Jory MacKay
Jory is a writer, content strategist and award-winning editor of the Unsplash Book. He contributes to Inc., Fast Company, Quartz, and more.
August 02, 2022 · 14 min read

The 10 steps to an Agile transformation (with free checklist)

🎁 Bonus Material: Free Agile Transformation Checklist

The 10 steps to an Agile transformation

For most development teams and startups, ‘becoming Agile’ starts and ends with how you build software. But a full Agile transformation isn’t just about the development process you use — it’s a way to bring creativity, innovation, and lean operations to every aspect of your business.

There are massive benefits to becoming an Agile organization (which is why companies like PayPal, Spotify, and Adobe have all undergone Agile transformations). But unfortunately, few companies can pull it off.

According to research published in Harvard Business Review, nearly 90% of companies struggle to complete Agile transformations — even after successful pilot projects.

In this post, we’ll cover the path to becoming more Agile across your entire organization, from creating cross-functional teams to reducing old and outdated processes and renewing (or even shifting) your focus on the customer.

Jump to a section:

What is an Agile transformation?

An Agile transformation is when an organization shifts to an Agile approach across all departments, processes, and structures.

This means embracing an iterative and customer-centric focus on all levels of the business, from how you build software to how you organize and run your customer support team, performance reviews, and growth strategies.

But this is where most companies get confused about Agile transformation.

Most people’s only interaction with the Agile methodology is through software development. Therefore, a transformation gets seen as simply applying Scrum or other Agile methods to your same working style and culture.

But “doing” Agile (what some people call Agile adoption) isn’t the same as living and breathing it.

Agile Transformations Are: Agile Transformations Are Not:
Company-wide transformations: A true transformation touches all aspects of your business, including people, processes, strategy, structure, and technology. “Doing” Agile: Many companies mistake “adopting” a few Agile principles with a full transformation. If your customer support team starts doing sprints and following Scrum, that isn’t a transformation.
An iterative process: Changing your way of working won’t happen overnight. Agile transformations usually start with small pilot projects or grassroots campaigns that slowly work through the organization. Instant transformations: Attempting to pull off a top-down, all-at-once Agile transformation will likely blow up in your face. Transforming means living the Agile principles. Not creating rules and structures that won’t last.
Culture shifts: The key to a successful Agile transformation is education. Teams need to understand why the change is happening and how it will impact them. There might be pushback, so you need top-down support from a cultural perspective. A set of strict rules and processes that replace your old ones: Agile organizations need to be flexible. If you apply the same process that works for your development team to your sales team, you’re not guaranteed to see the same results.

If you’re a little confused right now, that’s OK.

Reading about Agile transformations from business consulting firms like McKinsey can make it sound like you have to throw your current system in the trash and relearn everything you know about running your team or company. (And this might be the case at massive organizations trying to shift to Agile).

But for most team leaders, founders, and CEOs, the shift to becoming an Agile organization comes down to a few key aspects:

Before deciding whether you want to commit to a full Agile transformation, think if these values and principles fit within your organization.

What does an Agile organization look like?

It can be difficult to picture what an Agile organization looks like in practice. Is your executive team planning sprints and doing user testing? Are your sales reps taking an iterative approach to their sales calls?

Let’s take a step back from the detailed look at how Agile works across your company and start with the fundamentals.

Traditional companies are built around silos and hierarchies. The decisions come from the very top and (hopefully) trickle down. Teams work on their own and rarely get the opportunity to collaborate or share learnings. Instead, you’re likely to find an army of managers and VPs whose job is to connect the dots and make sure you’re all working towards the same goals.

On the other hand, an Agile organization is lean and constantly adapting to the customer’s needs and the business’s goals. Instead of top-down commands, the organization follows a common purpose. Instead of siloed teams and information-hoarding VPs, you get cross-functional teams and an emphasis on sharing the right metrics.

