Management 4.0 E-Book

Patrick Balve

• Herausgeber: Books on Demand
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 352

Veröffentlichungsjahr: 2019

Beschreibung

Who should read this Book? This book is written for anyone who is interested in agility or needs to be agile. It is for those who seek deeper knowledge about what keeps the agile world together. You can read it from the perspective of a top manager or decision maker who feels the urge to be more agile. But you can also take the book and just follow it from the perspective of a user. What do you get? - A systemic picture of agility - to enable you to analyse your system (your team, your department, your company or your business network) and identify fields of agile application and the specific need for agility. - The ingredients of an Agile Mindset - this allows you to transform your organization and develop an agile culture for your organization. - The theoretical foundation of agile principles - so that you can really understand and assess the value of all the expert ideas for you and your organization. You will get the necessary skills to tailor organization specific agile frameworks without losing essential ingredients. - Input for your own reflections - you will be capable of innovating agility and be ahead of the main stream.

Leseprobe

This handbook is created under the direction of the “Agile Management” professional group of the GPM German Association of Project Management e.V.

The book is published under the Creative Common License:

www.creativecommons.org

CONTENTS

THE AUTHORS

PREFACE

PRODUCT BACKLOG

CHANGES from RELEASE 2 to RELEASE 3

PART I – FOUNDATION

1 Agile Management – Traditional Management has reached its Limit

2 Management Models over the Course of Time

3 Theoretical Foundation

3.1 Positioning: Models, Theoretical Approaches, Definitions

3.2 Mindset of Agile Management 4.0

3.3 Complexity, Agility and Agile Management

3.4 Self-organization

3.5 Principles of Scrum and Kanban Agile Frameworks

4 Agile Leadership 4.0

4.1 Principles of Agile Leadership 4.0

4.2 Agile Leadership 4.0 – Digital Network Intelligence

5 Cybernetics and Organization

5.1 Agile Enterprise Structures from a Cybernetic Perspective

5.2 Agile and Fluid Organization

6 Reference Model Agile Organizations

PART II – BECOME AGILE AND STAY AGILE

7 The Impact of Working Agile on Human Resources

8 Reliable and Ultimate Scrum

9 Agile PMO 4.0

10 Agile Scaling

10.1 Scaled Agile Management 4.0 - new

10.2 Scaling Agile by using Critical Chain Project Management

11 Agile Transformation 4.0 - new

PART III Agile Management in Practice

12 Learnings and Guidance for the Implementation of Agility - new

13 Interaction Patterns for the Digital Transformation - new

(Figure based on http://www.forbes.com/sites/stevedenning/2016/09/08/explaining-agile/#727a73c12ef7, accessed 15/12/2016)

With a systemic leadership approach, Management 4.0 provides the guiding competence for viable learning organizations in complex situations and environments.

Management 4.0 integrates an Agile Mindset, the universal principle of self-organization as a governance guideline, and relevant work techniques, for sustainable working models of the future.

THE AUTHORS

Prof. Dr.-Ing. Patrick Balve

Heilbronn University, Faculty for Industrial and Process Engineering, 74081 Heilbronn

holds a master’s degree in Mechanical Engineering with specialization in International Project Management. After graduating, Dr. Balve spent five years in the field of consulting and research at the renowned Fraunhofer-Institute for Manufacturing Engineering and Automation. Since then, he has held various management positions in logistics and quality in the automotive industry. In 2009, Dr. Balve was appointed professor at Heilbronn University in the Faculty of Industrial and Process Engineering. He is director of the “Manufacturing and Operations Management” bachelor’s program and head of the Heilbronn Learning Factory. His fields of research include lean manufacturing systems and state-of-the-art project management approaches.

Dr. Frank Edelkraut

Mentus GmbH, 22359 Hamburg

is Managing Director and a well-versed Human Resources manager. As a Technical Chemist he started his career in Project Management and subsequently became a Human Resources Manager. In the last 15 years he has worked as an Interim Manager in a variety of industries and as a trainer in Leadership Development Programs. He is a member of the professional group for Agile Management of the GPM (German Association for Project Management e.V.). His field of work is Organizational Development and Leadership Development and the consequences of agile methods on organizational design and developmental matters.

Dr. Jens Köhler

BASF SE, 67056 Ludwigshafen

received his Diploma in Physics from Bonn University and already began tackling the subject of complexity in his doctorate. He focuses on the Digitization in research and development. His specialty is the regulation of social complexity to lever the efficiency and effectiveness of project teams, being inevitable for successfully forming the digital transformation.

