1. An HML white paper: Agile IT
A value-driven approach to IT delivery

2. CONTENTS ABOUT THIS PAPER
2: About this paper The purpose of this paper is to demonstrate how applying lean and agile
3. About HML principles can create value in software development.
Introduction
4. The need for It will be of interest to people who are responsible for IT projects, budget
change control, organisational change or who have an interest in lean and agile
thinking.
Lean agile roots
5. The journey to
The paper describes how HML has put these principles into practice in a
Agile IT
form of software development called ‘Agile IT’, which addresses key
7. Overcoming business concerns like time to market, responsiveness to changing
challenges to change needs, customer satisfaction and cost reduction.
8. The Eight
Principles of Agile IT The paper outlines the history of lean and agile approaches and explains
13. The benefits of how these have been applied to create Agile IT. It sets out Eight
Agile IT Principles that underpin HML’s approach, and how these enable the
delivery of the right IT capabilities at the right time to maximise value to
14. Agile IT at work:
customers.
Forbearance Project
15. About the author
“Agile IT has allowed HML to meet the strategic
challenges of wasted resource and lengthy change
management processes. What might have taken
months now takes weeks and our IT department is
engaged and able to offer clients tangible results
throughout the process. ”
Andrew Jones, Chief Executive Officer, HML
© HML 2012. All rights reserved.
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3. ABOUT HML
HML is the UK’s largest specialist mortgage servicer, providing
outsourced mortgage administration services to over 50 leading financial
institutions. HML operates from three UK locations: Skipton, Londonderry
and Glasgow. The company was established in 1988 and manages
approximately £43bn of mortgage assets and 400,000 customer
accounts.
INTRODUCTION
HML’s iConnect platform provides a sophisticated and comprehensive
tool to support a diverse range of client requirements. iConnect is
constantly updated, driven by HML’s desire to continually improve its
offering, but also by the regulatory environment in which HML and its
HML‟s success in clients operate.
applying lean and
agile principles has In 2008, HML began to apply lean 6-sigma improvement techniques
principally within its operational areas. In 2010 it embarked on an
resulted in a ambitious programme to improve iConnect in support of this drive for
nomination for the operational excellence.
Best Agile
Newcomer at this To meet this challenge, the IT teams needed to develop their ways of
year‟s UK Agile working, so Agile IT was born.
Awards.
For more Agile IT is achieved by the application of eight principles:
information about 1. Make it Visible
the Awards see 2. Make Collaboration Easy
http://www.agileaw 3. Assume Change: Experiment, Discover, Learn, Iterate
ards.co.uk/Awards2 4. Focus on Delivering Useful Value Today
012.html 5. Build a Sustainable Flow of Value
6. Build Quality In
7. Continuously Improve
8. Agility is Everyone’s Responsibility
HEADLINE RESULTS
In just 12 months, Agile IT has enabled HML to increase its rate of
delivery of new IT capabilities by a factor 4, while reducing the time
to deliver a new feature from months to a matter of weeks; all
without impacting cost or quality.
© HML 2012. All rights reserved.
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4. THE NEED FOR CHANGE
In common with many financial institutions, HML has in the past relied on
a sequential software development lifecycle, often known as ‘waterfall’,
where projects progress through a series of discrete stages:
At the start of 2011, • Request
HML recognised • Design
that its IT teams • Build
needed to evolve • Test
their ways of • Implement
working in order to
become more Each stage within this sequence was largely undertaken by a separate
specialist functional group and work was handed off from one group to
responsive to the next with formal documentation providing the communication between
changing needs groups.
and reduce the
„time to value‟ of This approach worked well for HML’s needs at the time and over five
changes, whilst years had resulted in a steady improvement in the stability of production
retaining the systems, with progressively fewer defects escaping into production, and
improvements in improved predictability of delivery dates.
quality.
However, these improvements tended to come at the expense of
responsiveness to change and long delivery timescales.
At the start of 2011, HML recognised that its IT teams needed to evolve
their ways of working in order to become more responsive to changing
needs and reduce the ‘time to value’ of changes, whilst retaining the
improvements in quality.
These changes were to be guided by the adoption of lean and agile
software development principles and practices – an approach that
complemented HML’s existing use of lean and 6-sigma techniques in its
Operational Service Areas.
LEAN-AGILE ROOTS
The term ‘Agile’ as applied to software development was first coined in
2001 to describe a range of methods that emphasised adaptability to
change. The Manifesto for Agile Software Development and its
associated 12 Principles sets out what being agile means; while a range
of methods, such as Scrum, eXtreme programming and DSDM, provide
ways of developing software in an agile way.
