{"id":1304,"date":"2017-05-08T17:58:30","date_gmt":"2017-05-08T15:58:30","guid":{"rendered":"http:\/\/leanmagazine.net\/?p=1304"},"modified":"2024-03-15T15:18:49","modified_gmt":"2024-03-15T14:18:49","slug":"transforming-e-on-into-an-agile-powerhouse","status":"publish","type":"post","link":"http:\/\/leanmagazine.net\/issues\/issue14\/transforming-e-on-into-an-agile-powerhouse\/","title":{"rendered":"Transforming E.ON into an Agile Powerhouse"},"content":{"rendered":"

\"eon-1\"<\/h2>\n

\u201cIt\u2019s crucial to find the right advocates and deliver success stories\u201d<\/b><\/span><\/em><\/h3>\n

German energy corporation E.ON is getting ready for the future by implementing a corporate-wide agile transformation. Lean Magazine got in touch with \u00a0two of the standard-bearers: Meggie Revesj\u00f6 and David White.<\/em><\/h2>\n

A changing society, rapid technical innovation and environmental concerns \u2013 the energy market is going through a far-reaching restructuring. For the major electric utility service providers, such as the German giant E.ON, this means both opportunities and challenges. To be able to respond more quickly to the needs, demands and constraints of the market, the company is now defining its own flavor of Agile Business. Not surprisingly, the entire process started in the IT department where management initiated a local transformation project back in 2010-2011.<\/span><\/p>\n

Different backgrounds<\/em><\/h3>\n

This initiative also meant the start of the professional collaboration between Meggie Revesj\u00f6 and David White. Before their career paths converged at E.ON, the two agile coaches had quite different professional experiences. Meggie had been around working with IT since 1995 as a consultant. For her, the agile journey started in the early 2000s as she became a project manager in agile projects. <\/span>
\n<\/span>\u201cThat showed very quickly the benefits of executing projects using Scrum,\u201d she recalls. \u201cBut at the same time, it also demonstrated all the pitfalls when you operate in \u2018water-scrum-fall\u2019 environments.\u201d <\/span><\/p>\n

Dave, on the other hand, describes himself as an old hand in IT with more than 30 years of experience. He got involved in RAD methods back in the 1990s when he was a developer, and then with Agile early in the 2000s. \u00a0<\/span>\u201cI\u2019ve worked for start-ups as well as large corporations and spent time as a self-employed consultant,\u201d he says. \u201cTo be honest I can\u2019t imagine going back to the old, traditional culture, methods and ways of running a business.\u201d<\/span><\/p>\n

Help from the agile community<\/em><\/h3>\n

When the agile transformation started at E.ON in 2011, the aim of the company\u2019s IT Management was to improve the whole project process. The agile advocates in the company successfully pitched their ideas on how to run things. They managed to convert a senior manager into a champion for their mindset and methods, and so things were able to get up to speed.<\/span>
\n<\/span>\u201cIn the beginning we started running projects using Scrum, developed essential training in-house, and created an agile community of practitioners,\u201d says Meggie Revesj\u00f6. \u201cWhen we reached enough volume of agile activities, business started to be involved. Last year the agile transformation initiative became official. Now we\u2019ve got the \u2018good enough\u2019 agile awareness in our company as well as a new strategy and focus for E.ON. In addition, another senior manager is willing to sponsor our ideas. From now on, we can target our efforts in the new way-of-working.\u201d<\/span><\/p>\n

The main source of knowledge and new insights for Meggie Revesj\u00f6 and David White has been the wider agile community, in which they are both deeply engaged. In addition, they keep in touch with their old colleagues and network at conferences, where they also often give presentations. <\/span>
\n<\/span>\u201cI suppose we absorb ideas from all over,\u201d says David White. \u201cI wouldn\u2019t say that we\u2019re inspired by anyone in particular \u2013 just by the changing world and by each other. Meggie and I are very different people, so we make a good team!\u201d<\/span><\/p>\n

