Special Issue Article

ING’s Agile Journal of Creating Value

5(2) 190–209, 2019
Transformation—Teaching © The Author(s) 2019
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DOI: 10.1177/2394964319875601
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Martin Calnan1
Alon Rozen1

Abstract
The present article is a practitioner case study of an ongoing event for the
period from 2010 to 2018. It examines a key period during which ING Bank has
attempted to transform itself from a traditional bank to a ‘platform bank’ with the
help of both benchmarked and ad hoc agile methods and mindset.
The research is extensively based on a review of the agile methods and creating
value literature, semi-structured interviews of the key ING Group and ING
Netherlands stakeholders, a documentary review of existing literature on
ING’s transformation, ING public information (annual reports, special reports,
marketing materials) as well as ING internal documents (presentations, internal
documents, training materials, etc.).
To ensure multi-layered coverage of the full story, interviewees were chosen
to capture the points of view of key participants in the transformation journey
and who represent the full range of major internal stakeholders, namely
representatives from IT, Business, HR and Corporate.
The aim of this case study is to gain a more granular understanding of the key factors,
people, processes and insights that helped drive ING’s profound transformation
of its operations, management, strategy and vision and how this ongoing ‘agile
transformation’ is value accretive (or not) for ING and its stakeholders. The
article identifies the three stages of a successful agile transformation as well as
the underlying paradox for an organization to remain agile over time and at scale.

1
Doctoral Candidate in Ecole des Ponts Business School, Champs-sur-Marne, France.
2
University at Albany, State University of New York, Albany, New York, USA.

Corresponding author:
Martin Calnan, Director, Executive Education and Doctoral Candidate in Ecole des Ponts Business
School, Champs-sur-Marne 77420, France.
E-mail: calnan@pontsbschool.com
Calnan and Rozen 191

Keywords
Transformation, leadership, agile, agility, leadership, value creation, adaptation

Introduction

Teaching your Elephant to Race

Creating value is rarely a linear process (Mahajan, 2019). Moreover, in today’s
VUCA1 world, it is also less and less a simple question of optimization of process
and efficiency, and more and more about the ability of an organization to adapt to
a complex and changing environment rapidly and seamlessly (Goldman, Nagel, &
Preiss, 1995; Itō & Howe, 2016). To achieve this organizational agility, however,
challenges the traditional way of working of most organizations (Appelo, 2011;
Bogsnes, 2016; Dosquet, Conticello, Dosquet, Dour, & Van Bennekum, 2017;
Goldman et al., 1995; Laloux, 2014; Perkin & Abraham, 2017). In fact, it
challenges the very core of many traditional management practices (Appelo,
2011; Bogsnes, 2016; Laloux, 2014; Meyer & Meijers, 2018). It requires a
fundamental shift both at the individual level—the mindset—and the organizational
level—the organizational culture (Laloux, 2014). The traditional ‘layered
organization’ with a rigid hierarchy, structured processes, strictly defined roles
and responsibilities, functional silos…was born to thrive in a ‘complicated’
market reality in which operational excellence and industrial optimization were
the keys to success (Goldman et al., 1995). Today, a fundamental shift in the
market has occurred, driven by the increasing ‘complexity’ of business—
accelerating rate of innovation and technological change, growing access to
technology, markets and capital for companies of all sizes, increasing
interconnectedness, shifting customer expectations and rising voice of customer
(Itō & Howe, 2016). These are some factors that have fundamentally shifted the
nature of competition, and therefore of what constitutes a competitive advantage
in today’s market. The increased speed, uncertainty and complexity that define
today’s competitive landscape require organizations to become adaptable and
agile in order to survive, let alone thrive (Appelo, 2011; Bogsnes, 2016; Denning,
2018; Goldman et al., 1995; Perkin & Abraham, 2017).
In this context of rapid change and high uncertainty, the ability to innovate and
create value—for all the stakeholders—forces companies to master the art of
constantly adapting their organization and teams to internal and external market
conditions (Perkin & Abraham, 2017). This implies providing people and teams
with a degree of autonomy, responsibility and accountability previously
unimaginable (Bogsnes, 2016; Laloux, 2014). Achieving this degree of implication
and engagement by teams also profoundly challenges habitual methods of
leadership and management, as well as measuring and rewarding performance
(Appelo, 2011; Bogsnes, 2016; Meyer & Meijers, 2018).
192 Journal of Creating Value 5(2)

