7.2: Agile HR - Video Tutorials & Practice Problems

<v ->Now, let us talk about Agile Human Resources or Agile HR.</v> The human resources function in multiple organizations around the globe is moving towards agility. This includes multiple areas, such as performance management, learning and talent development, compensation, and recruiting. Agile for HR looks at how HR can apply an Agile mindset and also various working methods within their own teams and products. And also, it looks at Agile adoption across the whole organization. Agile for HR has the potential to reinvent human capital organizations and change their operational model and overall, modernize HR as a profession. Any organization can realize the benefits by applying some basic concepts in their everyday work. This includes focus on outcomes versus processes, focus on the team versus individuals, and continuous improvement that leads to achieving efficiency and alignment. So in this sense, Agile includes an Agile mindset, Agile ways of working, organizational design of Agile, such as cross-functional teams that we discussed in less than six, and also it looks at establishing psychologically-safe organizations. This is usually done through collaboration and team empowerment. In order to develop a model for developing and sustaining Lean and Agile culture in the organization, HR professionals need to answer a number of questions. How to recruit and retain the right people? Rather than looking for people with the word Agile and Lean in their titles, the recruiting function needs to look for people with a Lean/Agile mindset, and that includes people who are customer-oriented, who are team-driven, those who have had a chance to work in an Agile environment and succeed there. The second question is, what does it mean to be an Agile or Lean HR function? Nowadays, performance review process has morphed into continuous feedback process. For example, Scrum builds feedback into its cadence. In lesson six, we discussed retrospectives. At equal intervals of time, the team meets and the team members provide direct process improvement feedback. This usually results in two to three action items that the team agrees to implement within their next iteration, and this process is ongoing. Meanwhile, team performance is very intentional, is driven by objectives and key results, and then teams self-assesses their performance against those predefined objectives on a regular basis. This includes quality, productivity, predictability, customer satisfaction, and employee happiness. Also, organizations use cascading goals, and the results are transparent across the organization. But, in the center is the continuous feedback. It is in the center of the performance review process as well with the feedback coming from leaders, peers, and clients in a 360-degree way. Now, let's talk about the third question. How does Agile or Lean organization handle compensation, recognition, and awards? There are too many major challenges in the Lean/Agile approach to employee recognition. So first, recognition comes from peers and customers rather than managers. Second is about awards. Awards are no longer individual and depend on team success. There is a great book about it, "Managing for Happiness," written by Jurgen Appelo. In this book, he describes all the multiple ways of recognition that happen in an Agile environment. An interesting example that is provided there is peer-to-peer bonus system, which Jurgen calls merit money. In this system, team members reward each other with credits, which are later translated into bonus money. And usually, it's awarded for collaboration and support. He provides the following example. Last month, on my team, Jennifer gave 15 credit to Lizette for being the backbone of the organization. Lizette, then, gave 25 credit to Sergei for the feedback and support. Sergei gave 10 credits to Chad for his terrific illustration, and Chad gave 20 credits to Hanno for his friendliness, clarity of communication. And on and on it went. At the same time, in the learning culture, there is no shameful failure. Mistakes are seen as a learning opportunity. Fail fast, succeed faster. Maybe you remember it from Lean startup concepts. So some companies even establish failure roles, where employees share their failures to allow others to learn from their mistakes. Now, the fourth question, how does Agile/Lean organization implement titles and promotions? Lean/Agile culture requires different thinking about organizational hierarchy and overall, the role of management. Managers and no longer assigning work or evaluating performance on their own. Rather, their role is to support employees, help with their development and growth, and provide tools. In most instances, mid-level managers are similar to playing coaches on their teams. This philosophy goes all the way to C-level management in Agile organizations. The principle is sometimes referred to as an inverted pyramid, where the role of an executive is to support and enable from the bottom of the inverted pyramid, where employees are the ones on top of the pyramid. While the manager is no longer assigned work to individual team members, this doesn't mean that there is chaos or anarchy, where everyone does whatever they like. With a clear definition of the company's objective and the team's goals, there is a clear understanding of what the outcomes are, there is alignment on deliverables, and transparency about overall progress. Now, the final question. How to create HR ecosystem in an Agile and Lean enterprise? We need to think of HR as the backbone of Lean and Agile, the one that empowers employees and teams and provides the underlying functions. It includes employee hiring, developments of the knowledge and skills, team enablement and recognition, and all of it is key to a Lean enterprise. This is one of the reasons why a success of Lean/Agile transformation is measured by two sets of parameters. The first step is in relation to business objectives and product delivery, such as time to market, quality, customer satisfaction. And the second set is employee-driven. It's represented as employee happiness, collaboration within the teams, employee retention rate, and overall, how comfortable, psychologically-safe, and happy people are on their job. This is also why work-life balance and sustainable pace for teams and individuals has become so important. Especially, that happened during the global pandemic, affecting all the people and organizations in unprecedented way. We do not talk that much about work-life balance, nine-to-five work day in an office environment. But rather, we talk about work-life fusion. It allows a person to dedicate time to the family as they need while being able to succeed in their job. And this can be easily done with the aid of modern technology, communications, and many tools that allow for building high performance globally distributed teams. There is a great book by Alberto Silveira called "Building and Managing High-Performance Distributed Teams," and this book provides excellent tips and guidelines how to create a successful work ecosystem and empower employees to seek their North Star. Another great idea is employee self-selection, when people decide which team they want to be part of. There are multiple examples of how thoughtful and well-executed self-selection mechanisms take teams to the next level. They create team productivity and work happiness. In her example of how HBC Universal ran their self-selection campaign, Agile coach Dana Pylayeva outlines a thoughtful step-by-step orchestrated process that provides a platform for team self-selection at the level of the whole company. Overall, Agile organizations implement an Agile mindset in all the aspects, from self-selecting teams to the culture of continuous learning and collaboration. There is no difference in Agile mindset in human resources or IT project delivery from this perspective.