#PMOSym - Project Management Institute · project and don’t care ... • Middle management are caught between agile staff and senior management that haven’t changed. • No clear

HOUSTON, TX, USA | 5 – 8 NOVEMBER 2017

#PMOSym

PMO17BR309

PMI 2017 Thought Leadership Series: A Closer Look

Howard Bagg, Director – Agile Transformation

KPMG LLP

PMI 2017 Thought Leadership Series:

Achieving Greater Agility – A Closer Look

Howard Bagg

Director, Agile Transformation and

Program Management

KPMG LLP

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BacklogIn-Progress (Limit 1)

Agenda

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Backlog

The case for agility

Why do good agile transformations go bad?

PMOs are critical?

Rebooting your agile transformation

Time for action

Q & A

The Business Advantages of Agility

4

Organizational Agility is NOT just a “Technology Thing”, it has real

business benefits

say profits and/or

revenue has

improved because

of agility

41%credit agility with

their ability to be

faster to market

50%Say it has helped

with meeting

customer/consumer

expectations

47%Of organizations

with high agile have

increased EDITDA

by 20% or more

31%

The Good News

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believe that

organizational

agility is critical to

business success

92%report that agility is

most important for

strategic initiative

implementation

82%agree organizational

agility is necessary to

succeed in digital

transformation

84%

Senior Management recognize the need for Organizational Agility

The Organizational Agility bottom line …..

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Increased organizational agility

=

Better performance

=

Higher customer satisfaction

=

Improved competitive advantage

The Bad News

7

Most organizations are struggling to make agility happen

of executives consider

themselves highly agile

27%Only

So why is transformation so difficult?

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We set ourselves up to fail!!

DoneIn-Progress (Limit 1)

Agenda

9

Backlog



PMOs are critical?

Rebooting your transformation

Time for action

Q & A

Typical Agile Transformation Optimism

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Better Quality

Speed to Market

Lets go Agile

More Transparent

Lower Costs

Happy Business Folks

More Efficient

Happy Employees

Agile Transformation

Typical Agile Transformation in Reality

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BusinessGroups

CIO / CEO

Middle Management

PMO

Risk & Compliance

“You Might not have target dates but I do!!”

“I have a funded project and don’t care how it is delivered”

“Why do I need Agile anyway?”

“I don’t have headcount for Product Owners”

“We need approved requirements”

“Of course there has to be a UAT”

“No deployment without Business physical signoff”

“What do you mean, empower staff, they work for me”

“I need projects to deliver on time to earn my bonus”

“Send us your project plan”

“We need change controls to increase funding”

“Send us your % complete and status report”

“I don’t see how Agile is better”

“Where are the promised cost savings?”

Agile Transformation

So what went wrong??

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Agile Transformation Missteps

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Lack of Executive

Sponsorship

Lack of Executive Sponsorship - Culture

• The Organizational Agility initiative is an email announcement or

mentioned once in an employee town hall

• Middle management try to change corporate culture but conflict with

other managers trying to do the same thing

• Focus is on the corporate benefits of agility ignoring he personal

“what's-in-it-for-me (WIIFM)”

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Not driving agile culture change organization-wide and from the very top.

Lack of Executive Sponsorship - Enablement

• Executives don’t lead by example. They say they want empowerment but still

manage the traditional way.

• Few feel they can make mistakes without being punished so groups remain risk

averse.

• Middle management are caught between agile staff and senior management that

haven’t changed.

• No clear commitment to organizational agility no matter what.

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Executives not demonstrating agile behavior.


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Lack of Executive

Sponsorship

Not taking an enterprise view

Not Taking an Enterprise View

Not including and incentivizing everyone:

• Focusing on delivery agility not organizational agility

• Allowing Technology Delivery to go it alone

• Not including Business and Corporate Support groups early

and often

• Not adding agility to Senior Management goals

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Not Taking an Enterprise View

Not leveraging economy of scale:

• Not driving similar transformation processes across the

enterprise

• Not having a central transformation program, run by a

transformational PMO, to drive agile maturity

• Transforming in isolated pockets which is inefficient and

ineffective

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Lack of Executive

Sponsorship


Not considering organizational

change

Organizational Change – Starting Point

Not being honest about where the agile journey is starting.

• Do you have high levels of outsourcing?

This will increase transformation complexity and maybe inhibit agile

collaboration

Agile delivery relies on maximizing the value delivered for a particular cost

not maximizing the cost of value delivered

• Has your software delivery organization become vendor managers?

• Is your recruiting organization still capable of hiring engineers?

