The Tax Teams Pay for Organizational Standards | Alidad Hamidi

Summary

Podcast Summary

Episode Overview

Podcast: Scrum Master Toolbox Podcast: Agile storytelling from the trenches
Host: Vasco Duarte
Guest: Alidad Hamidi
Episode: The Tax Teams Pay for Organizational Standards
Date: November 12, 2025

The episode zeroes in on the organizational challenges faced when balancing centralized standards and metrics with the evolving, context-specific needs of agile teams. Vasco and Alidad explore the “tax” teams pay to comply with top-down reporting requirements, and how to avoid letting these requirements stifle adaptability and genuine value delivery. The discussion is rich with practical coaching insights, cautionary metaphors, and wisdom from both system thinking and business agility experiences.

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Key Discussion Points and Insights

1. There Is No Single Challenge in Complex Systems

[01:57]

• Alidad: From a systems thinking perspective, organizations don’t have one "biggest" challenge; instead, there are many contributing factors that shape the conditions teams work within.
• Issues discussed:
  • The simultaneous pressure for teams to deliver in the present and transform for the future.
  • The demand for standardization (metrics, frameworks) often clashes with teams’ real work.

Memorable Quote:

“There is never a single challenge. There is always a number of contributing factors...sometimes we call them challenge, sometimes we call them problem. They’re just situations.” – Alidad Hamidi [02:01]

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2. The Tension Between Top-down Metrics and Actual Work

[03:00-04:12]

• Teams are frequently judged on metrics like flow time or velocity, but these targets can ignore the team’s context and true value delivery.
• Vasco: Metrics can blind leaders to system dynamics by narrowing focus to specific, often disconnected, aspects.

Memorable Quote:

“One problem with metrics is that it precludes the ability to see the system because it narrows down the focus on this very specific aspect.” – Vasco Duarte [04:19]

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3. The “Tax” Teams Pay: Adapting to Organizational Demands

[06:09-08:39]

• Alidad: Calls the extra work imposed by standardization a “tax to pay” or “license to play.” Teams need to balance meeting these external demands with their core mission of delivering value.
• He emphasizes understanding leadership’s intent behind metrics and co-creating ways to achieve these intentions with less rigidity.
• Sometimes, discussing these realities openly with both leaders and teams leads to improvement on all metrics, not just the mandated ones.

Memorable Quote:

“I call it sometimes, although I don’t encourage it, but I call it the tax to pay or the license to play.” – Alidad Hamidi [07:13]

• Reference to Deming:
  “If you set targets for people, they will achieve the target—even if that means destroying the system around them.” – paraphrased by Alidad Hamidi [06:32]

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4. Systemic Effects: Metrics Can Create Invisible Tradeoffs

[08:39-10:28]

• Vasco: Warns that team-level optimization can have unintended, negative ripple effects in other parts of the system, which are often hard to detect.
  • Example: QA team optimizing throughput may inadvertently slow down development elsewhere.
• Questions how to shift the organizational focus from isolated team performance to systemic, end-to-end performance.

Memorable Quote:

“…metrics that are applied to a specific point in the overall organization…by design they will sooner or later have a negative impact in some other part, but that negative impact is not going to be visible…” – Vasco Duarte [09:20]

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5. Context Sensitivity: One-Size-Fits-All Is Doomed

[10:28-13:52]

• Alidad: Describes his team's journey through multiple agile transformation “waves,” culminating in the adoption of value streams and end-to-end metrics.
• He cautions:
  • Even value streams aren’t a universal solution.
  • Metrics and frameworks must match the context—what works for a factory line (Toyota) won’t work for a “Pixar studio.”
  • The current shift is from product-centric models to scenario-based, ecosystem business models, reflecting changes in customer behavior and competitive landscapes.

Memorable Quote:

“If you apply lean metrics to your Pixar studio, you’re going to kill Pixar Studio.” – Alidad Hamidi [11:57]

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6. The Future: Scenario and Ecosystem Thinking

[13:52-14:19]

• Organizations should now focus beyond products toward customer scenarios and broader ecosystem models. This means partnering even with competitors and acknowledging that customers interact with multiple interconnected products and services.

