Agile product development: what is it and how does it work?
The basics of agile product development
Agile product development – why actually?
Hop Hop
Our world has become faster: we order something and expect it to be delivered the next day, we have questions and expect them to be answered immediately, we want the latest technical products and these are coming onto the market in ever faster succession. As consumers, we expect speed and as a company we have to adapt to these expectations.
We can no longer afford to finish developing products at our leisure or take a long time to react to customer wishes and customer benefits – because if we are too slow, the competition will be faster… So: Hop hop!
Fail Fast
The traditional way of development – idea, planning, production, distribution – cost a lot of time and money. And in the early stages of development, you never knew whether the product would be accepted on the market or not. This was only ever known after the market launch – and by then it was already too late for fundamental changes. Top or flop.
To mitigate this risk, the company looked for other ways of developing products and services.
The new, different type of development must ensure that we are faster and more customer-oriented than before.
And not only that. We need innovations, i.e. ideas. We must be able to quickly distinguish which ideas promise success on the market and which do not. So that we can quickly develop the relevant ideas into a product – and all others are quickly dropped again. Fail fast is the key word here.
The customer is king
In order to move in the right direction at this high speed and deliver results that are also received by the market, orientation is required. The customer’s actual needs serve as a compass here. Developments take place in dialogue with the customer in order to deliver what is actually needed as quickly as possible and to minimize failed attempts.
To overcome these challenges, we recommend agility – the ability to constantly adapt to new situations and learn from them.
We have already published several articles on the topic of agility. If you want to delve deeper into the subject, here is an overview for you:
- Agility in the company – What makes an agile company?
- Agility: Our company is becoming agile – where do we start?
- Agile tools, agile project management & agile leadership
- Establishing a culture of innovation through trust: 5 practical tips
- How self-organization works in the company: The 10 basics
- Corporate culture & cultural change: definition, examples, tips
How agility is guaranteed not to work
Agility is now on everyone’s lips. It is therefore not surprising that many companies are trying to become agile. However, this endeavor is often not crowned with success. Why? Many companies think they are becoming agile – i.e. fast and flexible – by using agile methods. Unfortunately, this does not work, because that alone is not enough.
Agility is a mindset, a state of mind. And if we don’t change our attitude, we won’t become agile.
If our organization continues to be hierarchically organized, if we still don’t let our employees decide anything independently, if we cling to bureaucracy and security – in other words, if we don’t adapt our mindset towards agility – then even agile methods won’t help. Unfortunately, this is the case for many companies: they introduce Design Thinking or Scrum, but leave everything else as it is and don’t change anything in their traditional way of thinking.
But: no agility without an agile culture
The corporate culture must be changed and adapted if you want to become successfully agile. If agile methods are used, the culture should be worked on in parallel, meaning that the company needs a different type of leadership and that processes, structures and decision-making channels need to change.
Common features of agile methods
There are now many different agile methods. In our next articles, we will introduce you to a selection of agile methods. The methods start at different points in the development process and a different method is recommended depending on the challenge. However, there are clear similarities between them all.
Agile methods and therefore also agile product development or agile service development have 6 foundations:
- You start with the customer and solve their problems
- You are aiming for speed
- You work with prototypes
- You see how the market reacts before (!) the product comes onto the market.
- They are open in their approach, have no clear goal
- You work iteratively, i.e. in approximations
5 practical tips for agile product development
1. start from the customer and solve their actual problems
It is still the case today that a new limousine is driven through the countryside in a veil before the official presentation so that nobody can catch a glimpse of the car beforehand. The secrecy is great. This attitude is inconceivable in agile product and service development, where the customer is permanently involved in the process at an early stage.
Resistors
But changing the attitudes of people in established industries is sometimes not so easy. We, the berliner team, support companies in developing products and services using agile methods. We realize that there is often resistance to overcome. People involved in the development of new products often already have a preconceived idea of what the customer needs. They have an idea in mind that they think is great, of course. What’s more, this idea is often already well developed and advanced. Naturally, they now want to turn their idea into reality or into a product in the way they envision and have developed it. And it takes a lot of persuasion to change this process halfway through – or right at the beginning – and to direct attention towards the customer so that their real wishes and needs are taken into account.
Our tips:
- Throw your preconceived ideas and thoughts overboard!
- Approach the task openly and freely!
- And very important: Involve the customer as early as possible!
Questions
You should ask the customer the following questions early on in agile product development:
- What are his real needs and ideas?
- What is he missing? What bothers him? What takes time? What’s annoying?
- How does he approach things? How does he act?
- What does it use, what does it not use?
- What is important to him and what is not?
We often find that companies have a very different view of what the customer wants, what they would and would not pay for. And so the product is developed to completion with a lot of money and work – and finally you discover that entire features can simply be omitted because the customer doesn’t need them at all. Or it turns out that features that the customer wants are missing. Or you realize that the customer is willing to pay for other things than you thought, but not for what you wanted.
Here are some examples
Many banks still have a large branch network. Slowly but surely, however, the banks are realizing that the customer is not prepared to pay for it. In the age of the Internet, hardly anyone has the time or inclination to visit a branch to carry out their banking transactions. Most customers want a simple current account or custody account that is inexpensive. Banking transactions are carried out online. And it is precisely here, on the Internet, that customers want better support. However, if a personal consultation is required, the banker could also visit the customer, but there is no need for a branch.