Wolfram Müller

VISTEM GmbH & Co.KG., 64646 Heppenheim

Founder & Principal Consultant at Speed4Projects.net and VISTEM, Wolfram brings 25 years of experience as a Consulting Executive, IT Project Portfolio and Project Manager, Process Engineer, and Software Engineer. As head of the PMO at 1&1 Internet AG, he led 40 project managers in the delivery of 500 projects, innovating industry-leading methods, to drive unprecedented improvements in speed and reliability across the portfolio. He has published over 20 articles and books on ‘Critical Chain’, ‘Agile’, and ‘Lean’ and is a well-known speaker in Europe on how to achieve hyper-productive IT project portfolios.

Dr. Helge F. R. Nuhn

PwC AG, 60329 Frankfurt

studied Information Systems at the Technical University, Darmstadt and obtained his PhD (Dr. rer. pol.) from the European Business School University, Wiesbaden. His areas of research lie in the realm of organizational theory and temporary forms of organizing. A Certified Scrum Master and Certified LeSS Practitioner, he seeks to enhance the ways in which teams work in every conceivable project and environment. In his job as a manager and consultant, he is part of an internal Agile Community of Interest.

Dr. Alfred Oswald

IFST - Institute for Social Technologies GmbH, 52223 Stolberg

earned his doctorate in Theoretical Physics at RWTH Aachen University. He is Managing Director at IFST-Institute for Social Technologies GmbH, a Consulting Institute for Agile and Fluid Organizations. He is head of the professional group for Agile Management at GPM (German Association for Project Management e.V.). His field of work is the efficiency and effectiveness of organizations through innovative social technologies. He has many years of experience in the management of innovative and complex projects, as well as in the transformation of project-oriented organizations into high-performance organizations.

Steve Raue

Accenture, 10117 Berlin

is an expert for strategic change and project management. He uses his expertise in communications, culture and behavior analysis for an innovative approach to changing organizations in projects and team development. He is a Scrum Master and founding member of the professional group on Agile Management of the GPM (German Associations for Project Management e.V.). Steve is currently working on his doctorate in Cross-Cultural Complex Project Management, exploring implications for future project management based on systemic integration of conventional and agile project practices.

Norbert Schaffitzel

DB Systel GmbH, 60329 Frankfurt

studied economics in Freiburg and Berlin with specialization in Business Informatics and marketing of investment goods. Since 1988 he has been working in enterprise IT, initially as a software developer and subsequently as project manager on different projects at DB Systel GmbH, the IT service provider for Deutsche Bahn AG. Since 2012 his special interest has been the implementation of Agile Management techniques in projects of large organizations and the transformation of project teams by using agile practices. To extend his knowledge of agile experiences and management of the future, in 2014 he joined the Agile Management GPM professional group.

Marcel Schwarzenberger

projektimpulse GmbH, 20354 Hamburg

works as a consultant and trainer at projektimpulse GmbH. Between 2004 to 2016 he was responsible for organizational and public administration investment projects in the security and defense industry. As a former federal armed forces officer, he is particularly interested in changing the methodology for leadership, and organizational development of Agile Project Management practices. He has been a member of the Agile Management professional group at GPM since 2017 and applies his knowledge and experience in management and strategic development of organizations to Agile Management. His research interests are leadership and organizational development practices for value creating organizations of the future.

Prof. Dr. Hubertus C. Tuczek

University of Applied Sciences Landshut, 84036 Landshut TCC-Management – Strategy Consulting, 81247 Munich

received his doctorate in Engineering from the Technical University in Munich (TUM) (Prof. Milberg). He has accumulated over 30 years of management experience in the machinery and equipment, aerospace and automotive industries. For 17 years he held the position of group vice president on the board of the Dräxlmaier Group, an internationally operating automotive supplier, with responsibility for international business development, quality and project management, as well as global procurement. At the beginning of 2015 he was appointed Professor for Management and Leadership at the University of Applied Sciences in Landshut, near Munich. His research is focused on the changing requirements for leadership in the digital age.

PREFACE

Perhaps you are familiar with the phrase: “Are you just residing or have you started to live? (Wohnst du noch oder lebst du schon?)“ If we interpret the message in this slogan within the context of “Agility”, it could be more freely interpreted as "Are you still just plodding on, or are you making sense of your life?"

The buzzwords “Agility, Agile or Agile Management” are often interpreted as miracle-workers.

