 Välkomna till Fika-kastet med Adjalpipo. Vi talar om hur vi navigerar med skillnad i våra organisationer. Välkomna till Adjalpipo Fika. Det här är ett små podcast där vi försöker tala om olika subjekt. I Sverige kallar vi det provprata. När du tar in en subjekt, så ser vi hur vi ender upp. Det är inget som planerar, det är bara en subjekt som vi ska tala om. I dag är det en subjekt som handlar om resurs- och lukationbudget. Eller om vi ska prioritera flexibiliteten med människor. Vi ska titta på det och se hur vi ender upp. I dag är vi några människor från Adjalpipo och vi har också David Thompson med oss. Välkomna. Tack. För mig bostrar det mycket om vad vi märker och vad vi märker. Jag ser att många märker i IT-kast. Om vi ser att kastet producerar val och val, så är det en valgrating. Det är en valgrating, utan en kostcentrum. Det är den viktigaste differenterna. Och när vi tittar på världen och volatilitet, komplexitet och allt det som vi är i, vi måste kunna vara flexibel. För mig är det en av de risker för att ha budget. Jag har sett i min år att en team hade en stor idé av en bra innovation som kan sälja sina kastare. Men de hade inte budget i det här banken. De hade inte budget i andra banken. De hade inte valgrating i det här scenen. Det är ett exempel. De hade inte budget för att sälja sina kastare och inte för att sälja sina kastare. De hade inte budget för att sälja sina kastare. Och så kan de bedsöva för att Send Quando och kan senda surrender pengar mellan grævar även om man inte vill sälja sina patriarier. Från att ta stort problem med de att fixa target för djurdepartement eller djurteam eller djur area så att du kan vara fri att skapa djurresorter där det var riktigt bra. Dessutom att försöka sälja och ge alla djurresorter för dig själv även om de inte är uppdelade till 100 % att försöka ge djurresorter för dig själv. Right? If you weren't governed by fixed performance targets on and suboptimizing then for part of the organization then you could share where oh we see the bottleneck over there. Can we help you? How can we support to remove that bottleneck? You know? And then you can share your resources. So dynamic resource allocation could happen in that case if we didn't buy fixed performance target. So but we have my take. We also have people that maybe holds the money bag and they they don't want the things to go go crazy in the organization. So how could we help them in that scenario then? Yeah, what is go crazy? Go crazy. Is it too easy to allocate resources to the places where it's really needed right now? Is that craziness? I don't agree. But just because things didn't turn out like we thought in October on November previous year, it doesn't mean that we go crazy. It means that we adapt to reality. And I think that's a lot of common sense instead of craziness. But still we maybe just have a set of money and we cannot break that number. So of course we should use that money in the best way. Exactly. You should you should use the money in the best possible way. What you want is the most bang for the buck that you have. Right. So so this is really using the resources in the wisest way possible. Because if you hold on to your resources and they are not used because you don't have a need right now for them. And you see that somebody else needs the resources. What's the most wise way to use your money bag? It's to share, right? Then create common sense, patient budget. It's maybe creates false safe or something that yeah, we give them that amount of money and then that amount of money. And then we have control of the over the costs that we have. So what is control? What is control? Can we answer that question? Maybe I throw it out to you. What is control? Be able to sleep at night, not go bankrupt. I play that person. Yes. Yes. Do we go bankrupt if we use the resources wisely? Or do we go bankrupt if we don't? Yeah, they're for wisely. How do we build in wisely? So we are not overspending. So how do you handle that? Are you are you referring to me or somebody anybody? What is using the money wisely is to use them where they are needed the most at the time they are needed. That's why in my in my head. Ja, so it's that we maybe are doing something else, creating that or sense of control, but in a whole different way. So we are spending where we should spend, but we're not overspending. And we have a system that can take responsibility over the spending. Also, they have maybe transparency into the budgets that we have and can take that responsibility as an organisation. Then being given money for their own, for their different apartments or teams or whatever it is. I guess it depends how good we are at predicting the future, isn't it? It's OK, as we mentioned last week about budgeting, but it's always predictive, it's never reactive. And so whatever your best guess is today is, you know, that can go out the window very quickly. And so if I think of my world, which you would be consulting and if it's a discrete project, then how are you resourcing that and in terms of the people, not everybody comes on day one, you know, people come staggered during the different development stages. And, you know, and that's deemed to be the most, I guess, equitable way of sort of managing that resource. But again, what we're not managing again is how effective that