The idea of lean software development began at a similar time. It takes
the core principles of lean thinking, e.g. flow, pull, and continuous
improvement, and applies them to software development.
© HML 2012. All rights reserved.
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5. Lean and agile can be seen as complementary approaches: lean tends to
address the wider organisational concerns, while agile focuses at the
development team level.
The combination of lean and agile principles and methods, together with
other approaches such as 6-Sigma, Kanban and the Theory of
The timely and Constraints provide the foundations for Agile IT at HML.
sustained delivery See http://agilemanifesto.org/
of valuable IT See http://www.scrum.org/ and http://www.scrumalliance.org/
capabilities to See http://www.extremeprogramming.org/
HML‟s internal See http://www.dsdm.org/
customers and See http://www.lean.org/WhatsLean/Principles.cfm
external clients
remains
paramount, and is THE JOURNEY TO AGILE IT
at the core of Agile
IT. Lean and agile software development is not just something that you do;
it’s equally about how you think. Changing the ways of working in IT had
to address both transformation of its culture and the adoption of new
practices and techniques.
And while lean and agile principles and techniques have been at the
heart of the changes, these have always been treated as a means to an
end rather than an end in their own right. The timely and sustained
delivery of valuable IT capabilities to HML’s internal customers and
external clients remains paramount, and is at the core of Agile IT.
At the start of the change transition, HML appointed an experienced agile
development practitioner to provide expertise, leadership and support
through hands-on coaching. Reporting directly to the Head of IT provided
the appropriate executive authority and clearly signalled the importance
of the changes.
Building awareness of lean and agile approaches, principles and
techniques has been a cornerstone of the transition. Alongside formal
training and hands-on coaching, peer-based informal ‘learning lunches’
and ‘community of practice’ forums have been used to regularly share
experiences and learn new techniques.
Task boards - big visible displays that show a team’s flow of work - were
one of the first items to be introduced and they remain one of the most
visible aspect of the changes to visitors. Impediments – things either
slowing down or blocking flow – are quickly identified enabling action to
be swiftly taken to resolve.
© HML 2012. All rights reserved.
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6. FIGURE 1: IMPEDIMENTS CAN BE ESCALATED TO A DEPARTMENT
LEVEL BOARD
HML has borrowed
from many of the
well known agile
methods, such as
Scrum, eXtreme
Programming (XP)
and DSDM, but has
deliberately chosen
to avoid mandating
a particular method
in order to
encourage
adaptation,
innovation and
ownership by Symbols used to indicate type of impediment:
teams in how they
work. Stopping progress
Slowing progress
Significant risk of stop or slow
Two other key changes were also introduced early in the transition: co-
location of teams and incremental development; where business goals
are progressively broken down into a series of features that are
developed in short iterations and delivered over a series of releases.
Fundamental to the long term success of changing the way of working
has been to make continuous improvement and learning a way of life.
Fortnightly ‘retrospectives’ enable a team to reflect on what is working
well, and what is not; and gives them responsibility for changing their
process. Over time, this process has itself been adapted, refined and
improved, with both a team and department wide improvement regime.
Instead, HML has developed eight principles of Agile IT that can be
used by everyone involved, from individual IT practitioners, to teams and
stakeholders to guide how they should work.
The principles help reinforce the view that Agile IT is primarily cultural,
and represents a journey not a destination.
© HML 2012. All rights reserved.
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7. OVERCOMING CHALLENGES TO CHANGE
Change is never easy, and HML faced a number of challenges on its
Iterative Agile IT journey.
development and
incremental One of the first challenges HML encountered was the creation of co-
delivery creates located, cross-functional teams. Unsurprisingly, some individuals felt
unhappy to have to move desks, and breaking up long standing functional
significant groups risked losing their sense of community. HML worked hard to
challenges for involve those who needed to move in the planning, and introduced
upstream and changes progressively. The existing functional line-reporting structure
downstream and regular functional team meetings were also retained. Only at the start
processes. of 2012 did formal line management change to reflect the new cross-
functional structure of teams.
Throughout the transition, HML needed to ensure governance was not
compromised. Many of the existing governance controls were organised
around or were dependent on waterfall stages and functional teams, so
the move to cross-functional teams and iterative development potentially
reduce these controls’ effectiveness. Close collaboration with the Risk
Creating an IT and Compliance teams ensured appropriate oversight and HML is
currently introducing Practice Leaders who will be responsible for
capability to build governing key practice standards.
and deliver new
features on a just- Finally, iterative development and incremental delivery creates significant
in-time basis also challenges for upstream and downstream processes. Creating an IT
requires a business capability to build and deliver new features on a just-in-time basis also
organisation that requires a business organisation that can define and prioritise a flow of
can define and desired features, and one that can absorb and apply them usefully. HML
has made some progress in this area, using agile techniques to define
prioritise a flow of business cases for increments rather than whole projects, but this
desired features, remains an area of development and improvement.
and one that can
absorb and apply
them usefully.
