As VP of Engineering, I frequently need to translate between engineers and management and one of the areas that come up frequently is our use of SCRUM (agile development). We happen to be lucky enough to have a CEO with a technical past and one that understands development methodologies. Of course this is good and bad in that he knows enough to question me :(
He recently commented that which methodology we use didn't really matter, what mattered was how it was managed. It is true that any of the methodologies can work given the right management. But, there are a number things that agile in general brings to the table that are more difficult (though not impossible) to handle with other methodologies, especially waterfall.
The first is that you should know a lot sooner if things are not working well in an agile environment. In a waterfall methodology, it may be months or longer before you realize you are way off track on a project. In Agile, you should see the "velocity" fairly quickly and be able to point out the discrepancies and adjust.
The next is that you should be able to adjust to changing requirements and changing environment/market much more quickly with an agile environment. With waterfall, you may take months just to nail down the requirements and by the time you are done, they are out of date. In agile, you adjust each iteration or sprint (usually 2 to 4 weeks long) and so are keeping up with any changes as you go.
Then there is the general philosophy in agile that attempts to build a creative, high performance team. This is certainly possible in other methodologies as well, but the framework defined by agile methodologies helps create the right, open environment where waterfall tends to push processes and control.
So... yes, they can each work given good management, but how many really good technical managers/leaders are there out there and I would contend that agile development methodologies help produce better results even if (especially if?) you don't have that kind of great management (or maybe it helps to train the manager :)
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