These fundamental shifts are driving the adoption of agile management

practices by companies of all types and sizes (Denning, 2018). From garage start-
ups to technology giants such as Amazon, Facebook and Google, by way of the
flagbearers of these new management methods such as Bosch, Haier, Netflix,
Spotify and Zappos. Recent literature by academics, consultants and pundits
abounds describing agile tools, practices, methods and attempts at far-ranging
business transformations. As agile technology-based firms continue to replace
traditional companies on the leader board of the world’s largest capitalizations,
interest in agile methods has grown exponentially. Today, many companies of all
sizes and across all sectors of the economy are launching agile transformation
initiatives at various scales.
It is in this context that studying the agile transformation journey of a bank, in
general, and the ING Bank, in particular, is especially interesting. To begin with,
nearly all banks are presently concerned with the disruption of their business
model(s). Despite a general desire to promote innovation and customer-centricity
throughout their organizations, most banks are saddled by legacy systems,
regulatory constraints, a compliance and risk-averse mindset and difficulties in
bringing anything beyond incremental innovation in products and services to
market. This makes the banking sector, in general, an interesting focus for studying
the value-creating potential of the agile methods. Furthermore, ING Bank is an
interesting case study, in particular, as, at the start of its agile transformation
journey, ING was a very traditional actor and had just come out of an operational
and financial restructuring following their well-publicized post-global financial
crisis semi-nationalization (ING Groep N. V., 2015b). Moreover, unlike many of
the recent success stories championing the use of agile methods, ING is more
diversified in products, services and geography than most of the ‘agile champions’.
Finally, unlike companies born of, and in, the Silicon Valley mindset and managed
by Millennials, ING’s cultural DNA was structured, hierarchical and administrative.
To use an image often used internally at ING (see Figure 1), this elephant of the
company needed to learn to race greyhounds. The question was: how?

Figure 1. Teaching an Elephant to Race

Source: ING Internal Communication.
Calnan and Rozen 193

Trust the Process, Because There is No Plan

Although the ING story has often been told before (Birkinshaw, 2018; Birkinshaw
& Duncan, 2016; Mahadevan, Jacobs, & Schlatmann, 2017; van Kemenade,
2016), the present case tells the story of the transformation journey as it unfolded
and from a wider perspective of major internal stakeholders that includes IT,
Business, Services (HR, legal, etc.) and, finally, the Company as a whole. This
story is not a retrospective about the execution of a carefully crafted plan; rather
it peels back more layers of the onion in the story as it unfolded over the period
from 2010 to 2018 with all its complexity and apparent contradictions. It also
attempts to capture the immensity of the change(s) undertaken, the determination
of those that made it happen, the ‘destructive creation’ experienced by managers
(notably) and staff who did not survive the transition, as well as some looming
issues ahead. This will also, perhaps, implicitly explain, why so many companies
attempting to make their own agile transformation are studying ING’s experience
so intently.
As Payam Djavdan, Global Head of One Agile Way of Working said, when
asked, what were the key learnings he could share from ING’s agile transformation
journey, his first recommendation was the following: ‘Do not attempt to copy our
approach instrumentally…and expect it to work’. A first indication that ING’s
transformation was not the result of a flawless plan; and, more interestingly, that
there does not appear to be a predefined and replicable recipe for a successful
agile transformation. Simply adopting agile jargon, tools and methodologies are
no guarantee for success; nor is ‘instrumentally’ reproducing ING’s—or anyone
else’s—plan. Especially in the case of ING, there was no ‘plan’ but, rather, an
emergent approach that grew out of a grass-roots adaption of agile methods,
principles and processes at the IT level.
There was no rollout, then or now, of a grand masterplan devised by top
management. Initially, the guiding principle was simply to experiment with new
ways of working, based on the incontrovertible realization that the current way of
doing things was not working. In other words, a commitment by local management
to trust the process—not to implement a predefined solution. Apparently simple,
this represents a major shift in mindset!
So, if there is a first secret to ING’s successful agile transformation, it was
experimentation: allow the teams to explore and test new ways of working to find more
effective solutions to create value for the customer. Adapting the organization, devising
the plan, constructing the narrative and rolling it out company-wide only came later.

Stage 1: Experimental Agile—Test and Learn from the

Bottom-Up

‘Welcome to the Dark Side of the Moon!’

In 2010, when Ron van Kemenade was named Chief Information Officer (CIO) of
ING Netherlands, ING’s online banking application was rated as the worst online
194 Journal of Creating Value 5(2)

banking application on the market. To make matters worse, shortly after hearing of
his nomination, a colleague from IT congratulated Van Kemenade on his nomination
by saying, ‘Welcome to the dark side of the moon’. Within weeks, the meaning of
this ominous welcome became clearer. According to Van Kemenade,

IT at the time simply did not feel like an IT department. Lots of managers, but the
number of true engineers who knew how to code, how to build resilient applications
was very small. The good people were hiding away due to all the governance and com-
pliance that was thrown at them. It felt wrong, but I didn’t know what would be right.

It is in this context that ING’s agile transformation begins. Soon after his nomination
in 2010, two engineers in charge of redeveloping the company’s mobile app walked
into Van Kemenade’s office and announced: ‘if we continue working in the same
way, in the waterfall process using Prince 2 documents, with everything carved in
stone, this will never work!’ Van Kemenade understood then and there that the
ambition of positioning ING as a leader of online and mobile banking was going to
require a sea change in how they got things done in IT at ING.

Transformation Can Begin With an App—and Pizzas!