© HML 2012. All rights reserved.
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8. THE EIGHT PRINCIPLES OF AGILE IT
1. Make it Visible
Teams own their The process of software development is difficult to visualise, and while
visual management Gantt charts have a place, they rarely map well to the needs of IT.
boards, and this
fosters innovation Agile IT makes use of large, physical display boards that show the flow of
in how boards and work being undertaken by the team, an approach known as Visual
Management. Task boards and similar visual management tools help a
the underlying
team visualise the ‘state of play’ of the work they are doing and make it
process they easy to spot and respond to impediments to a team’s development flow,
represent evolve to contributing to shorter delivery times.
meet the team‟s
needs. Teams own their boards, and this fosters innovation in how boards and
the underlying process they represent evolve to meet the team’s needs.
For example, blockages are highlighted with stop signs; avatars of team
members are used to indicate who’s doing what; and colour is used to
indicate different types of work.
FIGURE 2: SHOWING FLOW OF WORK ITEMS, TYPICALLY USER
STORIES AND ASSOCIATED TASKS
Avatars
show
assignment
Impediments
highlighted with
Red Flags
As well as helping the team, visible task and status boards have proved
invaluable for updating stakeholders. They’ve also fostered greater team
spirit and visibility of the status of the project with the wider business.
© HML 2012. All rights reserved.
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9. 2. Make Collaboration Easy
IT development is a creative process. Customers and IT professionals
have to work together to ensure they deliver what is needed in a
Face to face background of imperfect knowledge and change. Making collaboration
easy is therefore essential for successful projects.
communication is
encouraged as the
With Agile IT, work is undertaken by small co-located, cross-functional
primary method of
teams, known as ‘pods’ who take responsibility for the end-to-end
communication delivery of new software features.
As well as bringing together expertise in different IT disciplines, such as
test, engineering and analysis, customer representatives and other key
stakeholders work closely with teams throughout the development and
delivery lifecycle.
IT projects face two
key challenges: Face-to-face communication is encouraged as the primary method of
customers do not communication. Documentation remains important, but the emphasis is
know precisely on doing just what is necessary and using alternative forms of
documentation, such as wikis and other electronic knowledge bases,
what they really rather than paper documents.
need; and in
today‟s competitive 3. Assume Change: Experiment, Discover, Learn, Iterate
business
environment those IT projects face two key challenges: customers do not know precisely
needs are often a what they really need; and in today’s competitive business environment
moving target. those needs are often a moving target.
The traditional approach to addressing these challenges is to undertake
extensive up-front analysis before locking down scope and then limiting
subsequent amendments through change control regimes.
Unfortunately it’s also common to see these IT projects take a very long
Agile IT assumes time to deliver what turns out to be the wrong thing.
that change is
inevitable and Agile IT assumes that change is inevitable and seeks to exploit this rather
seeks to exploit this than resist it. Using an iterative approach to development coupled with
rather than resist it. incremental delivery ensures that the most valuable features needed
today are delivered first whilst others are deferred for later increments.
IT projects at HML typically use fortnightly iterations, and are able to
deliver new features into production monthly. Stakeholders are able to
review working versions of iConnect at least every iteration, and this
feedback is used to adjust what features will be developed next.
© HML 2012. All rights reserved.
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10. 4. Focus on Delivering Useful Value Today
Delivering something of value early is generally much more beneficial
than delivering a collection of things much later. As well as increasing
Agile IT seeks to return on investment, focusing on delivering what’s useful today helps
prevent speculative development or ‘gold-plating’.
incrementally
deliver value by
Research by the Standish Group suggests this is far from uncommon,
delivering in small,
reporting that 45 per cent of software applications’ features are never
valuable used. As well as incurring unnecessary cost, building these features
increments. Each means that other more useful features are either delayed or not built at
increment is all.
focused on
delivering the Agile IT seeks to incrementally deliver value by delivering in small,
minimum needed to valuable increments. Each increment is focused on delivering the
minimum needed to provide benefit to its customers today.
provide benefit to
its customers
Stakeholders are actively involved in determining the order of
today.
development of features and the team is encouraged to seek out
opportunities for delivering increments early. Monthly releases enable
new features to be rolled out quickly so it’s possible for a feature to go
from idea to delivery in just a few weeks.
