The document discusses three perspectives to Agile leadership: system, purpose, and people. It argues that leaders should view the organization as a system and focus on improving system conditions, such as processes, tools, and culture. Leaders should also define a clear purpose based on customer demand and value. Additionally, change is best achieved through experiments that educate people rather than coercive processes. The goal of Agile leadership is to study and improve the system, create a shared purpose, and promote continuous learning.

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Three perspectives to Agile Leadership
Sami Lilja
Agile Coach and Certified Scrum Trainer
Reaktor
Helsinki, Finland
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About me
• Sami Lilja, coach and trainer
• Reaktor since March 2011
• Certified Scrum Trainer since July 2013
• Before Reaktor, 15+ years experience at Nokia Networks and
Nokia Siemens Networks
• SW engineer 1994-1998
• 10+ years management experience: Project manager, Department
manager 1997-2008
• Assignment in China (Hangzhou) 2005-2007
• Agile coach 2008-2010
• Contact and connect
sami.lilja@reaktor.fi LinkedIn: samililja
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Purpose
People
Three perspectives to Leadership
System
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System
Systems Thinking
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5. ”
© Reaktor 2013
A system is not the
sum of its parts but
the product of their
interactions
- Russell Ackoff
What is System
• Collection of parts that
are interdependent.
• The parts interact in a
such a way that it affects
the capabilities and
qualities of the entire
system
• System has a purpose
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How can we see the system?
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System conditions are direct
or indirect results of the design
and management of work.
System conditions
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Some system conditions
Processes Training
Existing source code
Stage gates
Tools
Organizational
structures
Policies
Governance
Bonuses
Existing source code
IT systems
Physical working
environment
Quality of
requirements
Project model
Relationship with
customers
Culture of high
utilization rate Technologies
Approval chains
Missing feedback
Metrics
Roles and
responsibilities
Meetings
Outsourcing and
off-shoring
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System conditions
System conditions drive the
performance of organization
Improving the work requires at
least some system conditions are
changed
System conditions tell us about
management thinking
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Little’s Law and work-in-progress
Time through system =
Work-in-progress
Throughput
Little’s Law
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Why limit Work-in-Progress?
• Limiting Work-in-Progress creates Pull
• Without WIP limits, we do not know when to
take (pull) new work
• Pull system..
• Creates visibility to system and reveals
bottlenecks
• Removes queues from the system
• Creates slack for innovation and improvement
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Organizations are systems
• Improvement should focus on the System
as a whole, not parts taken separately
• Interactions are more important than components
• In order to improve the System, at least
some System Conditions need to change
• Systems have Purpose
• Improvement is aimed towards the Purpose, from
customer perspective
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Purpose
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Purpose
Purpose
Measure
Methods
Purpose is the reason for
an organization to exist
It defines from customer
perspective what (and
how) is Value
Purpose is derived from
customer Demand
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16. © Copyright Reaktor 2011 Confidential
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1. Eliminate
causes of
failure
demand
2. Shape
Demand
1
Most significant improvement is on this side!
Create FLOW
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Value demand and failure demand
Value demand
Adds value to our product or
service from customer point of view.
Something customers are willing to
pay for.
Failure demand
Failure to do what customer needs.
Bad quality, delay, wrong product or
service. No product or service.
Missing either what or how customer
wants the service or product.
Can account up to 80% of work
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Measurements
• Measure against the Purpose of the
organization
• From customer perspective
• Look at variation and trend over time
• Allows learning
• Measure to understand and improve
• Instead of arbitrary target, bonus or competition
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Measurements
• Measure against the Purpose of the
organization
• From customer perspective
• Look at variation and trend over time
• Allows learning
• Measure to understand and improve
• Instead of arbitrary target, bonus or competition
Are we achieving the
Purpose of the system?
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Purpose: Summary
• Organizations have purpose
• “What” and “How” it creates value for customer
• A good Purpose creates alignment, motivation
and allows sensible measurement
• Study demand to understand Purpose
• Organize work to produce Value Demand
• Study causes of Failure Demand and remove
those
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People
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© Reaktor 2013
John Seddon
People issues are not the point of
intervention.
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So, what is the point of intervention?
We need to change System
Conditions to that the System
can better respond to Value
Demand
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Process Improvement?
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Process Improvement?
Do we need this process at all?
What kind of thinking has
created this process?
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System
Thinking
Performance
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Change strategies
• Power-Coercive
• Obliges compliance and punishes failure
• Standards, best practices, process roll-outs
• Empirical-Rational
• “I explain and you follow”
• Works if thinking has already changed
• Can lead to argument or conflict
• Normative-Reeducative
• Change thinking through action and observation
• Get knowledge before planning actions
Chin and Benne: General
strategies for affecting change in
human systems (1969)
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Change strategies
• Power-Coercive
• Obliges compliance and punishes failure
• Standards, best practices, process roll-outs
• Empirical-Rational
• “I explain and you follow”
• Works if thinking has already changed
• Can lead to argument or conflict
• Normative-Reeducative
• Change thinking through action and observation
• Get knowledge before planning actions
Chin and Benne: General
strategies for affecting change in
human systems (1969)
Agile
Transformation
Training,
workshops
Study and
understand
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Experiments
Team
Product
Owner
Sprint
Planning Sprint Review
and Retro
Potentially
Shippable
Product
Increment
Product
Backlog
Every Sprint is an experiment!
Learning and adapting requires moving from
fail-safe design to safe-to-fail experiments
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Roll-in vs. Roll-out
• Roll-out: developing an improved process, standardizing it
and applying it to other areas.
• Problems
• The solution is not optimized for each specific context
• The other units have not been through the same learning --> lack
sense of ownership, loss of control and resist change.
• Roll-in: A method to scale up a change to the whole
organization that was successful in one unit.
• Change is not imposed. Instead, each area needs to learn how to
do the analysis for themselves and devise own solutions.
• Engages the people and creates better, more sustainable solutions.
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Agile Leadership is about studying and
improving the System, creating Purpose
and learning through experiments
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Agile Leadership is about studying and
improving the System, creating Purpose
and learning through experiments
Purpose
People
System
•Study and understand how the work
works
•Change unwanted System conditions
•Limit WIP and create Flow
•Study demand and what matters to
customer
•Remove sources of Failure Demand
•Organize work againstValue Demand
•Create Pull system to achieve Flow
•Alignment and motivation come from
clear Purpose
•Do experiments to learn
•Roll-in good ways of working, avoid
“roll-out” harmonization
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Thank you!
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