The right Balance

In simplified terms, there are two dimension that drive the efficiency of an agile business:

• Latency: the speed of response to factors/events
• Ambiguity: the level of certainty, confidence in understanding these factors/events (cause, effect)

Examining this along the popular "quadrant" approach of analyzing business, let's consider the following points:

Red Square:

A business with a fast response rate ("low latency") to events of uncertain understanding ("high ambiguity"), tend to be perceived more on the "chaotic" side.

Blue Square:

Businesses which take their time to respond ("high latency") to well understood events ("low ambiguity") are not particularly effecient and may come across as "bureaucratic".

Green Square:

When the overall business environment, in terms of markets and operations is rather stable ("low ambiguity"), the business can afford moving quickly ("low latency") in response to a well understood environment. The benefit is a "efficient" performance (and typically a high maturity level).

Yellow Square:

When business opportunity, or market dynamics (e.g. competitive landscape) cause a high level of uncertainty ("high ambiguity") it might be prudent to invest more time in understanding the risks and benefits of responses to events ("high latency" in response). The benefit is risk mitigation, but must be balanced against lost opportunity cost.

So far common sense business wisdom. But not so commonly seen in when applying "agile" practices to projects, development, and business intelligence.

You can use these two simple dimensions to quickly (agile) gauge the risk & estimate effort of your initiatives, and weigh the cost/benefit implications.