Elevating Agile With Financial Discipline

A corporate axiom is changing, shifting from “Big eats small” to “Fast eats slow.” But change doesn’t happen overnight.

While Agile and lean methods continue to chip away at the status quo, making gains and moving beyond pockets of teams to the portfolio and then enterprise-wide adoption levels, waterfall approaches to delivery persist.

Rumors of waterfall’s demise, it seems, have been somewhat exaggerated. A survey conducted by the Scrum Alliance (2017) of Scrum practitioners revealed that 78% of respondents said they used Agile-Scrum practices in parallel with waterfall practices. Mixed waterfall/Agile environments are complex. For many large companies, this is the norm. This is when the cohabitation challenges of agile and traditional workstyles become more glaring.

Importantly, as IT finance management (ITFM) leaders know, becoming “more agile” doesn’t give you a pass when it comes to financial discipline and oversight. Agile organizations are still responsible for their ROI and saying you’ve adopted lean methods doesn’t automatically make you lean. Or fiscally responsible. Or well-governed. Or profitable.

ITFM Leaders are Under Pressure

Technical organizations are in the midst of evolving from being project-centered to product-oriented solution delivery and scaling Agile from the team level up to the portfolio/enterprise. In these evolving, hybrid working environments, faced with larger and more vocal agile communities, ITFM managers are facing increasing process dissonance between traditional and agile methods, wreaking havoc with their reporting, planning, budgeting and oversight.

In a blended traditional/agile financial portfolio, understanding the true cost of projects, portfolios, value streams and OKRs helps companies make better use of their financial resources to drive profitable outcomes.

And with interest in the value of IT spreading beyond the CIO to the rest of the C-suite, integrated reporting and decision-making that combine Agile work with traditional IT projects, the ITFM role itself is even more essential.

Technology Business Management: Accurately Measuring the Cost of IT

For many ITFM leaders, a focus on the discipline of technology business management (TBM) has improved their ability to better understand IT costs and influence governance and behavior through targeted analysis of real-time reporting (and chargeback) for IT resources. TBM provides a decision-making framework to help leaders understand the true costs involved in the delivery of products and services to customers. That has worked well, particularly in industries where project-centric, traditional waterfall projects are the norm. As it turns out, it works very well for supporting Agile, too.

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