Agile Transformation (Part 1) - Understanding Your Investors

In this miniseries I want to share my observations about the organizational challenges with Agile Transformation. The information I use originates from my personal experience as well as from anecdotes and stories I collect from my friends and colleagues working in the software industry.

Any Agile Transformation is soner or later bound by the organizational capacity to accept change, and this includes executive leadership. At the end of the day, no matter how far the product development team is capable of going in becoming lean and Agile, they need full support and understanding of their investors, including customers and executives.

To illustrate, I want to use the unrelated at first glance story about the Japanese/American cultural differences. I drafted and never published this post more than a year ago, finding it interesting from the cultural perspective point of view. As I re-read it now I was somewhat surprised at how natural the story read if I were to replace the "American Vendor" below with a software development organisation striving to adopt Agile and similarly the "Japanese Customer" with their corresponding corporate level executives.

Situation: An American Vendor working on addressing a Japanese Customer’s request. Part of the disconnect is due to some cultural peculiarities that need to be understood by the Vendor.

First, the Customer fully expects to be able to provide input into the Plan. Not only the bottom-line value to the Customer has to be clearly articulated, the Vendor needs to sell the Customer on each item in the Plan so they understand how it maps to their concerns.  

Second, from the Customer’s perspective, the target completion dates should be thoroughly vetted and accounted for all possible delays. While an American might think this is unrealistic or overly conservative, from a Japanese perspective this is normal. From that perspective, it can be seen why multiple revisions to the Plan dates become problematic – the Vendor loses credibility with regards to its forecasting ability. This also helps understand why the Japanese Customer sometimes finds it hard to believe Vendor's explanation of the reason for a delay. The Customer believes the Vendor should have predicted the outcome and mitigated the risk before the Plan was committed (unless the Vendor is hiding the real reason for the delay). Again, from an American perspective this is unfathomable, but it helps to see things from the Japanese Customer’s perspective. 

Third, Japanese companies need frequent updates and hand-holding. Even if no progress is made, they need to be updated by the Vendor, with explanations why what is being done matters to them. The level of updates that Japanese companies see as normal may be considered an overkill to an American. Depending on the situation it is advisable to provide a weekly or even daily status update that simply states what has been accomplished and what is planned for the coming period. This can go a long way towards maintaining good relations. 

Fourth, the phrase “TBD” is not acceptable to the Customer. Culturally, Japanese are not nearly as comfortable with uncertainty as Americans. We see TBD as a necessary component of planning, but the Customer sees it as a lack of focus, investigation, and drive. For this reason, it is best to use TBD sparingly, and only if accompanied with an explanation of why it is undetermined, and when/how it will be determined. 

Bottom line, when helping Japanese Customers we need to make sure it is crystal clear what problem we’re trying to solve and exactly why that particular action item has value to them. Also, if there is some uncertainty, or if something will take more than a week to complete, or if there were multiple revisions to the target date, we need to thoroughly explain why.

What's my point? To be successful every Agile Team needs to understand the psychology of their investors, or their executive management.