Driving Change Through Incentives in the Agile Product Operating Model

In this episode of the Scrum.org Community Podcast, Dave West is joined by Darrell Fernandes to tackle questions from a recent webinar on the Agile Product Operating Model and incentives. Together, they explore how incentive models can either support or derail agility.

They dig into real-world challenges like misaligned rewards, hero culture, and scaling with private equity influence—offering practical guidance on creating transparent, flexible, and outcome-focused incentives.

Referenced webinar - APOM: Aligning Incentives with Value

Transcript

Lindsay Velecina  0:00  
Announcer, welcome to the scrum.org community podcast, a podcast from the home of Scrum. In this podcast, we feature professional scrum trainers and other scrum practitioners sharing their stories and experiences to help learn from the experience of others. We hope you enjoy this episode.

Dave West  0:20  
Hello and welcome to the scrum.org community podcast. I'm your host, Dave West, CEO here@scrum.org in today's podcast, we'll be addressing questions from a recent webinar on incentives in the Agile product operating model. To help me answer these tricky questions, I'm joined my fellow presenter, Dao Fernandez, executive advisor to scrum.org an ex CIO development lead who's actually a person who's helped shape incentive programs for larger corporations, but also deal with change when they're not aligned, meaning that he's dealt With the fact that incentive programs and organizational change can actually be at each other's throats, so I'm excited to have him here. Welcome to the podcast. Darryl,

Darrell Fernandes  1:12  
thanks, Dave. I'm really excited to continue this conversation. I think we got a lot of great questions in when we originally did the webcast last week, and looking forward to being able to follow up on some of them.

Dave West  1:24  
Yeah, it was a pretty good one, and I was always concerned, because, you know, when you start, when you do these webinars, we did lots of research, we talked to organizations. You and I spent quite some time together, deep research. We got all this stuff together, we presented it, and it's always a concern that how it will land, and it seemed to land quite well. The one word that was used, and I was an interesting word, was the word holistic, that you know, that we were describing incentives, both tangible and intangible, holistically and and how that needed to align to change, which I thought was, was a really nice advertisement for the webinar. All right, anyway, though, a lot of people asked a lot of questions, so I'm going to get in there and try to get some of these questions answered. So let's, let's start with perhaps one of the most frequent questions, and I picked one, but there was a few like it, which was give an example of a mixed signal incentive and how it is resolved. And this question made me think of really the, probably the most high profile disconnect, which is an organization that incentivizes heroes and individuals with a change program that is Encouraging teamwork and organizations, you know, groups of teams to be aligned, etc, and to incentivize people to not be heroes, But to actually be servant leaders and support those things. That's probably the best example. Do you agree? Daryl,

Darrell Fernandes  3:07  
I think especially with this topic around the Agile product operating model, which is a team operating model. Let's be honest, the whole notion here is the product team does product delivery together, and that hero, the legacy hero, incentive model, can really be disruptive in that space. And so I do agree. I think it's a it's a great example of that misalignment. And I think one of the things we talked about in the webcast was, how do you balance the incentive model from an individual perspective as well as an overall delivery perspective, because I don't think disincenting The hero is necessarily a good answer, right? You want people to go above, above and beyond, and explore different capabilities and filling in where they can to bring the product to success. But you need the whole team to feel good about that. You need that that person who historically may may have over indexed in that space to be able to help the rest of the team along and be successful together. And so I think balancing, like I said, the product delivery success with the individual success, is a model that you really have to explore here. There's many ways to do it, but you really have to look at that to your point earlier, holistically and understand just how far you want to push each of those levers and candidly how far your culture is ready to absorb.

Dave West  4:33  
Yeah, it reminds me of I remember I was working, gosh, this was years and years ago. I was working on a system, and we delivered some ink, and it failed. Oh my gosh, it went wrong, and we had to pull it out of production. And, and we're having a bit of a sort of, you know, retro, I think we'd call it, then in those days, we're doing a root cause analysis and, and this guy who I'm gonna have. Avoid his his name. Basically said, Well, yeah, I thought that might happen. I was like, what? He goes, Yeah. So why the heck didn't you say anything goes? Nobody asked me. Well, I would he goes, Yeah, it was going to happen. And he, you know, then went on to tell us why we were so stupid. And when you sort of dissected that, it wasn't that he had a KPI sitting on his review that said, you know, make sure that you're the go to person be whatever the app was. He instead, I think it was more this was an intangible incentive that he wanted to be asked and he wanted to be that person. It was, it was interesting that, you know, it's, that's a very that's an intangible, and then you have explicit, tangible incentives where you then, you know, encourage people to become this center of excellence, this unique set of skills. So it's interesting. You said we shouldn't disincentivize heroes. Should we not? Shouldn't we encourage generosity rather than scarcity?