But the number of different meanings attributed to these terms is immense: There are thousands of experts and tens of thousands of books and articles on what agile work actually is. And on the subject of agility, everyone is an expert – everyone knows how to do it best. But out of the thousands of experts and books, which ones are right? Or are all of the experts right? What is of importance? What do we need to know, so we can assess what is right in our own context?

There are those that suggest “unless you are sprinting all the time, you are too slow, and you are not agile”. Then there are others who argue that “if you are unsure of your product vision, then this is a sure way to make lots of mistakes”. Others place trusty old Lean and Kanban on a pedestal. And then there are those who assume complexity is responsible for everything. And if all else fails – it is a question of attitude as to whether one is agile or not. Last but not least, there are the pragmatists who have introduced the hybrid of - ‘do not throw away the old, but include something new’.

The “Agile Management” professional group of the GPM (German Association for Project Management e.V.) was founded to offer a deeper understanding of agility: our aim is to understand the need for a new kind of management, grounded on basic principles and free from pigeonholing.

Our vision “together with users, to establish cross-sectoral agile working models to deliver added value for the future” flows into an integral theory-practice framework: We believe that this framework includes a new mindset of agility, systemic thinking, an openness to welcome the ‘new’ as a friend, and the capability of retaining proven management tools.

When one starts to deal with the important things in life like love, truth or agility, then the picture tends to have as many facets as there are people. In discussing this topic, it becomes increasingly clear that it is not possible to give an operational definition of agility without including a context. – Hence this book has no chapter on "definition". What emerges though, are principles of agility (like natural laws) that hold concepts together. These principles are explainable and help in understanding the practice. They also help assess which expert ideas are useful and which are only useful in a particular context.

This book was conceived as a manual or "handbook" and ended up as a "brain book". It is full of concepts and principles – some rough and coarse – some fine polished. But all help to understand and put into practice the agile movement, and to ride this great wave without sinking!

Who should read this Book?

This book is written for anyone who is interested in agility or needs to be agile. It is for those who seek deeper knowledge about what keeps the agile world together. You can read it from the perspective of a top manager or decision maker who feels the urge to be more agile. But you can also take the book and just follow it from the perspective of a user.

What do you get?

A systemic picture of agility – to enable you to analyze your system (your team, your department, your company or your business network) and identify fields of agile application and the specific need for agility.

The ingredients of an Agile Mindset – this allows you to transform your organization and develop an agile culture for your organization.

The theoretical foundation of agile principles – so that you can really understand and assess the value of all the expert ideas for you and your organization. You will get the necessary skills to tailor organization specific agile frameworks without losing essential ingredients.

Input for your own reflections – you will be capable of innovating agility and be ahead of the main stream.

The Principles behind the Book?

We illustrate the big picture of the concept of the book by roughly outlining the content of this book. This book is Release 3 of the Management 4.0 Handbook. In Release 3 we have omitted some of the content present in Release 2 and introduced new content. The new content is indicated by “new” in the header.

PART 1 FOUNDATION

In Part I FOUNDATION we start with an outline of one of the main drivers of complexity, the megatrend “digitization”, followed by a short analysis of the choice of the name “Management 4.0” for this book.

We then go on to explain the basic principles of Management 4.0:

Management 4.0 as a new way of thinking

the key principles of an Agile Mindset and the link to Management 4.0

the relationship between agility and complexity

the “definition” of hybrid (project) management

the basics of self-organization

the key principles of Scrum and Kanban agile frameworks from the perspective of Management 4.0

the principles of Leadership 4.0

Leadership 4.0 in digital networks - updated

the relationship between cybernetics and agility and how guidelines for the design of agile and fluid organizations are derived

a reference model for Agile Organizations

PART II BECOME AGILE AND STAY AGILE

In Part II BECOME AGILE AND STAY AGILE we start by describing the impact of agile working on human resource issues.

We outline the “Reliable and Ultimate Scrum” agile frameworks as examples of how agile principles can be applied, and give input to the discussion on agility and fixed price contracts.

In the chapter “Agile PMO 4.0” we outline the concept of an agile Project Management Office.

In the chapter “Agile Scaling” we derived a Scaled Agile Management 4.0 from first principles and describe “Scaling Agile by using Critical Chain Project Management”.

In the chapter “Agile Transformation 4.0” we outline a model and an example for transforming a conventional organization to an appropriated Agile Organization.

PART III AGILE MANAGEMENT IN PRACTICE

Part III AGILE MANAGEMENT IN PRACTICE is devoted to practical examples of Management 4.0.

