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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
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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
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Backlog
The case for agility
Why do good agile transformations go bad?
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.
Agile Transformation Missteps
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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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Agile Transformation Missteps
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Lack of Executive
Sponsorship
Not taking an enterprise view
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:
Agile Transformation Missteps
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Lack of Executive
Sponsorship
Not taking an enterprise view
Not considering organizational
change
Not considering transition time
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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Agile Transformation Missteps
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Lack of Executive
Sponsorship
Not taking an enterprise view
Not considering organizational
change
Not considering transition time
Not leveraging your PMOs to drive change
DoneIn-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 transformation
Time for action
Q & A
You may of heard that you don’t need a PMO
with agile, but …..
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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
DoneIn-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
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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DoneIn-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 transformation
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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Action Plan for Leaders
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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Action Plan for Leaders
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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DoneIn-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 transformation
Time for action
Q & A
Any Questions??
63
DoneIn-Progress (Limit 1)
Agenda
64
Backlog
The case for agility
Why do good agile transformations go bad?
PMOs are critical?
Rebooting your transformation
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
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kpmg.com/socialmedia
The KPMG name and logo are registered trademarks or trademarks of KPMG International.
Howard BaggDirector
Program Delivery Services
T: 214-840-8582
Deven TrivediDirector
Program Delivery Services
T: 973-912-6229