DC54: The Decline of Agile Change Programs
Navigating Overwhelmed Leadership in a Disrupted World
In the last month or so, I have been researching what is happening in the world of Agility, why there seems to be so much noise on why agile is dead, and why so many coaches seem to be let off or find it hard to find work.
This article is a small part of that research.
This article shows how the overall chaos and rate of change in the macro global situation and the overwhelm executives feel are more significant than the results of agility in determining what to fund and when. Often, starting and creating more change in the name of improvement is just one step too much.
I believe this trend of the decline in agile change programs aligns closely with the overwhelming macroeconomic and geopolitical landscape that has placed unprecedented pressure on senior executives. To understand this shift, it is essential to examine the interplay between global events and the changing priorities of organizations.
The Perfect Storm: Macro Events Shaping Leadership Challenges
Economic Turmoil
The last decade has been marked by financial instability. In London, for example, job losses in 2020 exceeded those seen during the 2008 recession, decimating entire sectors.
Central banks oscillated between aggressive quantitative easing (QE) and tightening (QT), creating volatile financial conditions that left businesses in perpetual adjustment. By 2024, the Bank of England’s monetary policies had reduced reserves by £122.9 billion, further tightening corporate budgets.
Global Conflicts:
Geopolitical tensions have exacerbated the uncertainty.
Key events include the Brexit referendum in 2016, the Russia-Ukraine war beginning in 2022, and the Israel-Hamas conflict in 2023.
These events disrupted global markets, supply chains, and investment strategies. For instance, the Ukraine conflict in 2022 drove fuel prices in the UK to an average of 149.0 pence per litre, directly impacting operational costs for many organizations.
The Rise of Generative AI:
The rapid proliferation of AI technologies has introduced both opportunities and existential threats. Key developments include the release of Google’s LaMDA in 2021, OpenAI’s ChatGPT in November 2022, and GPT-4 in January 2024. These advancements have revolutionized industries, displaced traditional roles and created anxiety about the long-term relevance of human expertise.
Senior leaders face the dual challenge of integrating AI into their operations while managing workforce upheavals.
Leadership Fatigue:
A study published by Orgvue revealed that the average organization now undergoes nine significant changes annually, compared to just two before 2020.
This relentless pace has led to change fatigue among executives, with many preferring to avoid additional transformation initiatives entirely. Leaders are overwhelmed by the sheer volume and complexity of managing both internal changes and external disruptions.
Senior leaders across various industries have expressed feeling overwhelmed by the rapid pace of change and the extent of global disruptions caused by macro-events. Several articles and reports highlight these sentiments (reference links at the end of this article):
1. "What I learnt ... about working through change fatigue" – The Times (December 10, 2024)
A survey of 700 leaders from companies with over 1,000 employees revealed that 38% would prefer to resign than lead another change initiative.
Oliver Shaw, CEO of Orgvue, noted that before 2020, organizations experienced about two changes per year; now, it's nine. He emphasized the necessity for leaders to adopt a strategic approach to manage continuous change effectively.2. "Businesses Anticipate Unprecedented Rate of Change in 2024, New Accenture ‘Pulse of Change Index’ Shows" – Accenture (January 12, 2024)
The report indicates that 88% of business leaders expect an accelerated rate of change in 2024, with 52% feeling unprepared to respond effectively.
Chief Executive—Strategy & Consulting at Accenture, highlighted the need for structural changes in business operations to navigate this disruption.3. "CEOs in the age of anxiety" – Financial Times (July 1, 2024)
During a retreat with approximately 40 global business leaders, discussions centred on political uncertainties, such as the 2024 elections in the US and Europe, and geopolitical tensions involving China. CEOs expressed concerns about managing these disruptions and the necessity to adapt strategies accordingly.4. "Providing Resilient Leadership in an Era of Global Uncertainty" – SHRM (October 2024)
The article discusses how leaders are grappling with various global disruptions, including geopolitical tensions, pandemics, and climate change.
Sam Adeyemi, a strategic leadership expert, emphasized the importance of planning for such disruptions to prevent business failures.5. "A perfect storm: the macro forces impacting global companies" – Workday (2020)
This piece examines how political, economic, social, environmental, and technological factors create a "perfect storm" of disruption for businesses. It underscores the challenges leaders face in planning for the future amid numerous unknowns.
These sources collectively illustrate the challenges senior leaders face in navigating the complexities of rapid change and global disruptions, highlighting the importance of strategic adaptability and resilience.
The Decline of Agile Interest
Agile methodologies, once heralded as the solution to navigating uncertainty, are now facing scepticism. Several factors contribute to this decline:
Shift in Leadership Focus:
Agile programs often require significant investment in cultural transformation, training, and dedicated roles like agile coaches. When leaders are overwhelmed by macro-level crises, these initiatives are seen as non-essential or even burdensome.
Executives prefer to prioritize immediate, tactical responses over longer-term strategic agility.
Mismatched Expectations:
Agile promises adaptability and iterative progress, but its incremental approach can feel inadequate in a landscape dominated by rapid, global disruptions.
Leaders grappling with existential threats—such as economic instability or geopolitical crises—may perceive agile as too slow or misaligned with their urgent needs.
Diminished ROI on Agile Programs:
As organizations pivot repeatedly to respond to external shocks, the return on investment for agile initiatives becomes more challenging to justify. Programs initiated under stable conditions often lose relevance in the face of new priorities, leading to frustration and a waning interest in sustaining agile practices.
