shared across an organisation. Becoming Agile helps to break down these silos by creating cross-functional teams that encourage knowledge sharing.
To create these teams, large organisations should carefully select a range of employees from different areas of the business. These employees should hold a range of skills and experience. This allows the team to be autonomous, dynamic and to function effectively. Agile ways of working also encourage simplicity, directness and regular face-to-face conversations to ensure communication is ongoing and that challenges can be surfaced and resolved quickly. This keeps the business focused on its objectives even as it expands in size.
Adopt a mindset of continuous improvement
Businesses large and small should commit to continuous improvement. Such a commitment is a core principle of being Agile. To innovate effectively companies need a consistent flow of new ideas and a willingness to test and develop them. Larger organisations are often unwilling to put the right framework in place to encourage a flow of such ideas from all parts of their business and to test and refine new, even radical, suggestions.
Adopting an Agile way of working, and focusing on smaller increments, enables a business to experiment and quickly gain feedback from stakeholders. This can lead to rapid enhancements in a product or service – and its delivery – and achieve improved customer engagement. Other benefits may include cost reductions, better product design and logistics improvements – all aspects which can increase a product or service’s chances of success.
Big organisations should set aside dedicated time to encourage and reward their people for thinking creatively and trying to improve the company. LinkedIn has done this by getting their employees to come up with new ideas each quarter, which they pitch to senior members of the company. If the idea is approved then the team is given three months to make the idea a reality, giving employees a personal investment in the company’s success.
Agree measurable outcomes
Often, large companies begin work on a project but fail to implement an effective measurement tool to assess how successful it has been. Failing to measure outcomes can lead to delivering the wrong product, at best, a project runs over time and budget, with no clear result. In a fast-changing competitive marketplace, start-up organisations cannot afford to make this mistake. They agree outcomes from the outset which help them to fail fast and learn quickly.
Companies such as Netflix, Amazon and Google have been successful in sticking to their start-up roots by using Agile techniques to constantly measure a project’s success and adapting rapidly to internal and external changes in their marketplaces.
At Kumoco, we use the term Measurable Outcomes to describe business value that can be determined. Measurable outcomes ensure that every individual on a project (from customer to operations) is working towards a common set of goals with clarity about the value they bring to the business and customer.
Each part of the business should define their own Measurable Outcomes with these cascading throughout the organisation. This allows each team to show the value they are creating as contributing to the wider company vision.
Encourage a cultural shift – from the top down
It makes sense that if you want to introduce elements of a new way of working within your organisation, there will need to be a cultural shift. As with any move to Agile, embracing the required change should be a gradual process. This is particularly the case with large-scale transformation where it takes time to shift from established, rigid operational processes towards a more fluid start-up mentality.
The first step large organisations should take is evaluating their working culture. This can help businesses see where improvements can be made and helps inform the changes they need to make in order to become Agile. Creating a culture that embraces continuous improvement, transparency, innovation and empowerment should be encouraged across the organisation.
Senior management should lead by example to create this shift in culture. It is crucial that a company’s leadership team embraces Agile and eases into any required changes for a transformation to have a real impact on the organisation. At Kumoco, we believe that ‘Agility moves at the speed of management’ because the executive team is critical to its success.