The Agile change team of E.ON has chosen not to base their transformation enterprise on the larger frameworks SAFe, DAD and LeSS. At first, they looked into these, but soon decided that one size does not fit all. Instead, they have been building a framework of their own, based on the best practices they are picking up from other E.ON regions, other companies and their agile community.<\/span>
\n<\/span>\u201cThe British statistician George Box once said said \u2018all models are wrong, but some are useful\u2019,\u201d says David White. \u201cWe feel the same way about proprietary frameworks. The whole point of agility is that you experiment, inspect and adapt to create something that works for you. It therefore seems incongruous to then implement someone else\u2019s prescriptive framework.\u201d<\/span><\/p>\n

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The foundations of the new Way-of-Working at E.ON<\/em><\/h3>\n
    \n
  • Cultural change.<\/li>\n
  • Management change to servant leadership.<\/li>\n
  • Moving towards an Agile organization.<\/li>\n
  • Defining and implementing the right and necessary skillset.<\/li>\n
  • Providing best practices for covering the whole timeline – from idea to product\/service.<\/li>\n<\/ul>\n<\/div>\n

    \"eon-2\"<\/p>\n

    \n

    David White on getting management support <\/em><\/h3>\n

    \u201cWe did run a number of Scrum projects under the radar before we were really supposed to (as such, it was kind of a pirate movement!). This created a lot of grassroots pressure for a real revolution in how we work. I think the lesson is that you need to go and persuade senior management to get on board and create top-down initiative for change. You\u2019ve got to do a lot of cold selling and persuasion, not just in IT but in the business as well. We\u2019ve had really fantastic support from senior management once we got them on board with our revolution and we\u2019re really grateful for that; I don\u2019t think we\u2019d have made progress without. The point here is that agile IT and agile business make no sense separately \u2013 it has to be a holistic end-to-end delivery model with the culture and organization to support it. In the new world, IT is no longer a support function, IT is the business in many ways.\u201d<\/p>\n<\/div>\n

    Developing their own way-of-working<\/em><\/h3>\n

    Instead, the Agile change team at E.ON has rather taken ideas from all the different frameworks, looked at what others are doing and then \u2013 most importantly \u2013 started by establishing values and principles. The ideas, methods and experience needed is not intellectual property locked up in a vault \u2013 instead, it is free for the taking on the internet in thousands of blogs.<\/span>
    \n<\/span>\u201cOur protocol has been to start small, experiment, develop our own way-of-working, let it evolve and don\u2019t try to make one size fit all,\u201d says David White. \u201cDifferent business areas and regions will evolve different ways of working around the common theme of agile business. Proprietary frameworks contain some good ideas, but they\u2019re often implemented as totalitarian and prescriptive processes \u2013 and of course have become a vehicle for consultants to sell voodoo.\u201d<\/span><\/p>\n

    The main goal is now to turn E.ON into an agile company. The agile change team aim to give the best support to all regions within the corporation. Thirteen local agile coaches from their group of practitioners have been allocated as multipliers \u2013 training, coaching and bringing others on board. <\/span>
    \n<\/span>\u201dDuring 2017-2018 we want to have three things in place,\u201d Meggie Revesj\u00f6 says. \u201cFirstly, the right skills in all regions. Secondly, servant leadership for self-organizing teams focused on delivering valuable products to our customers. And finally, the right organization enabling our business to have the proper capacity to respond to market changes and a sensitivity to change. As we have different Agile maturity, needs and priorities in the regions, it is up to local agile coaches and local business to decide the highest value and urgency of the above for them, \u2013 and also the speed of implementing it in the regions. Our responsibility is to provide a starting framework, to coach and support when and where it is needed, and finally to share good practice and knowledge.\u201d<\/span><\/p>\n

    Sowing the seeds for change<\/em><\/h3>\n

    The industrial history of E.ON goes back almost a hundred years. The old, reliable business model was to generate power from fossil fuels and sell commodity. This model has now become obsolete with changing energy markets and growing environmental concerns.<\/span>
    \n<\/span>\u201cE.ON has now refocused on renewable energy and digital energy solutions,\u201d says David White. \u201cThat\u2019s an emerging marketplace and one that we need to shape in order to stay in business. I think the only constant thing in the future will be change, so I don\u2019t see this as a one-off transformation programme \u2013 instead, it\u2019s about sowing the seeds for constant evolution and occasional revolution. I don\u2019t see the world standing still any time soon. I think the vast majority of the company will be touched by this.\u201d<\/span><\/p>\n

