A Great Need for Change, Increasing Complexity, and Declining Productivity in R&D
The demands on companies are growing: software-centric development, artificial intelligence, cultural change, and increasing global competition are pushing R&D organizations to their limits. Today, innovation must be faster, more customer-focused, and more cost-effective—but this often doesn’t align with existing, rigid structures.
What’s going wrong?
1. Complexity: Projects are delayed, budgets spiral out of control, and quality issues are on the rise.
2. Resource utilization: Shortages of subject-matter experts and efficiency losses due to highly parallel task processing in a complex project landscape.
3. Silo mentality: A lack of collaboration and misguided incentives prevent a seamless value stream.
4. Hierarchy: Rigid hierarchical structures slow down decision-making.
The result: frustrated employees, inefficient organizations, and stagnant innovation.
But it doesn’t have to stay that way!
Scaled Agile: The Game-Changer for Development!
Agility and agile product development have often been the subject of controversy over the past 10 years. However, agile working has proven its worth and has become established in many companies—from individual teams all the way up to agile organizations. Numerous studies, such as the“Agile Development of Physical Products 2018–2023” report by the University of the German Armed Forces in Munich, demonstrate why it is still—or perhaps especially now—a good idea to work in an agile manner.
What positive effects are companies citing today?
Let’s just take the top 3 mentions:
1. Higher customer satisfaction
Higher customer satisfaction results from involving customers early and regularly, as well as identifying customer needs in the early stages of product development. Not only is the customer-centric identification of product requirements through use cases for the user application valuable and effective, but so are methods such as design thinking and user involvement. Likewise, customer process monitoring can lead to valuable new approaches. In this process, the customer is not asked questions but is observed in order to better understand their usage process and identify issues that can be resolved through new product features or functions. In an agile setting, customers are also regularly involved in demos and reviews to process direct feedback immediately in the early stages and enable prioritization. Ultimately, these efforts result in a customer-centric approach that significantly increases the product’s success.
2. Reduction in development time
In complex technical development projects, one of the biggest challenges is having the right experts available at the right time during the project. That’s why there’s usually a project plan in which resources are planned and allocated. However, since many projects are managed simultaneously and changes often need to be accommodated due to volatility, the planning—to put it mildly—is usually less than ideal. Furthermore, the belief in a plan often outweighs the realization that one must react quickly to changes.
In scaled agile product development, projects are not managed based on optimal employee utilization, but rather on the optimal output of the development organization. This means that immediate support is provided to every project along the critical path. This ensures that projects that are started can actually be completed as quickly as possible. This speed, in turn, creates room for new projects. The priority, therefore, is speed over parallelism and output over utilization. As a result, productivity increases.
3. Increasing Profitability
When projects are completed faster, development costs are generally optimized as well. Thanks to improved communication within the project—achieved through the timing of events, iterations (sprints), and improvement cycles (retros)—the system is self-improving. As employees take on more responsibility, decision-making speeds up—specifically where the information is. Employees get into the flow and become more satisfied, which in turn boosts team performance. We’re in an upward spiral! With well-scaled product development, an overall higher output of projects will soon follow the introductory phase, enabling more products and developments that generate revenue and contribution margin.
How do companies get started with Scaled Agile?
The adoption of Scaled Agile is not a “one-size-fits-all” approach. However, most companies follow a proven three-step model:
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Phase 1: Individual Agile Teams
The agile transformation should begin with a limited number of particularly challenging pilot projects—so-called “problem projects”—that can address the following challenges: shortages of subject matter experts, efficiency losses due to parallel work, and the complexity of a multifaceted project landscape. If these projects are successfully implemented using agile methods, it sends a strong signal: it proves that agility works and creates a solid foundation for further change. To address these challenges, it is advisable to bring in experienced Agile coaches or Scrum Masters who can ensure the smooth implementation of the transition.
Stage 2: Multiple Agile Projects
Following successful pilot projects, the next step is typically to scale up the size of the projects and the scope of the departments involved. This means that larger projects involving many teams, as well as multiple projects running in parallel and various functional departments, are also brought into the agile framework. This has far-reaching implications for the work model, system architecture, capacity planning, and the role model. Work tools are also typically adapted.
Level 3: Fully Scaled Agile Organization
In this phase, in addition to the elements mentioned above, project portfolio planning and the organizational structure are also considered. The goal is to better align corporate objectives, product strategies, and the project roadmap. Central to this is an agile (comparative) evaluation process designed to prioritize the right projects while keeping the effort involved as low as possible. To ensure that new projects can be launched efficiently, they are developed during an “Excellent Preparation Phase” to the point where they can be “pulled” (not “pushed”) into the development pipeline at any time. It is also important to adapt the organization to optimally support the new working model and avoid silo thinking.
What is the key to success?
For scaled agile product development, there must be a vision, a North Star, a clear direction. The range of possibilities is too broad to leave this to chance. The vision must be broad enough to provide an overview and detailed enough to clearly identify the interconnections. It must also align with the company. Studies have consistently confirmed that organizational adaptation is also helpful in achieving the goals of agile transformation and fully realizing its benefits.
The target vision should include the five pillars of scaled agile product development:
1. Architecture
The product architecture plays a major role in project organization. The system, module, and component levels are taken into account in an agile setting.
2. Processes and Artifacts
Requirements management, architecture management, verification, and validation through to system integration are taken into account, and existing artifacts (e.g., checklists and deliverables from the product development process) are utilized, thereby drawing on existing experiential knowledge.
3. Roles and Responsibilities
The new agile roles are mapped to and added to the role model so that responsibilities within the new structure are clear and understandable.
4. Heartbeat / Rhythm / Meetings
Sprinting becomes the heart of the meetings; stage planning provides direction and transparency, and everyone pulls together.
5. Fundamental Principles
Managers are evolving into servant leaders who help their employees take on more personal responsibility and build confidence. An agile mindset helps focus on customer value and makes lean development “good enough”—even if that means taking an unconventional approach at times.
Conclusion: Why Now Is the Right Time for Scaled Agile
The challenges in R&D are significant, but with Scaled Agile, companies can successfully overcome them. The 3DSE process model offers a clear solution to increasing complexity, time pressures, and cost pressures—and helps them remain competitive.
Roll up your sleeves and get started! Get your employees excited about the new method. In an awareness workshop where you explain agile work to your employees, you’ll give them the opportunity to discover this way of collaborating in a fun and engaging way. Take the first step and let your employees decide whether they want to try out the approach for themselves. Then your organization will have a solid foundation for change!
Take the next step: Contact us to learn more about
Scaled Agile and how you can implement it in your company.
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