ING’s transformation journey then does not start with a strategic decision, a plan, a
presentation, or even agile as an identified solution. On the IT side, it begins with
two very real challenges: building a mobile banking application fast and developing
the engineering talent and culture to do so. In other words, the driving motivation
underlying the desire to change was the realization that business as usual simply
would not allow IT to successfully deliver the necessary customer value—in this
case, a quality mobile application. And as Van Kemenade states, his role as the CIO
at this stage was twofold—allow the teams to experiment effectively and shield
them, to the extent possible, from the organization. The ambition was not to change
the organization; it was just to successfully launch an app.
It is interesting to note that the chosen approach reflects rather nicely some of
the Agile Manifesto’s fundamental principles: giving teams ownership of their
actions and the autonomy to organize as they see fit to achieve the results, as well
as removing the organizational obstacles to experimentation (Beck et al., n.d.). In
other words, principles trump methodology, tools and management theory. ING’s
transformation journey was, in fact, driven by the need to create value for the
customer, the realization that this would require fundamental changes and to the
willingness of the team to collaboratively experiment new ways of working.
Rather than a carefully laid out change management plan to implement the
latest project management methods and tools, it starts with an invitation by Van
Kemenade to a pizza party:

‘If you come and help me build the best app, I’ll pay for the pizza.’ Forty people showed up
the next Tuesday. Half were true engineers that I didn’t know I had; half were people willing
to help. So, we started building an app, with no budget, and just using our free time.
Calnan and Rozen 195

Van Kemenade would continue to provide the pizzas—for which he paid from his
own pocket—and together this spontaneously created team would achieve results
that for ING at the time were nothing short of extraordinary: three months to a
working demo of the application; nine months to go live; two years to functionally
catch up and attain a higher rating than the competition on both the Apple and
Android app stores. Later, it was even elected ‘best mobile application’ in the
Netherlands for two years in a row.

From Bank to Technology Company

These pizza sessions have become a legend within ING. Almost nine years later,
even people who were not present still talk about them, not only because of what
they allowed the team to achieve but also because they are the foundation myth of
ING’s transformation journey. Laying down the fundamental principles that
would continue to drive the change at ING for years to come.
Principle among these was the growing conviction of top management that in
order for ING to remain competitive in the financial sector, it had to become a
technology company. This simple statement is and was the essence of the ambition,
the vision and the drive of the group’s transformation. The Chief Executive
Officer, Ralph Hamers, stated in ING’s 2014 Annual Report that ‘When preparing
the strategy, we spoke to many customers. What they said was: “We don’t need
banks, but we do need banking”. And banking services today are technology-
driven’ (ING Groep N. V., 2015a). The depth of this shift was further reiterated by
Van Kemenade at the DevOps Summit in London in 2015, ‘We are a tech company,
serving 34 million customers with banking services’ (van Kemenade, 2016).
This leads directly to another fundamental principle that would drive ING’s
transformation journey throughout: the organization, the technology, the methods
are there to contribute to creating value for the customer, not as an end in
themselves. In other words, the underlying goal was not to become agile, for the
sake of becoming agile, but rather to find the solutions to the problems facing the
organization. And in order to do so, this also implied making ING an attractive
place to work for engineers. A place where engineers would be proud to work and
where they could express all their technical talent and creativity in the service of
the customer.
The unexpected, yet fundamental, shift this brought about was to suddenly
make IT customer-centric and radically shift internal conversations and mindsets.
As Athena Koekkoek, Senior HR Business Partner within Technology Market
Leaders, tells it: ‘Engineers started to communicate with Business and tried to
translate what they were doing into customer needs. And Business discovered that
IT could articulate and understand customer behaviour and needs. People started
converging on the same goal which was customer experience.’ IT teams started
working for the customer, with Business, rather than working on their own, on an
abstruse technical roadmap or functional specifications. Also, through the direct
feedback, they were getting from the customers, IT was becoming just as
legitimate, if not more, than marketing in defining product roadmaps.
196 Journal of Creating Value 5(2)

Figure 2. Spread of Agile within the IT Department of ING Netherlands

Source: ING Internal Communication.

The first step to break down the traditional silos of the company had been taken!
Initially, the agile transformation of ING Netherlands’ IT happened quickly,
organically and practically inadvertently: by celebrating the success of the first
teams, by making them visible to the rest of the company, by removing the
organizational obstacles and allowing the IT organization to naturally adopt and
adapt to this new way of working from the bottom up. In fact, within two and half
years, IT had moved from a targeted experiment with three Scrum2 teams to 175
DevOps3 teams (see Figure 2). Illustrating not only how agile grew in numbers
organically and by ‘contagion’—with success begetting success—but also how
the initial scrum approach itself was adapted to fit the organization’s needs to
become DevOps. It was not the simple, ‘instrumental’ application of Scrum, but a
process of experimentation to find the right mix of tools and methods to meet the
challenges.

Stage 2: Organic Agile—Breaking Silos Through the Ripple

Effect

Serendipity or Convergence?
A parallel transformation story begins in 2012. The explicit reasons for it seem
unclear. Was it the rumours of the new approach coming out of IT or the growing
need for product owners to staff the IT DevOps teams? As the IT silos were
disappearing, was the inevitable impact on the rest of the company and Business
in particular, being felt? Was this agile phenomenon beginning to attract corporate
management’s attention?
Interviews and available information have provided no clear answer and it is
likely a combination of all of the above. However, by 2012 the massive shift of IT
Calnan and Rozen 197

