Written by Mason Chaudhry
on April 18, 2023

Business Agility is a term that is being bandied around by businesses, leaders and practitioners from practically every type of enterprise. The idea that agility should exist beyond the walls of IT is not a new concept, but rather more and more organizations are now prioritizing resources on making Business Agility a reality across their enterprises. So, why is there a sudden desire for Business Agility? Haven’t businesses always strived to be faster to market and to operate more efficiently?

While the answer is yes, the methods of becoming faster, leaner and more innovative across an enterprise are evolving, and thus driving new Agile, Product and Change Management initiatives in enterprises of all sizes.

Unlocking the Benefits of Business Agility in the Public Sector: How Agile Practices Can Drive Innovation, Customer Satisfaction and Efficiency 

In the simplest terms, Business Agility is usually characterized by:

  • Increased innovation: Business Agility enables enterprises to quickly experiment and test new ideas, products and services, allowing them to stay ahead of the competition.
  • Improved Customer Satisfaction: Agile enterprises are better equipped to respond to customer needs and preferences, providing better customer service and higher levels of satisfaction.
  • Enhanced Flexibility: Agile enterprises can quickly pivot in response to changing market conditions, new technologies or unexpected events, enabling them to stay ahead of the curve.
  • Reduced Costs: By adopting Agile practices, enterprises can streamline their operations, reduce waste and improve efficiency, ultimately lowering costs and increasing profitability.

Most of us agree that Business Agility can better enable enterprises to respond quickly and effectively to changes in the market, customer preferences and technological advancements. In today's fast-paced business environment, companies that are slow to adapt may find themselves left behind by competitors who are more Agile and responsive to change. While that is great impetus for commercial enterprises to gain Business Agility, can Public Sector enterprises also benefit from a cultural shift to Business Agility? Absolutely!

While innovation, customer satisfaction and efficiency are also mission goals for Public Sector enterprises, there is a lot more that can be gained if these enterprises strive for agility within their entire (virtual or brick and mortar) buildings. Now more than ever, Public Sector enterprises require speed and modern tech to provide services, respond to regulatory and compliance needs and even to compete for business and IT labor.

Tailored Business Agility for Public Sector Enterprises: Optimizing Efficiency, Compliance and Risk Management

Business Agility within the Public domain can deliver:

  • Rapid Response to Changing Regulations: Public Sector enterprises operate in a highly regulated environment, and regulations can change quickly. Business Agility can enable enterprises to adapt quickly to regulatory changes, reducing the time and cost of compliance.
  • Improved Efficiency: By adopting Agile practices such as iterative development, continuous delivery and collaborative team structures, enterprises can streamline their operations and reduce bureaucratic delays.
  • Enhanced Customer Satisfaction: Public Sector enterprises are tasked with serving citizens, and Business Agility can help them respond more quickly and effectively to citizen needs and requests.
  • Increased Innovation: Agile organizations are more likely to experiment with new ideas and technologies, allowing Public Sector enterprises to take advantage of emerging technologies and approaches to better serve their mission.
  • Better Risk Management: By constantly assessing risks and adapting to changes, Agile enterprises can minimize potential threats and optimize outcomes.

As Regulatory Technology (RegTech) has become a tailored approach to Public Sector tech stacks, Public Sector Business Agility should also become a tailored approach to transforming process across Public Sector enterprises. While many Agile schools and consultancies push “one-size-fits-all” frameworks to enterprises of all sizes and in within various domains, most leaders and practitioners recognize that Agile practices require customization not only by industry type but also specifically to the culture and practices to their own enterprises. Public Sector enterprises budget, organize, govern and deliver quite differently than in the commercial space. As an example, the build of new products within the Department of Treasury and a commercial bank such as Wells Fargo might use similar Agile practices, frameworks and role types, but the way these products are regulated, funded and delivered can be vastly different.