Darrell Fernandes  6:13  
Absolutely. I guess it's an interesting take on it. We shouldn't disincent people from being their best of themselves and growing and learning and continuing on their personal journey. We shouldn't lose the individual in the team. So my intent was really around not disincentivizing the individual necessarily. It's still important that we contribute the things that we bring to the table, we learn, we grow as contributors to the overall success. So we don't want to disincentivize that by saying it's all about the team, so people can take a back seat. But we want to make sure that people are both personally incented to continue to contribute and grow, as well as aligned to the overall success of the project.

Dave West  7:04  
Yeah, I think it's so it's interesting. I'm always very struck this is a very much a Europe, UK versus America kind of perspective. My kids are obviously in US schools, and many schools, actually, the schools they go to don't do this, but they have a like an order at the end of the year where you finished, you know, joint top, second and third, down, top quartile. And you think to yourself, What the heck is that all about? What is this inherent competition that you're trying to create? You know, and instead of and that incentivize, obviously, in the classroom, I'm not going to help that kid, because I don't want them to do well on the test. In fact, I'm going to actively unhelp them, you know, steal their pencil or something, I don't know, still their pencil sharpener, which is actually much worse than stealing a pencil the it's just like what? I just don't get that. And maybe as an as a Brit, I'm like, huh, surely, we all want to help each other to be our best selves at any one moment. And that the word generosity, I think, is a, I think, a valid one in in mixed signals, we want to encourage generosity in any way that we can all right, so let's let's now move on to so a question around, ultimately, this is a, again, multiple questions. I picked one, ultimately, to make this work, the incentive model must change. But how do you influence that change when the current model benefits the people with the authority to change it. It's a sort of classical chicken and egg, you know, sort of, how do we, how do we get the revolution working when the people that are actually in power are the people that are incentivized around that the power that they've got at the moment, you know? And I think Karl Marx said, you know, any good revolution doesn't start with the upper class or the working class. It starts with the middle class because then they've got the time and the place to drive it, whereas the, you know, that doesn't, but, but I, but I don't I, you know, I'm not attributing this to revolution on quite that scale. But, so how do you deal with that. You know, the bosses got there because of an original incentive model, particularly around power, position and authority,

Darrell Fernandes  9:29  
yeah, yes. And I mean delivery, success, especially in an IT construct, is still the fundamental foundation of incentive models, right? You, you, you are rewarded for delivering value of some kind. That value may be efficiency, that value may be revenue growth, that value may be risk management, but, but there's some kind of delivery in an IT model. When we're in product delivery, we're talking about product delivery here. So there's some. Product that needs to be delivered in order to earn the incentive associated with it, right? So, so I think when I look at this question, the people in charge still have a vested interest in product delivery. So I think the question isn't, how do you how do you pivot their incentive model? It's, How do you tell the story that this incentive model actually just supports the incentive model they already have? Right? If their incentive model is different, if their incentive model is a is about power and influence in imparting that power in the organization, that's not the spot for this. Maybe there's more fundamental things to worry about, but most organizations and most leaders are incented on product delivery and product success, and I don't think this is necessarily different than that from an endpoint perspective. It's a different way to get

Dave West  10:56  
there. I think you said two things that are really, really important. I think one, I think, is that this isn't about the ultimate end goal. I think every single leader in every single business wants to deliver the most value they can. Whatever that value is, and whatever that value, the business strategy has dictated, is the most important value that and it's the question is, what connects to that? You know, how do we define in interim incentives, or the sort of incentive models that ultimately align to that? And some organizations believe that efficiency and productivity are the way in which you measure that other organizations are reward and equip heroes to do that, the trick is, is changing that mindset and demonstrating why this incentive can be model can be better or changed, or whatever you need to do and connect it to that original thing, the and the way you do that, unfortunately or fortunately, is to do stuff empirically. You build a team. You somehow persuade, through, I don't know, through your sheer personality of will, that organization, to say, Well, hang on a minute. Let's test this. Let's try something new. I know from your experience, that's what you did. They piloted some of these things and saw what the outcomes were.

