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- Now, let us talk about Agile
Human Resources or Agile HR.

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The human resources function

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in multiple organizations around the globe

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is moving towards agility.

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This includes multiple areas,

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such as performance management,

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learning and talent development,

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compensation, and recruiting.

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Agile for HR looks at how HR
can apply an Agile mindset

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and also various working methods

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within their own teams and products.

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And also, it looks at Agile adoption

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across the whole organization.

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Agile for HR has the potential

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to reinvent human capital organizations

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and change their operational model

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and overall, modernize HR as a profession.

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Any organization can realize the benefits

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by applying some basic concepts
in their everyday work.

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This includes focus on
outcomes versus processes,

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focus on the team versus individuals,

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and continuous improvement

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that leads to achieving
efficiency and alignment.

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So in this sense, Agile
includes an Agile mindset,

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Agile ways of working,
organizational design of Agile,

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such as cross-functional teams

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that we discussed in less than six,

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and also it looks at establishing

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psychologically-safe organizations.

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This is usually done through collaboration

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and team empowerment.

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In order to develop a model for developing

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and sustaining Lean and Agile
culture in the organization,

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HR professionals need to
answer a number of questions.

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How to recruit and
retain the right people?

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Rather than looking for people

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with the word Agile and
Lean in their titles,

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the recruiting function
needs to look for people

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with a Lean/Agile mindset,

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and that includes people
who are customer-oriented,

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who are team-driven,

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those who have had a chance to
work in an Agile environment

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and succeed there.

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The second question is,

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what does it mean to be an
Agile or Lean HR function?

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Nowadays, performance review process

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has morphed into continuous
feedback process.

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For example, Scrum builds
feedback into its cadence.

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In lesson six, we
discussed retrospectives.

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At equal intervals of time,

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the team meets

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and the team members provide

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direct process improvement feedback.

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This usually results in
two to three action items

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that the team agrees to implement

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within their next iteration,

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and this process is ongoing.

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Meanwhile, team performance
is very intentional,

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is driven by objectives and key results,

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and then teams self-assesses
their performance

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against those predefined
objectives on a regular basis.

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This includes quality,
productivity, predictability,

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customer satisfaction,
and employee happiness.

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Also, organizations use cascading goals,

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and the results are transparent
across the organization.

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But, in the center is
the continuous feedback.

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It is in the center

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of the performance review process as well

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with the feedback coming from
leaders, peers, and clients

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in a 360-degree way.

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Now, let's talk about the third question.

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How does Agile or Lean organization

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handle compensation,
recognition, and awards?

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There are too many major challenges

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in the Lean/Agile approach
to employee recognition.

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So first, recognition comes
from peers and customers

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rather than managers.

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Second is about awards.

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Awards are no longer individual
and depend on team success.

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There is a great book about
it, "Managing for Happiness,"

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written by Jurgen Appelo.

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In this book,

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he describes all the
multiple ways of recognition

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that happen in an Agile environment.

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An interesting example
that is provided there

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is peer-to-peer bonus system,

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which Jurgen calls merit money.

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In this system, team members
reward each other with credits,

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which are later translated
into bonus money.

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And usually, it's awarded for
collaboration and support.

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He provides the following example.

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Last month, on my team,

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Jennifer gave 15 credit to Lizette

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for being the backbone
of the organization.

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Lizette, then, gave 25 credit to Sergei

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for the feedback and support.

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Sergei gave 10 credits to Chad

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for his terrific illustration,

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and Chad gave 20 credits to Hanno

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for his friendliness,
clarity of communication.

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And on and on it went.

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At the same time, in the learning culture,

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there is no shameful failure.

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Mistakes are seen as a
learning opportunity.

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Fail fast, succeed faster.

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Maybe you remember it from
Lean startup concepts.

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So some companies even
establish failure roles,

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where employees share their failures

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to allow others to learn
from their mistakes.

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Now, the fourth question,

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how does Agile/Lean organization

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implement titles and promotions?

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Lean/Agile culture
requires different thinking

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about organizational hierarchy

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and overall, the role of management.

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Managers and no longer assigning work

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or evaluating performance on their own.

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Rather, their role is
to support employees,

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help with their development and growth,

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and provide tools.

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In most instances,

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mid-level managers are
similar to playing coaches

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on their teams.

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This philosophy goes all the
way to C-level management

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in Agile organizations.

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The principle is sometimes referred to

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as an inverted pyramid,

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where the role of an executive
is to support and enable

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from the bottom of the inverted pyramid,

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where employees are the
ones on top of the pyramid.

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While the manager is
no longer assigned work

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to individual team members,

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this doesn't mean that
there is chaos or anarchy,

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where everyone does whatever they like.

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With a clear definition

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of the company's objective
and the team's goals,

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there is a clear understanding
of what the outcomes are,

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there is alignment on deliverables,

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and transparency about overall progress.

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Now, the final question.

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How to create HR ecosystem in
an Agile and Lean enterprise?

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We need to think of HR as the
backbone of Lean and Agile,

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the one that empowers employees and teams

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and provides the underlying functions.

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It includes employee hiring,

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developments of the knowledge and skills,

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team enablement and recognition,

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and all of it is key to a Lean enterprise.

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This is one of the reasons

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why a success of Lean/Agile transformation

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is measured by two sets of parameters.

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The first step is in relation

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to business objectives
and product delivery,

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such as time to market,
quality, customer satisfaction.

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And the second set is employee-driven.

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It's represented as employee happiness,

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collaboration within the
teams, employee retention rate,

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and overall, how comfortable,
psychologically-safe,

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and happy people are on their job.

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This is also why work-life balance

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and sustainable pace for
teams and individuals

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has become so important.

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Especially, that happened
during the global pandemic,

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affecting all the people

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and organizations in unprecedented way.

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We do not talk that much
about work-life balance,

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nine-to-five work day in
an office environment.

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But rather, we talk
about work-life fusion.

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It allows a person to dedicate time

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to the family as they need

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while being able to succeed in their job.

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And this can be easily done

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with the aid of modern
technology, communications,

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and many tools

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that allow for building high performance

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globally distributed teams.

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There is a great book by
Alberto Silveira called

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"Building and Managing
High-Performance Distributed Teams,"

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and this book provides excellent tips

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and guidelines how to create
a successful work ecosystem

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and empower employees to
seek their North Star.

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Another great idea is
employee self-selection,

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when people decide which
team they want to be part of.

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There are multiple
examples of how thoughtful

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and well-executed
self-selection mechanisms

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take teams to the next level.

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They create team productivity
and work happiness.

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In her example of how HBC Universal

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ran their self-selection campaign,

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Agile coach Dana Pylayeva

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outlines a thoughtful
step-by-step orchestrated process

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that provides a platform
for team self-selection

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at the level of the whole company.

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Overall, Agile organizations
implement an Agile mindset

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in all the aspects,

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from self-selecting teams

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to the culture of continuous
learning and collaboration.

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There is no difference in Agile
mindset in human resources

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or IT project delivery
from this perspective.