According to McKinsey & Company (the massive business consulting firm that has also become major supporters of Agile), a truly Agile organization focuses on five key factors:

  1. Strategy: Agile organizations embrace North Star metrics and goals and share them throughout the company. This way, no matter what team you’re on, you know your purpose, why your work matters, and how you can improve the company.
  2. Structure: The focus shifts away from a top-down hierarchy (Executives, SVP, VP, Manager, etc.) and toward a network of highly functional teams. Agile organizations reduce their levels of management and try to ‘get out of the way’ and let their teams be successful.
  3. Processes: Agile organizations are characterized by rapid decision-making, experimentation, and quick learning cycles. Data and metrics are the ‘single source of truth’ and are shared throughout the organization.
  4. People: Agile organizations are always changing, and their workforce needs to be able to adapt and grow with those changes. Leadership becomes coaches rather than directors and should be open to teams challenging the current culture.
  5. Technology: Agile organizations need to trust their data and have the infrastructure ready to build and test new ideas rapidly. Technical debt is allowed if it means taking a big swing with a product idea, but the goal is to have a solid foundation that anyone can build off.

The 5 major benefits of becoming an agile organization

Agile transformations touch every aspect of your business. And when done correctly, you should see company-wide benefits in return. So, what should you expect to see after all this hard work?

The 5 major benefits of becoming an agile organization

1. Better cross-team collaboration

An agile transformation should break down silos and bureaucratic red tape that slow down organizations and cause confusion, double work, and missed deadlines. Agile teams also prioritize face-to-face interaction and continuous interaction between members. There are regular (effective) meetings to help everyone work towards their shared goals.

2. A shared purpose that boosts motivation

Agile organizations share values and understand their North Star metrics. Instead of getting caught up in the minor details, they’re able to focus on the bigger picture. Not only does this make your teams more effective, but a shared purpose is one of the biggest drivers of team motivation.

3. Renewed focus on your users and customers

There’s no doubt now that customer-centric companies are more successful. Agile transformations put the customer back at the core of your strategy through better user research, constant feedback, and an openness to learning.

4. Higher ROI on all your efforts

Agile organizations get better results with less effort. When your organization is built to learn quickly, adapt, and pivot, you spend less time and resources on wasted efforts. In just one example, Adobe’s Agile transformation led to a 30% drop in voluntary turnover (meaning their best team members were staying) and savings of 80,000 management hours annually.

5. More creativity and innovation

The goal of any Agile process is to help you learn faster and unlock innovation. When you can apply those same principles across your entire company, it’s a game-changer. Agile organizations are constantly on the hunt for the next great idea instead of feeling stuck with doing ‘business as usual’ or ‘what worked in the past’.

An agile transformation should break down the bureaucratic red tape that slows down your organization.

Agile transformation roadmap: 10 steps to embracing Agile

Agile transformations are challenging for both team members and managers. Follow these 10 steps to start down the path towards becoming a more Agile company:

1. Take stock of where you are now

Any change starts with understanding your current state.

Before you embark on an Agile transformation, take stock of where you are now. Ask questions such as:

It’s a good idea to do a ‘listening tour’ throughout your company. Meet with stakeholders, team leaders, and individual members to hear what they think about Agile.

What do they know? Are they excited about this change? Or does it seem like just another bureaucratic project that will get in the way of the ‘real’ work?

You can also use popular user research methods, such as surveys, diary studies, or card sorting. The goal is to collect as much information as possible about where you are now so you can plan a successful path to where you want to be in the future.

2. Build a leadership team that can get your required buy-in

Next, ask who will lead this transformation?

An Agile transformation will change every part of an organization and needs support from top leadership. Executives and stakeholders need to be aligned and onboard in action and in words.

Put together an internal leadership team that will drive the transformation forward. Depending on the size and structure of your company, this could include the founder, CEO and other executives, select managers and team leaders, and influential individual contributors, such as senior project managers, lead developers, and Scum masters.

You could also visit companies that are already on successful Agile journeys. Ask them about the core practices worth following and some pitfalls to avoid. You can even attend Agile conferences to meet with leaders and hear about their experiences.

3. Create an Agile blueprint for your company

With a team in place and a deep understanding of where you are now, it’s time to define what you want to get out of this Agile transformation.

An Agile transformation won’t succeed if you’re only trying to remove specific pain points. Instead, everyone needs to be aligned on the goal of fundamentally transforming your company for the future.

But what does that future look like? An Agile blueprint can help you define your ultimate goal and how you’re going to get there.

According to McKinsey:

“The blueprint for an agile operating model is much more than an organization chart and must provide a clear vision and design of how a new operating model might work.”

