Does Agility matter when there is no business plan ?

Ideas come cheap. World changing ideas are showered on technology teams everyday. Yet for every idea disguised as an important business need, business teams rarely have an execution strategy.

"An idea that sounds important" and "An idea that creates tangible value" are two different things. For years now, software teams have opened their minds to changing business requirements. Yet business teams know little about what it takes to build effective software products. Or to be accountable for executing their world changing ideas.

I strongly feel that Agility of software delivery teams has been quite abused in the name of business value. While responding to change is demanded from technology, there is no scrutiny on how business takes solutions to success. Agility doesn't matter when there is no business plan.

So what's going wrong ?

Mindset

As more traditional businesses move into the realm of digital, the education on how to leverage technology is want. In startups too, the urge to stand out as a cutting edge tech startup is more telling than having a business plan. Businesses assume that the latest buzzword tech itself will catapult them to success. Or they remain skeptical of tech and tread with extreme caution. 

Being a technology company requires a different mindset. Businesses need to stop thinking of technology as an isolated piece in their strategy.

Costs

Building good technology has high upfront costs. In many traditional businesses the software costs starkly outweigh other operational costs. So, having invested in technology, businesses expect immediate dramatic returns. But software isn't magic. Making software work for business needs a business plan.

(lack of) Understanding software flexibility

Software development is highly flexible. It lends itself to starting small, writing workable but throwaway code, creating small proof of concepts, mini prototypes etc. But businesses don’t understand this. They approach software development with a “lets build everything we need NOW” strategy.

My idea is precious

Most of us are great at coming up with solutions. Actually I feel we're naturally inclined to think solutions first. It's sort of liberating :) Defining problems is hard. When pushed, business teams will come up with innovative problems to suit their cool idea. And startup founders especially can be persuasive.  They will convince you that their idea will change the world. And that is needs to happen right now.

To quote George Bernard Shaw (with a feminist twist) “…all progress depends on the unreasonable (wo)man.” When visionary founders embark on a journey to changing the world, unreasonable ideas come aplenty. Software teams have mastered the art of asking “why do you need this?” and the processes to respond to “when we can deliver this”. Instead we need to ask “How do you plan to execute this idea ?”

How can Product owners help ?

Businesses don’t understand that building software is the simplest part of the puzzle. How to operationalise the software is the hard part. Product teams need to respond fast to business needs. But they must also nudge business teams to support and set up their product ideas for success. This requires that business teams critically evaluate expected outcomes. Not just failures, but plan for success. This requires a mindset that is open to scrutiny, accountability and agility from business teams.

Quantifying Business Value

Business progress is measured by numbers. Profits. Impact. Leads. Acquisitions etc. are quantifiable metrics.

Software teams also project metrics. They measure velocity, scope, burn ups – which have no relevance to business value. Telling the business that the product team worked 12 hour days, completed 200 story points at velocity of 30 points per iteration isn’t useful. What’s the use of building all the useless stuff really fast ?

But can we quantify business value of a product feature / idea / experiment and measure that instead ?

Here is a small experiment we tried at Rang De.

We started with asking 4 critical questions of the business teams. We got all the business functions together to do this.

1.   What are our most critical streams of business (for the next 3 months)?

Get business teams to “invest” in their critical streams of work to understand what the most critical business streams are. Given limited currency notes, business teams had to arrive at a consensus on priorities. (below is an example.)

2.   How do we expect our "idea" to impact the critical streams of Business ?

Have business teams rate each on a scale of 0 to 10.  This is the perceived impact on each critical business stream (identified in step 1).

The weighted scores (rating x investment) is the business value points (BVP) per idea. The higher the BVP, the higher its priority (below is an example)

3.   How do we know if our "idea" is working or not ?

For any idea rated 5 impact points or more, business teams had to define time-bound success metrics. This will tell us whether the idea is working or not. This is akin to defining acceptance criteria in user stories, but measurable.

For instance, creating a new lead generation widget would get us 100 new leads within 6 weeks, is a time-bound measurable metric. 

4.   What costs do we incur to take this idea to success ?

Each business team impacted by the high business value ideas, had to come up with an operational plan to support the idea.

For instance, it is not enough to create a fancy landing page, without having a supporting marketing strategy.

Also, business gets a hold on understanding the amount of investment needed to execute a plan. The exercise resulted in some important ideas getting deprioritised. Other ideas gained better visibility and support from cross functional business teams. 

1.    Invest in critical streams of business

2.    Estimate the expected business impact 

3.    Define success metrics.

4.    Plan to steer the product idea to desired business outcomes

And when things don't work as expected, start over.

Pivot or Persevere isn't just for business models. It is relevant for product ideas too.

Will it work?

I feel it can work well in upcoming businesses with a flat organization where visibility and cross-functional co-ordination is easier to manage.

Also, it works only when business teams are open to the idea of accountability in their business decisions. Business and product teams have to spend more time thinking about execution and measuring impact rather than justifying estimates or creating process overheads.