Darrell Fernandes  12:29  
And you may need secondary metrics that look like some of those oodles we talked in the webcast about flow right? And flow city, flow velocity, if you're looking for are you getting better as a function flow velocity can help there. It should not. It does not dictate product value or delivery of product value, but it can tell you whether you are delivering stuff and if stuff is the historical metric of an organization, you can still have evidence around stuff as secondary metrics. All this model suggests is the product value to Market is a higher order incentive structure than the fundamental of

Dave West  13:12  
stuff. Yeah, and I love flow metrics, particularly to inform my my retrospectives, to allow me to sort of pay attention and also flow metrics might be a step towards ultimately. I mean, how often you deliver is certainly better than those interim artifact type measures like lines of code, number of JIRA tickets we've dealt with, all of that kind of stuff so that. And that's the reason why it's one of those metrics in evidence based management. It's just not the only one that you need. So you said two things, though. One of them was, I think that, and I think that's exactly the other thing was, when you mentioned power, status and authority, and that's always a challenge, what I found is that by uncovering leaders real motivations, like, you know, I was talking to a leader last year, and he confided with me that he's looking for his next big, big thing. And you know, he's like done. He can only get so much out of this organization. He needs to move on somewhere else, but he hasn't worked out what that is, and he needs something to land that he can become his poster that he takes to his next thing, finding out that aligning the work you do to that and actually building metrics that then encourage that stuff, if you can show how you're doing that. Then, from my experience, any leader will do whatever. Finding what motivates them is a key, a key responsibility of every scrum master or change leader, in my opinion,

Darrell Fernandes  14:53  
even beyond those two roles, any any person who's leading in an organization needs to under. Understand what success is at the next two three levels above them, to make sure that the work you're leading is in line with that. And if it's not in line with that, ask the question, why is there a dissonance in the strategy? Something's wrong if you can't make that connection. I think it certainly highlights for Scrum Masters and for change leaders, but I think everyone should ask the question, if they can't make that connection, what's missing?

Dave West  15:27  
Yeah, and, and I think that a lot of times we're maniacal about written objectives from strategy down, but there are a whole set of, we call them, intangible things that can ultimately undermine that strategy that you need to be cognizant of, as well, definitely as a scrum master, and, as you rightly said, anybody in the team and also mature enough to realize that, yeah, in an ideal. We're not computer programs, we're not robots. Maybe one day we will be, but not at the moment. And because of that, you have to sort of balance these very human things around intangible incentives with the very tangible incentives programs, et cetera, which makes it complicated, I know, but you need to do this. Well,

Darrell Fernandes  16:21  
I think we all, as individuals who contribute in our own ways to organizations fall into a trap, sometimes that we know what our intangibles are, and we may know what some of our peer intangibles are, but sometimes we forget that everybody in the organization has human level intangible incentives that they're working towards. And sometimes it's as simple as taking a step back and reflecting on what those intangibles in the ecosystem and the bureaucracy and the climate that you're working in might be, just so you can make that alignment. Because I think we do lose sight of that. We do get very egocentrical when it comes to these topics, and we lose sight of the fact that everyone is egocentric, everyone has some of these same challenges,

Dave West  17:07  
exactly and and we are not robots, all right, so the next question really is about group, team, individual. We talked a lot in the in the webinar about the importance of product level incentives, you know, you know, particularly around the product OKRs, the product goals, the product things. And then that then translates to Team incentives, which ultimately translates to to individual incentives. Should they all be the same, or should they, you know, be different? Or, can they be different? Is there some benefit of making them, you know, more or less, you know, more individualized, meaning the team or the individual. Is it better to make them at what? How does it work? Can we discuss that a little bit more?

