Agile Organizations with Scrum@Scale

Agile Organization
Incrementally Crafting the Right
Organization with Scrum@Scale
Paolo Sammicheli
http://paolo.sammiche.li

Paolo Sammicheli – Agile Business Coach
http://paolo.sammiche.li

We are uncovering better ways of developing
software by doing it and helping others do it.
Through this work we have come to value:
Individuals and interactions over processes and tools
Working software over comprehensive documentation
Customer collaboration over contract negotiation
Responding to change over following a plan
That is, while there is value in the items on
the right, we value the items on the left more.
Manifesto for Agile Software DevelopmentProduct
products
product

In the old model the focus is the project,
which is at the center, and people
organize themselves in groups around it.
The new model puts the teams at the
center, and the work flows to them.
Stable teams who, with appropriate
coaching and time spent together,
become High Performing.
The Copernican Revolution of Labor

« An Agile Organization is one that
is quick in responding to changes in
the marketplace or environment »
Source: https://www.mbaskool.com/business-concepts/it-and-systems/6703-agile-organization.html

Agile Organization
Leadership #LikeABoss
JAN 2, 2018 @ 07:35 AM 33,971
/ /
Why Agile Is Eating The World
Steve Denning, CONTRIBUTOR
I write about radical management, leadership, innovation & narrative. FULL BIO
Opinions expressed by Forbes Contributors are their own.
In 2011, Marc Andreessen wrote his famous essay, “Why Software Is Eating the
World,” in The Wall Street Journal, leading to the cliché that “every company needs
to become a software company.” (A useful update by Jeetu Patel on the situation in
2016 is here: “Software is still eating the world.”)
In one way, Andreessen’s 2011 article was remarkably prescient. In 2011, IT firms
were looked down on by Wall Street. Andreessen was telling Wall Street: “Pay
attention! These companies are more valuable than you think they are.” And Wall
Image Wikimedia Commons: Brocken Inaglory
Great white shark at Isla Guadalupe, Mexico.
Why Agile is Eating The World
Jan 2, 2018
In 2011, Marc Andreessen wrote his famous essay, “Why Software Is
Eating the World,” in The Wall Street Journal, leading to the cliché
that “every company needs to become a software company.” In 2018,
the five biggest companies in the world by market capitalization are
IT firms: Amazon, Apple, Facebook, Google and Microsoft. t's not
that all software is eating the world: General Electric has just proved
that in a spectacular fashion: It invested heavily in software and the
result. After five years, the CEO and his top lieutenants were
terminated. Similar developments are under way at Intel, P&G and
HP.

«It is Firms that are truly Agile that are
eating the world, whether or not they
call themselves by the label “Agile” »
- Forbes, 2 Jan 2018

McKinsey & Company
Source: https://www.mckinsey.com/business-functions/organization/our-insights/the-five-trademarks-of-agile-organizations
January 2018

McKinsey & Company
December 2015
https://www.mckinsey.com/business-functions/organization/
our-insights/agility-it-rhymes-with-stability
Agility it Rhymes with Stability
Companies can become more agile by
designing their organizations both to
drive speed and create stability.

McKinsey & Company
December 2015
https://www.mckinsey.com/business-functions/organization/
our-insights/why-agility-pays
Why Agility Pays
70% of Agile Companies rank in the top
quartile of organizational health.
85% of the top healthy organizations are
Agile or Startups.

Harvard Business Review
12
May-June 2018
https://hbr.org/2018/05/agile-at-scale
Companies that successfully scale up agile see major
changes in their business. Scaling up shifts the mix of
work so that the business is doing more innovation
relative to routine operations. The business is better able
to read changing conditions and priorities, develop
adaptive solutions, and avoid the constant crises that so
frequently hit traditional hierarchies.
By Darrell K. Rigby, Jeff Sutherland, Andy Noble

Scrum at Scale
• Guide published by Jeff Sutherland and
released under Creative Commons License in
February 2018.
• Extremely simple, only 18 pages.
• The method clearly distinguishes the structure
of the organization from the content and
describe only the structure of the relations,
making it universally applicable.
source: https://www.scrumatscale.com
©1993-2018 Jeff Sutherland and Scrum Inc., All Rights Reserved
Scrum@Scale is a registered trademark of Scrum Inc.
Released under Creative Commons 4.0 Attribution-Sharealike License
Version 1.0 – 10 February 2018

© 1983-2018 Jeff Sutherland & Scrum Inc.
Components of the Scrum@Scale Framework
Continuous
Improvement &
Impediment
Removal
Executive
Action  
Team
Cross-Team
Coordination
Team-Level
Process
Metrics & 
Transparency
Product &  
Release Feedback
Strategic 
Vision
Executive
Meta Scrum
Deployment
Backlog
Prioritization
Backlog 
Decomposition 
& Refinement
Release 
Planning
Potentially
Shippable Product
Increment
Product Owner 
Cycle
Scrum Master 
Cycle
14