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7. Key Takeaways and Coaching Wisdom

[14:19-16:09]

• Large organizations take time to change; patience and persistence are essential.
• Behavioral change at scale is exponentially more difficult than personal change.
• Take responsibility for your circle of freedom, and seek to gradually move the organizational system.
• Recognize and work with, rather than against, a system’s natural rhythm and lifecycle.

Memorable Quote:

“If we take responsibility for our freedom, we’ll always find ways to move the system, but it may not necessarily be with the speed that we expect…organizations have their own rhythm and speed.” – Alidad Hamidi [15:46]

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Notable Quotes & Timestamps

• “There is never a single challenge. There is always a number of contributing factors…they’re just situations.” – Alidad Hamidi [02:01]
• “One problem with metrics is that it precludes the ability to see the system because it narrows down the focus on this very specific aspect.” – Vasco Duarte [04:19]
• “If you set targets for people, they will achieve the target—even if that means destroying the system around them.” – Deming, paraphrased by Alidad [06:32]
• “I call it sometimes…the tax to pay or the license to play.” – Alidad Hamidi [07:13]
• “Metrics that are applied to a specific point…by design will have a negative impact in some other part, but that negative impact is not going to be visible.” – Vasco Duarte [09:20]
• “If you apply lean metrics to your Pixar studio, you’re going to kill Pixar Studio.” – Alidad Hamidi [11:57]
• “If we take responsibility for our freedom, we’ll always find ways to move the system, but it may not necessarily be with the speed that we expect…” – Alidad Hamidi [15:46]

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Timestamps for Main Segments

• [01:11] – Episode theme and introduction of guest
• [01:57-04:12] – The multi-faceted challenge of balancing standards and real team needs
• [04:12-06:09] – The systemic risks of rigid top-down metrics
• [06:09-08:39] – The “tax” or “license to play” for teams, and leader-team conversations
• [08:39-10:28] – Systemic trade-offs and the dangers of local optimization
• [10:28-13:52] – End-to-end/value stream thinking, context, and organizational evolution
• [13:52-14:19] – Moving beyond products to scenarios and ecosystems
• [14:19-16:09] – Coaching wrap-up: patience, responsibility, organizational rhythm

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Tone and Language

The episode’s tone is candid and reflective, blending system-thinking pragmatism with an optimistic coaching stance. Both speakers balance hard-hitting observations with empathy for leaders and teams, making the episode relevant for practitioners grappling with change, performance measurement, and organizational complexity.

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In summary:
This conversation is essential listening for Scrum Masters, Agile Coaches, and change agents navigating the friction between rigid organizational metrics and adaptable team practices. The emphasis on patience, context sensitivity, and systemic thinking offers practical guidance while calling for a more nuanced, responsible approach to organizational transformation.

Transcript

[A]

Hey there agile adventurer, just a quick question.

[B]

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[A]

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[B]

Hello everybody. Welcome to our Wednesday the Coaching day here on the podcast and with us this week we have Alidad Hamidi. Hey Alidad, welcome back.

[C]

Hey, hey. Let's go.

[B]

So the coaching conversation is something we do with the guests where we discuss a specific topic and explore that topic, try to understand it as a system and potentially talk about experiments that we might want to run in that condition. We try to bring real life situations that we face so that you listening can also take inspiration from that. Potentially you are in a similar situation, but also so that you can hear what a coaching conversation sounds like. So Alita, let's start with the topic that you want to bring to us this week.

[C]

I wouldn't necessarily. This is the single biggest challenge right now because coming from a system thinking background and complexity, there is never a single challenge. There is always a number of contributing factors. There's always situations. Sometimes we call them challenge, sometimes we call them problem. They're just situations. There are situations that is stopping us to achieve a more desirable outcome. For me at the moment, one of the things that I'm working on is creating the balance between the organizational demand from a reporting structure, etc. Perspective versus what the teams are actually they need to do. And also the transformation they need to apart from doing their day to day job, the transformation they need to make at the same time to further develop their capability to be more fit for to change the environment. What I mean by that is we have some standard models and frameworks and operating models that we're helping the organization to the lack of better to roll out. And for teams to adopt. But there is so much emphasize on standardization. And then the teams as well as people involved with the transformations are measured by certain things, simple things like being measured by dev. And they're not bad measures, right? But it's just they are not context sensitive. So let's say we have things like flow time. You know, every team have to have flow time below a certain number. Every team have to have certain velocity. Velocity is not necessarily measured by story points or traditional velocity. It's velocity as in how much value they're delivering, things like that. Right. So creating the balance between there is this demand from the leaders that your metrics should look like this versus in actual work. What teams need to do to improve their work is something else. How do you create that balance?

