Spotify Agile Model: What it is and How it Works

Product development is a complicated process, what works for some might not work for others. Ever-changing business dynamics keep product managers on their toes to keep a lookout for the methodology that works for their company.

When trying to find the product management technique that’s right for your business, looking at other successful companies is a good starting point. One such company is Spotify which saw massive growth thanks to its unique approach to product management. It managed to increase its customer base to 15 million active users in just six years.

Spotify is one of the largest and fastest-growing music streaming platforms in the world. They owe their fast growth to their innovative product management systems. This process, called the Spotify Agile Model, attracted other Silicon Valley companies to try the same thing.

In this article, we’ll learn what the Spotify Agile Model is, how it works, and the benefits and challenges you may face when applying it to your own business.

What is the Spotify Agile Model?

The Spotify model is an autonomous approach to product management to scale Agile operations. Compared to other agile methodologies like SAFe or Scaled Agile Framework, the Spotify Agile Model is unique. It breaks through traditional frameworks and is organized based on tasks rather than a specific set of instructions.

The Spotify model was first introduced around 2012 by Henrik Kniberg and Anders Ivarsson who published the Scaling Agile @ Spotify Whitepaper. This document detailed the key elements of the Agile model they were using at the time.

This process streamlines agility by empowering employees to work as self-organizing teams, free to choose their way of working. Teams are divided into squads managed by a product owner. These squads don’t work in isolation but are organized into tribes which help maintain the organizational structure and encourage cross-functional collaboration.

How Does the Spotify Agile Model Work?

Spotify’s Agile model was the main driver of its rapid success. They used this model to scale their Agile operations to thirty teams located across three different cities! The model started gaining traction with many Silicon Valley startups which nudged the product managers at Spotify to publish their whitepaper discussing how the model worked.

Here’s a breakdown of the key elements.

Squads

A squad is the basic unit of the product development process at Spotify. Similar to Scrum, squads are self-organizing, cross-functional teams assigned a long-term objective like building the music player.

Team members in the squad have the necessary skills and tools to design, develop, test and release a product. Which makes it kind of like a mini-startup. Squads can decide their own way of working and which framework they plan on using (Scrum, Kanban, SAFe, etc.)

However, squad members don’t just work separately doing whatever they want. To keep a check on the squads and maintain efficiency, a quarterly survey is conducted to see where support is needed.

At its core, the Spotify model assigns the following to each squad:

  • Mission – what their main objective is and what shape the roadmap will take
  • Product owner – one who communicates product goals and vision and prioritizes tasks
  • Agile coach – guides the squad to stay productive and make efficient use of agile tools

Although they have flexible working practices, it is preferred that squads apply lean startup concepts such as creating MVPs (minimum viable products) for data-driven processes.

Tribes

A tribe is a group of squads that work together in similar areas of production such as developing Spotify’s radio experience or music player. Each tribe has a tribe lead who encourages collaboration and maintains effective communication with other squads.

Every tribe is limited to less than 100 people based on Dunbar’s number which states that the maximum number of relationships a person can maintain is 150. To keep everyone up-to-date, tribes hold casual gatherings to regularly exchange ideas and review work.

Chapters

To maximize efficiency, specialists in related fields are grouped as chapters. Chapters are a group of people that have a similar skill set within the same tribe. Chapters provide a needed cap on the autonomy of the Spotify model so the company can continue to cross-collaborate and work together as a whole.

Chapters are usually led by a senior developer called a chapter lead. Each chapter regularly meets to review their work, keep each other updated, and share solutions to common challenges.

Guilds

Guilds are a group of people that are grouped with general interests. Guilds encourage a community of interest where team members can join voluntarily and enhance the learning experience. There is no official leader of a guild but it does, however, have an unofficial guild coordinator.

Chapters and guilds are pretty similar, the only major difference is in chapters, people have to be from the same tribe, whereas in guilds, people from different tribes can join the guild based on interest. For example, developers could join a guild of testers to learn about the testing process.

Trios

Trios are a combination of the tribe, product, and design lead. Trios are assigned to every tribe to ensure there is alignment between the team members working on a certain feature.

Alliance

An alliance is a group of tribe trios. They are designed to help tribes work together on bigger, more complex problems which may not otherwise be possible for a single tribe. As organizations scale, they need to ensure tribes are aligned toward business goals.

What are the Benefits of the Spotify Agile Model?

