• Teri Christian

Diversity & Inclusion: Part 1

Updated: Jul 23, 2021

Why are Agile Transformations Failing?

How does your company operate?

For many years, at least since the mid-20th century, organizational operations have leveraged a closed model. How do you know if your organization is closed? There are a few simple tests to help answer that question.

  • Are you free to talk to the CEO about your great idea? Or are they even interested?

  • Can you discuss issues with leaders outside your area?

  • Are people rewarded for curiosity and experimentation?

Most likely the answer to these questions is no. Believe it or not, prior to around the 1950s people were expected to collaborate with leaders, from strategy to execution, to ensure they were doing the best things for the organization as a whole. The above behaviors were normal, standard operating procedures.

In the 1970s, with the rise of Friedmanism, a divide grew between the people doing the work and the decision-makers at the top, thus creating a closed, exclusive system. This broke collaboration and communication throughout the organization which resulted in siloed, competitive thinking within the organization.

Initially, this seemed to work fine. The damage done did not come to light until organizations began shifting to Agile frameworks over the last twenty-plus years. Organizations using a "Traditional" operating model, based on Friedman's theories, cannot transform to leverage Agility because they have a closed system that is not inclusive. The Agile Values and Principles demand inclusive, open systems. Closed systems are the root cause of failed Agile Transformations, which comes with a price tag of 900B per year.

The Standish Group's 2015 Chaos Report found that only 33% of attempted Agile adoptions were deemed successful.

New Digital era, new Operating Model

Two types of operating models create closed or open systems.

  1. Traditional Operating Model – Uses a Closed, Exclusive system

  2. Digital Operating Model – Uses an Open, Inclusive system

People tend to think that some industries, such as manufacturing, can only be successful using a closed, exclusive system. While other sectors, such as online retail sales, need a more open, inclusive model to respond to customers' needs. The truth is either model can be used in any industry. But Digital Operations will create market leaders.

The rise of the Digital era has caused a shift in knowledge and power from Enterprise Leaders to people working on the line. This is driving a change in behavior. The Digital era is moving companies from an economy where needs are known and predictable, to compete in an economy where needs are unknown, and organizations must adapt to meet emergent needs.

We have moved from simple to complex systems and given the nature of work, the people on the ground need autonomy and an empowered environment. Complex systems require inclusion so the organization can move effectively and quickly.

There is no question that now, as we are competing in a Digital economy, every organization needs to embrace an inclusive, open digital operating model. It is not a choice. The Digital Operating model creates inclusion and welcomes diversity. It creates a learning organization where people collaborate, learn, and work together, as in times past.

Regardless of the industry, a Digital Operating model produces better results. It seems obvious, so why is this rare? The answer is simple. It takes courage and discipline for leaders to create an environment where people can work together to deliver high-quality results. It takes leaders creating the system and then getting out of the way to support the delivery teams. Again, this sounds easy, so what is the problem? Why is this not seen as normal?

What does it take to create an inclusive Digital Operations model that respects diversity? Great Leaders!

How to Lead in a Digital Operating Model

Questions for leaders:

  1. Are you willing to create a diverse, inclusive environment in which every voice is heard?

  2. Are you willing to work across the organization to support strategic operational activities and measure results?

  3. Can you trust leaders to clear the way for your organization by asking them to work together as a team of teams to create flow?

  4. Are you willing to empower people to focus on delivering quality products and services together across the organization?

  5. Are you willing to learn from people and customers? Can you be vulnerable and learn instead of seeking expert advice?

If you said "no" to any of the questions above, your organization may not be ready to start the journey to compete in today's Digital economy.

While CEOs are rewarded for leading the market, they must understand that to compete in today's economy, they must move back to the open, inclusive open systems of the past. The one thing leaders can do is embrace a Digital Operating model, where every voice is heard. Today's market leaders create diverse, inclusive systems open to collaboration, working, and learning together. Then, Agile Transformations will be successful because the values and principles of inclusion and collaboration can be honored.

This is the first of a three-part series to highlight how the Digital Era requires a change in the ways of working, from exclusive systems to inclusive, collaborative Digital Operations.

In the next two installments, we will further explore how diversity, equity, and inclusion are necessary to compete in today's economy.

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