towards DevOps created a ‘handover impediment’ with Business. To address this

impediment, Business initiated a parallel—and initially separate—agile
transformation journey. Remco Dijkxhoorn, Expert Lead Agile Coach at ING
Netherlands and external consultant on the Business side at the time confirmed that
originally there was a little or no contact or coordination between the IT and Business
agile initiatives at ING. Nevertheless, this trickle over from IT and Business, was
fundamental in ultimately accelerating the agile transformation at ING.
The agile transformation journey on the Business side of ING Netherlands began
in 2012, two years after IT’s first steps. At the time, Business was organized in an
estimated 25–30 specialized silos. To break down these silos and create cross-
functional teams, Business started by setting-up more generic project teams—or as
Dijkxhoorn calls it, by T-Shaping the teams. This implied extending each team’s
area of expertise to adjacent fields. This represented a soft shift from the operational
methods in use at the time, which would not significantly disturb the organization
and its members. However, even this slight shift in the way of working produced a
35 per cent increase in productivity for the teams that adopted it.4
Based on this controlled experiment and its results, the second stage of the
transformation could be initiated. This involved transforming the Business-side of
ING from silos to a product-centred organization with fully cross-functional teams
(see Figure 3).
This initial step also allowed the Business teams to start implementing the
deeper changes inherent in Agile, including challenging such basic company
policies as ‘Clean desk, clean walls.’ This may seem superficial, but it actually
made implementing many agile rituals, like visual management, impossible.
Powered by the initial success, the initiative gained the necessary credibility with
top management to ‘act first and ask for forgiveness later’.
And this was not just a figure of speech. For example, organizing the Business
teams according to the agile principles led to some unintended consequences. Key
among them, overcrowded buildings due to teams preferring to work onsite
together rather than telework. This led to the costly, but important, decision to
relocate to a larger building, despite the recent move to a new location. This
illustrates how committing to the process and being willing to adapt, rather than
sticking to a predefined roadmap or strategy, was so central to the success of the
ING transformation. Top management was willing to accept and support the
organizational consequences of adopting a different way of working, as they
unfolded—even if, and when, they had a direct impact on corporate structure, and
very tangible costs, such as facilities.

Daily banking Pay m ents

Mortgages Etc.

From specialized functional silos… …to cross -functional product - based team s.

Figure 3. The Organizational Shift on the Business-Side of ING Netherlands

Source: R. Dijkxhoorn (personal communication, 27 February 2019).
198 Journal of Creating Value 5(2)

Stage 3: Structured Agile—Scaling Agile

A one day visit to Spotify in 2014 completely flabbergasted the ING leadership team.
With their vocabulary and roles: tribe leads, product owners. To whom do you report?—
‘it depends’. How much budget do you have—‘it depends’. Who works for you?—‘it
depends’. Slogans on walls, GSD (get shit done), It depends, … They realized that they
wanted to become Spotify.

Gradually, then Suddenly

By 2014, ING Netherlands had successfully initiated two separate, yet convergent
transformations. One in IT and the other at the Business level—and both with the
use of agile methods. But the two efforts were still relatively distinct, as each
department was experimenting and improving its own internal ways of working.
The convergence of these two experimental journeys was mainly limited to
Business being able to provide the necessary resources, that is, product owners, to
the IT DevOps teams. But as agile methods and practices gradually spread
throughout Business, it became increasingly apparent that a unified and concerted
approach was needed.
Until now, transformation efforts had been local, bottom-up initiatives, in
which top management’s role was primarily focussed on active sponsorship and
removing the organizational impediments for teams to experiment and adapt new
methods and ways of working. Overall, it remained organic, yet limited. In fact,
according to Dijkxhoorn, who was spearheading the effort on the Business side,
despite the initial success of the implementation of agile practices, a conscious
decision was made to allow the system the time to adjust to the shock of so much
change. In his words, ‘there is a limit to how much internal confusion you can
create’. Based on this, the initial transformation on the Business side was limited
to 250 people.
And although the transformation on the IT side was more profound and
advanced by 2014, having led to the restructuring of practically all the teams,
processes and a good deal of the technical infrastructure, the approach had
remained largely grass-roots-led and confined to the department with the CIO,
Ron van Kemenade, playing the primary sponsor and enabling the role.
ING was now at an organizational turning point and a completely new phase of
the transformation process:
• The two systems could no longer easily co-exist separately.
• Through the previous experiments in IT and Business, the economic
and human value created by agile practices and mindset were becoming
fully apparent.
• Customer behaviour and expectation were rapidly shifting, driven by
other industries and uses, such that being omnichannel went from nice to
have to strategic imperatives.
• With its cross-functional, end-to-end approach, agile was identified by top
management as a natural enabler for becoming omnichannel.
Calnan and Rozen 199

• ING could once again face this transformation from a financially solid
position based on a good performance and a favourable macroeconomic
context (still relatively high interest rates).
As Gijs Valbracht put it, it became clear to the Board of ING Netherlands that
‘you can’t get to real agility, if you do it with only part of the organization’. The
time was ripe for ING Netherlands to fully embrace Agile as an organization,
unifying what were still relatively separate task forces that were insulated and
protected from the rest of the organization. The agile transformation needed to
officially become a strategic priority mandated from top leadership and more fully
integrated across the Dutch company.
Central to this new phase in ING’s agile transformation journey was active
involvement and sponsorship by the Management Board. It may come as some
surprise given how deeply agile practices had already been adopted by certain
teams and departments at ING Netherlands that at this stage, most of the members
of the Management Board knew little or nothing about Agile. The first step now
was to educate the Board. So, in December 2014, Peter Jacobs, then CIO of ING
Netherlands, organized a learning expedition for the Board of ING Netherlands to
visit Spotify in Sweden. Among the participants was the then Chief Operating
Officer, Bart Schlatmann, who later became one of the first and most vocal
sponsors of Agile on the Board.
In the words of Payam Djavdan, currently Global Head of One Agile Way of
Working and Operating Model, at the time, this one-day visit of Spotify ‘completely
flabbergasted them [the board] with their organization, vocabulary and roles…They
realized they wanted to become Spotify!’ Immediately, the Board members started
to e-mail people within the organization talking the Spotify jargon, methods and
organization to create a sense of excitement and buzz.