is. You know, what's the efficiency? It's literally you're applying, getting bodies on the ground for particular stages, but that doesn't mean they say they're going to be so effective, you know. And then to even get in the subject of bankruptcy, again, if we are resourcing under the discrete project and that's running well and it's, you know, that doesn't mean to say the company can't go bankrupt because company will be running lots of discrete projects and there'll be their business as usual activities, etc. as well. So lots of things can contribute to a company's downfall. And I guess it's as we keep coming back to it's part of a company or an organisation can't just be the one that seemed to be agile. It has to be the whole organisation that buys into it and appreciate that. We're still very much of that infancy. We see very little companies who are completely agile, you know, and. And until we start kind of correct in some of those, those behaviours and understandings, then, you know, all the good work in some areas doesn't translate across the whole org, really. And I've seen that recently here in the UK. A number of public sector companies have gone bankrupt, you know. Now that doesn't mean to say they go out of business because the public sector, you know, it has to be retained. So it has to be, it has to be in some sort of rescue package and that that will happen, I'm sure. And if it was a private sector of financial services, then that can easily, you know. Falter and a good few of them have happened in recent times as well. I agree completely, you know, and I think it's just a matter of time. Before companies started to realise these things, we are focusing a lot in agile people right now on this. We have an upcoming certification in October, where we will be focusing a lot on agile for finance and how to think and how to act in an unpredictable world. Because we realize that this sense of control that we are after in finance and in the whole company is just a false sense of security. It's a false belief that we can control people because we cannot control people. They are complex adaptive systems and we cannot control reality. What is going to happen in the future is not predictable. We don't have the crystal ball to look into. And when we realise that, then it's a totally different solution that is required, right? So the budget ritual is because people are used to it. We always used to do budgets, that's the way we do. And if you go to a budget meeting, you're important. And this ritual is something that people stick to because they want to keep their power and status. It's human, isn't it? I also think that it is something about acting in a responsible way. And if we have that control or that perceived control mechanism, then we can always say that we acted in a responsible way. So what is the new way of acting in a responsible way when we accept the complexity we are in? The responsible thing is to adapt and change with reality, not following a predefined plan that doesn't match reality. And then also, as I started with, to measure value instead of just cost, I think. So what is the potential in the value creation instead of what is the cost of that? Of course you need to balance the two, but as long as you are in the plus side of things, that's where you need to be. If we find an initiative along the way during the year that we didn't even see or think of in the end of the last year, then we need to take that initiative and we need to do something about it if we make a quick calculation. While this has huge potential compared to what we decided to do, then we need to re-prioritise what we should be doing or not. Maybe it's a change in the program planning and so on. But people also have a tendency to stick on to projects which they have invested a lot in. Have you noticed that? But we invested so much into this project. We cannot see it as a sunk cost. We cannot just leave it to die now when we invested so much. So that's just stupid really to think like that. And I think also if you embrace agility at the heart of it, then you have the iteratively incrementally delivering value on that on its own. If you manage to tie a different business model to that, then you reduce the risk as well. If you work in long projects, of course, then you build up huge risk of delivering something that's not really attractive from the customer's perspective. So if you cut that down into smaller deliveries, incremental deliveries, then the risk isn't that high actually. And then you are actually designed to pivot and to change direction. So you do an evaluation every time you finish a spring. Should we continue now or not? Is there a chance that we could deliver more value or not? And we make that no go decision after every sprint. This is a very good recipe for success. As I see it there, it's very nice moving towards being more flexible with people. But you need to have more in the organization. We have been talking about some of them. One more aspect, of course, the value creation that's really connected to flow as I see it. And here, any public sectors are suffering quite a lot because the system they have built, it's very silo-oriented. And within those silos there is a fixed budget with a fixed number of people. But those silos could be huge bottlenecks to great