The situation is similar in the automotive industry: do customers really need a car dealership? Wouldn’t the customer perhaps be much happier if a car consultant came to his office, picked up his car, provided him with a replacement car and brought the car back when the work on the vehicle was finished? Do we still need the fancy car dealership or would a workshop container somewhere on a greenfield site suffice?
We often notice that companies are stuck in old ways of thinking and it takes a lot of time to convince them to think differently. The agile way to approach product development or service development is completely free in your head and with an open catalog of questions. In addition, the customer is actually consulted and involved in the development process.
2. speed is everything!
What do you think? – How long did it take Google from the initial idea of data glasses to the prototype, which was assembled by hand and didn’t look nice at all? We’ll tell you: It took Google just two weeks.
It has become old-school to develop a product for years before launching it on the market. That no longer works today. The world has become fast-paced. If we don’t launch the idea on the market immediately, we have to expect that someone else will have the idea or that the idea will perhaps be outdated by the time the product comes out and is no longer needed.
Our tips
- Let go of the old German engineering mindset!
- It’s not about going to the start with 100% or even 130%, because it’s not primarily about quality!
- It’s all about getting results to market as quickly as possible!
3. the production of prototypes and minimum viable products (MVPs)
The challenges of speed and customer orientation result in the development of prototypes. These are a simple, inexpensive and quick way of presenting customers with an idea for a product in order to incorporate their feedback into the production process. For example, this could be a version of an app that does not yet have all the functions, but already has the buttons for them, and which you can show to customers to ask what they are missing, where they would look for what, how they would use this app.
What can a prototype be?
As berliner team, we also work with prototypes in the change process: For example, we work with top management, middle management and employees to develop an idea for a change process at a customer, and then we publish this idea on the company’s intranet and ask the employees what they think about it. What is the reaction to what is planned? What else would be important to them? What can you imagine and what not?
If employees don’t like what we have planned at all, but have completely different ideas, then we can and should change something.
Minimal Viable Product
An example of an MVP can be the beta version of software that is further developed together with the customer. This means that the product can be brought to the customer quickly in an 80% variant. Of course, this is in line with German quality standards – and of course we want quality. But this raises the question of what is the minimum viable product, i.e. the minimum, presentable version of the product that can be shown as quickly as possible.
4. fake it until you make it
There are actually some companies that sell products that don’t even exist yet. Simply to be present on the Internet and show that we have the product: We have the product. The companies present fakes, while in the background they continue to develop. One example would be Tesla: they sell cars that they haven’t even made yet. Tesla first looks at how the market reacts, what is popular with customers and what is not, and reacts accordingly. Being the first is the motto.
5. remain open: Product development with an open outcome and no clear goal
In the previous product development phase, an idea was worked out, a business and budget plan drawn up, a project plan developed and the product developed.
In agile product development, there is a rough idea, but no fixed goal. After each work step, the results are compared with the customer. This is the best way to meet the fast-moving times and the constantly changing needs of the customer and to avoid investing in the wrong direction over a long period of time.
Our tips
Ask the customer
- Does that fit?
- Is that correct?
- Is that what he needs?
- Does this meet the needs?
- What other ideas does the customer have?
- Remain open to change
By constantly checking which path to take and then developing it further, neither the path nor the end product are clear at the beginning of the process.
6. trial and error – iterative development processes
Mistakes are made and corrected in the early stages according to the motto “try and error”. This principle is elevated to cult status here.
The step-by-step approach originally comes from IT:
Programs, interfaces and applications are programmed in this way. You can quickly show the customer a prototype without it costing a lot. And then something can easily be changed.
In the meantime, these methods are also being used in many other areas.
An example
For example, we use such agile, iterative processes in our change management work:
In change processes, we only plan the next steps towards our vision, implement them and then wait for the feedback from customers, employees and all others affected by the change process. Our advantage is that we do what really matters to the customer. We see what works and what doesn’t and can therefore make the right decisions for each individual customer.
This means that agile methods are not only relevant for agile product development, but can be applied in many contexts.
Methods for agile product development
Here is a brief overview of the best-known agile methods for product development that we use with our customers. In our article Agile methods: Design Thinking, Design Sprint, Lean Startup, Scrum you will find a detailed description of the methods.
1. design thinking:
An approach that allows us to develop a concrete product or service idea from relatively vague ideas.
2. google design sprints:
“Make Design Thinking fast” – a fixed format for developing a concrete product from an idea using methods similar to those used in Design Thinking.
3. lean startup:
An approach for entrepreneurs – both in start-ups and established companies – to place products on the market according to agile principles
4. scrum:
Scrum is agile project management – a fixed format for agile project management in iterative loops.
5. business model canvas:
– a product idea becomes a business idea. It is checked for feasibility, framework conditions and necessities are thought through, budgets, key partners etc. are defined. However, much more contemporary than in the classic business plan
Articles on the topic of agility
-
Agility: Our company is becoming agile – where do we start?
