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Mark Summer's Blog

The Incentive Trap

I often talk with teams about why software projects fail, yet we have answers. We have modern engineering practices that give us faster technical feedback, reducing technical and integration issues and resulting in higher quality products.  We have ways to work more effectively with our customers, reducing the risk that we deliver the wrong products and features.

It is usually not software development that is broken (although it often gets the blame), but something else that is stopping us really getting the benefits out of modern software development techniques, we usually find it is some other dysfunction within the wider organisation.  It is these organisational constraints that make it harder for us to deliver quality products and services to our customers. It is these constraints that limit our ability to be Agile, and sometimes this is fine, but we should recognise them as areas for potential improvement.

On Tuesday  9th March 2010 Simon Bennett and I ran a simulation at the Scrum Gathering in Orlando that demonstrated one of the common dysfunctions we see in organisations: how we incentivise people. This dysfunction stops teams from self-organising and doing their job, tying them up in internal conflicts. The Incentive Trap took participants on a journey of discovery in terms of their behaviour; the simulation illustrated different incentive schemes resulting in a variety of behaviours, bringing out different feelings depending on how participants were rewarded for doing their job.

Feelings in the simulation ran high, we had guilt and frustration, received death threats (hopefully he was joking) and saw teams coming close to industrial disputes. Other teams on a different reward scheme had a very positive experience where the team was able to achieve rhythm and clarity of purpose resulting in a lot of value being returned to a high quality.

The obvious conclusion was that we need to pay attention to how we incentivise people and many of us have got it wrong. We hope to run the Incentive Trap at Agile 2010, so if you were in our session at Orlando please give some feedback on the Agile 2010 selection site.  We thank all the participants who joined our session, we hope it got you thinking; we had a lot of fun running it.

Agile Software Development will not solve organisational dysfunctions, we need to reach out and work with the wider organisation and find ways to talk their language.  It is not about being more or less Agile; it’s about helping our organisations get better at achieving their purpose.

Published Tuesday, March 16, 2010 4:31 PM by mark.summers



john.rayner said:

Sounds very interesting!  Hopefully you can share some details of your session with those of us who couldn't make it.

There's an interesting paper which draws some very similar conclusions: http://www.cs.umd.edu/users/basili/publications/proceedings/P125.pdf

March 18, 2010 12:56 AM
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