Delivering incrementally places new pressures on repetitive tasks such
as build, deployment and regression testing and HML has steadily
focused on automating and refining this process. Similarly, architecture
and detailed designs need to support change, and technical practices
such as Test Driven Development and Refactoring have been adopted to
support this.
5. Build a Sustainable Flow of Value
Many organisations seek to maximise the utilisation of staff and the
number of projects that are in progress. Unfortunately, this approach
tends to result in long delivery times for any one activity and relatively low
completion rates. Whilst it can give the appearance of cost efficiency it
comes at the expense of time to value and responsiveness to changing
needs – qualities that usually far outweigh the savings made by
maximising utilisation.
Agile IT seeks to take a holistic view of the whole delivery value stream -
not just that part in IT - optimising for a fast, steady stream of deliveries of
valuable features. Instead of maximising utilisation (and minimising unit
cost), Agile IT seeks to minimise cycle time, the elapsed time it takes for
valuable increments to be delivered, and so increase throughput, the rate
of delivery of benefits.
© HML 2012. All rights reserved.
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11. Reducing cycle time enables returns on investments to be achieved
sooner and improves responsiveness to changing needs. Increasing
throughput maximises the opportunity to deliver what is needed.
Simply put, Agile IT Simply put, Agile IT values finishing over starting; doing less in order to
achieve more, and systematically finding and removing anything that
values finishing
disrupts or impedes flow.
over starting; doing
less in order to
Teams at HML use either iterations - short timeboxes of typically two
achieve more, and weeks - or explicit work in progress limits to manage flow. Projects are
systematically decomposed into small increments which are in turn broken down into
finding and small features that can be completed in days rather than weeks. And
removing anything teams actively identify and resolve impediments to flow, escalating those
they cannot quickly resolve to a department-wide daily impediments
that disrupts or
meeting attended by management to ensure visibility.
impedes flow.
6. Build Quality In
Deming famously declared that “You can not inspect quality into the
product; it is already there.”* Most traditional approaches to software
development focus on the (often late) detection of problems, through
inspections and testing, and make extensive use of manual processes
that inevitably introduce variation and errors.
Agile IT recognises that speed and agility requires attention to quality and
technical excellence; it is simply not possible to go fast if the process or
Agile IT recognises
product is unreliable.
that speed and
agility requires
Teams at HML employ automation for repetitive tasks, such as
attention to quality integration, build, check and deploy; enabling them to execute these
and technical tasks frequently – typically multiple times a day. They also use
excellence; it is techniques such as pair programming and test driven development that
simply not possible help prevent errors or catch them as soon as possible after they are
introduced.
to go fast if the
process or product
*From Out of the Crisis, by W Edwards Deming (MIT Center for
is unreliable.
Advanced Engineering Study, 1986)
© HML 2012. All rights reserved.
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12. 7. Continuously Improve
The need to respond to change applies just as much to the process of
development as to the capabilities of the software. The idea that a single
The idea that a process will work equally well for all time and across all projects and
teams is not reasonable, so Agile IT promotes a culture of continuous
single process will
adaptation and improvement and advocates that those who do the work
work equally well are best placed to improve how the work is done.
for all time and
across all projects HML has made knowledge sharing explicit; sponsoring ‘learning lunches’
and teams is not and the formation of communities of practice, and has recently introduced
reasonable, and so Practice Leaders to guide and support practice improvement.
Agile IT promotes a
culture of Frequent and regular retrospectives - workshops focusing on
continuous improvements - are undertaken by teams, typically every two weeks,
where teams are encouraged and empowered to make small incremental
adaptation and
changes to their processes to drive improvement.
improvement and
advocates that
8. Agility is Everyone’s Responsibility
those who do the
work are best
‘Doing agile’ is important, but ‘being agile’ is essential. Fundamentally,
placed to improve agility is a mindset that everyone in the organisation needs to express.
how the work is Agile IT provides an organisation with the potential for becoming an Agile
done. Business.
At HML, agility in general and Agile IT specifically, has become central to
its ethos.
„Doing agile’ is
important, but
‘being agile’ is
essential.
Fundamentally,
agility is a mindset
that everyone in the
organisation needs
to express.
© HML 2012. All rights reserved.
