Agility

DI in Industry (DIiI)

Andy Weeger

Neu-Ulm University of Applied Sciences

April 4, 2026

Motivation

Agile organizations are both stable and dynamic at the same time. They design stable backbone elements that evolve slowly and support dynamic capabilities that can adapt quickly to new challenges and opportunities. McKinsey & Company

Introduction

Let’s discuss

What does agility in a general business context mean?

What is agile?

The term agility has been increasingly used in management literature since the late 20th century (Harraf et al., 2015).

Around the same time, agile approaches gained prominence in software development, leading to the publication of the agile manifesto in 2001 (Beck et al., 2001).

Over the past two decades, organizational theorists have focused extensively on how agile performance enable companies to successfully adapt to rapidly changing and unpredictably disruptive environments (see e.g., Adler et al., 1999; Grewal & Tansuhaj, 2001; Judge & Miller, 1991; Smith & Lewis, 2011).

Common themes

Several common themes in literature Harraf et al. (2015) have identified:

  1. A specific set of organizational sense-response actions that are typical for organizations operating in an environment characterized by turbulence, unpredictability, and rapid change (i.e., VUCA environments).
  2. Agile organizational sense-response actions can be specified using a bi-dimensional concept of magnitude of variety change1 (flexibility) and rate of generating variety change2 (speed).
  3. Agility is a function of environmental conditions (the industry), exhibiting varying levels of market turbulence, competitive intensity, and customer need heterogeneity.
  4. The likelihood of observing a positive effect of agility on performance (e.g., efficiency, innovativeness) is greater in fast-changing environments.

Towards a definition

Literature suggests that organizational agility can neither be reduced to a singular dimension nor is it appropriately calibrated in absolute terms. In terms of the four key points outlined before, organizational agility can be formally defined as follows:

It is the ability of a firm to sense and respond to the environment by intentionally changing (1) magnitude of variety and/or (2) the rate at which it generates this variety relative to its competitors (Harraf et al., 2015).

It is a firm’s ability to sense changes in its environment (like customer preferences, new technologies, etc.) and respond effectively and intentionally by adjusting what it does.

Visualization

Figure 1: A two-dimensional framework for conceptualizing organizational agility (Harraf et al., 2015)

Characteristics

Agile organizations explore and exploit opportunities for innovation and competitive performance by resolving the efficiency/flexibility tradeoff to simultaneously pursue both. Sambamurthy et al. (2003)

Ambidexterity and agility

In general, ambidexterity refers to the combination of both incremental, more efficiency-oriented innovation (i.e., exploitation) and radical, novelty-oriented innovation practices (i.e., exploration) (Clauss et al., 2021).

Operational ambidexterity “relates to a firm’s dual capacity to simultaneously pursue not only the implementation of disruptive ideas [… ] but also the enhancement of the firm’s current operational speed, reliability, and cost” (Lee et al., 2015, p. 401).

IT ambidexterity relates to “the ability of firms to simultaneously explore new IT resources and practices (IT exploration) as well as exploit their current IT resources and practices (IT exploitation)” (Lee et al., 2015, p. 398).

Lee et al. (2015) shows that IT ambidexterity enables operational ambidexterity, which enhances organizational agility.

IT x organizational agility

Discussion

How does IT relate to organizational agility?

IT competences and digital options

IT competence describes a firm’s ability to translate available IT resources into strategic digital options (Sambamurthy et al., 2003).

Digital options are IT-enabled capabilities in the form of digitized work processes and knowledge systems (e.g., digital process capital3 and digital knowledge capital4) that the firm can exercise selectively as conditions evolve (Sambamurthy et al., 2003).

These capabilities are not acquired instantaneously. They emerge from a series of linked strategic decisions about IT investment over time (Sambamurthy et al., 2003).

The richness of a firm’s digital option set therefore depends on how its digital artifacts are architected, i.e., which properties make options broad, fast, and externally extensible.

Architectural enablers

Strategic agility demands a sense-respond loop. Three structural properties of digital artifacts determine how fast and how broadly that loop can operate: modularity, reprogrammability, and programmatic interfaces.

The structural properties of digital artifacts are the architectural enablers of the two agility dimensions Harraf et al. (2015) identify: they determine how broadly a firm can change its variety (magnitude) and how fast it can do so (rate).

Modularity x variety

Modularity decomposes a system into loosely coupled, independently deployable components.