From DevOps to BizDevOps

After the Spotify learning expedition, things went very quickly in the Dutch
organization. From December 2014 to January 2015, six Board off-sites were
organized to design what would become ING’s Agile Framework.

Delivery Sales
Business and IT implementing products Customer -facing teams selling products
and services for customers and services to customers

ING
W ork Areas
Service Support
Customer -facing teams providing Internal -facing transversal support teams
services to customers (call centers, etc.) (HR, Risk, Procurement, etc.)

Figure 4. The New Work Areas at ING Netherlands

Source: R. Dijkxhoorn (personal communication, 27 February 2019).
200 Journal of Creating Value 5(2)

Figure 5. Squads, Chapters and Tribes at ING

Source: Mahadevan et al. (2017).

The choice was made to adapt the ‘product-centred organization’ that had been
tested by Business and organized around four ‘work areas’, rather than business
units or departments (see Figure 4). It was also decided to focus the transformation
on the Delivery work area.
At this stage, Djavdan and his team borrowed freely from the existing models
of Agile and adapted them to each work area.
As such, delivery was largely modelled on Spotify (see Figure 5). ‘Squads’
were multidisciplinary, cross-functional teams limited to nine people with full
autonomy to self-organize to deliver on their purpose. Squads with interconnected
purposes were grouped as a ‘tribe’. ‘Chapters’ cross-cut squads to develop
expertise. ‘Tribe leads’ would ensure coordination between the tribes. And ‘Agile
coaches’ would provide individual and group coaching on an on-going basis, as
needed (Mahadevan et al., 2017).
However, the Sales and Services work areas required a different organization
to respond to customer requests in real time. So, in this case, ING adapted the
Zappos model and called it ZappING (Zappos at ING), where teams are organized
in ‘Customer Loyalty Teams’ and in ‘Circles’, also inspired by Google and Netflix.
The goal was neither to blindly copy-paste existing models into ING, nor to
create something new at all costs. ING’s Agile Framework was born out of
carefully adapting proven agile practices from innovative digital companies to
ING’s specific needs and culture—while building on the years of experimentation
within ING Netherlands itself.
In the winter of 2015, the decision was made to go live and roll out the new
way of working to the Delivery teams of ING Netherlands, since those teams were
the most mature at the time. The initial focus was 3,500 people from both Business
(1,000) and IT (2,500) organized in 350 squads of 9 people.
The following months were dedicated to select the team members and on 15
June 2015, the new organization went live with a huge event at Ajax Stadium
bringing the 3,500 people together to kick-off this ‘new way of working’ at scale.
And as Djavdan describes it, ‘the next day, I saw them shaking hands and talking
Calnan and Rozen 201

together and working together. Before agile, people were working on projects, but
not meeting…We put them all together!’

Paradigm Shift:The Paradoxes of Agile at Scale

By 2016, the model could be rapidly rolled out to the Sales and Service work areas
in the Netherlands. Within months, ING Netherlands had fully implemented Agile,
except for the Support work area, which still remains (a challenge) to be done.
Despite this stage-gate approach adopted by ING, according to Djavdan, if he
had any advice to give other organizations at this stage of transformation: ‘Do it
fast! If you don’t do it fast, uncertainty grows, and good people leave.’
Clearly, this is in stark contrast to the approach adopted from the beginning by
IT and Business and reflects the stage of the transformation ING Netherlands had
reached. The initial years were all about trial and error, experimentation, trusting
the process and removing organizational obstacles to the new way of working.
This included changing the organization itself, if necessary—from infrastructure
to facilities to the management itself.
However, once agile transformation became a strategic objective in and of
itself and the model needed to be scaled, first country-wide and later group-wide,
the paradigm needed to be adapted yet again. The focus shifted from
experimentation to implementation; the impetus from bottom-up to top-down; the
approach from principle-driven to process-driven; the nature from slow and
emergent to fast and by-design.
After having successfully transformed the Dutch bank, if ING was to become
a truly agile and adaptive organization, it now needed to address the challenge of
scaling agile to its 52,000 dependents worldwide. The key challenge was now to
scale agile across all of ING. This led to the creation of One Agile Way of Working
global team, of which Payam Djavdan became the head. This required codifying
and standardizing certain agile building blocks that could be applied uniformly
across the organization, providing clear guidelines, processes and tools to
transform quickly and effectively. One Agile Way of Working became the ‘agile
standard operating procedure’ of ING, the blueprint for ‘going agile’ and the
backbone of its scalability. Although, as Gijs Valbracht, Lead Agile Enterprise
Coach in the One Agile Way of Working Team, stresses that this organization
reflects more the new organizational setup born of the need to scale, rather than
the actual roll-out methodology. In his words:

