Does your organization perform?

Do you want to enhance your business’ agility? Are you dreaming of releasing your digital product even earlier, more frequently and with greater success? In that case, you will need an organization that is optimized to perform. Read the third article in a series of five, where we share some of our experience in making successful digital products. 

It’s rarely the ability to generate great ideas that prevent organizations from developing successful digital products. It is more likely the struggle of executing them fast, efficient and with eyes on the customer. One of the main issues is the fact that the organization is not optimized for this specific task.

It is difficult to quantify the exact potential released by increasing the agility in an organization. A survey from March 2020 by McKinsey & Company identified a potential improvement of 20-30%, measured on internal and external cost savings. Additionally, they identified a remarkable potential of improvement in terms of customer satisfaction, operational performance and employee engagement. Similar conclusions are found in an article by Harvard Business Review, where there is identified a potential improvement within quality, time-to-market, productivity, costs and employee satisfaction.

How much potential an organization can realize varies a lot. However, to increase agility can improve the ability to execute which represents significant competitive advantages on important parameters that can strengthen and grow the business.

In the following section, we will dive into what prevents companies in creating an organization that supports the development of successful digital products.

Do you optimize with execution in mind?

Companies are naturally divided into different departments with different purposes and measurement criteria in order to evaluate their performance. For larger organizations with a complex product portfolio, it’s a necessity with fixed structures and a large process system. This often comes with a number of consequences for the organization’s ability to collaborate across different departments. Many organizations are well aware of the need to break down silos, and in the software-industry, agile and lean are today an integrated part of an organization’s vocabulary.
Agile transformations are happening everywhere. One of the most typical drivers we meet is a wish for shorter time-to-market. However, we experience that many face challenges, as their organization is not optimized to reduce the lead time on the products that are prioritized by the business. Many organizations optimize each function according to an efficient utilization of resources, where teams and processes are determined by the function. Organizations that are capable of reducing lead times will to a greater extent optimize teams and processes to make products move through the organization as quickly as possible.

In organizations with a strong focus on efficient use of resources, many tasks are solved in parallel, bottlenecks occur and there is a high need of administration. If you zoom in on a project, you will experience delay in many organizations, where work is queuing up to be executed. The delay can occur for many reasons; lack of decision-making, lack of resources and lack of communication. This is illustrated in the figure below.

In many companies, the implementation of agile and lean methods takes place within a defined area of the organization. However, even if a few areas achieve a reduced cycle time for their part of a project, it’s only part of the total lead time. If you want to improve your organization’s agility, you have to take a more holistic approach. It’s the company’s overall efforts that holds the greatest potential to reach a competitive advantage through your organization’s ability to execute.

Cross-disciplinary products require cross-disciplinary teams.

In an organization, a very effective tool to limit silo-thinking is to work in cross-disciplinary teams that are established to carry out the development of the product across interdisciplinary functions. An important prerequisite for the cross-disciplinary teams to execute effectively is that they work on the basis of a holistic understanding of the product and that they both take responsibility, and more importantly, are authorized to make decisions.

The characteristic of a cross-disciplinary team is that the team is able to develop across domains and competencies. How broad an area the team should cover and whether it owns one product or works on several varies from organization to organization. However, it’s important to point out that a dependency is created if a needed competence is not included in the team. Each dependency for the team creates additional administration and work waiting to be activated. Too many dependencies between teams diminishes the agility of the business. It is a balance between optimizing after high utilization of resources or a low lead time on the product.

When we work with user-focused digital products in Jayway by Devoteam, we work in teams of backend/cloud developers; frontend web/app developers; graphic designers; UX designers; testers; DevOps developers; data scientists.

Key takeaways:

• Many organizations are divided into functions, where structures and processes are optimized for efficient use of resources.

• An optimization to utilize resources entails a longer lead time for a company’s products and product updates.

• To increase the agility of the business and the ability to reduce time-to-market, structures and processes must be optimized to reduce the lead time.

• A powerful tool to reduce lead times is end-to-end teams where all critical competencies to implement the product are represented.

Would you like to know more about how you can succeed with your digital products? Our consultant Nikolaj Grarup is giving a free webinar on Devotalks, December 16th. Sign up for the webinar right here. Note: the webinar is held in Danish.

About Jayway. Jayway is a Scandinavian based design driven software studio with more than 20 years of experience in developing digital products for an international client base. We have a proud history of being early adopters and we assist our clients in converting their strategic goals to digital solutions. We have hundreds of apps and web solutions under our belt and have delivered more backend services than we can count.

This is the third article in a series of five, where we share some of our experience in making successful digital products. The previous articles can be found in the panel to the right.