My presentation at Agile Tours 2012 at Bangalore. In this presentation, I have taken a hard look at how the basic agile adoption appears to be rather ineffective in the face of today's problems that are much more complex, dynamic and uncertain. I outline hat I consider as inadequacies of agility as we understand today. I also discuss Lean Startup framework as a better way to address some of these shortcomings. Feedback welcome...

1. Software Agility –
Necessary…BUT NOT
SUFFICIENT!
Tathagat Varma
http://managewell.net
Sep 29, 2012, Bangalore

2. my professional belief system
ò Goal: The goal of software is to deliver real
value to the business and the users it serves.
Software just by itself is, thus, not a value.
ò Means: Methodologies are simply a means
to organize work and assign resources to
deliver better software, not an end by
themselves.
ò Judgment: “When the terrain disagrees with
map, trust the terrain” - Swiss army manual

3. What is (my definition of) Agility?
ò Accomplishing end-objectives through
a series of mid-course corrections
“B”
ò Accomplishing = the focus is on results
and not on intent, desire or behavior
ò End-objectives = agility by itself is just
Progress
a means to accomplish end-objectives,
which include value delivered, time to
market, cost and quality constraints, etc.
ò Mid-course corrections = embracing
“A”
mid-course change and adapting to
Time them in real-time keeping the focus on
end-objectives

4. The [Old?] Agile Manifesto
Circa 2001

5. Does you Agile Manifesto look
like this?
http://www.halfarsedagilemanifesto.org/

6. Or, like this?
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7. And these values?
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8. Does the ‘tool’ matter???
A photographer went to a socialite party in
New York. As he entered the front door,
the host said ‘I love your pictures – they’re
wonderful; you must have a fantastic camera.’
He said nothing until dinner was finished,
then: ‘That was a wonderful dinner; you must
have a terrific stove.’
– Sam Haskins

9. Applying ‘Inspect and Adapt’ to
The Agile Manifesto
ò “…In looking back, [Kent] Beck finds that while each segment of
the Manifesto was a giant leap forward in 2001, the language no
longer reflects the challenge of launching successful innovation
in the marketplace of 2011.”
ò Beck’s Beyond Agile Manifesto -
ò Team Vision and Discipline over Individuals and Interactions (over
Processes and Tools)
ò Validated Learning over Working Software (over Comprehensive
Documentation)
ò Customer Discovery over Customer Collaboration (over Contract
Negotiation)
ò Initiating Change over Responding to Change (over Following a Plan)
http://www.forbes.com/sites/stevedenning/2011/05/04/innovation-applying-inspect-adapt-to-the-agile-manifesto/

10. Team Vision and Discipline over
Individuals and Interactions
ò In 2001, it was a big step forward in software development to realize
that the people and how they interacted with each other mattered more
than following some process. So the Manifesto declared that
“individuals and interactions” were valued more than “processes and
tools”.
ò Beck has found however that in developing software in new business
lines, “individuals and interactions” are not enough. Each
individual in a team in a startup needs to think, not about how
good a job he or she can do, but rather, how good a job
are we doing?
ò Individuals interacting have a tendency to optimize their own
performance. Beck believes that team vision and discipline goes beyond
that to discover how are we going to make the most progress together.

11. Validated Learning over
Working Software
ò Beck says that in a environment of a startup (or a new line of
business), nine times out of ten, it’s not that you don’t know
how to write the software. The central problem is almost
always: how do you find customers who are going to pay for
what you are building? Working software can be part of the
way to answer that question but it isn’t necessarily the best
way to answer it. The real challenge is to create an
opportunity for learning by the organization as to what might
satisfy or even delight customers so that they will pay for it.
ò As a result, Beck concludes that in 2011, in the world of
startups (or establishing new lines of business), validated
learning is to be valued ahead of both working software and
comprehensive documentation

12. Customer Discovery over
Customer Collaboration
ò It was a big step forward in 2001 to realize that in the
rapidly changing and unpredictable world of software
development, collaborating with customers was better
than trying to nail down all the details of software
development at the beginning.
ò But in a startup, or in a new line of business,
collaboration with customers isn’t possible, because
by definition, you don’t have any customers. In effect,
you have to find out who your customer is.
ò Thus in a startup or a new line of business, customer
discovery has precedence over both customer
collaboration or contract negotiation.

13. Initiating Change over
Responding to Change
ò Traditional management tended to believe that the way
to do software was to make a plan and then follow the
plan. In 2001, recognizing that things change too much
to be following a plan was a big step forward. Reality
diverges from the plan. Reality is much less flexible than
the plan. Reality bends a lot less than the plan bends. So
the Manifesto recognized that responding to change was
more important than following a plan.
ò But in a startup or a new line of business, nothing is
changing. Nothing is moving. You have to establish
momentum first. Development in a startup requires
initiating change, not just responding to it.