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Organizational Change - Scope

• New employee roles within a new operating model

• Re-skilling of many employees / separation of some

• Changes in core departments – Legal, risk / compliance, HR

• Change to the business customer / technology supplier relationship

• Middle management losing control by empowering staff

• Performance management process – teams not individuals

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Underestimating the amount of change. There will be:

Organizational Change - Speed

• Groups changing at different rates leading to misalignment and friction

• Employee change fatigue

• Frustration leading to backsliding

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Not controlling the speed of change. There will be:


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Lack of Executive

Sponsorship



change

Not considering transition time


Unless you are small enough for a “big bang” transformation, traditional and agile

approaches will need to coexist and must be managed.

• Hybrid might actual imped delivery

• Allowing teams to solve issues between approaches individually

• Taking the conventional approach of establishing agile teams and then scale

• Assuming all groups need to adopt agile approaches. Most organizations will

always have some traditional delivery.

• Not allowing for the impact of misalignment of business capabilities and

technology assets

• Not allowing for large, cross-business unit, enterprise programs

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Lack of Executive

Sponsorship



change


Not leveraging your PMOs to drive change


Agenda

26

Backlog



PMOs are critical?


Time for action

Q & A

You may of heard that you don’t need a PMO

with agile, but …..

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28

All

Respondents

Highly

Agile

PMO will significantly increase agile project management

PMO risks becoming obsolete if agility does not fully support

strategic change

PMO will become significantly more critical as a driver of

strategic change

…. the PMO is Actually Becoming More Critical

77%49%

88%58%

83%54%

Expected PMO role / practice changes over the next 3

to 5 years

Especially While Transforming

PMOs are so critical to transformation and making change stick that they should be

transformed first becoming a “hybrid” that will:

‒ Have an overall, end-to-end view of a given business value chain

‒ Promote collaboration between business and technology teams

‒ Leverage some traditional skills and learn some new ones

‒ Provide a consolidated view to senior management regardless of the approach used

‒ Modernize traditional approaches using agile principles to improve predictability and lower

risk

‒ Support agile approaches and scaling frameworks

‒ Enable agile portfolio management

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“The PMO is uniquely positioned to foster agility by rallying employees, driving greater adoption of fast-fail strategies, building small and nimble teams, and assigning accountability.” Stuart Cullum, Managing Director, Program Delivery Services, KPMG

The Hybrid PMO

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Traditional Approach PMO Skills

• Focused on Reliability

• Plan-driven, approval-based

• IT-centric, removed from

customer

• Good at conventional

process, projects

• Long cycles (months)

Agile Approach PMO Skills

• Focused on Agility

• Empirical, continuous,

process-based

• Good for new and uncertain

projects

• Business-centric, close to

customer

• Short cycles (days, weeks)

Hybrid PMO

• Overall Governance

• Information consolidation

and reporting

• Change Management

• Consolidated risk

management

• Manage cross program

dependencies

• Promote collaboration

Your Transformation PMO - the Enabler

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Establish the transformation framework

Build transformation strategic capabilities

Divide the effort - Business Value Chains and waves

Monitor BVC and team maturity

Track and report transformation progress

Your Transformation PMO - the Change Agent

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Communicate a consistent executive message

Track and report transformation progress

Enable formal change management

Help change enterprise processes

Help remove enterprise impediments

Your Hybrid Delivery PMOs – Making Change Stick

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Agile transformation can be guided by frameworks not is always team

specific. Your hybrid PMOs are best suited to drive transformation and

make it stick by:

Seeing the

“big” picture

across whole

Business Value

Chain

Identifying and

removing team

impediments

Managing

cross-team

risks and

dependencies

Managing

Business Value

flow

Promoting end-

to-end

collaboration


Agenda

34

Backlog



PMOs are critical?

Rebooting your agile transformation

Time for action

Q & A

Understanding Organizational Agility

Organizational agility is much more than implementing scrum, in fact, scrum won’t

work well without it!!

Business value is delivered across 3 distinct phases regardless of approach:

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Agile can only be truly effective when these delivery phases are blended into a

seamless flow of business value.

• A “chain” of business and technology groups across the enterprise work together to deliver

a predictable flow of business value.

• The least agile group limits overall flow along the Business Value Chain (BVC) and

establishes how agile the organization has or will become.

Decide the

next best thing

to build

Build it

efficiently

and with

flexibility

Implement

with speed

and

quality

How to Approach Agile Transformation

Delivery Team First Approach: Probably how most of your transformations

launched.

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Starts small with a few, isolated technology delivery teams

Expands into a scaling framework / portfolio management

Experiences increasing organizational inertia

Slows down or even stops

Limits the level of agility that can be achieved

How to Approach Agile TransformationPMO First Approach: A more effective approach!!