Darrell Fernandes  18:06  
Yeah, I think it's a really interesting topic, and it's, it's even bigger than just the incentive topic here. But we'll, we'll bring it back to the incentives. But we talk about Scrum before I even go into the incentives, we talk about Scrum and how successful scrum can be in a moment of urgency, where there's something that needs to be solved quickly, where there's a market change or a production a production opportunity like so we know those kinds of situations rally people to do these kind of team oriented things, and other Things fall away. We don't worry about so many of the egocentric things we're focused on the problem because we've got something to respond to and something to address. I think when we think about incentives, we have to recognize that what we're trying to do with the team level incentive is create that kind of dynamic where there's a common problem that we're trying to solve and bring people towards that common product. I mean, that common problem with the incentives, the question goes on to say, what if the right process isn't followed? You know, process cheating, etc. Yeah. I mean, if it's a security process where you have to make sure you're you have good, secure code that's really important regardless of what you're trying to sell. There's other processes that maybe you check take a different approach to if you have a market dynamic that you need to do. And I think the incentive model needs to allow teams to be able to understand for their context which processes are hard, hardwired in that you cannot ignore. And in my experience, secure code has always been one of those you never can put code into production that exposes the enterprise. It's just a fundamental but other things, like design reviews can adapt. Attempt based on the market need for what you're trying to deliver. That doesn't mean you don't do design reviews instead of, instead of, kind of moving the product into the design side, you may choose to bring the design side into the product team for that model, because you have to go faster, and you have to incent it as such. So I think the incentive model needs to assume whether you're in a in a critical market opportunity that needs to bend more roles than normal, whether you're in a commodity function that can stay the course and drive to the purest of process. You have to have that flexibility in the operating model and in the incentives that support it in order to allow teams to be successful for what the enterprise needs from the team.

Dave West  20:49  
There's an interesting question on ethics here as well. That sort of we did a podcast on ethics recently. There was a paper that we published. This is scrum.org, on ethics, and I got Magda and Trish in and we talked about ethics. And there's a relationship between ethics and incentives that are really that's both complicated and reinforcing and whatever you know. So in the medical field, there's a very simple ethical construct called do no harm, right? That the sort of like the we hear it on every episode of Star Trek or whatever, when you know dr McCoy is being, yeah, you gotta do this. I can't do it. You know, there's, there's this, do no harm, as it were, and everything. And as professionals, I think that's the fundamental now, obviously, it's subjective, it's complicated. There's, you know, the certain times where harm is not quite as well understood as other times. However, you know what scrum would do is bearing that in mind, would make it transparent, and then get the perspective of the team and the stakeholders on that, etc. Now what's interesting is how much you need to reinforce incentives. Are a mechanism that we use to reinforce good behaviors, to reinforce progress in the right direction, do no harm is almost universal, or this sort of ethical behavior is almost a universal construct. And it's, how do you balance that, I guess. How do you not have incentives for everything? You know? Yeah, I mean, how do you you have to have a simple set of incentives. You can't do everything correct,

Darrell Fernandes  22:38  
and you have to have a simple set of fundamentals that will not be whether it's do no harm, whether it's related to security and customer protection, like there are a simple set of these are the barriers you cannot we will not, as an organization, sacrifice. And I think you have to keep those simple, and then you have an ideal process alongside that. But an ideal process is, in a production scenario, an ideal process, it may be that that you have to put code in that doesn't protect 100% but if you've got a 50% exposure today, and you can bring that forward to 90% production, I mean protection, wouldn't you do that? Yeah, right, so, and then come back for the last 10% in another cycle like I think those are the things that you have to consider here again. It's all about product success. It's all about driving product value. If you're going to undermine your fundamentals, are you really delivering what the enterprise believes is product value.

Dave West  23:45  
And I do think that, as we've been doing this work, Darryl increasingly, I'm like try to remove as many tangible incentives, explicit tangible incentives, as you possibly can and encourage an organization to align just systematically, to the very simple incentive of we need products to deliver value. This is what value means at the moment, based on our understanding of value, let's move in that direction if you want to get promoted, you just have to help others as that sort of tangible ish type incentive and everything else you kind of just make as transparent as possible and try to mitigate, I think that increasingly is Where I'm naively perhaps thinking and that these HR departments that have made these incredibly complicated. I know when I was at IBM, I had no idea how my bonus was calculated. I think the reason why they were doing quantum computing was not driven by market demand. It was driven by what to understand how to create my bonus incentive. Yeah, and and I remember thinking, how can none incentivize me? Because I don't understand it.