There are five steps to creating an Agile blueprint. These should initially be done in a fast, iterative manner to get your company building and learning (in an Agile way!)

  1. Value: Where does your company create value? How can you differentiate yourself? Start with an understanding of products, features, or processes that can benefit from an Agile approach and how those will impact your North Star metrics. Revisit your product strategy documents if you don’t know where to start.
  2. Structure: How will your Agile company be organized? Agile organizations use cross-functional teams (sometimes called ‘cells’ or ‘tribes’) focused on common goals. Create a rough guide to how these teams will work together, what they’ll focus on, and how are different skill sets owned and managed.
  3. Agile teams: Next, decide how to group these teams or ‘cells’ together. How will they be managed? What goals or missions are they going to be aligned on? What Agile processes will they use (or what ones are best suited to their goals?) Don’t just stick people together and tell them to use a new process. Help them discover the Agile elements that work best for the value they’re trying to create.
  4. Backbone: Agile transformations need a strong foundation. What structural factors will need to be adjusted, updated, or thrown out for this to work? Think about everything from team structures to IT projects, communication processes, and culture. Many Agile companies fail by only focusing on launching more Agile teams and not giving them the structure they need.
  5. Roadmap: Finally, define your scope and pace of the transformation. Treat this like any other Agile project by defining a backlog of ‘tasks’ and a sprint schedule you can follow to make sure you’re hitting your goals.

Together, these steps give you everything you need to start your Agile transformation. But we’re not ready to fire the starting pistol quite yet.

4. Decide how you’ll implement your Agile transformation roadmap

How you roll out Agile across your company can make or break this transformation. Based on what you’ve learned in your own research, choose the implementation model that you think will work best:

How to implement your Agile transformation roadmap

There’s no ‘right’ way to roll out your Agile transformation. Use your judgment and follow the path that seems right for you. You can always adjust and pivot along the way.

5. Start with an Agile pilot project

Almost every major transformation starts with a pilot project. This isn’t just to ‘prove’ that Agile works at your company. Instead, it’s a testing ground to see how engrained your current processes are (and how much resistance you’ll come up against when you push for a company-wide rollout).

Choose a pilot project that will create value for your company (as defined in your blueprint). Then bring a team or group of teams together to focus on it.

Give your pilot project an end deadline to start. Most teams begin with a rolling 90-day plan, which gives them enough time to plan projects, get feedback, and adjust as they create value. Make sure to conduct 30-day check-ins to assess how the pilot project is going and make any necessary changes.

As part of your pilot project, you may need to go through additional training and coaching. This is ok. Ensure everyone has the resources they need — both people and technical — to do their jobs.

Pro tip: Use the right technology to empower your Agile teams. Project management software like Planio is designed to work with you and help guide you through your Agile transformation.

In Planio, you can create a backlog of tasks and then plan sprints and see them on Agile boards. This way, everyone can see exactly what’s being worked on — no matter what team they’re on.

Agile board showing who is doing what work

Agile pilot projects also help you prove the value of an agile transformation –– before you can roll out transformation across the entire organization, you might need to convince skeptical stakeholders and get buy-in across the board.

6. Scale and improve your Agile processes

After a successful pilot project, it’s time to think about how you can scale Agile throughout your company. But this is no easy task. Most companies can perform a few small successful Agile projects but fail when they try to replicate those results across teams (especially customer-facing ones, such as support and sales).

Depending on your transformation model (step-wise, all-in, emergent), you might scale differently. However, there are some key elements that can help you scale your Agile efforts:

  1. Define end-to-end value streams. Rather than scale across departments, think about where you create value. Are there customer journeys or user stories that can be the focus of cross-functional Agile teams? The more pieces of your organization that use Agile, the more it will become a part of your overall culture.
  2. Develop a solid communication plan. Transparency is critical to the success of your transformation. Think about how you can scale up communication and bring more teams together. If your company was previously defined by siloed teams, this may seem awkward at first. But push to bring people together through monthly ‘Town Hall’ meetings or optional ‘lunch and learns’. Get stakeholders involved as much as possible to show that this project has support from the top.
  3. Shift goal-setting from teams to individuals. Agile organizations empower their team members to create their own goals and self-manage their work. Help management (and project managers) shift from dictating goals and KPIs to becoming ‘servant leaders’ — the Agile term for leaders whose goal is to serve.
  4. Replace outdated or non-Agile processes. Gradually reduce and then eliminate any old practices and processes that go against your new Agile ones. This could include goal-setting exercises or meeting cadence. Replace these overtime so you don’t catch your team members off guard. And remember, always explain why these changes matter (and ask for feedback).