flow. And that more or less damaged the whole system. So it's very little value coming out. And it's very costly to have sometimes a sick person moving through that system. And there is also the notion of full-time employees, FTEs. So for this function we need five FTEs, full-time employees. But how do you know? I mean, it depends on what employees we have. If they are really focused, really engaged and very motivated and skilled. And we don't need five FTEs. But we are treating people like they are resources here. We are treating people like they are changeable like pieces in the puzzle. So this is also fundamentally wrong thinking that we can just exchange one FTE for another one. We can't because people are different and can contribute in different ways. And it depends on many, many things if you can or not contribute value. Carry on to the classic one that, yeah, we need to put some more effort into this. Just add some millions, add three or four more people. Into something that is suffering from something else than the lack of resources or lack of people. They are maybe struggling with something else. But it's really hard to see that from a distance. So instead you just see, we don't get the value we are looking for fast enough. Add more people. And then you add a lot of more complexity. And of course you need to train and onboard people. And that's suffering. And then you also have all the communication ways between people. And all these things that's making us fail even. And the loss in the end is maybe even bigger. I'm thinking maybe it would be better to decrease the number of people in those instances that you are describing, Daniel. Maybe you should split it up in smaller teams instead and maybe remove one person per team. And then see what happens. And you need to add this way of experimenting and trial and error. And let's test this and see what happens. But that is not on the menu for these projects which are driven in that way. I think it's not uncommon that you see that for instance if you have a big demo or something that you need to prepare. I have an example from an automotive exhibition where a team had to deliver some kind of prototype or something. And then they selected people into a team that worked together for three, four months. And the outcome was extraordinary. So everyone was kind of shocked saying, but how come this team, this was kind of a temporary team that didn't know each other well. They delivered such good value in such short time. And I think that's back to, they were quite few. They had a clear objective and they had a scope that was well defined. I think that is often, I think that points towards the direction you're at PME. That having smaller teams with better focus is always winning above having bigger teams with a more messy focus or messy scope. Steve Dunning, he's talking about the power of the small teams. The power of the small teams because it doesn't come that complex. It's easier, you know, short communication paths. Yeah, and there's less reliance on a smaller team than, you know, there's no hiding behind that wider team group to say, well, you do all the work and I'll just sit over here and cheer you on type thing. And just hide and just ride the wave. And I mean, there's a running joke here in the UK privilege, privilege universal is that in public sector takes three people to do the job, one to do it and then two to make the tea. You know, and it's that lay, those nonsense type layers within a team who just, you know, passively just contribute no value. You know, and if you cut that, make it two people, you know, want to do the job and want to make the tea, then fine, you can rotate. But at the same time, you've got no one else to talk to each other. So you've created that small team and you automatically holding each other accountable. You make the tea today and I'll make it tomorrow. Fine, let's move on. For me, I get this picture in my head from when I took lean trainings. And they show this small stream. And if you're stressing the stream a bit, you lower the water in it, you will start the big stones that is entering the flow in the stream. So that's what we're talking about. Removing the people will stress the system, because if the stream is too fat and happy, we may be not seeing these bottlenecks. We might have a lot of rework within the stream that someone is doing in the stream, but we need to remove also to see. But now we are moving into something else. What should we do? Yeah, should we just remove people? What's the value? Ja, I came to think of Sven-Jörn Ericsson. You know him well as well. Maybe David, coach for England a few years ago in football. Rinnsocker. And I heard a story saying that he always have this one person in the team who is maybe not the best player, but he contributes to building the others to cheer them up so they produce much better. And that means that he focuses on the value creation and not the cost, so that we can at least relate to this topic. So that is an activation saying that, okay, this will cost a bit more, but the value we get out of it is still on the plus side of things. It's not direct value, but indirect value. Yeah, indirect value. I think the other is to perform better, right? Ja, and I think that's typically what we see with team coaches getting the team