Darrell Fernandes  25:09  
I do think I agree, as simple as possible is the best answer. We tend to over complicate things. I do think there are industries that have constraints beyond something as simple maybe, as you laid out, whether it's financial services, whether it's biomedical, there are absolutely industries that have automotive has safety constraints that they have to meet with their deliverables, right? We talked in the webinar about our German auto manufacturer, who maybe lost some of that ethical direction in how they delivered some capabilities in time, right? So you have to be careful that your incentives don't overdo some of those things and drive people to unethical behaviors. But there have to be in just about every industry, I think, some level of guardrails that you have to operate within. And you do want to keep them transparent. You do want to keep them simple. You do want to keep them understood, but they will exist.

Dave West  26:14  
Yeah. And I Yeah, increasingly, I think simple is, is probably the way, the way that we need to do it. There's an interesting question around self managed teams that that maybe I find a little bit odd but obvious. You know, we talk about self management, you know, incentives, you could argue, are a management tool. What, you know, what should the self managed team have the power? Have they got the power to, you know, create the incentive model, and do they have the, you know, and whatever that is, that could be to agree. Should the team make decisions about salary for each other? Should they make a decision about bonuses, promotion, etc, etc. What's your take on that? Dara,

Darrell Fernandes  27:03  
you know, I think teams do have a degree of power in how the incentives are defined. Right when product, when a product is envisioned, there is a collaboration between the delivery team and the product manager, product owner as to what that delivery looks like, and it's sometimes a negotiation, sometimes a collaboration. But if you define product success together and you define what you can do, then you're, you are indeed, if and your incentive model is based on product delivery and product success, then you are contributing to that definition of product success. So I think, I think that is very much in line of where we're talking about taking these models. Do they have 100% no, because I think the market has some some thoughts on this. I think outside forces have some thoughts on this. If you're at a competitive disadvantage and you need to catch up to your your competitors. You may not have all the time that that the product delivery team would like. You may have to make some decisions that alter what you would normally do, and there's not, you know, you don't have 100% of that control, but I do think the model we're outlining here does allow for the product delivery team to be part of that dialog to define what product delivery success looks like, and then deliver upon it or exceed it, as the case may be. It

Dave West  28:29  
is interesting because, you know, we talk a lot about what happens if you make salaries transparent, what happens if you make incentive packages transparent? You know, does that actually help or hinder? And I think the biggest challenge with that, when I say transparent, I mean visible, I guess you know, the actual day event, five grand last year, whatever, which is what it felt like, honestly. But anyway, the and the biggest problem that we have is that context is missing, and there's so many nuances and so much, you know, just a salary, for instance, you know, you know, maybe there's competitive situation, and we're trying to get somebody from another of a company or another, you know, maybe there's a situation around the, you know, the age of the person, and how close they are to retirement, and all of these things become into play. Some of them are private, perhaps as well, and we don't want to share them. And I know that everybody looks, you know, there are members of our community, the Agile community, say, No, that's all excuses. You do it, goodness will come. But I see very little evidence in the literature that that is the case, and what I see is it creates a feeling of distrust. It creates a feeling of jealousy, anger. There's a lot of things that you just haven't got time to do. With in a in a team or in an organization.

Darrell Fernandes  30:05  
It don't lose sight of the fact that personal risk is different for everyone. Yeah, if you ask me to move to a different city, to take on a role that may mean a different the personal risk associated with leaving the family I grew up with, leaving the area I grew the geography I grew up in may be so traumatic that the personal risk there has a higher cost associated with it than somebody who's willing to leave a country and come to another country to make a fresh start like those are just different dynamics, and you can't there's not a black and white answer to that. And if you make everything transparent, then you have to justify the context through exactly what you're talking about. And that may not be something people are comfortable with. I guarantee you, it's something people aren't comfortable