7. Update your ‘backbone’ to support the agile transformation

Pilots often exist on their own and succeed in spite of regular processes. But your company's ‘backbone’ will determine if you can scale Agile throughout.

A backbone includes how decisions get made, where resources and budget get allocated, how risks are managed, and even the technology infrastructure you use. Each of these will need to change in order for a successful Agile transformation.

Here are some key points to consider:

An Agile transformation won’t succeed if you’re only trying to remove pain points. Instead, everyone needs to be aligned on the goal of fundamentally transforming your company for the future.

8. Bring in ongoing training

Successful long-term agile transformation depends on continuous learning. No team member can know everything about agile methodology from the onset. Think about how you can work consistent training into your organization's structure and company values.

This could mean creating internal resources like an Agile knowledge base or hiring coaches to train leaders.

It’s a good idea to formalize these educational processes so your team knows what’s expected of them (and to help bring new hires quickly up-to-speed). Set monthly or quarterly objectives and reward team members for their work.

Pro tip: Create an internal knowledge management system. Planio’s wikis keep your organization’s processes and knowledge in a shared central location that anyone can access.

Internal knowledge management Wiki

9. Make Agile a part of your company culture

Your pilot project, scaling efforts, and backbone will give you a successful start. But the only way an Agile transformation sticks is if your culture changes along with it.

Think about how your company culture and values can change throughout this process to reflect your new focus on agility.

Here are a few questions you can start with:

  1. How will your values change to reflect the Agile transformation?
  2. How will leadership act in order to support this change?
  3. How will you continue through the rough patches and chaos of any major change?

You might not have all the answers. And that’s OK. The goal is to continually listen to your team, look at your metrics, and adjust your Agile transformation roadmap.

10. Plan for the challenges you’ll face moving forward

Any kind of company-wide change will not be without its challenges. And a full-scale Agile transformation is no different.

The good news is that tons of companies have gone through successful transformations, despite the common roadblocks and challenges. In almost every case study of a successful (or failed) Agile transformation, these five challenges came up:

  1. There’s too much resistance to change. Some companies just aren’t ready for major changes. If your company views the transformation as another ‘job’, they’re not going to invest in it. Sell the benefits of Agile to everyone. This is a new way of working that will improve their lives. If the company is successful, they’ll be rewarded.
  2. Agile teams end up separated from the ‘main’ business. This is ultimately a problem of leadership. Rather than integrate Agile throughout the company, stakeholders get scared of changing core processes and keep Agile teams separated. Make sure you have the buy-in you need from the top to complete the transformation and not get stuck at 80%.
  3. The culture doesn’t change. Change will only be skin deep if your organization’s culture doesn’t change alongside the processes. Work hard to bring Agile principles into your company’s DNA. Make mistakes. Share learnings. Update your values to be more Agile. All these small changes will help guide you forward.
  4. Too many dependencies for it to work. This is a major structural problem where cross-functional teams get stuck waiting on each other. It will be complicated at first, but learn how your teams or ‘cells’ work best. Define a blueprint that shows their interdependencies and then plan accordingly. Agile should feel streamlined. An Agile project management tool like Planio can take a lot of the pressure off here.
  5. Companies get stuck on ‘fake’ Agile. Even after a successful pilot project and scaling Agile, some companies still end up ‘doing’ Agile rather than living it. Again, look to leadership and culture. How can you get everyone to embrace these principles not as tools but as a new way of working?

Transformations take time. But the results are worth it.

As businesses and industries get more competitive, companies need to be quicker to adapt and change. And although it’s nothing new, Agile is the best way to get your team into that powerful cycle of building, learning, and improving.

Take the time to plan out the steps of your Agile transformation and get leadership on board. They’ll be a powerful ally throughout the process and help you through the slog of shifting cultures and mindsets.

And to make it easier on yourself, make sure you’re using an Agile project management tool like Planio.