Paramita: Hello and welcome to PwC. Luxembourg TechTalk. We recently conducted a joint survey called "How Agile are companies in Luxembourg?" with the Project Management Institute. Today's podcast is based on that survey where we talk about Agile in project management with Thierry Kremser, a partner here at PwC and Nassos Karageorgiadis, member of the board of directors at PMI.
Hello and welcome to the second episode of our second season. Today, we have Nassos Karageorgiadis and we have an old face who has already done a podcast with us so he is the pro here... Thierry Kremser. And we will talk about agility.
Luis: We'll talk about being agile, what does it mean and how Luxembourg companies are adopting Agile.
So thanks for coming. We have between six and seven questions which are I hope interesting. Let's go to the first one. Let's start by asking you what agile means. I mean the key question is that one. What do you think Agile means?
Nassos: Agile originally started as an IT way of doing projects and it was originated by 14 gurus of IT in the area of project management. And the idea behind Agile is being flexible. That's what agility is all about.
Instead of using the traditional way of managing a project, you focus more on the end result. You focus more on the customer and the needs of the customer in a way that you produce something that from the beginning or even from the first steps is actually visible. You can test and you can see it. So Agile is actually this in a broad sense.
Luis: There was something called the agile manifesto...
Nassos: That was a set of basic principles. And Agile is not a specific, one way of doing things. It incorporates a lot of different let's say methodologies. But the basic focus is having in mind the end value to the customer. So that's the basic difference from project management in general.
Luis: Some months ago we wrote on the blog an article called The Happy Marriage between Agile and Scrum.
Nassos: Scrum is actually a mythology of Agile.
Luis: I'm bringing this up because the next question is... Are Lean and Agile the same thing?
Nassos: Now Lean has a different origin because it was created as a process management methodology. So the idea behind Lean is how we can define our basic value creating processes and then focus on improving them in a circular way learning from what we do, measuring our performance and then going back again and rethinking, redesigning our process again. So in this way Agile and Lean seem to be complementary because they both have the notion of doing things in a rather iterative way and then focus on the value. That's the basic idea and in creating circles of repetition of what we do learning and then getting better. That's the idea.
Luis: OK. Makes sense. What do you think?
Paramita: Well I'll be very honest with you. When I first heard the word, Agile and Lean I had absolutely no clue what they were.
Luis: You felt like going to the gym...
Paramita: Exactly. Thank you. It's like you know that kind of lingo you know... It's Agile vs something that doesn't move. Lean versus fat.
Thierry: It's a bit like that... looking at an organisation that goes to the gym. I think it's a good analogy.
Paramita: But we started talking about Agile and Lan I think it was just for IT projects at the beginning, IT project management. Is it still the case?
Thierry: So originally it comes from the IT project world but it has evolved to a more much larger concept taking the entire organisation. And this is what we call Lean Agile. And what is very interesting is that compared to the survey that we did two years ago this year we observe a strong evolution in the perception of Agile not anymore as an IT project methodology but really more as a state of mind, a philosophy. And 73% of the organisations that we interviewed define Agile as a culture and a state of mind. And this is really demonstrating that Agile is much more than pure IT.
Paramita: Why is that you think? Why is this change?
Nassos: I think it's you know business is changing. This is an area of continuous and very fast changes in the business environment and businesses need to adjust really fast. So if you follow the traditional ways of doing business that requires a lot of planning before... you need to have time in front of you. And now the question is do we have time anymore. Time is a crucial element. And by being agile one of the basic elements is you know being fast. Doing things rather you know in a quick pace.
Thierry: And I think that organisations realised that there are too many inefficiencies indeed to adapt to a digital world. So they are looking for ways to optimise and have a leaner organisation.
Luis: Are start-ups by nature more agile or not necessarily?
Nassos: I think so because you know in the Agile logic there is the idea of working in small groups, small teams that are very close and they worked very tightly together. So in start-ups this is actually how they do.
Thierry: And people are empowered. So they can make decisions and you don't need to go through X levels of approval before you can enforce anything. So this is very crucial.
Nassos: And imagine in start-ups, you need to have a viable product really soon. You have to show something really fast to your investors. So it's really important.
Luis: So if Luxembourg companies have started considering Agile you know as a philosophy, mind-set I guess there are still challenges to fully deploy Agile. And the third question is precisely that one. What are the challenges you see or the survey has unveiled when it comes to adopting Agile more broadly?
Thierry: I think the challenges and it's very often the case for challenges is the people, the people dimension. The culture, the change management but also the education, training... this is really the key. And it's very obvious if you look at the outcome of our survey the one thing that companies would like to change if they were to start again in Agile it's to reinforce that particular part on you know raising awareness, training, communication. This is the weak point and the main challenge.
Paramita: Is it really the people? The weak point is the people... probably yes. But does the change, does it have to come from the people really or from the governance within an organisation?
Nassos: I think it's both ways because when you need to change the way you think because this is actually a mentality changing methodology, you have to think differently than what you are used to do. And usually people, all of us, we are very much stuck, rooted to what we already know. Agile means that you do things rather differently than what many people are used to. And this requires an inner willingness to do this step further. Of course, you need, on the other side, the support and the engagement of management that will give you the tools, that will give you the push that you need in order to start because errors will probably be there in the beginning of any kind of transformation like this one.
