Role of the Agile Leader in Reconfiguring the Business <ul><li>Israel Gat </li></ul><ul><li>Agile 2009 </li></ul><ul><li>C...
Agenda <ul><li>Techno-economic Cycles: </li></ul><ul><ul><li>The Past 11 Months </li></ul></ul><ul><ul><li>The Past 9 Year...
Techno-economic Cycles
The Classical Techno-Economic Paradigm a la Perez  <ul><li>A sequence of events characterizes each of the techno-economic ...
Five Successive  Technological Revolutions Source: Carlota Perez,  Technological Revolutions and Financial Capital  Revolu...
Production Capital    Financial Capital <ul><li>We have witnessed a double bubble: </li></ul><ul><ul><li>Technological bu...
  Revisionist Theory* <ul><li>The historical pattern itself has been disrupted: </li></ul><ul><ul><li>Disruption followed ...
Implications for Strategy
Adapters and Shapers <ul><li>Two schools of thoughts to choose from: </li></ul><ul><ul><li>Adaptive: Winners are those tha...
Malleable Software <ul><li>As software is malleable, it can respond exceptionally well to the demands imposed by turbulent...
Agile Infrastructure <ul><li>Continuous Deployment </li></ul><ul><ul><li>Flickr updates its servers every 30 minutes </li>...
Three Chasms to Cross
Chasm #1: The Customer, the Business and R&D <ul><li>The myth that the required features are known </li></ul><ul><li>The m...
Chasm #2: The Broken Social Contract <ul><li>In 1942, the turning-point year of WWII, 833,000 person-days of coal mining w...
A Social Contract for Agile <ul><ul><li>“ Team, my overarching organizational objective is to preserve our team and its in...
Chasm #3: Cultural Duality <ul><li>By rolling out Agile, you create a cultural duality, possibly a conflict </li></ul><ul>...
Scale Up <ul><li>Likely to be least disruptive up to a point – you will probably stay within the culture in which you alre...
Scale Out <ul><li>In this era you are likely to be adding local culture(s) into the mix – Bangalore, Beijing, Moscow, Sao ...
Scale Downstream <ul><li>Leveraging Agile success in R&D to drive change in downstream functions is an effective strategy…...
Software as Oil
Five Successive  Technological Revolutions Source: Carlota Perez,  Technological Revolutions and Financial Capital  Revolu...
Enormity of the Opportunity <ul><li>Software is becoming pervasive: </li></ul><ul><ul><li>3 billion mobile devices nowaday...
© Copyright 1/11/2009 BMC Software, Inc. The New Economics of Software:  Productivity Index Values by Application Type 0 2...
Software as Oil <ul><li>In conjunction with Open Source Software, Agile software satisfies the four condition required for...
Continuing our Dialog   Israel Gat [email_address] www.TheAgileExecutive.com
Auxiliary Slides
Taxonomy of Core Cultures  8 Actuality Impersonal Possibility Personal <ul><li>Collaboration </li></ul><ul><li>Affiliation...
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Role of the Agile Leader in Reconfiguring the Business

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  • &amp;quot;Implied agreements by which people form a community and maintain relatively stable system of institutions, pattern of interactions and customs.“
  • Role of the Agile Leader in Reconfiguring the Business

    1. 1. Role of the Agile Leader in Reconfiguring the Business <ul><li>Israel Gat </li></ul><ul><li>Agile 2009 </li></ul><ul><li>Chicago, IL </li></ul><ul><li>August 27, 2009 </li></ul>
    2. 2. Agenda <ul><li>Techno-economic Cycles: </li></ul><ul><ul><li>The Past 11 Months </li></ul></ul><ul><ul><li>The Past 9 Years </li></ul></ul><ul><ul><li>The Past 238 Years </li></ul></ul><ul><li>Implications for Strategy </li></ul><ul><li>Three Chasm to Cross </li></ul><ul><ul><li>Customers, Problems, Solutions </li></ul></ul><ul><ul><li>The Agile Social Contract </li></ul></ul><ul><ul><li>Cultural Duality </li></ul></ul><ul><li>Software as Oil </li></ul>
    3. 3. Techno-economic Cycles
    4. 4. The Classical Techno-Economic Paradigm a la Perez <ul><li>A sequence of events characterizes each of the techno-economic cycles : </li></ul><ul><ul><li>Major technological innovation introduces new infrastructure </li></ul></ul><ul><ul><li>The new infrastructure disrupts both industry, commerce, society </li></ul></ul><ul><ul><li>In good time the new infrastructure gets harnessed and becomes a stabilizing force for a prolonged period: </li></ul></ul><ul><ul><ul><li>The technology gets understood </li></ul></ul></ul><ul><ul><ul><li>Confidence builds in the new order that evolves around the technology </li></ul></ul></ul><ul><ul><ul><li>Sufficient “runway” for investments to pay off </li></ul></ul></ul>
