What happens when a company whose roots go back over a century — a bank, no less — decides to adopt agile management methods developed in the software industry?

How is technology transforming the practice of management? As everyone knows, technological innovation enables changes in how we work, for example, helping people collaborate, access information more quickly, and make smarter decisions. Less obvious, but no less important, is the observation that technological innovation inspires new approaches to management. For example, the shift from mainframe computers to personal computers gave impetus to the empowerment trend of the 1980s, and the emergence of collaborative software tools shaped the knowledge management movement in the 1990s. In such cases, new technologies expand our capabilities and broaden our horizons, and it is this combination that enables management to evolve.

A case in point is agile. This emerged during the 1990s as a software methodology, made possible by new programming languages that made it much easier for developers to build prototypes and gain rapid user feedback. The concept of agile software development was formally defined in 2001,1 and over the next decade it gathered momentum as a more responsive and collaborative approach to software development than the traditional “waterfall” methodology.2 In recent years, agile has started to move into mainstream management thinking, with some observers proclaiming it the next big thing. Forbes.com contributor Steve Denning calls it a “vast global movement that is transforming the world of work.” In a 2016 Harvard Business Review article, Darrell Rigby, Jeff Sutherland, and Hirotaka Takeuchi wrote that “agile innovation has revolutionized the software industry. … Now it is poised to transform nearly every other function in every industry.”3

The purpose of this article is to shed light on agile as a management practice. To do this, I report on a detailed case study of the operations of ING bank in the Netherlands, which has adopted agile across its headquarters in Amsterdam. Though ING’s Dutch operations are less than three years into the process — and it’s therefore premature to declare the initiative a success — taking a deep dive into the organization’s early experience with adopting agile is nonetheless instructive.

Most IT departments in large companies today are adopting agile techniques to some extent, although with varying degrees of success.4 And many fast-growing technology companies, such as London-based Spotify Ltd. and Los Angeles-based Riot Games Inc.,

References

1. The original “Agile Manifesto” is available at http://agilemanifesto.org.

2. As part of this gathering momentum, a wide range of industry associations and training providers have emerged, such as Scrum.org, the Scrum Alliance, the Agile Business Consortium, the Agile Centre, and Lean Kanban.

3. S. Denning, “Explaining Agile,” www.forbes.com, Sept. 8, 2016; and D.K. Rigby, J. Sutherland, and H. Takeuchi, “Embracing Agile,” Harvard Business Review 94, no. 5 (May 2016): 40-50.

4. Challenges with implementing agile have been reported in several places. See, for example, J. Birkinshaw and M. Guest, “Digital Transformation in Practice,” London Business School and Deloitte Institute of Innovation and Entrepreneurship, October 2016, www.london.edu; and B. Boehm and R. Turner, “Management Challenges to Implementing Agile Processes in Traditional Development Organizations,” IEEE Software 22, no. 5 (September-October 2005): 30-39.

5. S. Denning, “Can Big Organizations Be Agile?” www.forbes.com, Nov. 26, 2016; and H. Kniberg, “Spotify Engineering Culture (Part 1),” labs.spotify.com, posted March 27, 2014.

6. J. Sutherland and J.J. Sutherland, “Scrum: The Art of Doing Twice the Work in Half the Time” (New York: Crown Business, 2014); S. McChrystal, with T. Collins, D. Silverman, and C. Fussell, “Team of Teams: New Rules of Engagement for a Complex World” (New York: Penguin, 2015); and K.S. Rubin, “Essential Scrum: A Practical Guide to the Most Popular Agile Process” (Upper Saddle River, N.J.: Pearson Education, 2013).