  • Each module encapsulates a well-defined function behind a stable interface
  • Modules can be recombined into new configurations without redesigning the whole (Yoo et al., 2010)
  • Recombinability expands the firm’s option set (i.e., the range of distinct responses it can assemble)

Modular architectures therefore directly increase the magnitude of variety change (Harraf et al., 2015): the same component pool yields a wide range of differentiated products, services, and processes on demand.

Reprogrammability x rate

Reprogrammability allows a digital artifact’s encoded logic to be altered without changing its physical substrate (Yoo et al., 2010).

  • Business logic (e.g., pricing rules, workflows, eligibility criteria) can be updated in hours or days
  • Logic fluidity decouples the pace of operational change from the pace of capital investment
  • Software ships continuously; hardware refresh cycles are measured in years

This decoupling is the primary digital lever on the rate of variety change (Harraf et al., 2015): the speed at which a firm executes, tests, and revises a strategic move.

Interfaces x ecosystems

Programmatic interfaces (APIs) standardize the terms on which a firm’s digital capabilities connect to and draw upon external parties.

  • A published API is a formal offer to co-create value with partners, developers, and complementors
  • Boundary spanning through APIs converts partner networks into real-time operational capacity
  • External resources (i.e., logistics, payments, identity, AI services) become exercisable on demand

APIs are therefore the digital foundation of partnering agility (Sambamurthy et al., 2003): the ability to marshal external assets and knowledge rapidly in response to market opportunities or threats.

From digital traits to agility

Digital trait Mechanism Strategic outcome
Modularity Recombinability Maneuverability: breadth of feasible responses
Reprogrammability Logic fluidity Versatility: speed of operational change
Interfaces (APIs) Interconnectivity Ecosystem agility: depth of externally leveraged capacity
Table 1: Digital traits and agility (Sambamurthy et al., 2003)

Each trait generates digital options: pre-positioned capabilities the firm can exercise selectively as environmental conditions evolve (Sambamurthy et al., 2003).

The organizational mirror

The same structural properties that make digital systems agile must be present in organizational design for digital options to be exercisable.

Organizational design Mechanism Agility outcome
End-to-end teams Team recombination (i.e., recombinability) Structural maneuverability
Sprint / PI planning Priority reconfiguration (i.e., fluidity) Strategic versatility
Defined team contracts Reduced coupling (i.e., interconnectivity) Inter-team agility
Table 2: Organizational analogs (Sanchez & Mahoney, 1996; Skelton & Pais, 2019)

A modular technology stack paired with siloed departments cannot recombine quickly; both layers must be co-designed (Sanchez & Mahoney, 1996; Skelton & Pais, 2019).

Types of agility

Types of agility supported by IT as identified by Sambamurthy et al. (2003):

  • Customer: Ability to co-op customers in exploration and exploitation of innovation opportunities (source, co-creators, testers).
  • Partnering: Ability to leverage assets, knowledge, and competencies of suppliers, distributors, contract manufactors and logistics providers in the exploration and exploitation of innovation opportunities.
  • Operational: Ability to accomplish speed, accuracy, and cost economy in the exploitation of innovation opportunities.

Agile IT project management

The approach to IT project management defines how IT resources are developed, orchestrated, and, best case, translated into strategic digital options.

The foundation of methods to agile IT project management is the agile manifesto (Beck et al., 2001), which defines following key values and principles:

  • Individuals and interactions over processes and tools
  • Working software over comprehensive documentation
  • Customer collaboration over contract negotiation
  • Responding to change over following a plan

These key values and principles aim to enable organizations to better deal with rapid changes in customer demands, markets and technology by, e.g., decreasing lead-time, increasing change rate, and the degree of variety change.

Discussion

How do agile methods like scrum implement the key values and principles?

Agile at scale

Introduction

Agile project management methods were originally designed for use in small, single-team projects (Boehm & Turner, 2005).

Compared to small projects and teams, large projects and organizations require additional coordination (i.e., inter-team coordination)

In addition, adopting agile at scale often requires tradeoffs as interacting with organizational units that are often non-agile in nature is required (e.g., HR) and/or a change of the entire organizational culture (Misra et al., 2010) .

Another key challenge is that management must move away from traditional hierarchical models (e.g., lifecycle-based) to autonomous, iterative models (e.g., feature-based), which requires a change of mindset.

Definition

Dikert et al. (2016) define large-scale as software development organizations with 50 or more employees or at least six teams.

