Taking An Agile And Lean Approach To Enterprise Management And Service Delivery

Moving beyond their respective origins in software development and industrial production, Agile and Lean methodologies are now proving their worth in a wider context. As we’ll reveal in this article, agility and leanness are also valuable attributes for organizations in several sectors, where such practices are facilitating and optimizing service delivery, and enterprise management.

Agile methodologies shun detailed planning at the inception of a project, instead adopting an iterative and incremental approach. In its formal definition, “Agile” refers to any process that operates in alignment with the concepts laid out in the Agile Manifesto — a collection of principles governing lightweight development methods, agreed upon in February 2001, at a meeting of 17 software developers in Utah, USA.

The Manifesto for Agile Software Development encourages development teams to treat customer satisfaction as their highest priority. Delivering on this promise under an Agile management system requires developers to work collaboratively and in self-organizing teams to provide working software at frequent intervals — all the while embracing change, and giving continuous attention to technical excellence and good design.

In essence, Agile is a delivery system based on trial and error, which favors adaptation to changing conditions, continuous improvement, and the frequent release of viable products or services that meet both customer demand, and the highest standards of quality and performance.

For software development, Agile encompasses a number of methodologies and programming techniques, including:

• Adaptive System Development (ASD): A management philosophy stressing the idea that projects should continuously adapt.
• Extreme Programming (XP): A response to changing customer requirements that involves feedback, a welcoming attitude to change, and simplicity of approach.
• Feature-Driven Development (FDD): An incremental and iterative process combining industry best practices.
• Kanban: A visual framework for Agile implementation, whose name derives from the Japanese word for “visual sign” or “card”.
• Lean Software Development (LSD): A development approach that takes its inspiration from the economies and efficiencies at the heart of Lean manufacturing.
• Scrum: A popular Agile development implementation that uses one or two week “sprints” conducted under a predefined set of roles, responsibilities, and meetings, that allow development teams to deliver software on a regular basis.

Continuous feedback and frequent person-to-person exchanges enable Agile development teams to keep their eyes on the prize of user satisfaction in the face of changing customer requirements. Agile practices like interactive meetings and visual management are universal, so the basic principle may be extended to apply in virtually any industry.

Conditions favorable for an Agile approach include the following:

• The end product or service isn’t rigidly defined, and can be altered in line with changing conditions.
• The customers or stakeholders reserve the right to change the scope of the project.
• Throughout the project, changes may continually be required.
• The service management or delivery team have a degree of independence for thought, action, or implementation.
• The product or service must be optimized for rapid delivery.

The Lean philosophy has its roots in manufacturing. One of its earliest examples dates back to 1913, when the American automotive manufacturer Henry Ford developed a fully integrated process for the production of the Model T — a vehicle available at the time in only one color and physical variant. The fast food franchise McDonald’s Speedee Service System of 1948 is another example, with kitchen layouts and food preparation routines designed to make delivery as efficient as possible.

Historically however, the production model most often associated with Lean is the Toyota Production System (TPS), of the 1950s. This was a process calculated down to the finest detail, so that each step in the car production process would yield maximum efficiency.

In essence, Lean seeks to create maximum value for consumers, while minimizing the time, energy, and resources required to achieve that goal. This approach requires a thorough understanding of the processes that will yield this value, an optimization of those processes, and enterprise-wide adoption of the Lean way of thinking.

A central focus of the Lean methodology is to eliminate waste in the production and delivery process. There are eight types of waste defined in Lean, several of which — such as excess inventory, unnecessary processing, and unused talent — will be recognizable to organizations in any industry. To deal with waste management Lean provides a number of tools and techniques, including DMAIC (Define, Measure, Analyze, Improve and Control).

With its emphasis on minimizing variation, decreasing costs, reducing response times, and maintaining delivery standards through continual alertness to potential issues and economical ways to resolve them, Lean has applications that go beyond production or development, and can extend across a range of industries and verticals.

While traditional organizations are built around a structured hierarchy and a rigid, step-by-step “waterfall” approach to project management, these foundation stones are inadequate for dealing with environments like today’s economy, which features both constantly shifting patterns of consumer demand, and a high degree of uncertainty.

By contrast, Agile organizations typically operate as a network of teams that work in rapid learning and decision-making cycles. With a Lean mind-set, the objective is to optimize the delivery of customer value and make operational processes as efficient as possible. Embracing both agility and leanness therefore positions the organization for adaptability, efficiency, continual improvement through iteration, and economy.

The leading business research firm McKinsey views an Agile organization as “a series of cells (or ‘teams’, ‘squads’, or ‘pools’) grouped around common missions, often called ‘tribes’.” In order to get to this stage, most enterprises require a transformation which begins with a push to conceptualize, design, and pilot their new operating model. The blueprint for this transformation must identify the necessary changes to the people, processes, and technology involved, and can be developed iteratively at rapid pace, to give enough direction for the organization to start testing their design.

In terms of enterprise management and service delivery, the cells of an Agile organization may be:

1. Cross-functional teams, dedicated to delivering products, projects, or activities.
2. Self-managing teams such as maintenance units or Lean manufacturing cells, which remain relatively stable over time.
3. Flow-to-work pools, consisting of full-time staffs of individuals who attend to various tasks on a demand basis.

Testing is integral to both Agile and Lean methodologies, and enterprises looking to embrace these philosophies for service management are advised to run pilot schemes that provide tangible business outcomes to demonstrate their value. McKinsey cites the case of an oil and gas company that launched a series of Agile pilots in which cross-functional teams managed to design wells in 50 to 75 percent less time than the historical average.

Scaling up from the pilot phase requires an iterative mind-set which incorporates learning, and continuous refinement based on feedback. For many organizations, the easiest way to do this is by transforming the corporate headquarters and product-development centers, before moving on to customer-facing units such as stores, call centers, or manufacturing facilities.

In all of these Agile and Lean endeavors — conceptualizing, planning, piloting, scaling out — an Enterprise Resource Planning (ERP) system can give your organization the visibility and strategic tools necessary for the transformation.

metasfresh provides you with a central management and control system for the precise mapping and automation of virtual business processes, as well as the technical and organizational integration of all sales channels.

metasfresh ERP is immediately ready for use as an agile and digital business solution, with a project management feature and integration with GitHub that extend your capability to manage and monitor service projects.

If you’d like to know more about how metasfresh can assist your organization in taking an Agile and Lean approach to enterprise management and service delivery, reach out to us.
Since 2006, we have been developing our metasfresh ERP software non-stop with open source components and under the open source licenses GPLv2 and GPLv3. Our mission is to enable each and every company to access a powerful ERP system that supports digital transformation and fuels corporate growth.