The End of Waterfall

In this current era of uncertainty and unstable global economy, business agility plays an instrumental role in strategic portfolio management and execution of the associated epics. Delivering constant value to customers while embedding the agile mindset in the core operating model, people and culture remains the biggest challenge of many organizations out there. Being resilient, adaptive and innovative would allow businesses to better respond to the volatility of the market/economy and sustain their competitiveness.

The traditional waterfall methodology born from a manufacturing process in the early 70s breaking down the project activities into linear sequential phases is not usable any longer in today’s market, and we will certainly see the end of waterfall in the next years. Projects do not need a process driven lifecycle but a framework that embraces and stimulates people centricity coupled with a customer success mindset and flow of value. Waterfall and its rigidity can become a barrier to forward thinking in businesses where the innovation and speed to market are the fundamental components of existence.

Constant Market Disruptions Leading to Agile Adoption

Since Waterfall model was born, market has gone through a considerable number of disruptions pushing businesses to become less predictive and explore agile ways of working.

The introduction of the World Wide Web in 1989 resulted in a pressure on companies to think about digital transformation which then became the trendy concept from 2000 onwards.

With the massive digital transformation underway and acceleration of changes in business and IT operating models, other frameworks and guidelines have emerged to support the complexities associated with the lift and shift of the processes, legacy systems/applications and information repositories.

Emergence of DevOps in 1993, introduction of TOGAF in 1995, release of COBIT in 1996, production of Agile Manifesto in 2001 coupled with Lean, Kanban, Scrum and publication of ITIL glossary in 2006 were some of the early accelerators of the digital agenda.

Furthermore, as the size of the global change became very visible, large organizations started to apply large-scale Scrum, disciplined agile delivery and Scaled Agile Framework (SAFe) to holistically address lean-agile software/ product development and system thinking.

Today, market demand and customer behavior are constantly changing preventing businesses from being able to come up with a strategy and fixed scope and execution plan. Products and services must continuously grow and be developed in a flexible and innovative manner so that the flow of value and speed to market remain immediately transformable as environmental factors shift.

While Agile has become impressively popular, many businesses are still not well equipped and ready to accommodate the mindset shift in their business models.

Statistics show that 52% of the projects worldwide use Agile Scrum to accelerate product delivery, 25% are working in a hybrid framework (Watergile) and 23% are still delivering in Waterfall method.

In June 2020 during the Global SAFe Summit, Chris James, CEO of Scaled Agile Inc. referred to the study conducted by McKinsey & Company outlining that 93% of business units that had fully adopted an agile model before the COVID-19 pandemic did better than the ones that hadn’t. The full point of view can be found here:

https://www.mckinsey.com/business-functions/organization/our-insights/an-operating-model-for-the-next-normal-lessons-from-agile-organizations-in-the-crisis

Business Attitude Changes during Economic Downturns

During important market crisis, key decision makers focus on three major areas to prioritize their projects:

• Cost savings: Leaders ensure labor costs are effectively very low and variable expenses are fully under control.
• Shift in priorities: In times of crisis, organizations launch mandatory projects, such as regulatory reporting and compliance, and in parallel, they require a faster return on investment and quick wins for non-material projects.
• Short-term planning: Business leaders want to be more adaptive and productive. Today, leaders holistically avoid long term projects that could potentially be stopped or put on hold because of external factors that are not under their control.

On top of these three areas of focus, organizations constantly consider PESTLE framework for strategic business planning.

The pressure on business benefits expected from projects is higher than before and they must be tangible and bring in revenue streams or provide cost savings. Many institutions have accelerated the automation and digital transformation journeys to better survive in their market segments. For some, COVID-19 was a wakeup call to just start their digital journey. 

Pioneering the use of cutting-edge technologies, such as Cloud Computing, Robotic Process Automation, Machine Learning, Deep Learning and AI can optimize business and finance operations.  

Coupling emerging technologies with intelligent and scalable management information systems and business intelligence solutions provides real-time decision-making possibilities to stakeholders up, down and across the organization. Centralizing capabilities and expertise can achieve economies of scale, such as building shared service centers, Agile PMOs or centers of excellence.

There are other areas of focus in agility such as the trend in streamlining risk, regulatory and compliance processes triggered by financial crisis overtime, predictive modelling to enrich insights and inject behavior analytics to optimize human interactions in the business contexts. No matter where the businesses start from, data is and will be the oil for these important journeys.

A Progressive Mindset for Continuous Improvement

Progress iteratively with feedback is one of the ITIL guiding principles which aligns with the agile principle of delivering working software frequently. The greatest enemy to progressing iteratively is the desire to understand and account for everything. This can lead to what is sometimes called ‘analysis paralysis’, in which so much time is spent analyzing the situation that nothing ever gets done about it. Understanding the big picture is important, but so is making progress.

In a waterfall model, the degree of upfront understanding and freezing of the requirements is so high in the analysis phase that the project stagnates and does not evolve. This is preventing business from reaching continuous improvement mindset, product innovation and business agility.

Modernize Your Organization with Incremental Achievements

The agile framework helps organizations measure, manage and increase the value they derive from projects and or product delivery. It improves outcomes, reduces risks and optimizes investments in projects.

Whether your organization is embarking on a major transformation journey or looking to readily comply with a regulatory or financial reporting need, work with a solution that will give you quick wins. Prioritize opportunities based on your strategic themes driving your portfolio backlog. Adopting value stream mapping helps you derive better business value from your initiatives while identifying waste, reducing cycle time and implementing process improvements.