All people do not need to be developers, but must belong to the same organization and develop a common product or project, and thus have a need to collaborate.

This definition includes both software development companies and as the parts of larger (non-software) organizations that develop software (i.e., the application development unit within corporate IT).

Transformation challenges

Dikert et al. (2016) identified challenges in nine cateogires for large-scale agile transformations

  • Resistance to change (e.g., general resistance, management resistance)
  • Lack of investment (e.g., lack of coaching, training, adapting physical spaces)
  • Difficulties of implementation (e.g., lack of guidance, poor customization)
  • Coordination challenges in multi-team environment (e.g., interfacing, autonomous team model, technical consistency)
  • Different approaches (e.g., different interpretations, old and new side by side)
  • Hierarchical management and organizational boundaries (e.g., silos kept, old-styled management)
  • Requirements engineering challenges (e.g., gap between long and short-term planning)
  • Quality assurance challenges (e.g., lack of automated testing)
  • Integrating non-development functions (e.g., adjusting to incremental delivery pace)

Frameworks

To address challenges to adopting agile methods in large, more traditional organizations, several agile scaling opportunities have been created (Dikert et al., 2016; Uludağ et al., 2021, 2022).

Examples

Short name Long name/topic Publ. year Cur. year Stand. org.
LeSS Large-Scale Scrum 2013 2015 The Less Co.
Nexus Scaling Scrum 2015 2018 Scrum.org
SAFe Scaled Agile Framework 2011 2020 Scal. Ag., Inc.
Spotify Scaling agile 2014 2014 Spotify

Maturity

Figure 2: Transformation maturity model (Stettina et al., 2021)

SAFe

What SAFe is

A framework developed by Dean Leffingwell (2011) as a synthesis of Lean, Agile, and DevOps principles for enterprise-scale delivery

  • Four configurations: Essential, Large Solution, Portfolio, and Full SAFe
  • Provides an explicit organizational model (roles, events, artifacts) rather than a set of principles to interpret
  • The most widely adopted scaling framework, and the most contested (Dikert et al., 2016)

Important concepts

  • Agile Release Train (ART): 50–125 people, long-lived, aligned to a value stream; the primary unit of delivery and planning
  • Program Increment (PI): Fixed timebox of 8–12 weeks; the cadence that synchronizes all teams on the ART
  • PI Planning: Two-day synchronization event; all ART members align on objectives, dependencies, and risks
  • Iterations: 2-week sprints nested within the PI; teams deliver working software increments
  • Innovation and Planning (IP) iteration: A dedicated iteration at the end of each PI for exploration, technical debt reduction, and planning preparation
  • Inspect and Adapt (I&A) workshop: Structured retrospective closing each PI; identifies and addresses systemic impediments

The four configurations

SAFe scales by composing layers. Each configuration adds the layer above to the previous one.

Configuration Adds Suits organizations with
Essential One ART, PI cadence, core ceremonies A single value stream, 50–125 people
Large Solution Solution Train coordinating multiple ARTs Complex solutions requiring several ARTs and suppliers
Portfolio Lean Portfolio Management, strategic themes, value stream funding Multiple value streams requiring strategic alignment
Full SAFe All layers active Enterprises operating across all of the above
Table 3: SAFe configurations (Knaster & Leffingwell, 2020)

Configurations are not maturity stages. An organization with one value stream stays at Essential and is not “less mature” than one running Full SAFe, but it has a different problem.

Example

All four configuration levels are simultaneously active in one company, here Zalando (Berlin-based online fashion retailer operating across Europe wit approx. 17,000 employees):

  • Feature team: The checkout team owns the moment a customer clicks “place order” end to end (UI, API, database, confirmation email); ~9 people, ships independently
  • ART: ~12 feature teams (~110 people) aligned to the online shopping value stream create the customer experience; synchronizes on a 10-week PI cadence
  • Solution Train: Four ARTs (customer experience, mobile, search & personalization, payments) jointly deliver the integrated Shopping product
  • Portfolio: Shopping is one value stream alongside Marketplace, Logistics Solutions, Connected Retail, and Marketing Services, each competing for strategic investment

SAFe in the Harraf framework

SAFe is engineered for adapters more than disrupters (Harraf et al., 2015).

The cadence-based design optimizes the rate of variety change through synchronized inspect-and-adapt loops, but the same cadence limits the magnitude per cycle..

