30

Agile Transformation: The Holy Grail for Utilities?

Utilities companies are widely adopting Agile practices to improve their internal business and IT performance, but struggle to implement an efficient governance to fully achieve the targeted benefits.

The Utilities sector is affected by higher customer expectations, price pressure, significant capital costs and regulatory constraints.

As technology touches virtually every facet of today’s utilities businesses, the IT landscape is more than ever a key competitive advantage and is a key element when considering market consolidation. Today, IT is the “core business” for the utilities sector and the IT department has an essential role to play in addressing these challenges.

As few examples of the business requirements that have to be answered by the IT department within extremely relative short timing we can name:

n Implement the new technologies and digital functionalities in the context

of the Digital Utilities Transformation in order to increase customer experience, achieve operational excellence and support the move to the new business model. Amongst other, getting involved and leveraging the Internet of Things and Big Data potential

n Launch of new products and services that happen today on a frequent basis to gain competitive advantage or respond to competition’s initiatives

n Develop and implement the legal and regulatory requirements in line with mandatory milestones (such as prices definition rules, VAT changes, clearing house or market model processes)

n Integrate or harmonize IT platforms in the context of mergers or acquisitions.

All the above requirements have to be managed and delivered on top of the ‘business as usual’ development and maintenance IT duties.

One of the key processes where best-in-class performances are expected is the software development life cycle (SDLC) from design, build, implement to operate that should be faster, cheaper, bug free and highly flexible.

To do so, over the past years many utilities companies have adopted the more adaptive, so called Agile (with Scrum as the most popular) IT development methods. These methods are built on the common values described in the Agile manifesto.

The key reasons behind the projected benefits of Agile are clear:

n Higher productivity and lower costsn Improved employee engagement

and job satisfactionn Faster time to market due to

incremental functionality releasen Ability to efficiently cope with the

changing demands

However, many organizations fail to capture fully these benefits because of several causes, the leading among which are:

n Lack of experience with Agile methods and tools

n Company philosophy / culture is at odds with core Agile values

n External pressure to follow waterfall practices

n Lack of cultural transitionn Lack of management support

To avoid these failures and harvest all the benefits of the Agile approach, companies should manage its implementation as a transformation program focusing on two critical aspects that are often under considered: the change management component and the integration of the Agile processes within the existing governance model to which the Agile principles are connected with

the ‘classical’ project, program and portfolio management practices.

Transforming the organization to Agile

Transforming an organization to an Agile one is complex as it fundamentally changes the way of working of the IT department (culture, roles, development process, governance) as well as the way of collaborating with the business. It should be not be regarded or treated as a mere software development method, but as a lever to transform an organization towards business agility, i.e. the organizational ability and flexibility to respond to – and even control – rapid evolutions within and outside of the organization.

This type of wide and deep change takes time. It represents challenging and hard work above and beyond the mere software development activities and tasks. The change process also transforms all impacted and attached employees – from management to

operators – activities and work. A full organization-wide Agile transformation may take up to two years. No matter the intensity or commitment by management, this timetable cannot be rushed because the core of the project is organizational transformation that needs time for people to change. The actual duration, result and pace of the transformation depends on the level of excellence that organizations seek, their vision, and – most of all – their determination.

Capgemini Consulting has developed its own Playbook based on the SCRUM one enhanced with its change and transformation experiences translating into 5 specific plays to launch and guide initiatives:

n Play 1: Pre-game Stagingn Play 2: Pilots – Seed Teamsn Play 3: Expansion – Grow Teamsn Play 4: Achieving impact – Blooming

Teamsn Play 5: Anchor – Rooting

Transparency and

communication

Iterative – Incremental

(Sprints)

Agile Manifesto

Prioritizationand evolution of

requirements

Lightweight and simplicity

Empowereddevelopment

teams

Activecustomers

Adaptiveplanning

2 Agile Transformation: The Holy Grail for Utilities?

Agile common values following Capgemini Agile Manifesto

Step by step, these plays will enable the implementation of an efficient organization that is agile, competitively impressive, and operates at significantly lower costs. The key domains covered will become significantly different, leaner and more agile as the plays occur.

Agile should be embedded in the existing governance

Agile is (or should be) a highly disciplined method, the short iterations creating a rapid feedback loop which can be exploited to provide exception reporting to the business, update backlogs and provide direction for the delivery team. This has the effect of creating better visibility and control of the transformation, maintaining alignment with the business and providing assistance as required.

Although traditional governance is not aligned with the Agile principles and that can result in a situation where Agile and the legacy project, program and portfolio management processes are disconnected. That often impacts the IT budget and controlling processes that suffer from a lack of project data regarding the planned capacity, the actual investment ... that the consolidation at the program and at the portfolio level and the mid and

long-term view is becoming difficult or is reduced to a high level exercise based on simple information such as headcount, available capacity...

At Capgemini Consulting, we strongly recommend to adapt the ‘traditional’ governance in a way that both the ‘worlds’ are seamless integrated. In this governance an ‘Agile’ PMO plays an important role. The feedback loop is maintained through an Agile PMO the executing reporting and maintenance of the ‘light touch’ document set as a backlog activity within each sprint. This releases the delivery team to execute activity as envisaged in Agile methodology. The PMO and Program Manager, with the business representative - the Product Owner, then ensure the flow of information meets business needs and that the program continues to deliver value.