Our goal was to take a different approach from the top-down approach. Not take the
usual route we take when we start a global programme with a big team at head office:
define what it needs to look like globally, create a roadmap of the rollout and the order
in which countries need to do their transformation…

Within months, One Agile Way of Working for Delivery had been rolled out to
Poland, Romania, Spain, Germany, Austria and Belgium. France, the Czech
Republic, Luxemburg, Australia and Turkey would follow over the following years.5
202 Journal of Creating Value 5(2)

IT Agile Experiment

Business Agile Experiment

One Agile Way of Working

July 2015 Sept 2018

Q1 2010 Dec 2014
Ajax Money -
RvKnamed Board visits
Stadium laundering
CIO Spotify
Event fine

0ct 2008
NL Gov’t
Bailout

Figure 6. Evolution of ING Stock Price Compared to Bank ETFs and Overlay of Main
Milestones of ING’s Transformation Journey

However, this is the essence of the paradox of scaling agile, as Valbracht puts
it, ‘the real transformation is on leadership and mindset’. The real challenge, at all
levels of the organization is learning how to work and collaborate within this new
way of working, with the new roles, methods and tools. This cannot be codified
for risk of killing the very essence of Agile. And, the global team is painfully
conscious of this paradox and having to balance the structure of what has been
codified and the ability to adapt to each new situation, as well as a challenging and
changing environment.

Value Creation,Value Destruction…or a Little Bit of Both?

A key question of the ING agile transformation is whether it is value accretive
and, if so, to whom in particular? To begin, it is not so clear to what extent the
agile transformation has been value-accretive to the shareholders, especially if
ING’s stock price evolution over the period is compared to either the overall
market or to bank Exchange-traded Funds (ETFs), both of which have
outperformed ING Group (see Figure 6). There are two caveats to this though: (1)
Calnan and Rozen 203

the overall trend has been positive and on par with bank ETFs (e.g., Standard &
Poors Depository Receipts Bank Exchange-Traded Funds (SPDR S&P Bank
ETF)) since the share touched bottom in 2009, following the global financial
crisis and the ensuing bailout by the Dutch government; and (2) it is difficult to
use the share price of the entire group as a proxy for value creation as the agile
transformation was mostly a Dutch affair until 2015 and had not yet been deployed
group-wide. Furthermore, the value may take time to accrete, and the value of
agile may take time to be appreciated by equity markets.
With that said, ING’s agile transformation appears to have been significantly
value-accretive to the rest of its stakeholders—company, community, staff and
customers. Whether measured in terms of efficiency, engagement, image, net
promoter score (NPS), time-to-market, or time-to-adoption…the indicators all
point to a positive impact on value—both internally and externally.6
Without being exhaustive, the following indicators capture some of the more
visible value created over the period:
• Average IT project time dropped from nine months to continuous delivery.7
• ING became ‘a cool place to work for engineers’, locally in the Netherlands
on par with the Facebook, Amazon, Apple, Netflix and Google.8
• ING began to attract agile specialists, creating the largest pool of agile
coaches in the Netherlands.4
• ING, which started measuring NPS in 2012, consistently achieved first-place
ranking in a majority of countries surveyed (ING Groep N. V., 2012, 2018).
• Employee engagement grew, as evidenced by Organizational Health Index
(OHI) and Winning Performance Culture Survey (WPC) reports
commissioned by ING over the period.9
• On average, the transformation reduced full-time equivalent (FTE)
employment by 30 per cent while productivity rose over the period.10
• From a business perspective, the transformation also fuelled a 60 per cent
increase in primary customers for ING from 2012 to 2018 (ING Groep N.
V., 2013, 2019).
Nevertheless, the value created did come at a cost—human, operational and
financial. This was not a superficial transformation. The change went deep
organizationally, touching at the core of culture and structure. It required new
physical spaces, new buildings that required substantial investment and a rethink
of how people physically interacted. It required a fundamental shift in the
mindset—especially at the managerial level. Going agile, in fact, could not be
faked by simply changing titles, adopting a new tool or reporting method or
redecorating existing facilities. As one top manager crudely put it: ‘There is no
revolution without casualties’. In this case, the first casualties were the managers
whose most basic managerial and leadership skills were being fundamentally
challenged. Some would try to adapt, many could not.
Unsurprisingly, productivity suffered initially. No matter how positive, no
matter how structured, change inevitably impacts delivery. ING estimates that an
average of six months11 was necessary for the teams and the organization to
compensate the initial setback in productivity caused by the transformation.
204 Journal of Creating Value 5(2)

Overall, the agile transformation translated into a 30 per cent reduction in full-
time head count12 (as measured by FTEs). But in certain situations, this implied
changing up to 70 per cent of management8 and even top managers were being
asked to leave.
The sheer intensity of such a change is difficult to convey, or measure, in
human terms. People who spent decades working their way up the ranks to fill
increasingly higher management positions saw both those positions and their
prospects disappear into the agile rabbit hole. It is interesting to note that, however,
this apparently severe structural and organizational mutation at the management
level is precisely what helped to legitimize the transformation effort, as it clearly
signalled that (1) no one was protected by the establishment and (2) that the
company was fully-committed to the transformation project. As the top was
culled, the bottom was increasingly convinced.