Thierry: Yeah. And I think indeed that there is this culture of all these levels of governance, control that you need to get rid of. And this is not easy as a leader, as a manager to accept that people will be able to make decisions without you, that you don't know exactly where things are going. But you need to trust people to do so. So it's also another way of accepting failure.
Nassos: And you have to have this leniency in failure as well.
Luis: The fifth conclusion or key finding of the survey actually has to do with "champions". It says that, "Agile champions are increasingly present within the workforce in Luxembourg". What is the role they play is... Well I guess they play the role being the heroes?
Paramita: They're like our Google guides!
Nassos: They're like beacons. They are the people that will be there, will support the idea and will help the others in a way that solve problems, answer questions. They are like the link between the old and the new.
Luis: But they are not still like the man on the moon. I guess they're still normal people?
Nassos: Of course, they are normal people... maybe a little bit more experienced.
Luis: More experienced in Agile...
Luis: Well this is a discussable question actually. So Agile... because it calls for transforming the way companies work and we work. I also think it is calling for rethinking leadership. What do you think? And if so, what should the structure of an agile company look like?
Thierry: It's a difficult question. Thanks Luis for asking. As we said Agile is transforming the way you manage, the way you empower people, the way decisions are taken. So indeed the leaders must be very different. Agile requires you to work more across the company, more transversal and so you need leaders who can trust people but also maybe more confident about their people, about their organisation, about things and not trying to hide behind the many decision layers and many roles.
Luis: And this means that a leader becomes a facilitator?
Thierry: Yes of course.
Nassos: I think through Agile, a leader can demonstrate more leadership traits than managerial traits. That's the idea. You empower the people. You give power to the team. You have teams that have members from all around the company, from all functions. They work rather independently. So you have to give them the time and the space and be there and support them when they need support.
But you know it's a different way, as Thierry said, it's not like another linear classical organisation where you have these levels of approvals and you know stuff like that. It's completely different.
Luis: Before the recording, you mentioned a matrix organisation...
Nassos: Yes. It's actually like that. You transform your organisation into a matrix one because the traditional line managers are not there anymore. There is no need for them. Not in all the areas of an organisation but in most of the productive areas of the organisation they don't need them anymore. It's a completely different way of doing business.
Paramita: And why do organisations need to be Agile? What is the value added of being Agile?
Thierry: Fast result. It's also a very effective approach for innovation. So companies need to innovate in today's digital world. So innovation becomes critical. So they want to innovate. They want to do things faster. They want to allow and boost new ways of collaboration. So these are all the elements where Agile is bringing value.
Nassos: We saw it in our research as well. When you measure the results of Agile, you see that you become faster, more effective and efficient. And at the end, you produce value really quick. So this is exactly what organisations need today to perform in a rather faster pace than what they did before. To be ahead of competition. This is actually the only way. And in parallel, when you follow Agile, there is this very close relationship and working together with the customer itself.
So by putting the customer inside the process then you create more advanced relations with the customers. You offer greater value to the customers as well and you gain value from the customer.
Luis: For some reason, I just wonder if Tesla is Agile because I recently read actually that they claimed to have invented a million mile electric car battery. And next year, this is what Elon Musk says, that it will be already marketable. That's being agile.
Paramita: That's a sprint.
Luis: I mean that's what he claims. I don't if it will happen next year. But you know it's impressive.
Nassos: You know it's empirical data are not easily found about Agile. And this is one of the reasons that we performed this exercise together because we wanted to have an empirical view of what's going on in Luxembourg. We don't have a lot of examples. We don't have a lot of best practices.
So it was really important to photograph the situation and see what is going on. Can we learn from each other. What can we find out.
Luis: And roughly speaking from 1 to 10, ten means super adopted, one is we are just starting. How can you grade Luxembourg companies, entirely as a market?
Nassos: We can base our response on our research.
Thierry: There is still room to improve. Now this being said, we've compared this year with two other countries because two other countries decided to participate in this research, Poland and Croatia. And we observed that Luxembourg is quite mature compared to these two other countries. So of course there's still a lot of things to do before we have a pure agile market but it's very promising and we are already ahead of some other countries. So yeah I would say maybe 6.
Nassos: But you know our data, what we found from the research, is that one out of three companies in Luxembourg is experimenting but one out of three is thinking of implementing Agile in a larger scale. Upscaling it. So it's rather balanced. That means that maturity is being built... maybe because we have a large financial sector in Luxembourg. That plays an important role.
Thierry: The maturity in financial sector was good, was better than other sectors.
Luis: You can get the publication on our website and also on PMI's website.
Paramita: It's a report that was conducted...
Nassos: It was a survey that we started conducting in March this year and we ended in August and we published and introduced the results in a very nice event here in PwC on the 18th of September.
Luis: You can look for, on our website, or on Google "How agile are companies in Luxembourg?"
Paramita: Thank you Thierry as always. And Nassos thank you so much for coming in and we really appreciate it.
Luis: How was it Paramita? Did you learn what Agile is?
Paramita: Yes I did actually. Did you learn what Agile is? Because you were I remember before the podcast you just looked at me and said you know what Agile means... something about multitasking...
Luis: Oh yes. When I was researching about this I found out that being agile means monotasking.
Paramita: It's not for women then because you know, by nature we multitask...
Luis: No this is not a sexist podcast. Please don't listen to her. This a very plural podcast.
Luis: So thanks a lot for being with us.
Commmunication, PwC Luxembourg
Tel: +352 49 48 48 5821
Commmunication, PwC Luxembourg
Tel: +352 49 48 48 5821