Over the last two decades, projects have grown exponentially in size as well as complexity, posing challenging situations for businesses and their project managers. It is no longer about managing a small team located on the same floor. Teams are larger, cross functional, and spread across the globe. Managing these cross functional teams to deliver different components of a larger product that work well together requires choosing the right project management approach. Shivoo Koteshwar, a Director with MediaTek India shares his insights – “Project management tools and methodology always oscillate between 2 paradigms: standardization and customization. The influencing factors are profitability, reliability, flexibility, power and value.”
Lean means efficiency
Lean project management methods are derived from Toyota’s Lean Manufacturing methodology, adapted to the software development processes. The main focus of this method is on the project management aspect vis-à-vis the development of software. The target is to improve the returns on the project by eliminating waste and reducing cost by following the guiding principles of eliminating waste, maximizing learning, deferring decisions until clear data is available and delivering fast. Lean methods also tend towards empowering the team, rather than top down decision making. Conceptual integrity is built in by making sure the system’s components work together as a whole, all while keeping an eye on the larger project objectives.
“Lean simply means doing more with less. It maximizes results with minimum effort, cost, material and time; the reason why most companies are now gravitating towards lean methodology. What works in its favor is its applicability across all industries and functions” shares Ruchi Bajpai, Practice Manager at Elixir Consulting.
Agile means flexibility
The Agile approach on the other hand, has an adaptive approach to development. The focus is on developing high quality software or products in short, iterative cycles, with quick feedback. Testing is also iterative and done in parallel with the development. Agile relies heavily on daily communication between all parties involved, in the form of stand-up or Scrum meetings. Processes are rather loosely defined as long as the above criteria are met.
While there are certain similarities between Lean and Agile methodologies, they are two very different approaches. Lean Methodologies use a predictive approach, focusing on the end results, planning in detail to reduce risk and eliminate waste. They are best suited for situations that are not very dynamic in nature. Gajanan Aiyer, Program Manager at InterContinental Hotels Group, and prior to that at IBM, shares “As per Lean methodology, projects are required to discard any processes that do not add value to the end result of the project. Lean Project Management is applicable in environments where the product is relatively stable and rather niche, so as to not be impacted by changing market preferences and competition. For example, a technology foundation overhaul would do perfectly well in a Lean Project Management model, but a Business Process overhaul is best delivered in the Agile way.”
As compared to Lean methods, Agile methods are more adaptive. The team and the workflow are finely tuned to adapt to any changes in the requirements and the environment. Agile methodologies are best suited to highly dynamic industries that are in the revolutionary phase. “Agile supports the dynamic nature of businesses by forcing the project team to assess product backlog at frequent intervals. It provides the team an opportunity to prioritize what’s most important to them from a business perspective”, says Mr.Aiyer.
All of these put together indicate that Lean methods are more suited for mature industries or processes where the product is well defined. “Lean processes are very effective in the standardization stage of a product’s evolution,” states Shivoo. In such cases, introducing Lean project management methodologies can help streamline the project, eliminate waste, and save costs.
One example is at ICICI Bank, where they use Lean methods for managing projects in their customer banking service. Over the years, the process and roles have all been clearly defined and pared down to best suit business needs, resulting in smoother workflows and increased productivity. Ruchi shares her experience with Lean methods at GE Capital, “Lean today is contributing to transformational changes within organizations. Coupled with Kaizen and Six Sigma, Lean methods can significantly reduce lead time in service industries. For example, while working with GE, Lean and Six Sigma helped us achieve significant cost reduction and improve quality standards.”
Even for a single product, different methodologies might be better suited at different stages of the product life cycle. Moreso for technology or software products. The early phases where the product is being designed requires multiple, fast, adaptive, iterations. In this phase, Agile methods may work well for the team handling the product. Once the product goes into mass production, Lean methodologies are better suited to improve on the work flow and product yield.
Shivoo has a slightly different take on the Lean vs Agile debate. “Depending on market maturity and needs, if we need to create differentiation and deepen customer partnerships, we sometimes needs to tweak the Lean process to respond to changing customer demands and be flexible on customization. This is the Agile process for me!” concludes Shivoo.