Modern Development, Part 1: A Transformative POV for the Business

The technology function often struggles to keep pace with the sheer scale of new demands in today’s business environment. After all, it has to keep up with market speed; address rising expectations for ease and availability of technology by the business; take advantage of new opportunities; and evaluate issues of risk. According to experts at KPMG, in order to meet those challenges, a more holistic look at modern solution development and delivery — that includes Agile, DevOps and cloud and many other approaches — is required. This model is helping CIOs and the entire technology organization to more rapidly deliver value, reduce failed deployments, create a culture of continuous improvement all while helping the business win in the market.

Steve Bates, principal at KPMG, emphasizes that this is no longer just an IT problem, limited to the roles of software developers or operations. “We’ve reached critical mass in the market and see this as the sustainable delivery model for a business to thrive in a digital economy — its culture, processes, tooling, policies, controls,” he says. “It is really transformative — most organizations cannot avoid this wave,” This is, he explains, the next generation of how technology will be developed and deployed across the organization, not just within the IT department.

The changing world of the technology function

There are several reasons for this need for a more holistic view of technology development: One is that consumer behavior, both from the external market as well as internal stakeholders, has changed over the past 5-10 years in most industries. Customers are accustomed to highly available, constant-release, high-value applications that are consumable anywhere, anytime, any place, on any platform.

“We have seen that shift drive very different buying behaviors, both internally and externally, but the way most corporate technology is delivered has lagged behind expectations, anchored to tech debt and monolithic systems and employing a slower waterfall approach backed by long-lead annual financial planning processes and siloed organizational functions ,” he says. That ship has sailed, he explains — instead, the ability to put the customer in the middle of the product design requires far more collaborative and agile methodology.

Another reason is that there is an increasing dissatisfaction with the lack of speed and flexibility in the IT function, to the point where business consumers go elsewhere — especially as the barrier to entry to acquire and deploy their own solutions from cloud providers has gone down. “We’re seeing more organizations dispersing those skills into the business and moving fast,” says Bates. “Financial services, for example, has been doing that for years — quickly adapting and coming up with completely new value chains empowered by technology — and the mainstream is now catching up.”

Finally, as the business dives into solution development outside of the central corporate IT function, leaders are just beginning to understand all the ripple effects of today’s fast evolving technologies and the impacts of poorly controlled releases. There are implications to changes in architecture, data management and privacy, access control, in financial planning, in budgeting and forecasting, and supplier management, to critical building blocks and sequencing that can’t be ignored. As speed to deploy and fragmentation comes into play, the risk to the enterprise grows, with famous incidents such as Knight Capital Group’s $440 million software bug in 2012 and the IT failure Heathrow Airport’s Terminal 5 in 2008. “Every company wants to avoid these mishaps,” says Bates, “while also chasing market opportunities and effectiveness.”

Modern development: The delta between traditional waterfall and an agile business

There are many different agile software development methodologies, from Scrum, XP, and Kanban. However enabling a shift to digital requires more than deploying agile project teams.  According to Bates “becoming digitally fluent is about orienting business teams around value chains, breaking the work into composable parts, and continuously focusing on what the customer defines as valuable.”

Ultimately, the modern development model is about combining learnings and best practices from nearly a dozen different frameworks and technologies, including SAFe, Scrum, Six Sigma and Lean, ITIL, TOGAF, TBM, and design thinking, AI, and machine learning into a new way of providing agility end-to-end through ideation to deployment to the customer. “It’s a new way to look at the modern development factory,” he explains. “Many companies have taken a bit of all of these practices here and there, and applied point solutions, but now we’re talking about bringing it all together in a holistic, unified way, to drive organizational change.

An organizational transformation opportunity

Often, companies take a very myopic view of technology development, relegating it to the developers and ops teams within the IT organization. “We’re saying that if you’re going to benefit from the methods of modern development and delivery, you’re going to have to view this through a lens of organizational transformation,” says Bates.  “Today, technology is an enterprise business competency, not simply an organizational function.”

That means being fully aware that once committing to the modern development model, it has to come from the Board and CEO on down. “If you want to keep pace with the market and develop customer-centric products and services at pace and scale the business, support functions and product owners must buy-in,” he says. Product owners developers and DevOps teams must interface seamlessly throughout the lifecycle with support functions like finance, HR, legal, procurement and security.  Anything that touches the customer experience or product velocity must be considered.

“Modern development really favors experimentation and applied earning — that is, failing fast and learning and adapting your next product to build upon that knowledge,” says Bates. “As you can imagine, the organization shift from traditional siloed systems development models to a flattened, self-directed, frictionless, and cross-functionally collaborative environment can be enormously disruptive, but again, we don’t think any organization can ignore it — but there are clearly ways to make this a successful journey.”

An important first step is understanding your organization’s readiness to start on the modern delivery journey.  “Many of our clients have been using agile teams to develop software for years,” says Bates “but are now looking to scale and rapidly integrate multiple functions.  Helping them understand the friction points and on-ramps to prioritize is the first step in building that transformation roadmap.” 

“Beyond charting the course, modern delivery is best done holistically and in waves— you can’t do it in silos, or in bits and pieces,” he says. “We’ve seen the failure of agile programs over the past few years, because companies lacked the executive sponsorship and commitment to change the culture, didn’t use a phased approach or treated it as an IT project and missed all of the other interdependencies when trying to scale it.” Instead, he explains, we help clients start with specific value chains or products, and align their operating model, organization, processes, resources and metrics around the delivery of that service.