SAFe is not “more agile” in an absolute sense. It is a particular design point in the agility space.

ARTs x magnitude

Agile Release Trains instantiate the modularity argument at the organizational level.

  • An ART is a stable, long-lived team-of-teams aligned to one development value stream
  • Teams within an ART are feature teams that own a slice of customer value end to end (e.g., checkout, search), not component teams that own a technical layer (e.g., frontend, database)
  • Shared services and platform teams provide common capabilities behind stable interfaces
  • Between PIs, teams can be recombined within or across ARTs without organizational restructuring

ARTs therefore expand the firm’s magnitude of variety change (Harraf et al., 2015): the same pool of teams can be reconfigured to serve a wider range of strategic responses without redesigning the organization.

PI cadence x rate

The Program Increment instantiates reprogrammability at the organizational level.

  • Each PI is a periodic re-execution of organizational logic: priorities, scope, capacity allocation, and dependencies are all set anew
  • The Inspect & Adapt workshop functions as continuous deployment of organizational improvements
  • Reconfiguration happens without restructuring: no reorgs, no formal change management, just the next PI
  • The IP iteration provides the buffer for retooling before the next cycle begins

PI cadence therefore directly governs the rate of variety change (Harraf et al., 2015): the speed at which the organization can intentionally redirect its delivery capacity.

Team interactions x ecosystems

Team interaction patterns instantiate the programmatic interface argument (Skelton & Pais, 2019).

  • Collaboration: two teams work closely together for a bounded period, typically during discovery or when boundaries are unclear
  • X-as-a-Service: one team consumes another team’s capability through a defined “API” (documented service, predictable behavior, low-friction integration)
  • Facilitating: one team helps another build new capability and then steps back

The Architectural Runway is the internal technical equivalent: pre-built code, components, and infrastructure exposed to ARTs as a stable platform on which near-term features can be built without redesign.

SAFe x ambidexterity

How does SAFe structure the exploration–exploitation balance (Lee et al., 2015)?

Exploitation: the PI delivery cadence with committed team and ART objectives drives execution discipline; teams deliver working increments against a known plan.

Exploration: the IP iteration and Architectural Runway provide structural capacity for innovation, debt reduction, and capability building outside normal delivery pressure.

Agility in a nutshell

Digital trait SAFe analog Mechanism
Modularity ARTs and Solution Trains Recombinable team-of-teams aligned to value streams
Reprogrammability PI cadence, I&A, IP iteration Periodic re-prioritization without restructuring
Programmatic interfaces Team interaction patterns, Architectural Runway Standardized integration points across ARTs
Table 5: SAFe instantiates the digital traits from Table 1 at the organizational level

SAFe is, read this way, an applied instance of Sanchez & Mahoney (1996)’s claim: modular technical architectures both require and produce modular organizational forms.

Challenges

SAFe addresses the agile challenges discussed by Dikert et al. (2016), but it can also exacerbate them.

Challenges addressed by SAFe’s structural mechanisms

  • Coordination challenges: PI Planning for explicit dependency management
  • Requirements engineering challenges: portfolio-to-PI-to-iteration hierarchy
  • Hierarchical management: Lean Portfolio Management replaces traditional project governance

Potentially aggravated by SAFe’s design choices

  • Resistance to change: comprehensiveness can trigger resistance
  • Different approaches: detailed prescriptions create friction when teams adapt selectively
  • Integrating non-development functions: SAFe assumes broad organizational participation that many implementations never achieve

The SAFe paradox

The framework that scales agility relies on heavy process scaffolding, in tension with the manifesto’s “individuals and interactions over processes and tools.”

Potential dysfunctions

  1. Agile theater: ceremonies without mindset change; teams follow the calendar but not the principles
  2. Process ossification: the cadence becomes the goal; teams optimize for PI completion rather than value delivery
  3. Top-down/bottom-up tension: portfolio governance constrains the team autonomy that agile requires

A firm can be procedurally compliant with SAFe and still be an indifferent on the Harraf matrix, going through the motions of synchronized cadence without generating meaningful variety change (Harraf et al., 2015).