The Spotify model has proved to be great for scaling agile operations. 

Here are the main benefits of the Spotify Agile Model.

Focuses on Autonomy

The self-managing of Spotify’s Agile methodology motivates team members to make their own decisions. 

Empowering squads with this level of independence can improve productivity and overall satisfaction. Team members don’t have to adhere to exhaustive ceremonies and formal processes to complete projects.

Increases Trust and Encourages Collaboration

At Spotify, people with similar specialties and interests are grouped as chapters and guilds. This kind of dependency increases trust within squad members and offers increased transparency between departments and different levels of management. It’s designed to improve interpersonal communication which leads to idea sharing and better problem-solving.

Regular meetings are also conducted to keep everyone on the same page. These meetings are specific to each squad, tribe, chapter, and guild where there is constant sharing of ideas and knowledge.

Leads to Innovation

Spotify encourages squads to spend 10% of their time on “hack days.” Hack days are time slots that enable squad members to come up with innovative ideas and enhance their knowledge. It gives employees an innovative environment to brainstorm and stay up-to-date with the latest Agile tools and techniques.

This environment can lead to breakthroughs in the product development process, ideas for a more efficient or productive workflow, or even a whole new product.

Streamlines Agile at Scale

Given its unique Agile scaling method, Spotify’s model provides a better framework than other traditional management techniques like the Waterfall. It’s the reason Spotify grew from a 30-person tech startup to a 250-person company in just three years.

Spotify credits its Agile method as the main driver of success in scaling its operations and becoming a globally renowned music streaming giant.

What are the Challenges of the Spotify Agile Model?

After seeing the huge success of Spotify, many companies started to copy the Spotify model. However, applying the Spotify Agile Model didn’t prove to be successful for many organizations.

Some companies failed to take advantage of the model because they rearranged their product management system without considering the possible challenges they may face.

It Doesn’t Work for Everyone

Although this Agile methodology worked for Spotify, it may not work for your company. The reason this model helped Spotify succeed was that it suited its specific work culture. Every business is different, so copying the model is a huge risk.

Henrik Kniberg, who was partly responsible for publishing the Spotify Agile Model Whitepaper, noted in his blog that he found it a bit “scary” when companies started to copy the model. Before you apply the model to your business, you should first consider the context of your business, or you might waste a lot of time and money changing your framework.

No Clear Direction

The Spotify Agile Model promotes an autonomous approach to working. At first glance, this may sound great–but this model can be disastrous if not implemented properly. Productivity may decrease when there isn’t a clear plan of action and teams are left on their own to decide what to do.

This can confuse and lead to wasted time. Teams need guidance to ensure they’re on the right track. Appointing an official product manager for squads can lead to better output, focused on achieving company goals.

May Lead to Increased Conflict

Because squad members are involved in more than one group, they may have conflicting interests. In this Agile model, team members are usually involved in two groups – a squad and a chapter. Sometimes they are further included in a guild.

This increased responsibility may ultimately lead to employee dissatisfaction and cause conflicts within a cross-functional team. Also, some members might focus on achieving their squad goals rather than combining their specialization with others to maximize productivity.

Does Spotify Still Use Agile?

It’s no secret that the Spotify Agile Model proved to be successful in building the Spotify business into the global giant it is today. However, many downfalls led to Spotify later dropping the model.

One of the main reasons the model failed in managing Spotify was because of its high level of autonomous practices. People need an established framework or some guidance to work together and this model didn’t offer much.

Numerous people working however they wanted didn’t always prove successful. As projects got more complex and trends changed faster than ever, it was difficult for managers to adapt without some structure.

Conclusion: Should You Use the Spotify Model?

Hopefully, this article has shed light on the Spotify model, how it works, and the challenges you may face when applying it to your business. Spotify used this exact model to achieve exponential growth in its first few years as a tech startup.

The Spotify Agile Model became popular for its simplified method of scaling agile operations in enterprises. It has started to become the blueprint of many tech firms and many organizations have seen a positive uplift in their growth after application.

However, Spotify has since dropped its once game-changing model, which goes to show there is no perfect managing style. 

Before spending time and money to implement the Spotify Agile Model for your business, it’s crucial to take into account the context of your organization. Your goals, workflows, systems, and work culture may be vastly different from Spotify’s – which is one of the many reasons nobody should copy-paste a model from another business, expecting the same outcome.