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Opinion 28 June 2018

HR goes Agile: a case study in BBVA

“HR Goes Agile”. That was the headline of a recent issue of Harvard Business Review on talent management. Further than any academic paper, this is already a reality in BBVA. In fact, we may well be the first company with over 100.000 employees to execute a complete (all team), transversal (holding and countries) transformation of the HR function into a new Agile organization and governance model.

It all started in 2014. By that time, at BBVA we recognized that even though we had a very clear strategic vision, we were not fast enough in executing it. New competitors (fintech and big tech) were entering into financial services and moving at high speed. So we needed to find a new way of working, collaborating and creating new solutions for our customers at a faster pace. After looking at different practices in other companies, we decided to start implementing Agile as a new way of executing projects. We launched the first scrum teams in Spain, Mexico, South America… combining product and engineering people into multidisciplinary, co-located teams with full time dedication. Teams working in 2-3 week cycles to test and iterate and thus build new solutions based on customer feedback.

The change was not easy and we had to manage significant resistance from many people during the first months, but results arrived very fast. In less than a year it became clear that Agile was making an impact in improving product quality, accelerating time to market and raising employee engagement and productivity. In South America, for example, scrum teams were delivering up to three times more features in the same timeframe. Therefore, we continued extending the model to more and more teams and, eventually, moved all of our teams developing new solutions for our customers into a new quarterly planning process following SAFE (Scaled Agile Framework) principles. By the end of 2016 we had 3.600 people working in scrum and many more working with the quarterly cadence of PIs(Program Increment).

But by that time we also realized that we were still far away from being an Agile organization. Most of our units (up to a total of 132.000 people) were still working following a traditional model and somehow constrained by organizational silos. The transformation of some units in Customer Solutions and Engineering had been fantastic, but all other areas (HR, Finance, Risk, Legal…) were still very much working business as usual. In fact, this transformation was starting to create friction between Agile and non-Agile teams. We understood then that we needed to scale Agile to all corporate areas.

And we decided to start with HR (or Talent & Culture, as we call this function) so we could experiment this transformation journey ourselves and thus be better prepared to support other areas in following it. Our first step by the end of 2016 was to create a pool of people fully dedicated to projects in all Talent & Culture (T&C) units in the countries, moving 10% of the team to this new project-based organization. In parallel, we started to analyze the opportunity to create shared-services centers in every country. But in a few months it became clear that having this dual organization (the old organization and the emerging Agile structure) was not very effective, and by mid 2017 the head of T&C in Spain decided to move forward by transforming the whole team into a fully Agile organization. Over the next 9 months, we have been able to go through the same process in every country and in the holding, so today we have a T&C team of more than 2.000 people in 10 countries working under a fully Agile organization and governance model.

How does it work? We have broken up the previous functional units and hierarchies and reorganized the team along four different groups:

1º – Front:

Team of business partners offering strategic advice and support to internal customers: areas, managers and employees. Business partners have to play a strategic and proactive role in giving service to internal areas, based on a very good knowledge of their needs and priorities. They also have to act as coaches for managers and as a point of contact for employees through their life cycle in the organization. They typically represent 10-15% of the team.

2º- Disciplines:

Expert teams with the role of defining the strategy and developing the models, policies, tools and platforms for their respective areas of expertise (such as talent management, compensation and benefits, internal communication, organization…) They ensure connectivity of people in execution teams through global Communities of Practice in which practitioners in their field share knowledge and best practices and even co-create new models and platforms. Discipline teams are typically senior but very small (just 2-3 people by discipline), representing no more than 10-15% of the total team.

3º – Solutions Development:

Pool of professionals fully dedicated to execute projects or build new solutions following scrum principles. They constitute multidisciplinary teams with autonomy to organize their work and end-to-end accountability and capacity to execute. These scrum teams typically work in 2-3 week sprints following an iterative, incremental process to continuously learn from (internal) customer feedback. They are dynamically assigned, on a quarterly basis, to the evolving strategic priorities of the area through a staffing process. Ideally they should represent at least 25-30% of the team.

4º – Employee Experience

Group of teams empowered to execute all end-to-end processes in the function and deliver value to internal customers using Kanban. They have a big impact in employee experience, operational excellence and productivity. By concentrating all processes which were previously fragmented into different units, there is a clear opportunity to stop doing things that do not add significant value, apply process engineering to redesign processes for better quality and efficiency, and apply automation, robotics and machine learning techniques to raise productivity. Furthermore, we can define a catalog of services to be provided to internal customers, linked to specific KPIs and service level agreements so we can measure and continuously improve quality of service. These teams normally represent 40-50% of the area.

This new organizational design constitutes the backbone for a new governance model demanding new roles and responsibilities, new team ceremonies, new people management models (such as project staffing and mentor leaders for the Solutions Development team), new communication tools to increase openness and transparency, etc.

In fact, this Agile transformation is a journey that never ends, as the ultimate goal is to promote a cultural transformation that puts execution teams at the center of the organization and transform managers into servant leaders. Leaders will now focus on giving strategic guidance to the teams, helping them in solving impediments and acting as coaches to help everyone build new skills and mindsets. And teams will benefit from increased visibility, empowerment and accountability.

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