6 Key Reasons Why Agile Transformations Fail (And How to Avoid Them)

Seventeen years since the Agile Manifesto and 96% of agile transformation projects fail because of their inability to rapidly adapt to market and environmental changes in a productive and cost-efficient manner. Such an increasing agile transformation failure rate is alarming for many.

In today’s dynamic business ecosystem surrounded by nimbler competitors and demanding consumers, organizations must work faster and deliver more value.

Agile transformation promises precisely that. That is why agile transformation is needed and has become the go-to strategy for many businesses. Yet, the struggle is real.

In this piece of content, we have mentioned a few of the most common reasons that define why agile transformations fail, which, if you understand, will leave you with much better chances of avoiding a fiasco.

6 Agile Transformation Challenges and Their Solutions

While there can be many reasons behind why agile transformations fail, we see the below-mentioned as the common challenges organizations fail to tackle when embarking on their agile journey.

1. Lack of ‘Agile’ Understanding

First, get the basics right.

Agile Manifesto deals with software development, not business outcomes. On the other hand, organizational agility is the capability to adapt to changing market conditions, which was never the objective.

Often, CTOs prefer to look for ways to build the right products faster and get to market more quickly with more innovation. For this, they start to transform their engineering teams to become more efficient. They apply this work order to their product development process and claim that an agile transformation is in play. However, focusing your transformation just on product development is the number one reason agile transitions fail.

How to Prevent this Failure?

An agile transformation is a far different approach than just improving the efficiency of delivery teams. In a nutshell, it goes beyond IT. Having an agile team implies being responsive to change, learning while executing, and switching on to ‘failing-fast and fixing-faster mode’ for the organization’s long-term growth.

The Ultimate 15-Point Checklist for Agile Transformation

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2. Organization’s Culture

Culture is a king, and at its core, agile transformation is a mindset. Each corporate culture is driven by a shared perspective, evaluation paradigms, and behavioral patterns. One of the major setbacks whenever a change is brought into an organization is the people’s resistance and ignoring the cultural and change-management implications of agile.

Going agile is a radical organizational change, which means breaking down the traditional silos mentality. Organizations with a strong ‘command-and-control culture’ often overlook it as a challenge. They wish agile to “fit in” their organizational culture as it is, which is why do transformations fail.

Even the 14th annual state of the agile report states that organizational culture is the major challenge faced by businesses when adopting or scaling agile.

Challenges Experienced When Adopting & Scaling Agile

How to Prevent this Failure?

In small as well as large organizations, agile transformation is a radical change. To successfully transform your organization, you have to move away from historically evolved and manifested mindsets towards an ideal cultural set-up established and promoted both on a top-down and bottom-up basis.

Remember, just as you can not push an athlete to love a particular kind of sport, for instance, rugby—the term “scrum” originated from it—you can not force employees of your organization to enjoy agile working methods. Build a corporate culture based on trust, team spirit, and commitment, and you will see employees starting to embrace agile work methods resulting in agile product development.

Netflix and its Cultural Evolution

Netflix aimed to foster innovative thinking and high performance in their organization. And the management decided to bring in the culture of freedom, high-value performance, and responsibility by treating employees like grownups.

Netflix’s agile transformation objective was achieved in the following ways:

  • By assigning trust in responsible behavior and judgment of employees to create space for independence.
  • By substituting annual reviews and performance improvement plans with frequent and open conversations with team leads as an organic part of daily work.

Result: It boosted the independence and decision-making power of employees through less organizational complexity and bureaucracy, leading to faster feedback, iterative changes, and cross-collaboration, paving the way for an agile transformation.

Key Takeaway: An organization’s culture is the most critical agile transformation success factor. However, it is often the hardest one to change as an organization spends years building one.

3. Copying Others Agile Transformation Projects

How most of the agile transformation projects are currently being implemented?

In most cases, someone (agile coach) is hired from outside the organization. They define your agile transformation roadmap by bringing in a specific, already used set of practices that, according to them, are best for you.

If this is not the case, then someone from within the organization gets inspired by the case study of ING or a video by Spotify, and they start using that as a blueprint for their transformation, if not using it as a manual itself. That is one of the significant reasons why agile projects fail.

Agile Product Development Report

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Copying what other organizations did and using it as a cargo cult is a wrong approach that leads to agile methodology failures. Your organization will definitely have different requirements and priorities than those organizations you are copying from.

How to Prevent this Failure?