Dave West  30:56  
with. I think there's something really interesting there. And I'm reminded of that film of Robert Redford and Demi Moore, indecent proposal. You know, there's a, there's a certain, you know, sort of challenge towards any you know, Robert Redford, I think, says everybody has a price. And I at that price isn't necessarily money. It's, you know, power, position, status, you know, make me a king, make me a Lord, whatever, and I will move to London or it's just interesting. And I think you have to, it's so complicated. I think that that's the other learning I got from the webinar and from the particularly from the work we did prior to the webinar. It's so damn complicated to think about these human beings, human, human, human beings are the single most complex thing in any product development organization. Isn't your code. It's just so complicated to ensure that we're doing everything that takes us in the right direction. So I maybe there's a question around scaling here. There was a question around private equity and and, you know, this organization, obviously this person that wrote the thing in my company, acquired by private equity, incentives shifted from meaningful work to target based work, like we had to grow by this amount to fulfill this the you know, the funds request. Do we have any experience? I think that that's actually more so private equity tends to be involved when when you're scaling an organization, as opposed to VCs, which tend to be when you're incepting an organization. But there's probably two questions, you know, when we're scaling, do the incentive programs have to change than when you're, you know, sort of like your status as it were, when you're in this growth mode? Is it better to do that?

Darrell Fernandes  33:00  
So the reality is, right. It's about alignment. In my opinion, here, private equity is looking for a different outcome than your angel VC phase. Right now, product to market is no longer the goal. Scale and in revenue, yeah, estimated revenue based on scale is now the goal. So you fundamentally changed the target if you don't change your incentive model. Now how individuals get incentive doesn't necessarily need to change the measurement and the transparency associated with that target needs to change. So if the measurement was get to market with a with a prototype, or a beta or a v1 of a concept, that's a measurement. It's tangible. It's visible. You can, you can base success or not on that. When you get to scaling, it's a different set. It's, did we get to 10,000 did we get to 50,000 did we get to 100,000 and so the work you're doing has to change, because the work of scale is different than the work of inception, and the measures and the transparency associated with that change, also the influence on how you get to that success. All of a sudden, marketing has a role in that. All of a sudden, other influences come in. And so to your point earlier, it gets more complicated, because there's more factors which, which is why that transparency and understanding all of the levers and all of the metrics, but the team, if product success is defined originally, at inception, or at scale, if those things are defined, and the team is measured by product success loosely defined, then, then that doesn't change. What changes is the metrics you're using and the work you're doing to drive product success.

Dave West  34:58  
I think that that's the trend. Translation of business strategy to technical strategy to product goal correct becomes incredibly important, and that you need to be mindful of that. The thing that always worries me, and I've been involved in a little bit of this growth stuff, is what happens to the product when it is when it goes to that next scale, because ultimately, you've destroyed its long longevity because you've been so focused on its marketability at that moment. And, you know, I think Sonos is probably the greatest example of this, you know, around the technical debt that the app acquired. So for our listeners, so nice is a basically a music platform that has incredible speakers, and then you can play your Spotify or your Apple Music or your CDs through it. I have downloaded all of my CDs and play them through it. I am that old, and what happened was they grew, grew grew grew scale, took on, you know, financing along the way, and did a fantastic job building some fantastic products, but but at that, but at some point, hit a technical roadblock which undermined their ability to grow. Required lots of firings, and the CEO was incredibly transparent in in his, you know, he was very honest about the mess they got themselves in, which I think, in part, is the reason why they are they've managed to get themselves back on track. But that so that can happen. I think that scaling. I think, I think ultimately, that this question talks about the fact that incentives will change during the life of a product or life of a product group, whether it be funded by private equity or funded internally by some sort of investment model, and that we need to be cognizant of that. But it is ultimately about the translation of business strategy to product strategy through goals.

Darrell Fernandes  37:03  
And this happens within the enterprise. Some of the hardest conversations I've had in these models is when what was a darling product knew a lot of investment pouring in became a commodity, and that that product team, all of a sudden had a very different set of goals, and success was defined very differently, and it was a hard adjustment emotionally. So back to intangibles, to go from a high investment level a high visibility level to more of a commodity level for delivery. But again, it to your point, business strategy evolved technical strategy in this is where I think the structure of OKRs can help here if, if you're you have the right transparency and you have the right evidence to support the KRS understanding that the O changed, the objective changed, and therefore the KRS evolved. And you've got the right transparency and metrics to support those KRS, you can, you can work through that, but it happens in enterprises as often as it happens in the VCPE world that that that evolution takes place.