Scale-Free Architecture
• A scale-free network is a network
whose degree distribution follows a
power law, at least asymptotically.
• The most notable characteristic in
a scale-free network is the relative
commonness of vertices with a
degree that greatly exceeds the
average. The highest-degree nodes
are often called "hubs", and are
thought to serve specific purposes
in their networks, although this
depends greatly on the domain.
15
https://en.wikipedia.org/wiki/Scale-free_network

Scale-Free Architecture
• If you want to scale exponentially you need
a “scale-free” architecture
• Otherwise you risk introducing waste into
the system and slowing the whole
organization down
• You will not achieve linear scalability
• Scale-free architectures are pervasive
in biology (ex. neural networks)
• They are able to evolve to perform
new functions more rapidly than an
alternative network design
Diagram of a scale-free network that contains components with
a highly diverse level of connectivity. Some components form
highly interconnected hubs, while other components have few
connections, and there are many levels of interconnectivity in
between. Scale-free networks are pervasive in biology.
Computer simulations at the University of Chicago show that
scale-free networks are able to evolve to perform new functions
more rapidly than an alternative network design.Source: http://chronicle.uchicago.edu/061207/darwin.shtml
Digital Darwinian world reveals architecture of evolution
16

Scaling Challenge: Bureaucracy & Hierarchy
• A bureaucratic processes creates poor decision latency.
• Everything we do requires so many sign-offs that nothing gets done.
• We have layers upon layers of managers.
• Therefore, we need a Minimum Viable Bureaucracy.
17

The Scaled Daily Scrum: The SM Role Scaled
•Scrum must scale in an
organic way consistent
with the Scrum Guide or it
will be slow
•Using a Scrum of Scrums
reduces communication
paths but increases
communication saturation
•Scrum of Scrum works as
a “Team of Teams”
In order for the SoS to be
most effective, we need a
Scrum of Scrums Master
(SoSM) to ensure that:
• Impediments are shared
and removed
• Knowledge is spread and
standardized
• Dependencies are
discussed and resolved
• The SoS functions as a
Team of Teams with the
responsibility of Release
18

Scaled Daily Scrum (SDS)
19
SM
SM
SM
SM
SM
SoS
• Exists to coordinate the Scrum of  
Scrums and remove impediments 
to the delivery of value to customers
• The SDS event mirrors the Daily  
Scrum
• An opportunity to re-plan in 
order to achieve the Sprint goal 
for the SoS
• Surfaces impediments
• Shares learnings for continuous
improvement
SDS

The Executive Action Team
• Accountable for the quality of Scrum in the organization
• Owns the Organizational Transformation Strategy
• Owns the Transformation Backlog and “eats impediments” that
block it
• Removes impediments not handled at the Team level due to
scope, budget, or corporate political power
• Executes the Transformation Strategy or delegates it to a center
of expertise (often called the Agile Practice)
• Measures and improves the quality of Scrum in the organization
to build capability for business agility
20

Typical Impediment Escalation
21

Who should be on the EAT?
• A leader who can change company
policy without having to ask
permission [ex. COO, CIO, CTO]
• Someone who can write a check
[ex. VP of Finance]
• Someone who is a Scrum Star [aka.
Agile Champion]
• Leaders who can motivate change
• Someone from People Ops [ex. HR]
• Someone from Legal/Compliance
22

© 1983-2018 Jeff Sutherland & Scrum Inc. 23
Scaling the Product Owner
Product Owner
•Team
•Sprints
•Validated
Learning
Chief
Product Owner
•Multiple Teams
•Roadmap
•Coordinating
teams
Chief Chief
Product Owner
•Value Streams
•Vision
•Organizational
Priorities
PO
CPO
MetaScrum
PO
PO
PO
POPO
Executive
MetaScrum

© 1983-2018 Jeff Sutherland & Scrum Inc. 24
The MetaScrum: Refinement
C
CPO
S
H
Stakeholders
P
O
Product
Owners
Aligned
Product
Backlog
C
S
HP
O
Sprint/Time
Aligned
Product
Backlog
C
P
O
Aligned
Product
Backlog
C
P
O
M
etaScrum
M
etaScrum
M
etaScrum
S
H
S
HS
H
S
HS
HP
O
P
O
P
O
Validated
Learning
Vision
Validated
Learning

The MetaScrum Backlog Refinement
• A MetaScrum Scaled Backlog Refinement Meeting is a gathering of Key
Stakeholders, Leadership, Product Owners, and Team members.
• Run by Chief Product Owner
• Did anything change that would change the strategy or priorities?
• Aligns enterprise around single backlog
• The forum for stakeholders to express preferences, remove blocks and provide
resources needed (they should not try to alter product vision between MetaScrums)
• Decompose upcoming backlog
25

Scaling SAAB Technologies to Hundreds of Teams 
Synchronizing 2000 People in about one hour!
• 7:30 Daily Scrum
• 7:45 Scaled Daily SoS
• 8:00 Scaled Daily SoSoS
• 8:15 Scaled Daily SoSoSoS
• 8:30 Executive Action Team
26