Although Agile programs are supposed to enable an organisation to change more effectively, they are often seen as too slow for immediate change.
AI as a Competing Paradigm:
The rise of AI has shifted attention away from human-centric methodologies like agile. Many organizations invest heavily in automation, predictive analytics, and machine learning, viewing these technologies as more scalable and cost-effective solutions to complex problems.
Mapping Agile’s Decline to Macro Events
The decline in interest in agile change programs correlates strongly with key macro events:
2016: Brexit Referendum:
The UK’s decision to leave the EU created widespread economic uncertainty, with GDP growth slowing to 1.9% and the City of London facing long-term challenges in financial services employment. The impact of this wasn’t really felt until after the pandemic, so around 2022-2024.
2020: COVID-19 Pandemic:
The pandemic’s sudden and sweeping impact forced organizations to adopt crisis-management strategies. Agile programs were often sidelined in favour of immediate survival tactics. GDP contracted by 9.8%, and unemployment rose to 4.5%.
Most agile workshops and initiates stopped during the pandemic as everyone adjusted to life online. The work dynamics of being in the exact geographical location to being at home changed the nature of work and how agility, its meetings, and processes worked.
The disruption during this period was massive, and it was difficult for any executive to understand. Most organisations were fighting for survival, and those that boomed faced different challenges. There was a lot of change at levels unprecedented in modern history.
As an aside to this article:
For Agile companies offering training, there was a noticeable race to the bottom regarding quality and price after the initial shift to online offerings. Booking and financial commitment to training venues kept many smaller providers out of the market. With the advent of running courses online, this changed, and many providers of agile training were less qualified and less organised. This profoundly impacted the quality of agile coaching and scrum mastery in the market over the following few years.
2022: Geopolitical Conflicts:
The outbreak of war in Eastern Europe disrupted global markets and created a climate of fear. Many organizations paused transformation initiatives to focus on navigating supply chain disruptions and fluctuating energy costs. Fuel prices surged to 149.0 pence per litre.
This coincides with the first round of layoffs of Agile Coaches. For example:
Capital One: In late 2022, Capital One eliminated approximately 1,100 Agile roles, including Scrum Masters and Agile Coaches.
Royal London: The company made 90% of its Scrum Masters redundant around the same period.
2023: Central Bank Policies:
Aggressive QT measures by central banks led to tightening credit conditions and reduced corporate spending. Organizations shifted their focus to cost-cutting and risk management, deprioritizing agile initiatives.
The most significant decline in Agile roles and certification was in October 2023. This directly coincided with the Israel-Hamas Crisis, the release of generative AI, and central bank policies on QT. All overwhelming factors for organisations (and leaders) to deal with.
2024: Generative AI Boom:
The widespread adoption of AI technologies captured the attention of business leaders, overshadowing agile as the dominant paradigm for managing complexity. AI’s promise of automation and predictive capabilities offered a more tangible solution to immediate challenges.
AI spending and the hope that it will reduce stress and increase well-being continues, and many organisations are focusing on this approach rather than collaboration between people as a way of bringing stability.
Implications for Agile Coaches and Organizations
1. Redefining the Agile Role:
Agile coaches must adapt to remain relevant. They must position themselves as enablers of strategic resilience rather than merely facilitators of iterative processes. This involves integrating agile principles with emerging technologies and crisis-management frameworks. This often means switching roles and using the incredible agility experience to stand out—for example, in Product or People (HR) roles.
2. Focus on Strategic Agility:
Organizations should shift from rigid agile frameworks to more fluid approaches that prioritize adaptability at the strategic level. This includes fostering cross-functional collaboration, enhancing scenario planning, and embedding resilience into the organizational culture. Many of us have already done this, but many still ‘do SAFe’ and other rigid delivery frameworks. The lifespan of these rigid approaches is limited, and anyone solely working in this way and not focusing on real business outcomes is advised to start diversifying quickly.
3. Leveraging AI to Enhance Agility:
Rather than viewing AI as a competitor, agile practitioners should explore ways to integrate AI tools into agile workflows. For example, AI can be used to analyze data, predict outcomes, and support decision-making processes, enhancing the overall effectiveness of agile initiatives.
Conclusion
The decline of agile change programs not only reflects their inherent flaws but is also a response to an unprecedented confluence of global events and leadership challenges.
As senior executives grapple with overwhelming macro-level disruptions, the demand for more immediate, scalable, and technology-driven solutions reshapes organizational priorities.
To remain relevant, agile methodologies and coaches must evolve, embracing new paradigms and addressing the realities of a rapidly changing world.
There is more to follow as this is just one thread of the research into why things have rapidly changed for agility and those people who are improving organisations for a living.
References:
https://www.ft.com/content/18e7d294-debf-4662-9a12-63644c1341aa
Finding the right balance (sheet): quantitative ... - European Parliament
Quantitative tightening: the story so far − speech ... - Bank of England
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Thank you for the article and the deep research you provided. I have the privilege of observing many of those fluctuations from inside organizations. I reflect that the majority of the agile-led initiatives were improperly hooked. For example, trying to transform the organization by coaches placed under some middle-level management.
When I was talking to coaches about how we should measure our "ROI," being able to assess the value to the organization continuously, I saw surprise in their eyes.
I would add the greed of the training and certification companies. All those small crumbles could create a big event.