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PMOs add skills to support business and technology agility

Enables collaboration across diverse enterprise groups

Modernizes current approaches before introducing new ones

Manages whole BVC allowing end-to-end agility

Allows traditional and agile approaches to coexist

Promotes and enables agile maturity

Business and Technology groups transform together

Communicates the c-suite message in a consistent way

Where should you focus?

Even if you adopt a PMO first approach, you need to focus on some key areas to

be successful:

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Culture –

nothing

changes

without it

People – where

most of the

challenge and

risk is

Managing the

transformation

enterprise-wide

– leveraging a

PMO

Guiding the

organization to

similar

transformations

across groups

Accelerate Organizational Agility

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Live an Agile culture

Focus on the People

Leverage a

Transformation

PMO

Establish a

Formal

Transformation

Program

Live an Agile culture

Culture Comes First

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Culture comes first!!

• Agile is a mindset not a process or methodology. Culture will change

across the whole organization

• Needs C-level Sponsorship and promotion with frequent

communication and reinforcement

• Executives and Managers must exhibit agile behavior not just

communicate it

• Empowerment at all levels threatens middle management if they are

not also re-organized and re-skilled

• Freedom to fail fast and learn is very different for a “mistakes will be

punished” organization

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Live an Agile

culture

Then it is all about the people

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People Will Make or Break Transformation

• If people are confident they have a role in the new culture, they will be trained and they will be

allowed to make some mistakes along the way transformation will succeed.

• If not, people will stick to what they know no matter what and make transformation difficult,

painful and/or impossible.

• Some things that help are:

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Focus on the People

Establish a

formal change

management

program

Communicate

what is

expected and

when

Address

employee

what-is-in-it-

for-me (WIIFM)

Make Talent

Management

as a key part of

the program

Review an

update HR and

performance

processes

Manage Employee Satisfaction and Engagement

• People are happiest when they know what they are meant to be doing and how to do it, when

the know what will get them in trouble and they know how they will be rewarded

• Agile transformation will change all of these so an unhappy, demotivated staff is a real risk

• To minimize the impact:

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Focus on the People

Clearly define

new roles and

the specific

skills needed

Develop

training and

learning

journeys by

role

Make an

honest

assessment of

each

employee’s

skills gapAllow plenty of

time to upskill

with formal

testing to

eliminating any

“cheating”

Replace those

people who

can’t or won’t

make the

change

Manage the speed of change

Transformation will impact most parts of your organization so:

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Focus on the People

Aim for just “different enough, just enough the same”

Give permission to make (small) mistakes and learn

Go as fast as you can, change doesn’t age well it leads to fatigue!!

Get regular (anonymous) feedback to adjust speed

Look out for backsliders!! Burn the boats!!

Leverage a Transformation

PMO

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Leverage a

Transformation

PMO

Your Transformation PMO

As Enabler

• Establish the transformation framework

• Build transformation strategic capabilities

• Divide the effort - Business Value Chains and waves

• Monitor BVC and team maturity

• Track and report transformation progress

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Focus on the People

As Change Agent

• Communicate a consistent executive message

• Enable formal change management

• Help change enterprise processes

• Help remove enterprise impediments

• Track and report transformation progress

Establish a Formal

Transformation Program

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Establish a

Formal

Transformation

Program

Establish a Formal Agile Transformation Program

Agility is an enterprise-wide change in culture and approach which can’t be executed

at the individual team level. An enterprise agile transformation program will:

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Establish a framework in which transformation can happen

Develop strategic capabilities for use within the framework

Encourage groups that have not worked together to collaborate

Develop new job roles and organizational structures

Help transform corporate policies and procedures

Evaluate agile maturity and reports progress

Divide Up the Effort

Few organizations can launch agile across all business and technology groups all at

once so we need to divide up the effort. Business Value is delivered through

“Chains” of related groups where the least agile group in the chain dictates overall

agility so all related groups must transform together.

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Business Value Chain

Business Group

Business Group

Technology Delivery Teams

Technology Infrastructure Support

Business Group

Technology Delivery Teams

Transform in waves

Transform groups of similar BVCs into 6-month “Transformation Waves”

Each wave consists of:

• 4-week rampup that has training and practical exercises

• 2-3 Directed sprints where teams take direction from an agile coach

• 2-3 Guided sprints where teams take the lead with close agile coach monitoring

• 5-7 Supported sprints where teams operate on their own with centralized agile coaching

support and periodic check ups

• First wave has a maximum of 10 BVCs across no more than 2 business units

• Subsequent waves can be larger and launch every 3 months

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Ramp Up2-3 Directed

Sprints

2-3 Guided

Sprints5-7 Supported Sprints

6-Month Transformation Wave

Transform Delivery PMOs

• Transformed Delivery PMOs are key to:

• Having an end-to-end view of a Business Value Chain

• Enabling conflicting approaches to coexist

• Providing a consolidated program view

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Traditional Approach PMO Skills

Agile Approach PMO Skills

Overall Governance & Consolidation

“Hybrid” PMO

• After transformation Delivery PMOs:

• Become hybrid

• Are extended across business and technology groups

• Start to build end-to-end collaboration

• Are included in wave planning

Transform Business Portfolio Management

After transformation, business portfolio management will:

• Provide a steady flow of work to match the rate of technology delivery

• Have a well defined transparrent process with regular reevaluation and

reprioritzation

• Be working towards a capacity-based rather than project-based funding model

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Initiative Definition Engagement Discovery ElaborationExecution, Test

& Learn

Identify and describe

Business

opportunities

Build and maintain a

transparent business

initiative backlog

Agree the minimum

functionality to test

hypothesis (MVP)

Map business

initiatives to

technology assets

Continuous

Business and

Technology

collaboration

Transform Business Portfolio Management

A Culture Shift Will Be Needed to enable agility:

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MVP

Mindset

Limiting

WIPNew Roles

Rapid

Learning &

Redirection

To deliver value faster

and to learn and pivot,

go as small as possible

To improve flow and

minimize management

overhead

That are empowered to

make operational

decisions and drive

delivery

Ability to change

direction based on

customer feedback

Transform Technology Delivery Teams

• Multiple PO deployment models

• Delivery teams become agile with training and coaching provded by

their transformation wave

• Scaling frameworks introduced when necessary

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Transform Technology Infrastructure Groups

• A lot said and written about “Devops” but seems to mean a lot of

different things to different people

• Clear that if testing and deployment doesn’t change, deployment

will backup and you will of built inventory not business value

• Risk and compliance groups need to be part of the BVC

• Testing needs to be automated

• Deployment needs to be automated with minimum bureaucracy

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Agenda

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Backlog



PMOs are critical?


Time for action

Q & A

Conclusion – Bolster Your Transformation

• Leverage your PMO as a change agent to drive Agile Transformation and to make change

stick

• Establish a formal Agile Transformation program

• Consider the existing organizational culture but don’t despair if executives won’t sponsor

• Focus on the people

• Carefully manage the change

• Plan the transformation in waves of Business Value Chains

• Mind the gap: The gap between highly agile and the rest is growing. In many

industries, organizations are at the point where they must “Pivot or perish.”

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Achieving organizational agility is critical success factor for today’s organization. It

increases competitiveness by speeding innovations to market and minimizing

impacts from competitors. We recommend you:

Action Plan for Leaders

Next week:

Identify the most senior levels that will sponsor your program

Transform them so they start to live the agile life

Have them start communicating frequently at all organizational

levels. Awareness and transparency reduce fear

Establish a transformational PMO and launch your formal

transformation program

Start an honest assessment of your transformation and identify

the major impediments

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Next 90 days:

Continue to reinforce agile culture

Define new organization structures and roles, launch Talent

Management

Define and develop your strategic transformation capabilities

Define Business Value Chains and divide up the work

Launch your first transformation wave

Inspect and adapt

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Longer-Term:

Go as fast as change management will let you.

Transformations don’t age well!!

Keep up the momentum

Finish!! Not everyone will be agile but business value flow

has been optimized.

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Agenda

62

Backlog



PMOs are critical?


Time for action

Q & A

Any Questions??

63


Agenda

64

Backlog



PMOs are critical?


Time for action

Q & A

Final Thoughts

• Look beyond the propaganda and adopt an approach that is right for you.

• Executives must communicate why major disruption is necessary and give

everyone permission to make some mistakes.

• Don’t allow one group to go agile alone. Break down traditional barriers and

collaborate to make agility successful.

• People come first. Some people will leave your organization and others will

be hired but, when you have reached your agility goal, you still need to

maintain the culture that makes you uniquely you.

• Don’t automatically exclude traditional approaches, with modernization, they

can still be useful.

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Reminder: Take the Session

Survey!!

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Contact Information

Stuart CullumManaging Director

Program Delivery Services

T: 214-840-8204

E: [email protected]

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kpmg.com/socialmedia

The KPMG name and logo are registered trademarks or trademarks of KPMG International.

Howard BaggDirector


T: 214-840-8582


Deven TrivediDirector


T: 973-912-6229


Documents

#PMOSym - Project Management Institute · project and don’t care ... • Middle management are caught between agile staff and senior management that haven’t changed. • No clear