The economic landscape is changing by the resurgence of the small firm. Be it a bakery, a niche restaurant serving exotic cuisine, a small mobile phone app maker or a startup offering web-development services – the ‘small business’ is growing in importance. Who or what is making this possible?
Walk into a gym and put on your business hat. Fancy yourself as a 21stcentury economist. Think of barbells. And then, think of what any unsuspecting consultant from McKinsey will blurt out if you approach him, brandishing a barbell. Barbell Economics!
The analogy is apt when one imagines the modern economy to be a barbell – few large firms on one side, the mid-sized firms populate the middle and thousands of small firms balance the other side. Sort of Chris Anderson’s Long Tail meets Rocky Balboa’s Gym.
So what enables the ‘small fries’ do well in a world of ‘economies of scale’? Numerous factors, possibly, but technology is perhaps the most important of them. An example of technology enabling small businesses capture market shares is the power of software. From providing analytics to building a better customer relationship through web services, software is paving the way for small companies. However, we would be missing the wood for the trees if we fail to understand the methodologies that make well-functioning, targeted and customized software possible. It is hard to escape the term “Agile” while discussing methodologies.
Agile & Small Businesses
Small businesses run on tight purse strings. Things are piecemeal and nothing is done without keeping an eye on the results it should deliver. Hence the ‘IT” part of businesses or small software development firms take on a huge responsibility when saddled with some initiative like developing a creative piece of software that captures X amounts of data/insights and delivers Y dollars worth of results. The fuzziness of requirements coupled with the fog over the end result is what Agile flourishes in and delivers results that not only work but deliver excellence.
Agile & the Development process
There are several different flavors of the Agile methodology, but the fundamentals simple. Its principal objectives are shorter delivery lifecycle, smaller teams, continued customer collaboration and iterative development. This methodology is known to lower costs, lower defect rates, increase flexibility to change, and the ability to leverage new technical or business information for rapidly changing/dynamic business needs with a need for fast time-to-market. In other words, working through the fuzziness of requirements and the fog of results just became interesting and fun!
Agile & the statistics
A recent survey by the hallowed Harvard Business School revealed – using Agile delivered 50% reduction in engineering efforts, 55% improvement in time to market and 925% improvement in the number of changes allowed during the development process. The same study also stated a 50% improvement in quality associated with iterative development. No wonder case studies of Agile include that of a small die-cutting shop in Ohio, a mid-sized law firm in Washington or a small chain of sports goods stores – all with similar requirements. They all wanted to harness the power of software; customized to their own business needs and they all wanted it done within a definite budget and timeframe. Agile is what they embraced. And excellence is what they’ve experienced.