Chapter “Learnings and guidance for implementation of agility” gives strategies and hints to pitfalls in introducing and using Agile Techniques.

In the chapter “Interaction Patterns for the Digital Transformation” we use the Dilts Pyramid to describe communication patterns and to derive some consequences for the Digital Transformation.

The Management 4.0 Handbook – Release 3 : A Minimal Viable Product

One of the most important agile principles is to get feedback from customers as quickly as possible!

The book is not yet finished, and we still have enough material remaining for further releases – there is so much more to write and say. So much so, that it would be easy to keep working on the book for an infinite amount of time.

However, we believe that this release - again - contains enough to be of value for you as reader. Your feedback is of great importance to us - it will help us to improve quickly!

We have created a product backlog on the next page, which contains the topics we have planned for the next release of the handbook. We intend to change the content and priorities of the topics depending on the feedback we receive from you.

So feel free - after reading the book – to discuss your ideas with us. You can contact us at: [email protected].

Nürnberg, February 2019

Alfred Oswald and Wolfram Müller

PRODUCT BACKLOG

Megatrends (e.g New Work, New Learning) and Management 4.0

Aspects of Digitization (e.g. Fab Lab)

People Analytics

Digital Agile Competences

Collective Intelligence, Collective Mind

DevOps: Continuous Integration to Continuous Delivery

Viable System Model and “Off-the-Shelf” Agile Frameworks

Common Language to describe Agile Frameworks

Controlling and Management 4.0

Agile Modeling

Agile Management for safety critical domains

CHANGES from RELEASE 2 to RELEASE 3

Omitted

Lean Management

Agile fixed priced projects with hybrid software development

SAFe – Scaled Agile Framework

Example Wire Swiss

Example Agile Transformation - From Acting Agile to Being Agile

New

Scaled Agile Management 4.0

Agile Transformation 4.0

Learnings and guidance for implementation of agility

Interaction patterns for the Digital Transformation

PART I – FOUNDATION

1 Agile Management – Traditional Management has reached its Limit

Author: Hubertus C. Tuczek

Summary: Digitization is changing the environmental conditions for management in a radical way. Increasing change dynamics combined with new business models cannot be handled using traditional management concepts. Common enterprise structures, which have been successful so far, are not flexible enough for these new challenges and have to undergo a fundamental transformation process. New approaches need to be designed according to Agile Management principles and individual solutions developed for every branch or company.

Key terms: Digitization, Changing Environmental Conditions, Disruptive Business Models, Traditional Management vs. Agile Management, Increasing Change Dynamics, Transformation Management

Digitization – a Game Changing Force

It is currently the number one topic: DIGITIZATION. We are living at the beginning of the next Kondratieff-cycle and everything around us is influenced by this new development. We are in the middle of a technological revolution, accompanied by economic, social and cultural change. What is happening?

After the major technical innovations of mechanization, electrification and automation, the Internet has initiated a development, characterized by rapid paradigm changes with uncertain outcome. The Internet is actually nothing new anymore, given that 25 years have passed since we started to surf the World Wide Web and connect with each other around the world. But today’s technology has reached a level of maturity, with its dynamics capturing our private and business life with breath-taking velocity. While in those early days, only IT-geeks would have placed orders on the Internet, today shopping online is commonplace. This has changed the structure of business trading dramatically. On the book market for example, there is no getting away from the Internet giant Amazon. Assisted by digital technology, such disruptive business changes do not happen over longer time frames, but gain momentum in an exponential manner. This poses great danger to companies from a strategical point of view, as business environments and conditions may change suddenly from day to day. The short response time required does not match the time frame, which is typically anticipated for the strategy process within companies.

What does this mean for the economy? The market capitalization of DAX-30 companies does not even add up to half of the stock-exchange price of the 30 most valuable companies in Silicon Valley - a tectonic shift of values. Additionally, studies carried out on the further value development of DAX-Companies do not generate confidence. Most companies in Germany, especially medium-sized businesses, were identified as having missed out on new trends. This is not a surprise, as such companies are typically led by "digital immigrants" who have written their success stories before the age of digital technology.

Is there a need for change in every industry or company? Or are there islands of consistency where the traditional way of doing business can continue into the next decades, retaining a successful share of the market?

In fact, the picture is not so black and white. As a business leader, you need to determine how your markets will develop, and therefore, subsequently, also your business model. There are companies like Kodak, which – an erstwhile dominant market leader in photographic supplies - was erased by the development of Digitization. Another example in the mobile phone sector is Nokia, which – despite being a market leader in its field – failed to understand and effectively react to the challenge of smartphones and their embedded App-logic. These dramatic examples show the need for top management to be able to foresee such disruptive changes, which in hindsight seem obvious, yet were not anticipated using traditional strategic corporate development processes.