14. So, what is Innovation?
ò Innovation is the development of new customer value
through solutions that meet new needs, unarticulated
needs, or old customer and market needs in new ways.
ò Innovation differs from invention in that innovation
refers to the use of a better and, as a result, novel idea or
method, whereas invention refers more directly to the
creation of the idea or method itself.
ò Innovation differs from improvement in that innovation
refers to the notion of doing something different rather
than doing the same thing better.
http://en.wikipedia.org/wiki/Innovation

15. How are Innovation Projects
different?
ò Innovation projects tend to start with loosely defined,
sometimes even ambiguous objectives that become clearer as
the project proceeds. The processes used are more
experimental and exploratory and seldom follow strict linear
guidelines.
ò Teams need to be more diverse and have a higher level of
trust as they explore new territory where failure is a
possibility.
ò With failure as a built-in possibility, innovation teams are
more actively involved with risk management and need to
learn to fail fast and fail smart in order to move on to more
attractive options.
ò Also, innovation projects generally need to be sold to project
sponsors and funding committees, a responsibility usually not
required from normal project teams.
http://www.innovationtools.com/weblog/innovationblog-detail.asp?articleid=303

16. Innovation Continuum
High
Disruptive
Rewards Operations Innovation
Sustaining Projects
Innovation
Low
Rewards
Low Risk High Risk

17. Kaizen vs. Kaikaku

18. Kaikaku and Kaizen relationship
http://www.centrodecompetitividad.com/img/kaizen.jpg

19. What is wrong with traditional
notion of agility?
ò Focus on sprints as a means to deliver user stories
ò What do you do when user stories are not known?
ò What do you do when user story is a best-effort hypothesis?
ò Velocity as a measure connotes ‘certainty’ within a range
ò What does it mean if you complete 100% user stories?
ò What does velocity mean in relation to value delivered?
ò Team productivity gains don’t scale up at business level
ò Claims of team-level performance improvements in the wild ranges of 5x-11,000x !!!
ò However, mature businesses in most industries only grow single-digit y-o-y !!!
ò Agility metrics focus on efficiency and not on effectiveness
ò Efficiency is ‘lower-order agility’ and means nothing to the business or the customers
ò There is no focus on ‘higher-order agility’ that the business need

20. What might be a (slightly) better
approach?
ò Sprints are a means to test a hypothesis
ò Strategy, Product Backlog, User Stories and even
design is a hypothesis
ò Sprint goal is to validate a hypothesis and provide a
‘validated learning’
ò Each sprint delivers a real business value
ò Velocity is the business value delivered to the end-
user in each sprint
ò Under/over achievement of sprint goal signals a
need to revisit the hypothesis

21. The Lean Startup
ò Lean Startup is about learning
what your customers really want.
It’s about testing your vision
continuously, adapting and
adjusting before it’s too late.
ò A Startup is a human institution
designed to create a new product
or service under conditions of
extreme uncertainty.
ò Innovation is a bottoms-up,
decentralized, and unpredictable
thing, but that doesn’t mean it
can’t be managed.

22. Validated Learning
ò Validated Learning is not after-the-fact rationalization of a
good story designed to hide failure.
ò It is a rigorous method for demonstrating progress when one
is embedded in the soil of extreme uncertainty in which
startups grow.
ò Validated Learning is the process of demonstrating
empirically that a team has discovered valuable truths about a
startup’s present and future business prospects.
ò It is more concrete, more accurate, and faster than market
forecasting or classical business planning.
ò It is the principal antidote to the lethal problem of achieving
failure: successfully executing a plan that leads nowhere.

23. Innovation Accounting
ò Innovation Accounting enables startups to prove objectively that
they are learning how to grow a sustainable business. It involves
three learning milestones:
ò Establish the baseline: A Minimum Viable Product (MVP) helps
start the process of learning as quickly as possible. It is not
necessarily the smallest product imaginable, though; it is simply
the fastest way to get through the Build-Measure-Loop feedback
loop with minimum effort and least amount of development time.
ò Tune the Engine: Every product development, marketing, or other
initiative that a startup undertakes should be targeted at improving
one of the drivers of growth model.
ò Pivot or Persevere: are we making sufficient progress to believe
that our original strategic hypothesis is correct, or do we need to
make a major change? That change is called a pivot: a structured
course correction designed to test a new fundamental hypothesis
about the product, strategy, and engine of growth.

24. Build-
Measure-
Learn
Loop

25. What are we learning?
ò Problems are constantly mutating
ò Agile Manifesto too needs an upgrade!
ò Software agility is necessary…but not
sufficient
ò New methods are needed for innovation-
led new product development
ò Lean Startup is one such method to
deliver kaizen on kaikaku scale

26. References
ò http://www.microsoft.com/windowsembedded/en-us/evaluate/history-of-
windows-embedded-compact-7.aspx
ò http://en.wikipedia.org/wiki/Drupal
ò http://money.cnn.com/galleries/2011/technology/1109/
gallery.apple_financial_empire/7.html
ò http://xprogramming.com/articles/beyond-agile-new-principles/
ò http://www.justin.tv/startuplessonslearned/b/262656520
ò http://www.forbes.com/sites/stevedenning/2011/05/04/innovation-applying-
inspect-adapt-to-the-agile-manifesto/
ò http://blogs.forrester.com/mike_gualtieri/11-10-12-
agile_software_is_a_cop_out_heres_whats_next
ò http://practicalagility.blogspot.in/2012/04/agile-in-its-second-decade.html

27. Thanks!
Blog: http://managewell.net
Email: Tathagat.Varma@gmail.com
Slides: http://slideshare.net/managewell
Twitter: http://twitter.com/TathagatVarma
My Articles: http://managewell.net/?page_id=2