    Looking back at the work so far, the change team is especially satisfied with building an agile community within the corporation, spreading awareness, as well as bringing the existing brainpower and engagement into the light. But still there are challenges to deal with, for example E.ON\u2019s organizational structure, middle management and culture.<\/span>
    \n<\/span>\u201cWe had a lot of early success with the Wholesale Gas business in Munich back in 2011,\u201d recalls David White. \u201cThat proved to be a lighthouse that inspired many more since. We\u2019ve also transformed the way that we deliver change in the Energy Solutions business in Sweden. Now we see other parts of the company in other countries wanting to do the same. We\u2019ve had a lot of great Agile projects that have brought our people closer together, broken down walls and delivered some great products. I guess the challenges are the same as all large companies trying to make this change. Corporate culture, processes, organization structure, the investment and controlling model are all built for the past industrial age. Changing those things isn\u2019t easy!\u201d<\/span><\/p>\n

    Involving the organization<\/em><\/h3>\n

    As E.ON is a multinational industrial group, containing organizations that have their own company history, and so corporate culture is not homogenous. This of course creates special challenges.<\/span>
    \n<\/span>\u201cI would say that in some countries or business areas, the hierarchal structure and processes are very strong,\u201d says Meggie Revesj\u00f6. \u201cIn these cases, it\u2019s crucial to find the right advocates and deliver success stories which prove it works and brings benefits. Culturally, we\u2019re dealing with the remains of a demand and control world. Our solution is to involve as many as possible in agile movement, both from IT and business, and to show good examples and good alternatives to support the change to self-organization and empowerment. The lesson here is to think big but to start small \u2013\u00a0then you can break the resistance!\u201d <\/span><\/p>\n

    Every day, Meggie Revesj\u00f6 and David White see the well-known challenges which the cross-cultural communicator Richard Lewis described in his famous book \u201cWhen Cultures Collide\u201d.<\/span>
    \n<\/span>\u201dSure, they\u2019re challenges but that\u2019s what makes the job fun,\u201d says David White. \u201cWe work with so many different people in so many different places. They share some ideas and some problems but many are unique. It\u2019s incredibly rewarding to listen to those people, to inspire them, to share the difficulties and to celebrate the successes with them. I\u2019ve worked in a lot of different industries and energy sector people really are some of the nicest that I\u2019ve met. I think that all human beings operate on the same hardware platform. They\u2019re just people \u2013 but as times change sometimes we all need a firmware upgrade.\u201d<\/span><\/p>\n

     <\/p>\n

     <\/p>\n

    \n

    What Meggie and David have learned from\u00a0E.ON\u2019s agile transformation<\/em><\/h3>\n

    Do not try to copy solutions from other companies<\/b>
    \n<\/b>Be inspired but find your own way and use your own people. Find senior management sponsors, involve the business and start to drive an agile mindset from there.<\/span><\/p>\n

    Start small, think big, learn fast<\/b>
    \n<\/span>Be open-minded and courageous \u2013 the best solutions follow a sort of \u2018guided evolution\u2019 approach, so don\u2019t be afraid to just start with some Scrum teams. The obstacles that they encounter are the organizational and cultural impediments that you have to knock down, one by one. <\/span><\/p>\n

    People have to <\/b>want<\/i><\/b> the change and they have to <\/b>own<\/i><\/b> it<\/b>
    \n<\/span>The agile transformation should not be <\/span>yet another<\/span><\/i> management-imposed initiative. As a result, it is obvious that management needs to actively sponsor you. Change is much more sustainable if you build in-house expertise rather than throwing money at consultants; your own staff must have a passion for making the company a better place. <\/span><\/p>\n

    Handpick your advisors<\/b>
    \n<\/span>The big consulting firms largely lack the mindset, culture and expertise in this field. You pretty much have to do it yourself along with the small specialist firms who really understand what Agile is about. <\/span><\/p>\n

    Beware of so called Cargo Cult Agile<\/b>
    \n<\/span>Don\u2019t expect that Agile will happen by itself, just because you set up a framework. This stuff is 95% culture and 5% practice.<\/span><\/p>\n<\/div>\n

    Read the article in Lean Magazine on issuu.com<\/h2>\n
    <\/div>\n