Agile, simply put, is about thinking, running small experiments, and improving quickly and easily. An agile organization always keeps exercising and building the muscle of learning.

You should build your own internal coaches who can help you lead your organization’s transformation from the inside out. No doubt, you will require the help of an external digital experience agency to kick-start the transformation. Still, your employees need to own it, which includes making informed decisions about the transformation.

4. Restricting Agile to Pilots

Why agile fails is because organizations limit it to pilot projects and wait for results. The pilot project’s restricted nature prevents the C-level executives from seeing the impacts a broader agile transformation could have.

How to Prevent this Failure?

While it is acceptable to start the agile transformation within a small team of the organization, it is crucial not to stop there and wait for outcomes. Agile teams need to approach it holistically and embed agile principles in its culture throughout the organization. Spreading agile beyond small groups is where the real advantages arise.

5. Not Investing in Hiring the Right Resources

One of the agile principles is building self-organizing teams, which require hiring motivated and skilled individuals. The right human resources are the fuel that supports the agile journey of organizations. However, for many product owners, hiring talent is an afterthought that leads to failed agile transformation.

According to Net Solutions’ Agile Product Development Report, 66.2% of surveyed team leaders said their team members do not have a complete understanding of agile and what value it delivers. Without team members knowing the importance of agile, successful agile transformation is impossible.

How to Prevent this Failure?

While every organization should develop a strict process for hiring the right talent, the agile team can not just compromise when bringing people on board. Agile is against micromanaging, and therefore you need to hire people who can manage themselves and create value for the business.

Here are some tips you should follow before you start hiring people for your agile team:

  • Focus on people, not just on skills. Agile teams need individuals with the right personality, mindset, and values.
  • Find out the intrinsic skills needed to be successful in agile projects and where you can find such resources.
  • Don’t compromise ever – you may feel the need to hire someone immediately. However, product owners shouldn’t do that.

6. Underestimating Communication and Collaboration

Why agile fails in large organizations? The most common reason is that communication and collaboration is the major hurdle in larger teams.

Agile favors individuals & interactions over processes & tools. However, adhering to this principle in a large organization or distributed agile teams often becomes a challenge.

In agile development methodology, where short iterations are preferred, effective collaboration and communication become a significant problem. Not being able to solve this problem effectively is an important reason why agile transformations fail.

How to Prevent this Failure?

Following agile principles, it is crucial to have everyone involved in the project. Agile team should have a proper balance of time devoted to collaboration and other development activities like coding and testing. They must have pre-scheduled time for formal collaboration meetings and to focus on user stories. Besides, they must engage with each other over small talks online to know each other better.

Here are some more strategies that will help the agile teams working in a distributed environment:

  • Use video conferencing tools for project meetings
  • Use digital whiteboards for design sessions and sprint planning
  • Use low-code apps or surveys to gather feedback at retrospectives

The agile transformation journey is a bit challenging. However, by avoiding the common agile transformation pitfalls like failing to set a framework that doesn’t support agile principles and not putting the culture first, you can surely build an agile team that creates value.

Here are the top 5 Agile techniques to ensure better communication and working as per the 14th state of agile report respondents:

agile techniques used by organizations

Also, finding an answer to why you need agility is crucial to agile transformation success.

Often, product managers or owners give vague reasons like they want to market the product faster or be agile like other teams, leading to discrepancies. These are not valid reasons to pursue an agile transformation. Keep in mind that well-defined reasons will cause your agile transformation to be more valuable and successful.


Agile transformations are hard to achieve for organizations and employees. Remember, there is no conventional route for any organization to become agile. You have to find your own way of sustainable improvement and help your organization move towards agile transformation as a destination.

Getting acquainted with the potential ways that a transformation can fail helps you build awareness of where to start your agile transformation project. However, many of the challenges you face will be unique to your organization. In that case, feel free to take advice from expert assistance beyond the contents of the blog.

Agile Transformation Isn’t Rocket Science; It Needs Thought-through Implementation Though

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Adam Milne

About the Author

Forte:Managing and Leading projects with multi-cultural teams in competitive environments
Likes: Biking around NYC and enjoys Pineapple on Pizza
Dislikes: Micromanaging
Claim to Fame: As Creed in ‘The Office’ says, I was born in the US of A.
Biggest Tech blunder committed: Early in my career, thinking UX and UI are the same things. *Facepalm*
Wannabe: A professional Basketball Player

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