The Need for Speed

Some companies, especially those organizations founded during the Internet age, are born agile. They start out with small, cross-functional teams and scale by adding more teams as they grow.

But what about the rest of us? How do companies that are organized in a more traditional way move toward a small-team structure without descending into chaos or wasting valuable time? We have observed many organizations facing this challenge when they needed to accommodate rapid growth, started an agile adoption, or simply wanted to reorganize their existing teams because they felt they were in a rut.

When we first started moving toward stable teams at Trade Me, it was on quite a small scale, introducing one team at a time in a controlled manner. But as the company grew ever faster, we realized we were going to have to be able to scale up—and quickly.

We knew what we wanted: small, cross-functional teams that would persist over time and across projects. We’d seen measurable benefits in the initial teams and knew we wanted to extend the stable approach right across the organization.

The impetus was also growing internally, as employees were seeing what was going on and starting to express their desire to be part of this new way of working. They could see how much other people enjoyed working in fixed teams, how much more fun their colleagues had (visibly and audibly across the office), and how much more they were achieving. Having some people work in a way that was so obviously a success and telling others they had to wait their turn seemed a little like we were treating some employees as second-class citizens.

To us it began to feel like a meaningless and frustrating delay. The controlled approach may have been vital initially, but we soon realized we had to go all in and move everyone into small, stable teams as quickly as we could.

We were deeply inspired by the workflow of the music-streaming service Spotify and its terminology of squads, chapters, and tribes. We also admired its culture, which promoted autonomy, mastery, and purpose. In their 2012 whitepaper “Scaling Agile @ Spotify with Tribes, Squads, Chapters & Guilds,”^[3] Anders Ivarsson and Henrik Kniberg describe Spotify’s culture and how the company is organized. The following image from this paper illustrates Spotify’s squad, chapter, tribe, and guild concepts.

At the core of Spotify’s workflow is the squad; a small, cross-functional team whose members sit together and collectively possess all the skills required to design, develop, test, and release software. Squads are self-organizing and in full control of the processes and tools that help them achieve their goals. They are created with a strong purpose and are designed to feel like a mini-startup. In this book we’ll use the term squad to represent the cross-functional teams we established at Trade Me.

A tribe is a collection of squads that work in related areas and can be seen as a kind of incubator for the squad mini-startups. Tribes have a fair degree of freedom and autonomy and are sized around the concept of Dunbar’s number, which states that people cannot maintain a social relationship with more than 150 people.

The purpose of chapters and guilds is to share knowledge and tools. A chapter is a small group of people within a tribe who have similar skills and work within the same general competency area, such as testing, web development, or databases. Each chapter meets regularly to discuss their area of expertise and their specific challenges.

A guild is a more organic and wide-reaching community of common interests. Examples include the test-automation and agile coaching guild. Guilds reach across tribes, and anyone who is interested is welcome to join.

Squads are the vertical dimension of the matrix and, as people sit together and work toward a shared goal on a daily basis, considered their primary home. The horizontal dimension (chapter) is for sharing knowledge and tools and, while important, is secondary to the core concept of the squad.

With that inspiration, and our increasing sense of urgency, our next move was to come up with a plan for our next steps.