    5. 5. Five Successive Technological Revolutions Source: Carlota Perez, Technological Revolutions and Financial Capital Revolution Name Country Initiation Year First The ‘Industrial Revolution’ Britain Arkwright’s mill 1771 Second Age of Steam and Railway Britain The Liverpool-Manchester railway 1829 Third Age of Steel, Electricity and Heavy Engineering USA and Germany The Carnegie Bessemer steel plant 1875 Fourth Age of Oil, the Automobile and Mass Production USA Ford Model-T 1908 Fifth Information/ Tele-communication USA The Intel Microprocessor 1971
    6. 6. Production Capital  Financial Capital <ul><li>We have witnessed a double bubble: </li></ul><ul><ul><li>Technological bubble: </li></ul></ul><ul><ul><ul><li>The Internet Mania and crash of the 1990s </li></ul></ul></ul><ul><ul><li>Financial bubble: </li></ul></ul><ul><ul><ul><li>The easy liquidity boom and bust of the 2000s </li></ul></ul></ul><ul><li>Both are part of the assimilation of successive waves of technological revolution </li></ul><ul><li>(*) Based on Perez, CERF Working Paper No. 31, April 2009 </li></ul>
    7. 7. Revisionist Theory* <ul><li>The historical pattern itself has been disrupted: </li></ul><ul><ul><li>Disruption followed by stabilization is no more the case </li></ul></ul><ul><li>The pace of change in Information and Telecommunication is exponential </li></ul><ul><ul><li>Uncertainty and instability are pervasive </li></ul></ul><ul><ul><li>Sustained periods of prolonged equilibrium are unlikely </li></ul></ul><ul><li>Both business and social systems need to adapt on an on-going basis to turbulent changes </li></ul><ul><li>(*) Hagel, Brown and Davison, Shaping Strategy in a World of Constant Disruption, Harvard Business Review, October 2008 </li></ul>
    8. 8. Implications for Strategy
    9. 9. Adapters and Shapers <ul><li>Two schools of thoughts to choose from: </li></ul><ul><ul><li>Adaptive: Winners are those that can react faster than their competition </li></ul></ul><ul><ul><ul><li> Sense change and respond quickly within the techno-economic cycle </li></ul></ul></ul><ul><ul><li>Shaping: Winners use technology changes to create new business eco-systems </li></ul></ul><ul><ul><ul><li> Alter the industry/market fast as part of non-cyclical universe </li></ul></ul></ul><ul><li>Both strategies critically depend on end-to-end Agility </li></ul>
    10. 10. Malleable Software <ul><li>As software is malleable, it can respond exceptionally well to the demands imposed by turbulent times: </li></ul><ul><ul><li>As an end to itself </li></ul></ul><ul><ul><li>As embedded software </li></ul></ul><ul><ul><li>As part of a business process/initiative </li></ul></ul><ul><li>The higher the embedded software content in a product/process is, the more malleable the whole product/process becomes: </li></ul><ul><ul><li>For example: cellular phones </li></ul></ul><ul><li>End-to-end: </li></ul><ul><ul><li>Development  Deployment  Operations </li></ul></ul>
    11. 11. Agile Infrastructure <ul><li>Continuous Deployment </li></ul><ul><ul><li>Flickr updates its servers every 30 minutes </li></ul></ul><ul><ul><li>[Kent Beck, Trends in Agile Development ] </li></ul></ul><ul><li>[Allspaw & Hammond , 10+ Deploys Per Day ] </li></ul><ul><ul><li>IMVU updates its servers every 9 minutes </li></ul></ul><ul><ul><li>[InfoQ: Beyond Continuous Integration: Continuous Deployment ] </li></ul></ul><ul><li>Continuous Operations </li></ul><ul><ul><li>[ Shafer and Nasrat, Agile Infrastructure , today at 2:00PM, Grand Ballroom A] </li></ul></ul><ul><li>Aligning development with operations and business requires reconfiguring the business </li></ul>
    12. 12. Three Chasms to Cross
    13. 13. Chasm #1: The Customer, the Business and R&D <ul><li>The myth that the required features are known </li></ul><ul><li>The myth that the required features are unknown </li></ul><ul><li>Iteratively discover the customer and define the product in tandem </li></ul><ul><li>Contained cost of experimentation </li></ul>The Lean Startup Steve Blank and Eric Ries
    14. 14. Chasm #2: The Broken Social Contract <ul><li>In 1942, the turning-point year of WWII, 833,000 person-days of coal mining were lost due to strikes in the UK coal industry. </li></ul><ul><li>Even a world war in which the UK was fighting for its life could not compensate for a broken social contract. </li></ul>