The Agile PMO allows a program to leverage the benefits of Agile whilst maintaining a focus on corporate requirements of visibility and control. Capgemini’s expertise and experience in PMO, our understanding of both business and IT challenges and our collaborative approach ensures the creation of value whilst maintaining momentum.

We propose a comprehensive set of services to help you implement or improve your agile organization

Capgemini Consulting together with the other disciplines of the Capgemini Group dispose of all the competence and skills to support you in your Agile initiative, from strategy, design and implementation to sustain.

If you are looking to engage on the Agile journey, we can help you create your Agile team and guide you through the process to secure management buy-in to proceed. Once accomplished, we’ll “kick into high gear”, working in collaboration with you to ensure that your first Agile implementation is an unmitigated success.

If you have the implementation behind you and are looking for improving the current situation to achieve the remaining potential benefits, we can assess your organization and help you fine tuning it that you get to the best-in-class level and stay there.

Our Agile services portfolio includes:

n Agile Transformation (Organizational Agile Readiness Assessment, Agile Transformation Strategy & implementation, Agile Methodology Consulting)

n Agile Governance (embedding agile into the PMO, project, program & portfolio management)

n Agile Staffing (Scrum Masters, Product Owners, Developers, Test / QA, Change management)

n Agile Training & Coaching (Scrum Master and Product Owner Training, Leadership Workshops, SAFe certifications, Coaching (all levels)) And the above specific services are backed by our classical consulting ones such as change management, business case development, target operating model development, transformation management and roadmap development.

Traditional Value Chain (simpli�ed)

De�ned sense of urgency

ACT team trained

Metrics established

Communicate Results

Cross fertilization

Development orientedon applications and platforms

More teams

Agile Organization

Reduced waste

Manage by Corporate Objectives

Embedding in personnel objectives

1st Pilot projects decided

Expanding More Teams

Expanding Organization Technology Infrastructure Career paths Structural training Consolidated metrics

ACT Sprints

Scrum Teams

First impediments resolved

1. Staging

2. Pilots

3. Expansion

4. Impact

5. Anchor

Capgemini Playbook: The 5 Plays of the Game

3

the way we see itUtility Sector

Capgemini Consulting is the strategy and transformation consulting brand of Capgemini GroupThe information contained in this document is proprietary. © 2015 Capgemini. All rights reserved.

About CapgeminiWith more than 180,000 people in over 40 countries, Capgemini is one of the world’s foremost providers of consulting, technology and outsourcing services. The Group reported 2014 global revenues of

EUR 10.573 billion. Together with its clients, Capgemini creates and delivers business and technology solutions that fit their needs and drive the results they want. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore®, its worldwide delivery model.

About Capgemini ConsultingCapgemini Consulting is the global strategy and transformation consulting organization of the Capgemini Group, specializing in advising and supporting enterprises in significant transformation, from innovative strategy to execution and with an unstinting focus on results. With the new digital economy creating significant disruptions and opportunities, our global team of over 3,600 talented individuals work with leading companies and governments to master Digital Transformation, drawing on our understanding of the digital economy and our leadership in business transformation and organizational change.

Please find out more at:

www.capgemini-consulting.comRightshore® is a trademark belonging to Capgemini

Pierre LorquetVice President, Capgemini ConsultingHead of Utilities BeNeLuxpierre.lorquet@capgemini.com

Contacts: Benjamin DawesPrincipal, Capgemini ConsultingUtilities Beneluxbenjamin.dawes@capgemini.com

During the iniiation stage a ‘light touch’ set of leading practice documents, and the metrics to be used to measure performance and value, should be created (jointly with the customer. IT and business; facilated through our Agile Governance framework) to ensure ampowerment and alignment of the team. This docu-ment set is then maintained aa a backing item for each sprint-confirming the programme’s value and ensuring it remains aligned to meeting the business need

In order to initiate an Agile Transformation there remains a need for a robust Business Case to justify the investment. This provides the foundations to confirm value for money as the transformation progress.

During the closedown stage the final deliverables are released and the Agile PMO gathers lessons in order to ensure that best practice is incorpo-rated into business as usual.

In the execution stage, further ‘light touch’ governance is introduced in order to affirm that value is delivred and need met. These will include a sprint plan and backlog which are reviewd after each sprint leading to a sprint report and re-prioritised backlog for future sprints. And finally, daily scrum discipline allows for prioritisation of effort and maintence of momentum and alignment.

Throughout the execution stage there will be a number of releases; each delivering a usable product and so interatively increasing programme value. each release acts as gateway review for the next to instil ‘checks and balances’ into the programme and facilate format invesment decisions.

ExecutionClosedown

initiationPre-initiation

Business case Charter Use cases

Mandate Features

Vision Release schedule

PID Dependency maps

Strategies Risk log & allocation

Final backlog Backlog

User stories

NFRs

Tests

Release

Sprint report

Value

Exceptions MI reportRemaining backingUpdated risk/issue logLeassons report

Sprint report

Value

Release 1-n

Exceptions MI reportRe-priorotosed backingUpdated risk/issue logUpdated dependency maps

Final release

Close sprintSprint 1-n

Final Release

The Agile transformation journey