Welcome to this episode of the Agile People Fika podcast, where we

engage in an unscripted discussion about 'Resource Allocation Budgets

versus Prioritizing Flexibility with People'. This insightful conversation

among Agile People team members and guest David Thompson delves

into the fundamental question of whether organizations should measure

value or costs, particularly in the context of IT departments.

The dialogue opens with an examination of the drawbacks of rigid

budgets in stifling innovation and flexibility. One example cited is a team

with a potentially valuable innovation but constrained by budget

limitations in their specific 'money bag', hindering the project's fruition.

This example illustrates how budgets can lock teams into a non-

innovative mindset, focusing solely on meeting deadlines set by

predefined projects.

The conversation then shifts to the idea of dynamic resource allocation,

which could be more effective if not constrained by fixed performance

targets. This approach would allow resources to be shared where

needed most, promoting efficiency and adaptability. The panel

discusses the challenge of convincing those who control budgets

('money bag holders') to embrace this fluidity, acknowledging the

inherent fear of 'going crazy' or losing control.

Addressing the notion of control, the discussion highlights the

importance of adapting to reality rather than adhering rigidly to plans

made in the past. It's argued that using resources where they're most

needed at any given time is a wise and responsible approach, as

opposed to the false sense of security offered by fixed budgets.

Further, the panel delves into the idea of agile for finance, emphasizing

the need to shift from traditional budget rituals to more adaptive, reality-

based planning. This includes acknowledging the unpredictable nature

of the business environment and the impossibility of controlling complex

human systems. The concept of 'value creation' versus 'cost

management' is also explored, suggesting that organizations should

focus on potential value rather than just costs.

The discussion also touches on the tendency of organizations to stick

with projects in which they've heavily invested, even when it's more

sensible to abandon them. The benefits of small, focused teams over

larger, less cohesive ones are considered, along with the need for agility

in resource allocation and decision-making.

Towards the end, the conversation steers towards practical steps for

traditional organizations to transition towards more flexible resource

allocation. Suggestions include questioning annual budgets, making

changes as needed, and avoiding rewarding people based on

performance against fixed targets.

The podcast concludes with an invitation for listeners to explore further

training with Agile People, highlighting an upcoming certification

focusing on agile for finance. This initiative aims to foster modern

leadership and governance for a more profitable and sustainable future.

Join us in this engaging Fika session to gain deeper insights into

navigating the complexities of resource allocation and prioritizing

flexibility in organizations.