to play better and work better together than having a quite dysfunctional team working in silos maybe and not getting the value out. And I guess one thing that's a good point, just to stay on football, but to move on to women's football. And it's quite interesting because so the women's football come to more prominence recent times and obviously Spain won the World Cup recently. But what each of those teams do is that they don't just credit themselves for the work of achieving the goal. They go back in history and say we're only as good as the legacy that was created for us. So I think in terms of that value creation, if we say it's only within a finite period of time, then you're liable to be miscalculating there because there'll be huge value leaps in one period and then less reduction in another. And so therefore, as you net it out, it's either up or down. But the way to value, I guess value or efficacy if you like, is to say it's a progression. It's born out of legacy. It's hidden in the right direction. It's not intended to have finite points, although for financial purposes or regulatory purposes, we will do that, but we're still staying in the game and we're reaching a higher goal. And I think when particularly organisation and when we talk about flow, people just don't understand that bigger picture. Your future is getting brighter. You personally might not see it, but you're creating that legacy for your community, for societies as a whole. And I think that's always a good one when you talk to public sector because they're serving the public, the communities as a whole directly. That's the main customer. It's you cannot ignore that. Okay, if you're in a manufacturing or IT company, you might not be directly involved with your customer, but you should still see that your impact and the value creation is greater than you. What is the first step then? Moving into this direction. If you are more of a traditional organisation and you have resource allocation, highly connected to budget, it's inflexible and we suffer in our organisation from it. So what's the steps we know of them? Question the annual budget. Start to make changes as needed instead to the annual budget. That could be your first step that you start to think. Like the budget is something that is a moving target. And don't reward people based on performance against fixed targets. Let's just start. Let's just start. Any other ideas? I saw David, you were thinking of it. I'm always thinking about Daniel. It's not always sensible. Anders threw me there when he mentioned the Anglian quote. Yeah, I mean it's always a tough one when you're dealing with traditional organisations because obviously, whatever, I guess, regardless of how tiny the habit that you're asking them to change, it's always going to be a difficult conversation, isn't it? Because the minute they hear you talking, then they're going to think, oh, you're talking about agile and you're talking about this and you're talking about that and all that misconception that they have around agility. And so you're kind of still introducing those half steps of how successful do you think you're being? Okay, you might be making a profit. But what's your impact? What are you really doing that suits the vision that you set out or your founder set out to achieve? Are you still on track for that? And if the answers are resounding yes, then fine, carry on. If it's not, which is likely to be not, although they might not admit it, but almost just pull those strings and say, listen, have you thought about this changing the way that you view things, not everything's in an annual cycle. Things are beyond that. Your existence is beyond that. Your survival was beyond that. So can we think, what is it you, have we still aiming to achieve what we set out to achieve and sustain that? Absolut, from a financial perspective, budgeting is almost the one that's completely uncertain and it is just predictive. Absolut, PMR, let's go, let's go. Agile for finance, alongside HR as well. Yes, and it's compact, the guys from beyond budgeting, they are not talking about agility at all. We made the training together with them, they are not talking about agility, it's not about agility, it's about survival and it's about having a modern leadership and governance for the future world. That's what it's all about, being profitable in the longer perspective and seeing that if we do it this way, what might we then, what profit might we then have, not the profit we have today, maybe we can increase it, if you think in a different way. And maybe that's the thing, the approach to take, then PMR, is that we don't say that agility is the end goal, agility is the enabler and we know that that will probably be replaced at some point in the future and that will be that next aspirational step and there might never be an end game, there might never be, but it's always aspiring to keep improving. Do something else. Yeah, absolutely. So one other step, we have also talked about it, it's to take the training with us at Agile people and if you're interested, you can have a look at agilepeople.com and there you can find the latest training that will soon be launched with Beyond Body Team. So with that said, the FIKE is over for today. See you next time. Bye bye. See you. Thank you. Bye bye. Take care.