Should we introduce Agile Ways of Working in IT/OT?
60-70% of Digital Transformation Projects Fail in IT/OT – Discover Why and How working Agile Can Turn the Tide!
The majority of digital transformation projects fail, also in our beloved IT/OT world. Whether you want to know the exact percentage (*) or take comfort with this generic statement, the point is that it is a huge loss of money and a waste of time.
(*) The number most often circulated in surveys is 60% to 70%. That’s the failed projects, not the successful ones. Many articles and whitepapers cover this, check them out if that makes your day ;)
In this previous article, we already discussed the importance of the management style in digital environments, including the IT/OT groups. In most large (traditional) organizations the stage-gated “Waterfall” project management approach is still the way to go.
This is not strange. In the end these companies are used to working on very complex projects. Setting up a new site or expanding a production line means investments of several millions with a ton of stakeholders (safety, production, engineering, legal, HR, marketing, purchasing etc). It also goes beyond the methodology. The way we spend money and measure success are also based on this way of thinking.
So when we want to talk about agile ways of working and thinking, it’s normal to face resistance from people, the culture and the management systems
Why bother?
When you are working in the OT world, you're probably thinking at this point:
“Yes, but we’re different! We aren’t developing software products. This is just me and my colleague overseeing our plant automation systems.”
And you are absolutely right!
In OT we don’t have 100s or 1000s of software developers working collaboratively to construct and uphold that singular digital product our company sells. We are in the business of integrating and adapting existing (industrial) software packages, occasionally extending it with custom code. Small teams of 1 to 5 people are our norm and they are typically part of the local operations team. Similarly, within the IT/OT Integration Zone (recall the green box from our field guide), small teams are commonplace.
In the OT world it is very common to have 1 engineer or a small team being responsible for both the Automation infrastructure and the development work. They can deploy changes fast. If something is wrong, they have full control and ownership. The job gets done.
So why do we bother?
You’re not so special and neither is your case. Banks realized they are technology firms a long time ago and are very advanced in adopting agile methodologies. We’d also dare to state that global payment systems are critical and regulated, and we wouldn’t consider them as a bunch of idealistic hippies either.
It simply works: Study’s and publications comes to the same finding: using agile as a methodology is imperative to increase the success of your projects.
So why is it so hard to change?
…We crave certainty
Project management is in essence all about managing risk, it tries to bring certainty where there is none. So what do we do when we encounter uncertainty? More planning, more control, more stringent project management. Maarten Dalmijn wrote down this great summary in his book ‘Driving Value with Sprint Goals’:
“We will encounter many surprises in our plans, execution and results. Our usual response is to spend more time planning, issuing instructions or imposing tight controls which makes all three gaps even worse.”
In our previous article ‘The real reason manufacturing digitalization fails’, we talked for the first time about the Money-Technology-Talent-Culture problem. If you have not read this one yet, we advise you to do that first 🙂 (spoiler alert: it’s culture).
Let’s do Agile?!
Enter the Agile movement.
You might fall in one of these categories:
“Agile? What?”,
“Agile is something for IT and we’re not IT”,
“I’m already successfully applying Agile in my team/departement/company”.
1: “Agile, What?”
We’re sorry to hear that ;)
Agile is a philosophy with a focus on collaboration and organization. Instead of planning everything in advance, we introduce ways to deal with the inherent uncertainty of (in this case) digital projects. There are literally thousands of good resources and we are not one of them 😂 Here are some other articles you can review if you like to know more about Agile (and DevOps):
Follow ‘Ageling on Agile’ or ‘Agile Product Development’ on Substack
Listen to the “No Nonse Agile Podcast”
Like reading? We published our Mini Book Library a while ago
2: “Agile is something for IT and we’re not IT”
This mindset often stems from misconceptions about Agile being just trial-and-error with no processes or documentation, leading to budget overruns. However, Agile isn’t about disregarding these aspects but rather ensuring they don’t overshadow the ultimate goal: the outcome. Starting small, evaluating, and regrouping—even if it means halting a project—is the Agile way.
The challenge lies in not applying traditional Project Management skills to Digital Projects. In operations and engineering, processes are meticulously planned, but this approach can be counterproductive for digital products. Even companies striving to be Agile often struggle to let go of the 'waterfall' approach, especially at the management level. It’s about finding a balance and understanding the difference between a 'one-way door' decision (irreversible) and a 'two-way door' decision (reversible) in the digital realm (We found this good analogy in this interview with Jeff Bezos).
3: “I’m already successfully applying Agile”
Nice! Please, please, please, share your story with us! Your experiences, challenges, and triumphs are invaluable to others on this journey. We encourage you to share your story with us and the wider community.
Conclusion: Agile Beyond IT
Agile, initially an IT-centric approach, has vast potential in industrial digitalization projects. It encourages adaptability, quick response to change, and a focus on delivering value. While transitioning to Agile in a non-IT environment presents unique challenges, it also offers significant opportunities for innovation and efficiency. The key lies in understanding Agile's core principles, adapting them to your context, and being open to learning from both successes and failures. Remember, Agile is a journey, not a destination, and every step taken is a learning opportunity towards achieving operational excellence in the digital age.
