Making agile work in traditional or highly governed environments

Agile has become a go-to approach for delivering projects in fast-paced and uncertain environments. But what about organisations where governance is strict, compliance is non-negotiable, and change must follow formal protocols? Can an agile methodology still work?

This was the focus of our recent webinar, Overcoming barriers to innovation: Governance with agility, hosted by Richard Campbell, Product Engagement Lead, and Niamh Trundle, Learning Design Lead, from the Agile Business Consortium. The session explored how agile approaches can be adopted in traditional or compliance-heavy settings to enhance innovation without sacrificing the control, oversight, or auditability these environments demand.

The myth of agile OR governance

A common misconception is that organisations face an ‘either-or’ choice when it comes to agile and governance. But agile project management and compliance are not mutually exclusive. While it prioritises flexibility, agile isn’t about abandoning structure – it’s about using the right structure for the context. In fact, when applied correctly, agile can enhance governance by making it more transparent, iterative and responsive.

The key is to tailor agile principles so they align with existing frameworks rather than replacing them altogether. This is where hybrid approaches and scaled agile models can become particularly useful.

Understanding the barriers

Organisations operating in regulated sectors, such as finance, healthcare, utilities, or government, often face similar challenges when adopting agile:

• Top-down cultures that limit team autonomy and decision-making
• Heavy documentation requirements that can conflict with the simplified ‘just-enough’ process encouraged by agile approaches
• Fixed compliance standards that can appear incompatible with flexibility
• Risk aversion due to external oversight or fear of audit failure

These are legitimate concerns, but they’re not reasons to avoid agile. Rather they highlight the need to adapt agile approaches so they work within existing controls, not around them.

Implementing agile in highly governed environments

When combined, governance and agility unlock new possibilities for innovation. By aligning governance practices with agile principles, teams can focus on outcomes rather than rigid processes. This means involving compliance and standards teams as partners in innovation rather than as enforcers of limitations.

We’re living and working in a VUCA (Volatility, Uncertainty, Complexity, Ambiguity) world, and how we respond to these challenges is key. Taking this acronym and giving the letters new meaning can provide guidance for leaders on how to apply agility in highly governed environments.

Addressing volatility with vision

Organisations need a vision of what they want to be and how they can get there. Keeping this goal in mind when changes occur that are outside of your control allows your organisation to adapt and be flexible without steering too far away from your main objective.

Leaders must clearly communicate the direction of travel for the project to ensure the team can adjust plans and remain on track regardless of the challenges and blockers that may arise.

Meeting uncertainty with understanding

In the face of uncertainty, you can’t just carry on with the originally decided plan and traditional ways of working. Leaders need to stop, listen, and pay attention to what is going on around them, this is the only way to truly understand your given situation. Teams must work together, bringing diverse perspectives to the table and consulting with experts, to create a solution.

Complexity calls for clarity

Simplify decision-making by focusing on what matters, not on excessive detail. In complex projects it can be easy to get distracted, but it’s vital that leaders maintain clarity around organisational objectives and funnel their efforts into the tasks that will help achieve these.

Moving from ambiguity to agility

Fixed plans can’t be applied to ambiguous environments, as a result, adaptability and flexibility are crucial. This is where the value of business agility is truly showcased.

For example, many businesses are currently trying to implement AI. But when you don’t know what AI will look like in a year, six months, even in the next few weeks, how do you create policies for its usage? This is where agility comes in. Senior leaders need to build a document that is open to adaptations and iterations when the inevitable changes occur. An agile document for an ambiguous future.

Business agility: A strategic imperative

Business agility is no longer optional. Whether facing global competition or internal transformation, organisations must respond quickly and effectively to change. But what does this mean in practice?

Agile leadership and mindset are at the heart of business agility. Successful agile organisations exhibit:

• Agility in culture, leadership, and governance
• Agility in operational capabilities and business support
• Agility in delivering value to customers, partners, and employees

Want to build agile capability into your regulated organisation? Explore our full range of Agile courses from AgilePM® to PRINCE2® Agile and Scrum.