Decades ago organizations could be competitive by implementing industrial era concepts that work well in a stable environment, such as centralized management, close supervision, well-defined functions and replication of best practices. Nowadays this would be a recipe for disaster. In today's information era we rely on principles that almost completely contradict what we were doing only twenty years ago.

Interestingly, the ways of working organizations are now striving for are quite similar to the agile principles that are gaining momentum in software development. The agile principles seem broad enough to cater to other areas. Therefore the question is: Can we leverage agile principles for activities other than producing software, such as managing business in general?

Source: Cirque Nova

We will go though agile principles (compiled from various sources ? see references at the end) and examine briefly what they mean from business management's point of view.

Leverage individuals and interactions

• Instead of controlling individuals, empower individuals and teams. Trust them to take the right course of actions to achieve results.
• Place accountability at the team level, not at the individual level.
• Instead of assigning responsibilities, let teams self-organize to ensure that each team member takes on a role he/she really wants, leading to optimal use of resources.
• Rather than distributing tasks, state the desired results and let the team decide how to reach it by allocating work units across its members ("implicit" leadership).

Hire adaptive people and reward contribution continuously

• Traditional HR emphasizes standardized behaviour and functions, which leads to silo thinking and inflexibility. The agile organization is only as good as its people. Hiring adaptive people is key to reap agile benefits.
• Develop cross-training to improve collaboration and enable workers to see things from different perspectives.
• Reward contribution continuously (monthly for example, instead of annually) based on the impact the person had on the value that has been delivered to the customers.

Develop specific strategies

There is no recipe for success. Replicating so-called "best practices" is risky at best. Design specific strategies to achieve each business objective.

Deliver value quickly and regularly

• Delivering value to customers is the main measure for progress. Measure progress by tracking value, not effort.
• Schedule incremental (aka iterative) delivery of results ? even if they are little ? to keep motivation high and the feedback loop short.
• Set up a project-based organization to ensure that teams are always working toward goals.

Improve continuously

Make sure processes are lightweight and that nothing is edged in stone. Team members are encouraged to bring small but meaningful improvements (Japanese kanban-style improvement).

Respond efficiently to change

• Plan only what can be planned; keep planning minimal and iterative.
• Elicit changes continuously from all stakeholders.
• Anticipate what you can.

Collaborate closely with stakeholders

• Keep close contact with customers.
• Make sure people that decide the what (ex: customer, business analysts), the why (ex: managers, marketing), and the how (ex: engineers, developers), work closely together.

Target technical excellence

• Encourage learning.
• Target superior quality.

Keep it as simple as possible, but no simpler

• Take the shortest path toward the solution (without compromising quality).
• Don't use agile as an excuse to cut corners.

Maintain low overhead

• Minimize resources that are not directly involved in delivering value to customers.
• Use processes and tools only when there is a clear need for them, and keep them as simple and as flexible as possible.

Encourage creativity and innovation

• Foster intellectual curiosity and experimentation.
• Create an environment where individuals have the opportunity to make a difference.
• Don't punish mistakes that are the result of genuine forward-thinking.

REFERENCES

7 Agile Leadership Lessons for the Suits, E. Nizker, CIO.com (2008)

Business agility: 8 steps to improve reaction time, BDC

Agile Enterprise, Wikipedia

Are You Ready for an Agile Future? S. M. Heathfield, About.com

Leadership for the Agile Organization, Michael Hugos, CIO.com (2007)

The Next Generation Enterprise: Creating the Agile Organization, M. Schweer, Talent Readiness (2008)

Agile Software Development, Wikipedia

PM Declaration of Interdependence, Wikipedia

The declaration of interdependence for modern management, A. Cockburn (2008)