12

13. BENEFITS OF AGILE IT
Over the first 18 months of its Agile IT journey, HML has significantly
improved its IT capability:
An HML consultant Increased throughput
feeds back after a HML has been able to move from quarterly releases to monthly releases.
recent project to Delivering more frequently has had two benefits: firstly, it is much easier
to release opportunistically – stakeholders, having seen an iteration
automatically and
demo, may realise that the software would be beneficial if deployed as is,
securely retain and monthly releases allow these opportunities to be exploited. Secondly,
customer card more frequent and smaller releases reduce the risks associated with
details goes live: each deployment.
“I have to give you Reduced time to deliver value
this feedback Before the transition to Agile IT, IT projects at HML, even those that used
because it is proof a phased delivery approach, would typically take between three and nine
months from approval to their first delivery into production. Agile IT has
of the success of
reduced this ‘time to value’ considerably, with projects typically now
card re-use delivering benefits within three months, and often considerably sooner.
functionality. We
had over 200 calls Greater flexibility and responsiveness to changing needs
today and not Focusing on achieving a business goal frees teams to explore and adapt
dropped a single their solution so that it best meets that goal, enabling them to respond to
one, on last changing circumstances and new knowledge about what is important.
working day! This flexibility has enabled projects to start and begin to deliver useful
benefits despite imperfect information; while allowing new needs to be
Normally by now
much more easily accommodated.
we would have
expected to drop
Improved stakeholder and client satisfaction
calls as it is so
By working more closely with its stakeholders, building iteratively and
busy. It's obvious acting on their feedback, HML has been able build trusted relationships
that there are a lot and a real feeling that they were a part of our product development.
of card payment
only calls and we
are flying them.
Customer feedback
is positive and
consultant
feedback is very
positive.”
© HML 2012. All rights reserved.
13

14. AGILE IT AT WORK: PROJECT FORBEARANCE
At the start or 2012, responding to a request from one of its clients, HML
began a project to implement improvements to iConnect to support
anticipated regulatory requirements proposed by the FSA.
INDUSTRY
Speed of response was critical to the client’s needs, but uncertainty
REACTION TO around what was really needed was high – HML was seeking to be first to
AGILE IT: market – and operational usability was essential to ensure minimal
impact to customers and call centre consultants.
“I got the impression
that [lean-agile During the start-up phase of the project, the team, through a series of
principles] were truly workshops with stakeholders, created a high level vision, a prioritised list
embedded in the day- of high level requirements and an outline roadmap. Work then proceeded
to-day work of the using fortnightly iterations that planned, built and demonstrated new
teams.” functionality. Regular retrospectives generated frequent improvement
‘experiments’ which drove constant adaptation and improvement in how
the team worked.
“I was surprised at just As the project progressed many items originally in the backlog were
how good the visual considered unnecessary, and many new items were added in response
management was in IT to improved understanding of needs identified through the
in terms of its variety demonstrations. Throughout the process, both the client and internal
and complexity.” stakeholders were involved, and this has resulted in high levels of
engagement and satisfaction.
“I was greatly Key metrics
impressed by the IT
Mobilisation time: 2 weeks
department...to see an
IT team working so First demo of useable 2 weeks after mobilisation, and
cohesively is something functionality: fortnightly thereafter
we can only dream of.”
First delivery of useful features: 6 weeks after mobilisation, and
monthly (on demand)
Delegate thereafter
responses from a Number of software defects 0
meeting of the escaped into production:
Lean Service
Internal stakeholder Consistently rated high
Forum, hosted at satisfaction:
HML in April 2012.
For more Client satisfaction: Consistently rated high
information on the
Lean Service What the client said:
Forum see: “The projects team's approach throughout has been one of collaboration
best demonstrated by their invitation to me, to not only attend, but part-
http://www.oeeuk.c facilitate the two day forbearance training event that was delivered to our
om/community- Credit Management colleagues.” (Compliance Manager)
leanforum.asp
“It has been a pleasure to work with the Forbearance project team.
Communication has been excellent throughout the project, they have
been responsive to requirements (including late ones) and all signs point
to delivery meeting agreed scope and originally agreed timescale.”
(Operations Manager)
© HML 2012. All rights reserved.
14

15. ABOUT THE AUTHOR: Andy Lawrence, Lean-Agile Practice Lead
Andy has over 20 years experience in delivering IT based solutions across a
diverse range of industries, and has been leading and coaching software teams in
lean and agile software development for the last decade. He has presented at
conferences and industry events, and regularly contributes to groups such as Agile
Yorkshire and Agile Testing in Finance. Andy joined HML in 2008, initially working
with the Business Intelligence team before joining the IT department to lead the
lean-agile implementation.
Andy has been nominated in the Agile Coach or Mentor of the Year category for UK
Agile Awards 2012.
© HML 2012. All rights reserved.
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