Accelerating Digital Transformation with a Project-Based Approach


The “Project Economy,” comprised of diverse and agile teams or “squads,” represents a new approach to digital transformation projects.

If there’s one thing that the last two years have taught us, it’s that all types of work must be hybrid-ready – and digital transformation projects are no exception. The notion of a team comprised of software engineers, data scientists, IT managers, product and marketing leaders, and C-level executives, all working together in one office building, are going the way of the dinosaur.

According to Antonio Nieto-Rodriguez, author of the Harvard Business Review Project Management Handbook, What is replacing the physical internal team is the “project economy,” a new way of working that is estimated to generate $20 trillion in economic activity and employ 88 million people in project management related roles by 2027.

It’s not only the hybrid way of working brought on by the pandemic, as well as “the great resignation” that is driving this new Project Economy. In fact, it’s been in the works for some time, thanks to key developments such as:

  • A tech talent shortage. This has been increasing over the past decade, forcing enterprises to seek alternate ways of initiating and deploying digital transformation projects, leveraging talent outside of the organization.
  • Increasing automation and cloud growth. Making it easier to conduct work and collaborate remotely, technology advances also are automating mundane or repetitive tasks so that companies have time freed up to focus on digital transformation as a strategic business asset.
  • Agile software development. As an approach that requires continuous iteration and flexibility, agile development also has been marked by more autonomy for software development teams, working with less oversight. The proven success of this democratized model is ushering in new approaches to software development.
  • Business at the speed of sound. Driven by an increasingly competitive climate, customers in all industries are demanding next-day delivery, immediate responses to questions, and extremely fast ROI. Companies are scrambling to leverage advanced technologies to meet customer expectations against a bar that keeps on rising.

See also: Technology Modernization: Punching Above Its Weight

The project economy approach to digital transformation is driven by squads

The key drivers to the project-based approach to digital transformation have one common theme:  the need to boost efficiency within an environment continuously in flux with changing demands and requirements. Projects, as opposed to operations, are proving to be the fastest route to the efficiencies that companies crave. 

While projects make companies more efficient, nimble, and faster on their feet, one challenge is in breaking down the traditional siloes and ecosystems that can impede their progress. IT managers, data scientists, design professionals, project managers, senior leaders, CEOs, and all stakeholders must work together to select, prioritize, and execute the specific projects.

A concept first recognized by Spotify is the “squad” approach to projects, a human-centric approach for scaling agile that emphasizes the importance of culture and network. It has helped Spotify and other organizations increase innovation and productivity by focusing on autonomy, communication, accountability, and quality. This idea of projects driven by squads, as opposed to traditional internal departments, requires three foundational elements:

  • Design. To ensure that what is being developed and delivered is meeting real-world needs, not just implementing digital transformation for its own sake, every digital transformation project must involve design experience. Led by design professionals, this first step requires input from all types of stakeholders, voicing their desires and frustrations and defining the problem that needs to be solved.
  • Technology: Embracing and constantly iterating the most relevant solutions to deliver better experiences requires software engineers, data scientists, IT managers, and other professionals who can select the right tool for the task based on a thorough understanding of the design goals.
  • Business: Projects must be closely aligned with the greater business goals, involving line-of-business staff, as well as C-level executives who will be focused on the solution’s impact on customer satisfaction, competitive advantage, streamlined efficiencies, and ultimately revenue growth.

A squad moves beyond the business walls

Squads comprised of members from these three areas require complete integration and collaboration, and they’re not always found internally. Companies must seek out partners to fill the need for advanced tech and design talent, yet they can’t compromise the core tenets of project-based squads: culture and human centricity. Companies need to carefully select outsourcing partners that can assimilate into the squad’s culture, taking the time to onboard and integrate them into the project team. Below are some strategies for integrating all members into a squad wherever they may be:

  • Carefully vet the project team members, not focusing on where they are located or whether they are in-house or outsourced, but selecting those members best suited to the job
  • In order to nurture a squad that is self-directed and fast-moving, they should share a common language and set of rules, which should be clearly articulated
  • Spend time to onboard the members outside of the organization to not only company processes and programs but also to the culture and business drivers.

Companies today face enormous challenges in meeting customer and stakeholder expectations, remaining profitable, and constantly staying one step ahead of technological change with fewer resources. Tackling it all is simply not possible, but breaking it into pieces – or projects – is the key to success. The Project Economy will drive the future of digital transformation and, consequently, the future of product and service innovation, but it requires a complete reimagination of what constitutes a team. 

Dana Montenegro

About Dana Montenegro

Dana Montenegro is Chief Design Officer for Wovenware, a nearshore provider of AI and custom software engineering services. He combines design thinking with agile and lean methodologies to help customers identify their unique business challenges and find innovative ways to address them. He can be reached at [email protected].

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