Challenges of Implementing Business Agility in the Public Sector

Key differences that must be recognized in Public Sector transformation include:

  • Governance and Regulation: Public Sector enterprises are subject to a higher level of governance and regulation than commercial enterprises. This means that they must follow specific laws and regulations that can affect the way they approach Agile transformation.
  • Budgeting and Funding: Public Sector enterprises often have different budgeting and funding structures than commercial enterprises. This can make it more challenging to secure funding for Agile transformation initiatives.
  • Stakeholder Engagement: Public Sector enterprises often have a wider range of Stakeholders to engage with than commercial enterprises, including politicians, regulators and the general public. This can make it more complex to navigate Stakeholder engagement in an Agile transformation.
  • Organizational Culture: Public Sector enterprises may have a more hierarchical and bureaucratic culture than commercial enterprises, which can make it more challenging to adopt Agile ways of working.
  • Service Delivery: Public Sector enterprises are often responsible for delivering critical services to citizens, such as healthcare, education and emergency services. This can make it more challenging to adopt Agile approaches that prioritize experimentation and iteration over stability and predictability.
  • Organizational and Operating Models: Public Sector enterprises can be comprised of a dizzying array of organizational layers, governance bodies and operating rules that must be measured when undertaking Business Agility initiatives.

Yes, even with Agile-operating models, larger Public Sector enterprises are complex multi-layered organizations consisting of Portfolios, Programs, Projects and Products (the 4 Ps). True Public Sector Business Agility requires transparency amongst these layers, flattening of organizations when possible and empowerment of teams. Managing the 4 Ps effectively is a prerequisite to Business Agility and is (as many of you can confirm) a very challenging endeavor.

Key Considerations for Implementing Agile Practices in Public Sector Portfolio, Program, Project and Product Management

The cultural change from traditional (4 P) management practices to Agile (4 P) practices requires:

  • Understanding of Public Sector Policies and Regulations: Public Sector enterprises operate under specific policies and regulations that govern their operations. It is important for Portfolio, Program, Project and Product Managers to have a clear understanding of these policies and regulations to ensure compliance and avoid any legal or financial implications.
  • Strategic Planning: Portfolio, Program, Project and Product Managers must have a strong understanding of the overall objectives of the Public Sector enterprise, as well as its mission and vision. They should be able to align the Portfolio and Product Management strategies with the enterprise's goals to ensure that they are contributing to the overall success of the enterprise.
  • Risk Management: Managing Portfolios and Products within a Public Sector enterprise requires careful consideration of the risks associated with different projects and initiatives. Managers must identify potential risks, assess their likelihood and impact, and develop strategies to mitigate them.
  • Financial Management: Public Sector enterprises operate with public funds, which means that managers must be able to manage budgets and financial resources effectively. They should have a strong understanding of financial management principles, including budgeting, forecasting and reporting.
  • Communication and Stakeholder Management: Managers must be effective communicators and able to manage relationships with Stakeholders, including government agencies, customers and employees. They should be able to communicate effectively to ensure that Stakeholders are aware of project progress, risks and any other important information.
  • Monitoring and Evaluation: Managing Portfolio, Program, Project and Product within a Public Sector enterprise requires ongoing monitoring and evaluation to ensure that they are meeting the enterprise's goals. Portfolio and Product Managers must be able to measure the success of projects and initiatives, identify areas for improvement and make necessary adjustments to ensure that they are delivering value to the enterprise and its Stakeholders.

All of the change described above requires a sound Agile strategy, transformation roadmaps and most importantly, buy-in from Stakeholders. Yet many Public Sector leaders and practitioners are grappling with the 4 Ps in an Agile world, questioning the intersection of governance, gating, command-and-control with Lean teams, Agile budgeting and the ack of the “triple constraint.” The notion of leaner, faster, and transparency sound good on paper, but when rubber hits the road, governance, territoriality and dare I say it – even office politics – can be hindrances.

In Conclusion

Today I called out the difference between Business Agility within the Public Sector, and these differences are considerable. Further, I argued for Public Sector Business Agility to be differentiated from Agile practices required to run a a commercial enterprise. Next, I will take a deeper dive and tackle the co-existence of agility with the 4 Ps and ask: can Public Sector enterprises increase Business Agility by simplifying the 4 Ps?

In the next part of this series, let’s take a look at how Business Agility in the Public Space can be impacted by how your organization manages Agile practices in conjunction with the 4 Ps - Program/Project/Portfolio and Product/Agility are not oxymoronic concepts!