A model has been developed to help identify potential drivers for exponential change dynamics. This model classifies businesses and companies according to 2 dimensions. One is the technical complexity of the products involved and the other is the social complexity of the organization and its customer relations.

Figure 1-1: Industry Dynamics Classification matrix (IDC)

The industry dynamics classification as shown in Figure 1-1, suggests that a company positioned in the lower left corner of the matrix is characterized by low social complexity and products with low technical complexity. This can be referred to as a conventional industry. The more a company is exposed to social and technical complexity, the further the position of the company moves to the upper right corner of the matrix. Digitization is a driver for such increased complexity.

For example, if you look at a taxi company, you could call this a rather "conventional" business (see also Figure 1-2). You require a license and a certain number of available cars and drivers who are coordinated by telephone operators, who then book journey requests from passengers. With digitization the game changes. Uber Technology Inc. has become a ride-hailing giant with billions of dollars of revenue, by offering an Internet platform, which connects drivers and people looking for a ride. Technical complexity increases due to IT-platform technology, which is necessary as a base for this kind of business approach. Social complexity increases with the number of passengers and drivers, who need to be brought together and integrated with their individual needs, for successful implementation of the commercial transaction.

Figure 1-2:Game changing dynamics for the taxi business

The worldwide growth potential of Uber's business model is staggering. In 2015 they doubled their revenue every six months, according to Uber’s Chief Executive Travis Kalanick. After only 7 years of existence on the market, the company is valued by investors at more than $ 50 billion. These figures indicate the game changing dimensions of this new business model, which was made possible by the opportunities created by digitization. In the market of smaller local enterprises, a global player, the size of a large international corporation has suddenly emerged within just a few years.

Does this same logic apply to industries, where big global players dominate the market? Are they facing similar potentially disruptive changes in their business? Or is size a protective shield?

An apt illustrative example in this context is the automotive industry. A massive consolidation process over the past few years has resulted in a small number of globally relevant enterprises. Now digital technology is coming into play and is changing the industry focus from mechanical to one with more and more digital know-how. One force for this development is the concept of autonomous driving. The necessary hardware, such as sensors and control units, is currently available. The further maturation of the technology is controlled by smart software algorithms, which enable the vehicle to safely find its way in all traffic conditions, without driver interaction. Traditional car companies are finding themselves at a digital cross-roads, where they need to invest intensively in new digital competences, in order to manage the paradigm, change they are facing. This transformation not only refers to technical challenges, but to a change in leadership style, which is also required. The high level of dynamics in this new environment cannot be accommodated using traditional functional hierarchies, but requires agile structures, which are already familiar in innovative software companies.

Figure 1-3: Game changing dynamics for the automotive industry

On the one hand, there are low-tech automotive companies, fulfilling the need for basic transportation and focus on developing countries. On the other hand, there are leading automotive companies, working on a variety of concepts to explore the potential of new business models. They are experimenting with car sharing enterprises, offer new emission-free powertrain options and are attempting to shape a new world of digital services around the vehicle industry. Meanwhile, new competitors have emerged in the automotive market whose core business is in the digital segment. Google is one example. They are developing the Google self-driving car, which can already be seen on the road as a prototype. They intend to bypass the hurdle of automotive market entry - the large sales and service organization, which has been necessary up until now - by having no intention of selling the car, but leasing it to customers for the time required. If a car develops a technical problem, it will simply be replaced by another car, with its repair being neither customer, nor time critical, for Google. This approach is also attractive for companies like Uber, who have already announced their intention to use self-driving cars for their ride-hailing business in the near future. It is not yet clear, who will win the race. But, it is a huge challenge for traditional car manufacturers, to transform their mechanically-based business into a digitally-integrated high-tech company.

The next stage of technological development in the automotive industry is already visible with prototype applications: 3D-Printing. With this, customers would purchase the design for a specific car and then have their individual car printed on demand.

Consequences for Management – What does the New Management Look Like?