    15. 15. A Social Contract for Agile <ul><ul><li>“ Team, my overarching organizational objective is to preserve our team and its institutional knowledge for our corporation and its customers for years to come </li></ul></ul><ul><ul><li>We will achieve this goal by enhancing our software engineering prowess to the level that the resultant benefits will outweigh the repercussions of the current financial crisis </li></ul></ul><ul><ul><li>The state of the Agile art should enable us to attain hyper-productivity </li></ul></ul><ul><ul><li>In the event that we fail to accomplish hyper-productivity and our assignments fade away, you will find the Agile skills you developed much in demand in the market </li></ul></ul><ul><ul><li>Whether you will or will not be with the company in the future, I acknowledge your need to develop professionally as an Agile practitioner and commit to invest in your education/training” </li></ul></ul><ul><li>  </li></ul>
    16. 16. Chasm #3: Cultural Duality <ul><li>By rolling out Agile, you create a cultural duality, possibly a conflict </li></ul><ul><ul><li>Culture =“how we do things around here in order to succeed” </li></ul></ul><ul><ul><ul><ul><ul><li>[Schneider, 1994] </li></ul></ul></ul></ul></ul><ul><ul><li>The Agile Manifesto =“how we do software in order to succeed” </li></ul></ul><ul><li>The cultural duality/conflict intensify at scale </li></ul>
    17. 17. Scale Up <ul><li>Likely to be least disruptive up to a point – you will probably stay within the culture in which you already demonstrated success </li></ul><ul><li>Furthermore, you are likely to be able to use the same Agile infrastructure </li></ul>
    18. 18. Scale Out <ul><li>In this era you are likely to be adding local culture(s) into the mix – Bangalore, Beijing, Moscow, Sao Paolo, etc. </li></ul><ul><li>Fully Distributed Agile might not be optimal, but their use is inevitable in an era characterized by off-shoring and outsourcing </li></ul>
    19. 19. Scale Downstream <ul><li>Leveraging Agile success in R&D to drive change in downstream functions is an effective strategy… </li></ul><ul><li>… as long as you are mindful of the cultural boundaries you are crossing </li></ul><ul><li>Classical cultural clash between development and IT: </li></ul><ul><ul><ul><li>Agile vis-a-vis ITIL </li></ul></ul></ul>
    20. 20. Software as Oil
    21. 21. Five Successive Technological Revolutions Source: Carlota Perez, Technological Revolutions and Financial Capital Revolution Name Country Initiation Year First The ‘Industrial Revolution’ Britain Arkwright’s mill 1771 Second Age of Steam and Railway Britain The Liverpool-Manchester railway 1829 Third Age of Steel, Electricity and Heavy Engineering USA and Germany The Carnegie Bessemer steel plant 1875 Fourth Age of Oil, the Automobile and Mass Production USA Ford Model-T 1908 Fifth Information/ Tele-communication USA The Intel Microprocessor 1971
    22. 22. Enormity of the Opportunity <ul><li>Software is becoming pervasive: </li></ul><ul><ul><li>3 billion mobile devices nowadays touch the Internet </li></ul></ul><ul><ul><ul><ul><li>[Joshua-Michele Ross, The Rise of the Social Nervous System ] </li></ul></ul></ul></ul><ul><li>Software is quickly becoming the biggest component in many products in which it is embedded </li></ul><ul><ul><li>Each of the aforementioned 3 billion mobile devices probably contains about 1 million lines of code </li></ul></ul>
    23. 23. © Copyright 1/11/2009 BMC Software, Inc. The New Economics of Software: Productivity Index Values by Application Type 0 2 4 6 8 10 12 14 16 18 20 22 24 Productivity Index (PI) w/ ±1 Standard Deviation   Source: QSM Associates, July 2007 Business Information Command and Control Process Control Scientific System Telecommunications Engineering Avionics Microcode Real Time Real Time 28 26
    24. 24. Software as Oil <ul><li>In conjunction with Open Source Software, Agile software satisfies the four condition required for an input to become a key factor in a technological revolution: </li></ul><ul><ul><li>“ Clearly perceived low - and descending - relative cost </li></ul></ul><ul><ul><li>Unlimited supply for all practical purposes </li></ul></ul><ul><ul><li>Potential all-pervasiveness </li></ul></ul><ul><ul><li>Capacity to reduce the cost of capital, labor and products as well as to change them.” </li></ul></ul><ul><li>(*) Source: [Perez, 2002] </li></ul>
    25. 25. Continuing our Dialog Israel Gat [email_address] www.TheAgileExecutive.com
    26. 26. Auxiliary Slides
    27. 27. Taxonomy of Core Cultures 8 Actuality Impersonal Possibility Personal <ul><li>Collaboration </li></ul><ul><li>Affiliation </li></ul><ul><li>Family/Athletic team </li></ul><ul><li>Nurse </li></ul><ul><li>Control </li></ul><ul><li>Power </li></ul><ul><li>Military </li></ul><ul><li>Surgeon </li></ul><ul><li>Competence </li></ul><ul><li>Achievement </li></ul><ul><li>University </li></ul><ul><li>Research scientist </li></ul><ul><li>Cultivation </li></ul><ul><li>Self-actualization </li></ul><ul><li>Religious institutions </li></ul><ul><li>Minister, priest, rabbi </li></ul>Source [Schneider, 1994]

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