Dave West  38:20  
Yeah, yeah, that's very true. So we could keep talking about this all day. You know, at the heart of this, it's the complexity of the human condition and its relationship when they in, when you're working together in pursuit of a goal. You know, we see it on every TV program. We see it on, we read about it in every book, but that is just that this is a sort of fundamental truth. So thank you for spending time with us. Daryl, I guess the last thing you know, as people are sitting there, they maybe listen to this podcast, maybe they attended the webinar, and they're like, Oh, this is interesting. What is the one thing that you would tell people when they're thinking about incentives? You know, what would be the simple sort of like, Hey, if you do nothing else, do

Darrell Fernandes  39:15  
this. So I think it's really important to find a pocket of opportunity and learn right? These are big decisions. Changing the way people are incented is it's personal to them, it's impactful to the enterprise, the organization. So find a place to learn, to test do do it in parallel, possibly with existing incentives, understand what behaviors you'll actually get. We talked about it very early on in this conversation around mixed signal incentives. It's very easily easy to over engineer something. Think you're doing the right thing, and yet you end up in a mixed signal scenario. Yeah, so be willing to learn. Be willing to be wrong and adapt, but but do it on a scale that you can support that learning without really fundamentally going so big that you may may have much broader implications. So that that would be my thing is, these are really sensitive topics. They're sensitive to the organizational ecosystem. They're sensitive to the human beings playing in that organization. No one answer is the right answer for everyone. So I think it's really important that you take the time to understand what might work in your organization, and then find a good way to test that with 123, teams, whether that be in actual production or whether that be in parallel, and learn and adapt through that

Dave West  40:48  
process. That's good. That's really, really good advice. Okay, everybody. Well, thank you today. We talked a little bit about incentives, and thank you, Darryl, for joining us. Thank you for taking the time out of your schedule. Thank you. Yes. So today we talked a little bit about incentives. We tried to address some of the questions from a recent webinar on incentives and a palm It's as clear as mud as my grandmother would say. I think she was implying that it's not very clear. I think what I'm taking away from from the research, the questions and subsequent conversations that we've had about it, are sort of three or four things. Number one, incentives are there? Whatever you say, even if you pretend that they're not. You ignore them at your peril. They can definitely undermine any change that you have in place. So try to make them transparent. Try to at least think about them. Why does that person want to behave in that way? We are under the assumption that everybody is not evil, and that ultimately, there's some motivation, some incentive, that is getting in the way of that change. Try to make it transparent. Try to understand it. Try to uncover it. If you're a change expert, if you have the ability to influence a change to particularly tangible incentives, then make sure that keep them very, very simple, because the more complexity adds to the likelihood that these things will go wrong. It's a bit like code, right? The more lines of code you have, the more likely it is going to be that it breaks. Keep it simple, if at all possible. And you know that if you are driving change, then accept that they themselves will change incentives, even if you haven't changed any on paper, the reality is, what's important to human beings will change, and the mechanisms that are used to change, their behavior will also change over time. I know when I talk to younger people, their view of the world is very different to mine, which is logical, right? They've been brought they open up in a different set of social constructs. You know, that wasn't the A team and Knight Rider and Buck Rogers in the 25th century, or even space 1999 they watched a whole different set of things which defined who they happy game. Probably, I'm not saying that television is ultimately at the root of all incentives, but it definitely influences them a little bit. But so just think a little bit about the fact that things change and keep an eye on them to be effective. And then the last point, really is partnership. I think that you know, Daryl talked a lot about this in the webinar, partner with HR and with the departments that have that power or that perspective, get their perspective on how you can influence change and drive that using incentives as as a tool. They're the four things that I that I heard today and from the earlier webinar. Hopefully that makes sense, and hopefully that's been useful for you. So thank you for listening to today's scrum.org community podcast. If you liked what you heard, please subscribe, share with friends. And of course, come back listen to some more. I'm very lucky to have a variety of guests talking about everything in the area of professional Scrum Product thinking. And, of course, agile. Thanks everybody, and Scrum on you.

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