Agile teams are the building blocks of any Agile enterprise. They work differently from chain-of-command bureaucracies. They are optimally suited for innovation—capable of profitably applying creativity to improve customer solutions, business processes, and technology.
Here is how it works: To tackle an identified opportunity, the organization forms and empowers a small (typically three to nine people), multidisciplinary team with all the skills necessary to complete its tasks. The team manages itself and is strictly accountable for every aspect of its work. Senior leaders tell team members where to innovate but not how. Confronted with a large, complex problem, the team breaks it into modules and develops solutions to each component through rapid prototyping and tight customer feedback loops. Members hold themselves accountable for outcomes (such as growth, profitability, and customer loyalty), not just outputs (such as lines of code or number of new products).
This structure reduces layers of control and approval, speeds up work, increases teams’ motivation, and can lead to some amazing innovation. But for all of that to happen, teams need to have eight critical characteristics. One that is commonly overlooked, but quite important, is responsibility for specific outcomes. In addition, they must be supported by senior executives, focused on a major business opportunity, properly resourced, committed to an Agile approach, trusted to work autonomously, capable of rapidly creating prototypes, and empowered to collaborate with the customer.