Agile teams are not a supervisory body, nor an ad-hoc created team, but executors. These are empowered teams that have the authority to make decisions…. Members of agile teams gain a sense of purpose and belonging and are motivated to reduce complexity, eliminate rework, and continuously improve deliverability.
“Steal with pride” is an expression used in corporations when you proudly want to steal and apply some successful practice from another country/sector/company. As the goal of all companies is to have successful results and satisfied employees, we will present how this practice is applied by IT companies, and which FMCG companies could also apply in their work. An innovative and creative company culture that motivates – is a prerequisite.
What we can learn from IT colleagues is – how to be focused, efficient, and at the same time, casual. Even in non-IT companies, these sectors seem to have their own rules and ways of working. What is characteristic of them is that they are smart, interesting, curious, and ready to help. New projects and learning are imperative for them, which especially inspires them. Such teams are an example of a good culture of collaboration. That is why the agile way of working has been “accepted” in such environments. Unlike the declarative company culture, they live and implement their culture. This is exactly what makes the difference between a successful company and another. Indeed, most companies don’t want to change because changes can often lead to collateral damage. Especially in large corporations, where management and their view of business often change every couple of years. But when a company rejects new ideas (whether they come internally or externally), negative consequences are bound to occur. The secret of successful companies lies in a creative culture that encourages collaboration, proactivity, and continuous learning. But not only to check off a list of planned training or team building but also a sincere desire to acquire new knowledge that can be immediately applied in practice. If you provide this to employees, you are guaranteed to make progress in business and have employees who are motivated, given that they are doing something interesting, useful, and profitable (assuming you reward them). To create this kind of innovative company culture, it is necessary to cultivate a “growth mindset”. It is a mental model that encourages internal motivation, i.e. self-motivation of employees with the belief that they are capable of working better and smarter. Of course, such teams must also be provided with the possibility of experimentation, i.e. ensuring psychological safety. If there is no fear of error, each new initiative brings more value to clients and, consequently, benefits the entire company. And to realize a good idea, it is necessary to make decisions quickly. IT companies have been applying the agile way of doing business for several decades and have confirmed its success in practice. This business model has become necessary in the conditions of a changing and uncertain environment.
Why is agility important in FMCG?
The time of dominance of big manufacturers, strong brands, expensive media, and powerful stores is changing and becoming relative. Today, more and more small brands “outsource” and rent service production, so that they can match the capacities of the big players. Then, with digitization and the introduction of popular e-shops, i.e. internet stores, the availability of all products was made possible. Without that option, there would be a problem securing shelf space at a major chain. Digital media and social networks provide, through interesting and authentic advertisements, the achievement of visibility towards target groups, for a fraction of the budget of large ATL campaigns. Therefore, the start-up becomes a serious competitor to all large manufacturers. Often, consumers give preference to small brands that meet their specific needs, such as organic food, products without additives, specific flavors, etc. At the same time, as a rule, they are much more creative and faster in realizing ideas. Their simple organizational structure gives them an advantage over slow, giant companies. More and more often we hear that corporations talk about “corporate entrepreneurship” in the desire to learn and apply entrepreneurial work principles or simply, for rapid growth, they carry out acquisitions of small companies, but which have great potential. In addition to entrepreneurs, the challenge for large producers is also the stores that are increasingly demanding of suppliers and are expanding their activities by introducing their Private Label offers. The price of entering the trade chain (the so-called “listing fee”) is not small, and it also entails investments in continuous promotion programs – special prices, marking at the point of sale, promotions, etc. so this, once the most standard form of product placement, is becoming more and more expensive and unavailable to many manufacturers. Everything speaks in favor of the need for organizations to adapt to new times and conditions.
The advantage of the Agile way of working
In essence, Agile is a set of beliefs, principles, and rituals that self-organizing teams can work together, quickly and efficiently to satisfy the client’s needs. The main advantages are:
Orientation to the client/customer – all the team’s activities are aimed at fulfilling the client’s/customer’s requirements. A good understanding of the client’s requirements and needs and finding the right solution, which will not be just mere fulfillment, but providing additional value for the sake of delighting the so-called. “customer delight”.
Faster innovation cycle – with the help of frequent and quick feedback from the control target group, the product is adjusted and improved from the MVP to the final version. In this way, product development costs are reduced and the risk of large losses is reduced, while competitiveness increases with more novelties on offer.
An organization that motivates – members of different functions (cross-functional teams) to work as one team, which improves cooperation, and enables easier understanding and parallel execution of activities. Teams are focused, and dedicated to the product that is the main priority because their attention is not scattered on other tasks.
Why do agile teams work well and deliver outstanding results?
Agile teams are not a supervisory body, nor an ad-hoc created team, but executors. These are empowered teams that have the authority to make decisions. Although team members have functional superiors, the team itself is responsible for decisions related to a specific project/product. Thus, members of agile teams gain a sense of purpose and belonging and are motivated to reduce complexity, eliminate rework, and continuously improve delivered value. Therefore, agile teams design, adapt and execute business activities for the final marketing of a product or service that will satisfy the client/customer/user more than expected.
How to successfully implement Agile?
The transition of an organization from traditional to agile can encounter obstacles, primarily due to the non-acceptance of middle management and anxiety about the distribution of decision-making power. Tips for implementing agile business have crystallized from practice:
Introduce a “Flat” organization – the agile way of working is easier to apply in shallow organizations, with as few hierarchical levels as possible. Employees in agile teams require less supervision, so their leaders can have a wider range of control. This results in cost optimization (fewer expensive functions), motivated employees, willing to go the “extra mile” because they have freedom in their work (less micromanagement).
Foster a creative and innovative culture – adopt a process of testing and learning. The advantage of working in a shorter time interval (Sprint) is that teams identify errors early. That way, the team has time to correct the error and prevent a much larger expense (an unwanted product that won’t sell or a product with an error that has to be withdrawn from sale, etc.).
Start with a pilot project – create several cross-functional teams by area: marketing, product development, or merchandising. Based on metrics that show better results, e.g. faster time to market, you can justify the model and ensure buy-in across the organization. You can share examples from one sector with other teams, both good practice and what was challenging, and then improve the processes, step by step.
Set realistic goals – agile teams have their capacity. It is necessary to objectively assess what is feasible, and in that case, each team member commits to implementation. In many companies, unrealistic goals are set, which leads to losing the will to achieve even an approximate result. If the result will certainly not be fulfilled, then there is no point in even trying.
Focus – team members need to be able to work quickly and cohesively. Multitasking is not a desirable trait in an agile environment. For real commitment, you must be focused on the priority. The agile team sets priorities together, which are then fulfilled by experts in their fields, often with additional improvement.
Reorganization with purpose
Organizational adaptation is necessary if you want to implement an agile way of working. Reorganization should go in the direction of reducing sectoral silos and learning in joint work. The role of general functions is shifting from a directive to a support role. Managers in legal, financial, personnel services, etc. they should become active members of cross-functional teams. This way of organization significantly reduces the number of decisions that go through the hierarchy. The structure, roles, and management of results will have to be modified, but all with the aim of rationalization. The general approach and adopting a mindset are more important than respecting formal events (sprint, planning, retrospective…). Only in conditions where cooperation, information exchange, and problem-solving are rewarded, it is possible for companies to be competitive by satisfying customer needs and introducing new products faster.
Before making any business decision, ask yourself WHY you are doing something… and then the HOW will self-organize.
Autor: Nataša Predić