When SAFe is the right answer

SAFe suits organizations with:

  • Regulatory or contractual planning horizons that require multi-quarter predictability
  • Large existing application portfolios with significant dependency and migration management needs
  • Mixed agile and non-agile interfaces
  • A need for a shared governance language across business and IT at scale

SAFe suits less well when:

  • The organization is small or its teams are already high-performing and loosely coupled
  • Products operate on sub-monthly feedback cycles where PI cadence introduces overhead without value

Q&A

Literature

Adler, P. S., Goldoftas, B., & Levine, D. I. (1999). Flexibility versus efficiency? A case study of model changeovers in the toyota production system. Organization Science, 10(1), 43–68.
Beck, K., Beedle, M., Van Bennekum, A., Cockburn, A., Cunningham, W., Fowler, M., Grenning, J., Highsmith, J., Hunt, A., Jeffries, R., et al. (2001). The agile manifesto.
Boehm, B., & Turner, R. (2005). Management challenges to implementing agile processes in traditional development organizations. IEEE Software, 22(5), 30–39.
Clauss, T., Kraus, S., Kallinger, F. L., Bican, P. M., Brem, A., & Kailer, N. (2021). Organizational ambidexterity and competitive advantage: The role of strategic agility in the exploration-exploitation paradox. Journal of Innovation & Knowledge, 6(4), 203–213.
Dikert, K., Paasivaara, M., & Lassenius, C. (2016). Challenges and success factors for large-scale agile transformations: A systematic literature review. Journal of Systems and Software, 119, 87–108.
Grewal, R., & Tansuhaj, P. (2001). Building organizational capabilities for managing economic crisis: The role of market orientation and strategic flexibility. Journal of Marketing, 65(2), 67–80.
Harraf, A., Wanasika, I., Tate, K., Talbott, K., et al. (2015). Organizational agility. Journal of Applied Business Research (JABR), 31(2), 675–686.
Judge, W. Q., & Miller, A. (1991). Antecedents and outcomes of decision speed in different environmental context. Academy of Management Journal, 34(2), 449–463.
Knaster, R., & Leffingwell, D. (2020). SAFe 5.0 distilled: Achieving business agility with the Scaled Agile Framework. Addison-Wesley Professional.
Lee, O.-K., Sambamurthy, V., Lim, K. H., & Wei, K. K. (2015). How does IT ambidexterity impact organizational agility? Information Systems Research, 26(2), 398–417.
Misra, S. C., Kumar, V., & Kumar, U. (2010). Identifying some critical changes required in adopting agile practices in traditional software development projects. International Journal of Quality & Reliability Management.
Sambamurthy, V., Bharadwaj, A., & Grover, V. (2003). Shaping agility through digital options: Reconceptualizing the role of information technology in contemporary firms. MIS Quarterly, 237–263.
Sanchez, R., & Mahoney, J. T. (1996). Modularity, flexibility, and knowledge management in product and organization design. Strategic Management Journal, 17(S2), 63–76. https://doi.org/10.1002/smj.4250171107
Skelton, M., & Pais, M. (2019). Team topologies: Organizing business and technology teams for fast flow. IT Revolution Press.
Smith, W. K., & Lewis, M. W. (2011). Toward a theory of paradox: A dynamic equilibrium model of organizing. Academy of Management Review, 36(2), 381–403.
Stettina, C. J., Els, V. van, Croonenberg, J., & Visser, J. (2021). The impact of agile transformations on organizational performance: A survey of teams, programs and portfolios. International Conference on Agile Software Development, 86–102.
Uludağ, Ö., Philipp, P., Putta, A., Paasivaara, M., Lassenius, C., & Matthes, F. (2022). Revealing the state of the art of large-scale agile development research: A systematic mapping study. Journal of Systems and Software, 111473.
Uludağ, Ö., Putta, A., Paasivaara, M., & Matthes, F. (2021). Evolution of the agile scaling frameworks. International Conference on Agile Software Development, 123–139.
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Footnotes

  1. Magnitude of variety change includes the decision alternatives generated, different strategies deployed, new products and lines introduced, non-routine tasks added to the repertoire of routine tasks, and product variations offered.

  2. Rate of variety change—defines the temporality of change and relates to the change in variety per unit of time.

  3. Digital process capital is the IT-enabled inter- and intra-organizational work processes for automating, informating, and integrating activities (e.g., customer acquisition, order fulfillment, supply chain, product innovation, and manufacturing flow) and creating a seamless flow of information (Sambamurthy et al., 2003, p. 247).

  4. Digitized knowledge capital is the IT enabled repository of knowledge and the systems of interaction among organizational members to generate knowledge sharing of expertise and perspectives (Sambamurthy et al., 2003, p. 247).