In this environment of increasing dynamics with newly emerging business models, traditional management concepts are unable to react in a quick and flexible manner. Based on the division of labor, functional structures and optimizations, it creates a hurdle to exploring new potentials and shifting resources to innovative departures. If you take a close look at how projects often struggle to fight their way through the jungle of functional organizations, then you will understand the deficit of an approach built on technical expertise in more or less separated entities within a company. The managers of these units have been successful in their careers, as a result of strengthening the profile of their department, but not necessarily because they acted in the best interests of the business as a whole. It is often quite astonishing to see how seldom, operative problems seem to attract management attention in today’s large corporations, unless they impact on the tactical strategies of the manager involved. A more integrated approach is needed, to encourage management to focus on the total throughput of the company, rather than on the individual interests of single departments.

This is where Agile Management principles come into play. Agility stands for speed and flexibility. These characteristics are required from managers and their enterprises in a disruptive digital environment and its corresponding business models. But what exactly does this mean for operational management?

In the world of software development companies, in 2001, a guideline called the “Agile Manifesto” (see Figure 1-4) was written and distributed. It describes software development principles, which lead to more flexible and leaner software creation, in contrast to the traditional – and rather bureaucratic - software development process. The concept is based on the delegation of responsibilities, self-organization and incremental development steps, which allow a flexible response to customer needs. These principles can also be transferred to general management tasks. Their benefit lies in the fact, that there is already a great deal of experience available of using these principles with large software projects with many teams involved. This know-how can be transferred to management activities. In addition to having better quality of results and achieving defined goals more quickly, Agile Management has social benefits, as it subsequently increases job satisfaction. Values such as self-responsibility and self-organization result in individual fulfilment of employees and as a consequence lead to intrinsic motivation.

Figure 1-4: Agile Manifesto (Beck et al. 2001)

So what can be done? How can large groups of people, who are supposed to achieve common goals, be best organized to become more effective overall?

In this context, what is extremely important is the difference between effectivity and efficiency. Today´s management concepts are mostly based on using organizations to their full capacity – or in other words making them efficient. A very different logic is applied, if the focus is on the throughput of an organization. As a consequence, employees are given more leeway to organize themselves and to define and achieve their goals. This fulfils a basic human need, increases motivation, fosters creativity and on top of that, provides more scope for individual development. The upshot for the company is that unused energy is freed up and the overall performance of the organization is boosted for better effectivity.

This is supported by social communication platform technology, which represents a new way of information exchange within a company, in addition to writing e-mails. All necessary information can be shared on a common platform between communities or virtual project teams. Activity streams collect relevant data for each individual user, so that there is quick and easy access. The embedded work flow is visible for everyone involved, which supports a transparent process. Status information can be commented on or enhanced online. Wikis, blogs and forums enable central availability of knowledge. Social platforms enable the introduction of a new way of entrepreneurial collaboration. The managers themselves are forced to give their input on these platforms too. This procedure enables teams in an organization to work autonomously, with the boss as a coach, rather than a manager who gives directions in the day-today business. Thus, smart and effective collaboration of all those who are able to contribute to successful realization of a specific objective, is introduced in a natural way.

It would be a fatal misunderstanding though, to see such an approach as an IT project. To achieve an effective transformation, using this type of smart collaboration, the company needs to bring about nothing less than a complete culture change. Management has to relinquish its monopoly on information ownership, which may be perceived as loss of power. In fact, if an operational base is more or less self-organized, then less hierarchical intervention is required. Of course management still retains responsibility for steering the company as a whole in the right direction, yet its role has changed. As coaches to cross-functional teams, they need to cooperate closely with management colleagues. It is necessary for management to collaborate, in order to eliminate bottlenecks for the teams, by focusing on the total throughput. There is no longer room for individual power play between departments, as all teams have cross-functional tasks.

On a strategic level, it is important that as much of the total knowledge of the company as possible is brought into the process of shaping the future of the enterprise. This leads away from the traditional top down approach and adds a bottom up dimension, which brings employees into play. By doing so, the operational experience of various facets of the business can be integrated to determine the way forward. Misinterpretation of business drivers can be reduced and new options can be generated. The use of social media enables the systematic collection of customer input and underlines the strategic direction.

Strategies can no longer be determined for 5 years and more. A variety of possible scenarios for strategies need to be defined. These are verified by indicators identified during the strategy process and which make a scenario more or less probable over the time. The direction determined upon needs to be followed consistently, yet according to the principles of agility, and sufficient checkpoints should be established, to question the validity of the chosen route in light of changing environmental conditions.