Conclusion
While ING is not the first or the biggest corporate to have attempted an agile
transformation, it is noteworthy for multiple reasons. First, it was one of the first
publicly known corporate transformations. Second, it was the first documented
transformation of a multinational bank the size of ING. Third, ING has patently
created a model that is a proprietary mix of agile best practices taken from the
technology sector and its own emergent methods and practices. Fourth, ING has
been extremely open about telling the story, sharing its experience and trying to
help others to do the same.13 Fifth, the scale of the on-going transformation is
ground-breaking. Sixth, ING’s ambition of becoming a technology company is
shared by a growing number of corporate giants and banks today (e.g., General
Electric, BNP Paribas and Société Générale). Finally, the story is still unfolding
with major challenges remaining to be met.
As such, the ING transformation journey provides multiple insights into the
key factors driving a successful agile transformation, and not just for the banking
sector, while offering a bit of a cliff-hanger as to whether or not it will succeed at
group-wide scale.
Among the key insights, a commitment to shared principles, rather than tools,
appears to have been a key to creating a new culture to support the transformation
at all levels of the organization:
• Small local and personal initiatives can have a big impact.
• Small successes are contagious and help foster emulation.
• Make customer value a priority as a means to drive transformation.
• Aim to fix problems, not apply methods, to encourage change.
• Locally experiment, test, learn and protect…before repeating and adapting
at the scale.
• Let the experiment guide your learning, not the expected (desired) result.
• Be ready to make difficult choices, in terms of management, organization
and structure along the way.
Calnan and Rozen 205

• Focus on behaviour and mindsets to foster culture.

• Agile principles can work as a shared compass to align the efforts of all actors.
These general principles, however, built on an existing ING corporate culture
defined by two guiding values, aptly captured by Valbracht: ‘allow people in the
organization to intentionally deviate from the standard; and then have the guts to
do it at scale.’
In hindsight, we can identify three stages in ING’s agile transformation to date:

Stage 1: Experimental Agile—Test and Learn from the

Bottom-Up (2010–2012)
An initial experimental, test and learn application of agile methods within a
confined environment (in this case IT) with no clear roadmap as to where this
might lead. This stage is driven by the need to find a solution to concrete, clearly
defined problems—initially, developing an online mobile banking app. When
successful, this initial stage includes a second phase in which the new ways of
working organically spread within the confined environment (still IT). This
second phase of Stage 1 is predicated upon management’s ability to remove
organizational obstacles and to champion their success. The approach is clearly
bottom-up and limited in scale.

Stage 2: Organic Agile—Breaking the Silos through the

Ripple Effect (2012–2015)
Stage 2 grows out of Stage 1, as the cross-functional and multi-disciplinary nature
of agile challenges traditional organizational boundaries. Stage 2 marks the
gradual buy-in across other operational units. This phase is still largely
experimental, problem- and value-driven, as the impetus for change is largely due
to the friction caused by interactions between the agile units and practices and the
rest of the (traditional) organization. The role of top management remains largely
limited to removing obstacles and protecting initiatives.

Stage 3: Structured Agile—Scaling Agile (2015–2018)

In Stage 3, a fundamental paradigm shift occurs. Once agile becomes a strategic
objective at the company or group level, agile transformation becomes more
codified and centralized—One Agile Way of Working, Orange Code, etc. This
allows for agile practices to be rolled out more quickly and effectively. A common
language and new culture emerge, productivity and engagement grow, but at the
expense of those who cannot or chose not to adapt.
206 Journal of Creating Value 5(2)

As the present case illustrates, ING can pride itself in having accomplished a
remarkable transformation. The journey, however, is far from over. In fact, it is at
this stage that paradoxes of agile at a scale begin to appear. And, ING already
realizes that it needs to rethink parts of its agile puzzle. As such, it is clear that
although agile practices need to be codified to scale, this naturally creates the risk
of replacing one set of processes with another—albeit so-called agile processes.
In Valbracht’s words: ‘The challenge is to keep improving on [our agile methods].
To look beyond tribes and squads. To listen to people who say this doesn’t work
for us. That’s what we should be doing. To become an agile and adaptive
organization’. Although, agile methods have become the new operational
blueprint, should all parts of the organization be fully agile, or should a hybrid
approach be attempted? As the organization and customer needs continue to
evolve, how can this new way of working continue to adapt?
On a deeper level, in the words of Ron van Kemenade,

what I’m most afraid of is that we may lose the clear purpose of projects. You only keep
motivation if the purpose stays clear. Tribes are driven by a why, by a purpose. That
is why they are not defined by hierarchy, but by professions. We have kept the organi-
zation flexible because tribes are flexible. But tribes have become too fixed as they
haven’t changed since 2015. If your purpose, as defined by your strategy, has changed
then the tribes need to change.