[B]

Because that's a very good question. So I want to break that into two parts. The first part is the metrics and how they frame everything that we can see. And then the second part is that contrast, perhaps even conflict, between attending to the standards we are being asked to follow versus attending to the actual work that needs to be done. And I want to use the garden metaphor. You introduced the idea of flowers in the previous episode where the basic metaphor is that if a flower is not growing as much as you would expect, then the problem is in the system around the flower, not in the flower itself. And one problem with metrics is that it precludes the ability to see the system because it narrows down the focus on this very specific aspect. And I read a book quite a while back by John C. Scott called seeing like the State where he catalogs meaning. He describes many examples of how this top down imposition of metrics on a system actually makes the system worse, less adaptable, more brittle when we think about adaptability. So the environment is changing, the market is changing. When we do top down, what typically happens is that we prevent the system from adapting. One example that you gave, let's call it the flow. Anyone who understands anything about theory of constraints or lean processes would say, but that's a great metric. Why wouldn't you look at it? And I would agree in abstract. But then let's go into the practice. Let's imagine a team that needs to attain a certain level of flow. If they are not attaining that level of flow, then they have a conundrum. Do I optimize for the flow or do I optimize for solving the problem I really have in my hands? So how are you managing that conversation? Because I'm sure it's coming up all the time.

[C]

I think that's a really good point. Like I said, this is something I think about it almost every day. I think one of the ways I could help the system to live with that polarity is first of all, I'll make it very visible to the leaders. Deming have a good point about if you set the metrics or if you set targets for the people, they will achieve the target, even if that means destroying the system around them. And that's very unhealthy, this natural human behavior. There is nothing to blame there. The only thing to blame is the people who set those targets. But I think when I come from a more empathetic perspective from the leaders, we say, what is it that you want to achieve by these metrics? Then I think that's one thing. So by understanding what they want to achieve, I think I can facilitate a better conversation. We can help you achieve those in a different way. And I've had quite a lot of success with them. So when you go and talk to the right level of leadership and you have that conversation, when you go past that, the corporate thing and this is what everyone have to do, say, look, I really want us to do this and I want the engagement of the team, achieve this and that. So, well, what if we do that but some of our metrics drop? Well, it's not ideal, but that's what I want. You know, surprisingly, the leaders want that as well. Right. So that's one way to kind of understand the intent. Number two is, which is the typical, you know, coach response is I actually asked the team, I said, look guys, we need to achieve these numbers. We don't want to spend too much time on achieving them. I call it sometimes, although I don't encourage it, but I call it the tax to pay or the license to play. So I said, well, there's a tax. We need to do a little bit of this extra work to achieve these numbers. But really if we deliver, if we create value for our customers, they are happy. And if the team dynamic is right, if we have the right performance, those metrics, we could have it. And you know what, this is a surprising reaction I got from the system. Not all of them. The moment we have that conversation, most of those other metrics improve as well.

[B]

Yeah. So I can totally see how bringing a more adaptable perspective to the team. Right. The tax to pay, the license to, to play, as you describe it, it kind of makes it playful. It doesn't make it like a top down imposition of something bad. Right. Like it tries to Incorporate it in a way that can become, I would say that the inefficiency of the metric can be absorbed by the team. I get that and it makes perfect sense. I do worry about the other aspect which is that flow metrics or cycle time, lead time, throughput at a team level, it's actually quite useless from understanding and optimizing the overall goal of the organization. So the other thing that I worry is about these metrics that are applied to a specific point in the overall organization. So it could be an individual or a team, or even a subset of teams that can, and by design they will sooner or later have a negative impact in some other part, but that negative impact in some other part is not going to be visible. So for example, one team can be optimizing for throughput, which affects flow time. But by them having to optimize for throughput, let's call it the QA team optimizing for throughput, they are not going to help the developers, the development team, achieve their goals. Their going to make it harder for the development team to achieve their goals, therefore affecting the flow time of the development team. So what kind of thoughts and ideas have you brought to the organization to kind of bring that, that, that topic of the overall performance rather than the team level or individual level performance?