One critical core competence in enterprises is symbolized by the decision making process. In a digital mode, speed of decisions is the key to good performance. In Agile Project Management, where iterative tasks have a duration of four to six weeks, the decisions necessary for the team to be able to continue their work, need to be made within a day. If these decisions cannot be made on an operational level, then top management must be available for such decisions via a quick escalation mode. This is hard to envisage in today´s large, traditional corporations. It can sometimes take weeks, or even months, to obtain a slot in a board meeting for a decision, and even then it may be postponed due to other priorities. And there are many examples, where the decision-making authority in large corporations has been reduced to a few, or even one person, and has led to severe problems. An increase in speed for decision-making can only be achieved by delegating responsibilities.

In conclusion, the change or transformation of a company into becoming a leader in its field, in the new digital age, requires a new management approach (see Figure 1-5), which is described in the context of this book as Management 4.0.

Figure 1-5: Transformation to the digital age by Management 4.0

The various chapters provide the reader with detailed information on how to implement agile and forward-orientated concepts to cope with future requirements in a digital world. It has to be understood, that as a first step, the culture of the company needs always to be addressed. The success of the transformation depends on a successful and enduring transformation of the company culture.

The way in which agile principles should be transferred to a corresponding enterprise has to be chosen individually, case by case, and should be verified in steps – according to the agile philosophy.

But for successful businesses in the future, there is no avoiding a transformation process geared to agility!

Challenge for Agile Leadership

In discussions on Agile Management structures, senior executives often bring up the argument that management has the responsibility for the success of the company and therefore has to lead the way. In the context of self-organisation, managers of traditional enterprises feel a loss of control regarding their impact, responsibility and shaping the objectives of their organisation. This makes them very sceptical of change or they may even build up strong resistance.

To make a change to agility and self-organisation successful, the question as to why managers in charge should support the move instead of fighting against it needs to be addressed. If you cannot convince the managers, you cannot create an agile organisation. A prerequisite for creating intrinsic motivation to change lies in showing managers how they can discover their new role. Strong managers want to shape the future and use their power to make things happen. A mere role as a coach to their employees does not seem to provide adequate satisfaction. Nevertheless, in today’s dynamic markets, managers cannot ascertain the right way to move forward by themselves, but need to organize the answers found within their enterprise. This makes them number one networkers in the company.

A concept needs to be developed that gives management a clear perspective as to how they can set up a management system which supports self-organisation and, at the same time, still gives them control over the direction of activities. Working with the system as a paradigm, instead of working in the system, includes permanent readjustment of the system parameters to adopt to change in the market, the organisation itself or its environment.

Working with systemic order and control parameters is the first step in establishing a system that supports self-organisation.

Literature

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Beck K et al. (2001) Manifesto for Agile Software Development, agilemanifesto.org

Becker T et al. (2015) Digitales Neuland, Springer Gaber, Wiesbaden

Cole T (2015) Digitale Transformation, Vahlen, Munich

Drucker P (2009) Management, Campus Verlag GmbH

Eberspächer J, Holtel S (eds.) (2010) Enterprise 2.0, Springer, Berlin Heidelberg

Gloger B, Rösner D (2014) Selbstorganisation braucht Führung – Die einfachen Geheimnisse agilen Managements, Hanser, Munich, 2014

Lehky M (2011) Leadership 2.0: Wie Führungskräfte die neuen Herausforderungen im Zeitalter von Smartphone, Burn-out & Co managen, Campus Verlag, Frankfurt am Main

Petry T (2016) Digital Leadership - Erfolgreiches Führen in Zeiten der Digital Economy, Haufe, Freiburg

Rossmann A, Stei, G, Besch M (eds.) (2016) Enterprise Social Networks, Springer, Wiesbaden

Schütt P (2015) Der Weg zum Digitalen Unternehmen, Springer Gabler, Berlin Heidelberg

Sprenger B, Novotny T (2016) Der Weg aus dem Leadership Dilemma – Team-Exzellenz an der Spitze, Springer, Berlin; Heidelberg

Sutherland J (2015) Scrum: The Art of Doing Twice the Work in Half the Time, Crown Business, New York

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2 Management Models over the Course of Time

Author: Alfred Oswald

Summary: This chapter outlines the evolution of management mindsets.

Key terms: Management 1.0, Management 2.0, Management 3.0, Management 4.0

The essential purpose and benefits of Management 4.0 are to ensure that projects progress efficiently and effectively and with appropriate agility for a given business. Agility - as an expression of speed and flexibility – guarantees the level of adaptability required and is a response to the increasingly complex environments in which companies operate today. The drivers of these complex environments may be environmental requirements, globalization, digitization, disruptive innovations or the interaction of cultures. In the previous chapter, we outlined the impact of digitization as an example.

