The Problem with Growth: Why Everything is Failing Now
The debates over frameworks like Scrum vs. SAFe or Design Thinking vs. Lean UX often overlook a critical point that is undermining companies. When the Agile Manifesto was created in 2001, it aimed to revolutionize the way companies operate. By 2023, 71% of U.S. companies had adopted Agile methodologies. Originally intended to promote a responsive mindset, Agile has become more about adhering to specific processes.
Agile, initially designed for engineering teams, expanded to entire organizations, leading to the development of scaled frameworks to coordinate teams across companies. This expansion fueled a training and certification industry, with the enterprise Agile transformation market projected to reach $142 billion by 2032. However, 83% of managers cited “fast deliveries to customers” as their primary goal for these transformations, which has led to significant issues.
Product Teams and Scrum@Scale
Scrum@Scale references Harvard research suggesting the optimal team size is four or five people. A Scrum of Scrums Team should consist of four or five teams of this size, responsible for delivering integrated product increments each Sprint. The Scrum Guide emphasizes that Scrum Teams are cross-functional and small, with team members expected to learn various roles. However, companies still need specialists, as the expectation that every team member can perform all tasks is unrealistic.
Specialists in a Generalist World
The popular frameworks, often developed by engineers, tend to overlook non-software development functions. In many companies, engineers have little interaction with other departments, leading to a disconnect. Frameworks like SAFe attempt to integrate “the business” but often do so with overly prescriptive processes. User research is frequently neglected or assumed to be the responsibility of the team members, rather than specialists.
The Things We Have Forgotten
Business strategy, as taught by Michael Porter, emphasizes understanding customer needs, competition, and a company’s capabilities. Porter’s tools, such as the Five Forces and Value Chain models, highlight functions often missing from Agile frameworks. Market research, a crucial business function, has been largely replaced by Lean UX in startups, leading to unqualified teams making critical decisions.
The Problem with Growth
Companies face three potential outcomes: failure within the first year, stabilization as a boutique company, or rapid growth into a large company. Rapidly growing companies often struggle due to a lack of systems for selling new products to new customers. Hypergrowth companies are rarely profitable long-term, with “ran out of cash” becoming a leading reason for failure by 2021.
No Checks, No Balances
Risk management and market research are often overlooked. Recent incidents, such as CrowdStrike’s outage and Microsoft’s Azure DDoS attack, highlight the importance of thorough software testing and risk management. Companies that neglect these areas face significant financial and reputational damage.
Enshittification and Bad Service
Cory Doctorow’s term “enshittification” describes the shift from customer-centric to corporate-centric practices, where companies prioritize profits over customer satisfaction. This approach leads to poor service and customer dissatisfaction, costing companies billions annually.
What Can We Do?
Neither traditional waterfall nor Agile frameworks are sufficient for modern business needs. A new system is needed, one that acknowledges both the dynamic nature of business and the foundational work of strategists like Porter. This system should emphasize the value of human resources and provide a win-win for all stakeholders. While such a system does not currently exist, the call for change is growing, and the potential for transformation remains.
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