Considering that ING’s strategy has evolved over time and that Ralph Hamers has
ambitious goals for ING, it is clear that fixed tribes, a ‘new’ set way of working
and a codified transformation agenda may actually be the indication of underlying
stress fractures in the transformation process and that the organization as a whole
risks reverting back to a new form of stasis, rather than a perpetual drive and
ability to adapt and transform itself.
The stress fractures may soon become critical, as ING embarks on what could
be considered a Stage 4 in the transformation—Staying agile—as it attempts to
extend agile across borders and across cultures (both corporate and national) to
the entire group, while remaining sufficiently agile to adapt its blueprint to local
needs, as well as the increasingly complex and uncertain environment it faces.
And as agile becomes the operating DNA of the entire group, when will the group
need to rethink its C-level structure? Will we see tribes and chapters emerge in a
new governance structure at the Corporate Board level? This is a chapter that
remains to be written.
Beyond governance, this new stage will be pervasively challenging in and of
itself at the group level. A challenge made even more daunting as ING Netherlands
with ten years of agile experience and culture under its belt and fully engaged
agile personnel is mismatched with the rest of the group that is just beginning to
come to grips with agile. Once again, it will require confronting different people,
processes and principles and stretching the agile model as it exists today, beyond
comfort. This is agile at yet another scale, in uncharted territory. As ING’s agile
transformation journey nears a decade in duration, it will be fascinating to see if
Calnan and Rozen 207

and how ING will meet the new challenge it faces with agile methods that can
adapt to a new scale or with scalable processes that are agile in name only.
In retrospect, then, ING’s agile transformation journey went from a bottom-up
initiative to a strategic imperative, from a country-specific to a group-wide
transformation. And herein lies the fundamental paradox, potentially at the heart of
all agile transformations: what got you here (bottom-up) and allowed you to scale
initially (top-down) may not take you into a fully-scalable agile future as over-
codifying may bring on a similar form of rule-induced sclerosis that agile was
intended to eliminate in the first place. If agile is a structured-yet-open approach to
getting things done effectively and creating new value, then closing it by over-
structuring may create new challenges to be addressed in the emergent movement
of corporate elephants trying to become agile greyhounds. In the words of Valbracht,
the danger is ‘that you kill the organizational innovation that initially got you to this
new solution.’ And that, although the elephant may have learnt to compete in one
race, how do you teach it to keep running in the never-ending race that is the new
normal?

Acknowledgements
The authors wish to thank Harry Oosterhuis at ING Netherlands, Martijn Rademakers at
University of Amsterdam, Andre Leeuwendal at Corporate Tribes and Joseph Santora of
Ecole des Ponts Business School for their support and making the writing of this article
possible. Also, a special thanks to the people we interviewed and the teams at ING
Netherlands who were willing to openly share their experience to help others craft their
own agile transformation journeys.

Appendix 1: Stakeholder Interviews

As a basis for this article, interviews with the following stakeholders were used:
• Remco Dijkxhoorn, Expert Lead Agile Coaches, ING Netherlands.
• Payam Djavdan, Global Head of One Agile Way of Working, ING Group.
• Athena Koekkoek, Senior HR Business Partner, ING Netherlands.
• Ron van Kemenade, Chief Information Officer, ING Group.
• Harry Oosterhuis, Chapter Lead Feature Management Core Bank, ING
Netherlands.
• Gijs Valbracht, Lead Agile Enterprise Coach, ING Group.

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research,
authorship and/or publication of this article.

Funding
The author(s) received no financial support for the research, authorship and/or publication
of this article.
208 Journal of Creating Value 5(2)

Notes
1. The US military term originally used to describe the more volatile, uncertain, complex
and ambiguous multilateral world resulting from the end of the Cold War. Today, used
to describe the increasingly volatile, uncertain, complex and ambiguous environment
in which most businesses operate.
2. Also called ‘development’ or ‘delivery’ team, the scrum team is responsible for deliv-
ering the committed product or service within the time frame, called a sprint. The
principle characteristics of a scrum team are that it is autonomous, self-organizing and
cross-functional.
3. DevOps is a set of software development practices that combines software devel-
opment (Dev) and information technology operations (Ops) to shorten the systems
development life cycle while delivering features, fixes and updates frequently in close
alignment with the business objectives.
4. R. Dijkxhoorn (personal communication, 27 February 2019).
5. P. Djavdan (personal communication, 21 February 2019).
6. The present study does not demonstrate the positive impact of ING Netherlands agile
transformation on front-line staff and customers through hard data and indicators,
despite considerable anecdotal evidence and a general perception within ING that
this has indeed been the case. Future research could address this question through the
analysis of the detailed NPS scores over the period, specifically, the variance between
countries at different stages of the transformation effort; the evolution of customer
satisfaction measures used in the customer service centre; as well as, the evolution of
the App rating over the period.
7. H. Oosterhuis (personal communication, 6 December 2018) and P. Djavdan (personal
communication, 21 February 2019).
8. R. van Kemenade (personal communication, 21 February 2019) and A. Koekkoek
(personal communication, 21 February 2019).
9. This claim is based on discussions with Athena Koekkoek, as the researchers have not
had access to the actual OHI and WPC reports.
10. R. Dijkxhoorn (personal communication, 27 February 2019), A. Koekkoek (personal
communication, 21 February 2019).
11. R. van Kemenade (personal communication, 21 February 2019).
12. The reduction in FTEs was not an end in and of itself. It was the result of a clearly
stated objective to demonstrate that an agile organization could function with fewer
FTEs. This upfront goal was crucial in establishing the transformation mindset, as it
was the basis upon which the organization was able to reselect all its team based not
only on their expertise but also their mindset. G. Valbracht (personal communication,
9 May 2019).
13. Because transformation is less about the methods than the mindset, this also explains
why ING has been so open in sharing its experience. This is clearly reminiscent of
Toyota’s making its Toyota Production System available to all, based on the premise
that you can copy our practices but not our culture.

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