Lockheed Martin F35 vs Saab Jas39e Gripen
27
© 2011 Scrum Inc.© 2011 Scrum Inc.
Cumulative program cost of $15 billion
• New iteration every 6 months
• $43M cost1 (20% of F-35)
• $4,000 Hour Flight Cost
1. According to Jane’s Aviation Weekly, the Gripen is the world’s
most cost-effective military aircraft
Cumulative cost 1.5 trillion dollars
• $143 billion over budget
• Delayed until 2022
• Cost of Navy F-35C $337 million
• $31,000 Hour Flight cost
DoD Waterfall vs. DoD Agile
American F-35 Lightning vs. the European JAS-39 Gripen
https://www.scruminc.com/scrum-military-aviation/

Scrum Master and Product Owner  
Functions Scale Coordination Differently
Scrum Master Product Owner
• Share best practices
• Collectively solve problems &
remove impediments
• Maintain clear and consistent
product vision
• Optimize business value
• Respond decisively to
changing market
Team
Scrum of Scrums
Scrum of Scrum of Scrums
T TT T TT T TT T TT T TT T TT
PO
CPO
PO PO
CPO
PO
CPO
Product PO team
Component PO team Component PO team
28

Scaling 250 people

3M - HIS

Sprints never finish with working product
Process Efficiency = 5%
Sprints always finish with working product
Process Efficiency = 50%

Large Defense
Contractor
• Top-down agile
transformation motivated
by perceived external
market pressure
• Company vision to halve
the cost of projects
Mid-size Software
Company
• Opportunistic agile
implementation triggered by
acquisition of a small Scrum
company
• Market leader Looking to
stay ahead of competition
Growing “Agile
Native” Company
• Disruptive technology
innovator with successful
product looking to scale to
keep up with demand
• Leadership are steeped in
agile principles
A B C
Name Classified Autodesk Spotify
Key Context:
• Complex, integrated multi-
year hardware/software
projects
• Each project has one
customer
• Reliability a key priority
• Must deliver to detailed
contract requirements
Key Context:
• Redeploying a legacy
software product to cloud-
based SaaS model
• Goal to increase pace of
innovation
• Historically, releases a
disruption for customers 
Key Context:
• Web/app-based product
• Product and company set
up modularly
• Allows teams to work
independently with
minimal coordination
• Teams co-located

“Emergent” Product Design
“Defined” Product Design
ProcessAdaptability
ProcessPredictability
EP
CP
EA
CA
Adapted from Michael Cottmeyer
Where is your
organization
on this chart?
Place a dot
for your
organization
Place an arrow
for the direction
Where should
it be
heading?
Where do
these go?

Case Study by Paolo Sammicheli
• Form the EAT and create a Transition
backlog
• Form the first small set of Scrum
Teams
• Make them to work well, solving
impediments. This iteratively will
create your “operating model”.
• Scale up extending this “operating
model” to the rest of the company
incrementally.
How do you start

• European IOT Company creating the
next generation house automation
platform, under NDA.
• Very complex product with Software,
Electronics, Mechanical parts, Engines
and Plastics components with design
needs.
• Time pressure from the market
Scrum for Hardware at Scale
Challenge: Many external
suppliers for SW and HW
components with a tight
schedule. How to manage the
complex dependencies?

The project started with a two day
LiftOff (as described in Diana Larsen’s
book) where we shared the Vision,
formed the development teams, defined
the working agreements and created the
backlog with a User Story Mapping.
Whole team alignment
Purpose
Alignme
nt
Context

Organizational Structure
MetaScrumScrum of Scrums
CPO Chief Product Owner
SSM Senior Scrum Master
PO Product Owner
SM Scrum Master
Product
Backlog

• We tried to do our first Sprint Planning projecting the
backlog on the wall from Jira. The result was a boring
meeting with very low energy.
• We asked the teams to behave like a real buffet: you
can't take too little, because it would not be polite, but
you can't take too much because you have to eat
whatever you take
• It resulted in a very energetic meeting where
discussions took place spontaneously; a managed
chaos
• It takes around one hour for the three teams. At the
end of the hour every team shares with the others
what they selected and the CPO checks the table to
see if there are high priority items still there. In that
(very rare) case, teams are asked to volunteer to
replace something they have with the remaining high
priority item
Buffet Planning

Deployment / Review
• Often during the Sprint, the Teams
integrate the product and deploy it
in a dedicated room, used also for
the Joint Sprint Review.
• The different products are installed
in several movable panels. They
can be taken to the team room
during the Sprint for convenience.
• This photo has been taken at the
beginning of the development and
shows the empty panels with no
products.

Results
Cumulative Yesterday’s Weather
0,00
15,00
30,00
45,00
60,00
Sprint 1 Sprint 3 Sprint 5 Sprint 7 Sprint 9 Sprint 11 Sprint 13 Sprint 15 Sprint 17 Sprint 19 Sprint 21 Sprint 23 Sprint 25
Cumulative HQ Teams Yesterday’s Weather
Sprint 8 = 6sp
Sprint 14 = 23sp
Sprint 26 = 55sp
In one Year
x 9.16 faster!
Yesterday’s Weather is the average velocity of the last 3 Sprints

Agile Organizations with Scrum@Scale

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