[C]

Yeah, I mean this specific case, let me add this context. You know, they are in a really, they're in the fifth evolution of agile transformation and agile adoption. Right. So they have been significant amount of time spent in the last couple of years to structure the organization in a way that teams are aligned to value streams. I think we've kind of removed a lot of that. Effectively the teams are part of value streams, that part of design is already done. Right. And most of our metrics are kind of end to end metrics. So I just want to add that, you know, they've gone to the, to that process of optimizing for team versus understanding the value streams. That's a whole different conversation I'd like to have later maybe because I think even value streams are not necessarily the best tool for us because you'd imagine you have. The analogy I use is the difference between total production line versus a Pixar studio. Right. So the metrics that apply to Toyota production, like if you're applying the same, if you're applying lean metrics to your Pixar studio, you're going to kill Pixar Studio. Why? So worse, if you apply the approaches and method of Pixar studio production, they will go bankrupt in less than A month. Right. Context sensitive is quite important. None of them are by self or bad things. But if you apply these metrics, approaches, whether it's lean, agile or any other approach you take, if you see them as universal laws that apply everywhere, then that's the failure. But if you see them as context sensitive, depending on the team, depending on the evolution of the environment, the organization, evolution of the market. A big part of open system delivery is also you start externally, you start from outside in versus inside out. A lot of organizational transformation that they fail. And even beyond agile, and not just agile is they have such an inward looking. They try to optimize everything and say well what are you optimizing for? If you got to start from outside and you want to start from not even customer, you have to start from broader environment, then industry, then customer and then and only they start thinking about your products and value streams. And even then I think we've reached to a point that we are. The paradigm is now beyond product. Now I think I see a lot of product operating model gaining a lot of traction. I think product paradigm by itself is probably it finished 10 years ago. Now we are into scenario based and ecosystem business model where there isn't a single product, customers are part of the broader ecosystem and they team multiple products for different scenario of their life to use your product. If you're focusing on your product only remember that your product is a tiny bit as a broader scenario that the customer is trying to use in their life. The only model that help you succeed in that is if you use scenario, customer scenarios plus ecosystem model. When you open up your business and you start interacting with other players, even your competitors in the broader ecosystem.

[B]

That's actually a very good point and I think a huge topic for another episode this ecosystem perspective of business. If you would wrap up this conversation. Alidad, what do you think are kind of the key insights from your own experience and the issues, the topics that you're struggling with right now? What are the key insights that you would want our listeners to take away?

[C]

I think if we talk specifically about. That's a very broad question by the way. But if you bring it back to the first, to your first question and my. The challenge that I raised, I think remember organizations are very large, very complex, right? It takes, even if you look at the nature, it takes a long time for things to evolve. You have to allow you either have a platform of fire or a visionary leader or chance that you can make a lot of change in a short amount of time, which probably is not Even a good thing. Or you have to accept the fact that organization goes through these learning cycles. It takes a long time for a large organization to change its behavior, even a single individual. We drink coffee a lot in Australia. Right. So try to not drink coffee for a week, even for a single person. One practice. It's very hard to change your behavior. Imagine for organization of hundreds of thousands of people or I don't know where the.

[B]

Where there are emerging behaviors that no single individual.

[C]

Lots of emerging behavior, lots of external forces, systemic forces, internal systemic forces. So one of the things is be patient.

[B]

Yeah, that's definitely important.

[C]

Understand very organization is in the life cycle. I don't want to justify bad behavior for a lot of leaders. There's certainly that. But look, I think what I find is if we take responsibility for our freedom, we'll always find ways to move the system, but it may not necessarily be with the speed that we expect. Have their own rhythm and speed.

[B]

Absolutely. And check out yesterday's episode where Ali dad presents the book that helped him gain this perspective. Thank you for that, Ali Dad.

[C]

No problem. That was a great question.

[A]

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