Why Scrum works in new product development: the role of social capital in managing complexity

Abstract

Major changes are currently underway across new product development (NPD) practice, and a number of new NPD management methods and processes are emerging. Managers are faced with an array of possible process models and methods to choose from, including the formal Stage-Gate method as well as multiple emerging variants of Agile. The claimed benefits of Agile methods make it attractive, but its suitability is uncertain. In safety-critical organizations and environments a well-controlled, waterfall-based project model would likely be expected. In an empirical study of an R&D department in a large organization creating and adapting complex air traffic management systems we investigate the use and effects of Scrum, the leading Agile method. Since project coordination is a social phenomenon, we apply social capital and project complexity as theoretical lenses for evaluating the effects of Scrum. We find that Scrum and social capital provide reciprocal benefits, and that the stakeholders found Scrum to be an effective and valuable way of working, mitigating the effects of complexity.