Why agile working has moved from fad to fit-for-purpose
Leaders need to understand when agile adds value, how to implement it effectively, and the role of purpose and discipline in the process, write Greg Joffe and Laust Pedersen
Five years ago, agile was the latest fashion, with many large organisations reconfiguring themselves to use agile ways of working or agile at scale. Since then, as is often the case with ‘the latest greatest thing’, many organisations have struggled to implement it successfully.
This article considers when agile is the right approach, how to apply it well, and how to avoid the traps that have limited its impact. It provides guidance on how leaders can take a pragmatic, fit-for-purpose approach to agile.
A short history of agile
Agile has now been around for over two decades. It first emerged as a methodology for technology companies seeking faster, more adaptive ways of developing products. Over time, agile spread far beyond tech, with banks, insurers, and even governments experimenting with agile transformations.
Our experience is that agile can be a powerful methodology. It can achieve faster iteration and delivery of products and services, better alignment of multidisciplinary teams, a culture of experimentation and learning, and greater responsiveness in volatile environments.
But agile has also suffered from hype, misunderstanding and misapplication. Too many organisations have treated it as a universal solution, becoming absorbed in processes, terminology, and team structures rather than the underlying question: “When should we use agile, and when shouldn’t we?”
When agile works best
Agile methodologies work particularly well in environments marked by uncertainty and rapid change. They are effective for organisations developing new products or product upgrades that require continuous iteration and incremental deliveries. By embracing and managing change, agile enables teams to respond swiftly to evolving requirements, making it ideal for time-bound projects where priorities may shift frequently.
Agile derives its core strengths from the cross-functional and self-organising agile teams. Bringing together different perspectives helps teams solve problems collectively and creatively. Being close to customers and empowering them in operational decision-making enables faster and more informed decisions. In addition, shifting tasks based on expertise, these agile teams may adapt quickly to changing priorities to keep work moving and deliver value consistently.
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A key advantage of agile is its emphasis on experimentation and learning over extensive documentation and planning. Teams can prioritise small deliveries to test assumptions and refine outcomes frequently. This focus on learning and iterative progress allows organisations to capitalise on emerging opportunities while mitigating risks associated with extensive planning.
When agile struggles
Agile is as much a mindset as a methodology, asking teams to embrace collaboration, transparency and continuous learning. Many organisations focus on rituals like stand-ups and sprints without changing underlying structures and cultures, which can create conflict and misalignment. In hierarchical cultures, the flatter, distributed leadership model that agile requires may clash with established norms, leading to fragmentation instead of coherence. Agile requires leadership support and thoughtful change facilitation.
Agile works well in small teams; scaling it across a large organisation is challenging. Teams need to stay aligned with each other and with the company’s broader goals, while dependencies between teams, managers and projects can slow down or blur decision-making. Scaling requires clear priorities and thoughtful coordination to preserve the autonomy and adaptability that make agile effective.
Agile can also be challenging in projects where stability, predictability and extensive documentation are essential. Its iterative approach and emphasis on adaptability often conflict with strict schedules, regulatory requirements and risk-averse cultures, making planning and coordination more difficult. This requires adapting agile to meet these demands while communicating trade-offs between flexibility and predictability.
When to use – and not use – agile
A fit-for-purpose approach helps leaders decide where agile belongs.
| Use agile | Don’t use agile |
| Product development and upgrades (especially new products in the prototype phase) | Dedicated teams doing well-defined and repeatable work |
| Projects with evolving or uncertain requirements | Stable projects with clear and fixed requirements |
| Work demanding collaboration across multiple disciplines | Functions where sequential processes already deliver consistent results |
| Short-term initiatives needing fast iteration and frequent feedback | Large-scale operations requiring stability, standardisation or compliance |
The key is to match method to challenge, rather than applying agile by default. Understanding when agile adds value can guide the right approach.
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Here are a couple of examples:
A train company uses agile to develop a new passenger app for ticket booking, journey planning and real-time travel updates. Because passenger needs and technology trends change rapidly, the team works in short sprints to release small updates regularly. Frequent user feedback allows the team to quickly fix bugs, add popular (or requested) features and improve the overall customer experience. This agile approach ensures the app stays relevant, reliable and meets passengers’ expectations.
A telecom company is developing a streaming content platform for movies and television series using agile methods. Given the evolving preferences (and expectations) of users and the dynamic nature of content and platform trends, the team organises work in iterative development cycles. Regular customer and stakeholder feedback informs continuous improvements to recommendations, bug fixes and introducing trending content or features, ensuring that the platforms remain up to date.
How to use agile well
When agile is the right fit, success requires more than simply adopting structure, ceremonies and new roles. Leaders should keep in mind:
- Focus on outcomes, not rituals. Agile is a means to an end, not an end in itself. Avoid “methodology fundamentalism”.
- Allow coexistence. Some parts of the organisation can and should work in an agile way, while others operate hierarchically. Both can succeed side by side.
- Balance structure and culture. Agile needs both deliberate structures (e.g., team design, governance, processes) and a culture of empowerment, collaboration and adaptability. One without the other leads to failure.
- Cultivate leadership fit. Agile thrives where leadership shifts from command-and-control to enabling teams, distributing responsibility, and providing clear boundaries for autonomy.
- Leverage new tools. The rise of AI makes iterative experimentation easier than ever, but only when integrated into disciplined, outcome-driven agile practices.
Using a hybrid approach (waterfall plus agile)
A ‘middle path’ is to use a hybrid approach by combining the strengths of both agile and waterfall while addressing the limitations of each. Rather than emerging from a single event or trend, these hybrid approaches have evolved naturally in response to the growing complexity and demands of modern projects. In his 2023 HBR article, Antonio Nieto-Rodriguez illustrates this hybrid approach through the following cases:
Flexibility and structure: Philips used a hybrid approach for its HealthSuite digital platform, combining waterfall’s strict documentation and safety standards with agile’s rapid, iterative software releases. This allowed Philips to maintain quality and compliance while accelerating time to market and controlling costs.
Phased and iterative development: During its digital transformation, DBS Bank applied a waterfall approach for well-defined infrastructure upgrades and an agile approach for customer-facing digital services. This combination enabled the bank to modernise legacy systems while quickly delivering innovative services.
Customer focus and predictable delivery: British Telecom used agile for its 5G network development to gather frequent customer feedback and waterfall for data centre infrastructure projects to ensure predictable timelines and budgets. This hybrid approach balances responsiveness to customer need with control, supporting both innovation and operational stability.
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A fresh start for agile
Agile is neither dead nor a cure-all. It remains a powerful set of principles and practices, but only when used thoughtfully. Organisations should stop debating whether they “are agile” and instead ask: Where does agile create real value – and where do other approaches serve better?
By moving beyond stereotypes and fads, and rebranding agile as one tool among many, leaders can harness its strengths while avoiding its pitfalls. The future of agile lies in pragmatic and deliberate integration, not polarisation.
Greg Joffe is an AGSM Adjunct Professor and a Principal at Nous Group, and Laust Pedersen is Chief Consultant at LEAD and an Industrial PhD Fellow at Aalborg University.