We speak of "fluid organizations" when teams, departments or companies are able to adjust to these complex environments by assembling and disassembling quickly and flexibly according to agile structures and processes. The use of agile and traditional project management (PM) techniques falls short here. Management 4.0, therefore, is not identical to agile techniques or agile frameworks, such as Scrum. Instead, we stress that Management 4.0 is an attitude, a mindset. Self-reflection, appreciation of human needs, systems thinking and the self-organization of social systems have predominant importance. Both agile and traditional PM techniques contribute to agility, only if they are able to incorporate this mindset. Leadership also plays a prominent role. This has its roots in the relationship between mindset and self-leadership and is due to the fact that self-organization cannot be obtained without leadership.

Figure 2-1: Evolution of management mindsets

Figure 2-1 shows the evolution of management mindsets. This process started with the Taylorism mindset, which we have called Management 1.0. This was followed by a boom in management tools, a period which was the golden age of global consulting companies and we have called Management 2.0. The Agile Mindset arose during the late 1990s. Its birth is often associated with the advent of the Agile Manifesto, which was followed by agile frameworks such as eXtreme Programming, Scrum and Feature Driven Development. Appelo (Appelo 2011) was one of the first agile practitioners to recognize drawbacks in the practice of agile techniques. He suggested that these techniques needed a theoretical foundation to promote an understanding of which values, basic assumptions or techniques bring which added value, and under which circumstances. He named his approach Management 3.0. This designation - along with the fact that the GPM professional group likes to emphasize the relationship with Industry 4.0 - led us to coin the term Management 4.0 about four years ago. As with Industry 4.0, interconnection is the dominant characteristic of Management 4.0, interconnecting humans, teams or any social organization. Interconnection is a key characteristic of complexity, and therefore, organizational complexity is seen as gift. To regulate complexity, this handbook offers a network of theories and practices. For a deeper understanding of the relationship between agility and complexity, we refer to Oswald (Oswald 2016).

Literature

Appelo J (2011) Management 3.0: Leading Agile Developers, Developing Agile Leaders. Pearson Education Inc., Boston

Oswald A, Köhler J, Schmitt R (2016) Projektmanagement am Rande des Chaos, Springer Vieweg, Heidelberg. This book is avalaible in English: Oswald A, Köhler J, Schmitt R (2018) Project Management at the Edge of Chaos, Springer Verlag, Heidelberg

3 Theoretical Foundation

3.1 Positioning: Models, Theoretical Approaches, Definitions

Author: Alfred Oswald

Summary: This chapter defines agility and Management 4.0.

Key Terms: Agility, Management 4.0

Agility stands for maneuverability, alertness, flexibility, and adaptability, but also for speed and creativity. Agility includes skills and values that people or organizations have, or consider to be important. Very often agility is seen in the context of competences, which in times of change and uncertainty enable people and organizations to act adequately. Agile people and agile organizations are those that show energy in their actions and use this energy effectively. Agile people and agile organizations are distinguished by their ease of value creation.

Agile people and agile organizations are not hindered in thought and action by conditions. They show the necessary mental flexibility and openness to see, permit and absorb new things. Agility reflects the belief that the values of maneuverability, alertness, flexibility, adaptability, openness, speed and creativity are central components for a business benefit creation process. These values are necessary conditions to perceive situations and be attentive and vigilant, and to have the freedom to then be able to act. However, this is not sufficient to permit and carry out agile behavior. This is where Agile Management begins. We understand Agile Management as a leadership and management practice, to be able to act in an agile and proactive way in a complex environment characterized by uncertainty. It is described as an Agile Mindset with a focus on:

leadership for which self-leadership is the basis

leadership, which is based on a respect for basic human needs

leadership, which demands an understanding of complex systems and promotes their regulation through iterative procedures

people who self-organize in teams

fluid organizations, which promote adaptable and fast delivery of useful results and create innovative customer solutions through proactive dealing with changes

Figure 3-1 outlines a semantic network covered by the cornerstones of (Agile) Management 4.0:

Figure 3-1: Cornerstones of Agile Management 4.0

In this Management 4.0 Handbook we will illuminate the following cornerstones: Mindset and Learning, Meta-Competence and Leadership, Self-Organization and Complex Systems and Fluid Organization and Transformation.

We will show that selection of these conceptual fields is not arbitrary, but arises naturally. Management 4.0 is a tool to create agility in a complex system. The central anchor for all other considerations is the conceptual field “Mindset”; here Agile Mindset. With this term we describe a personal attitude or an