Article

4 Advantages of Agile Methodology & How They Compare to Waterfall

January 03, 2025

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Emily May

Every agilist needs to understand the difference between agile and waterfall approaches. Why? This distinction helps us select the most effective project management method to meet our desired outcomes based on the nature of our work.

This article examines the four primary advantages of agile methodology compared to waterfall, supported by practical, real-world examples. 

What Is Agile Methodology?

Agile methodology is an iterative process for managing projects and products to promote ongoing adaptability, collaboration, and value delivery. Agile methodology derives from the twelve principles outlined in the Agile Manifesto. 

Some popular examples of agile methodologies include:

  • Scrum
  • Kanban
  • Extreme Programming (XP)
  • Lean Product Development

Read our article explaining the difference between agile methodologies and frameworks. 

When To Use Agile Methodology

Agile approaches are best suited for knowledge work. Instead of following a strict plan, complex projects like product development or marketing strategy require nuanced problem-solving, creative strategy, adaptivity, and ongoing analysis.

Agile methodology helps knowledge workers perform tasks in short iterations, collect feedback at pre-determined milestones, and implement their findings for continuous improvement. 

What Is Waterfall Methodology?

The waterfall methodology is a predictive process for managing projects. Unlike agile methods, which call for iterative development, the waterfall approach adheres to predefined steps.

Features of waterfall methodology include:

  • Gathering all project requirements before the implementation process begins
  • Following strict process guidelines & milestones
  • Maintaining comprehensive documentation at every stage
  • Minimal opportunity for changes throughout the process

Traditional project management follows the waterfall methodology and offers very few opportunities for feedback and improvement during the process.

When To Use Waterfall Methodology

The waterfall approach is best suited for task work and in spaces where “best practices” have been established. Tasks like managing customer service inquiries or documenting meeting minutes follow pre-defined, streamlined procedures. 

Because task work requires little innovation and is subject to less uncertainty, the waterfall methodology provides pre-defined steps for efficiently completing projects. 

4 Advantages of Agile Methodology & How They Compare to Waterfall

This section highlights the major benefits of agile methodology and how they stack up against the waterfall approach. 

1. Continuous Improvement

cartoon person looking at cyclical icon with in with options and they are selecting one of those options

One of the most prominent advantages of agile over waterfall is the emphasis on iterative development. The benefits of iterative development for knowledge work include:

  • Seeking continuous improvement
  • Embracing change
  • Identifying risks & opportunities early
  • Adapting quickly to feedback

Adaptability is necessary to remain competitive as technology and markets evolve rapidly. Iterative development provides milestones for teams to pause, reflect on feedback and challenges, and identify opportunities for improvement. 

Iterative improvements can apply to a team’s processes, products, or culture. 

Continuous Improvement Example: Imagine working for an AI assistant platform similar to ChatGPT. The customer service team noticed a trend in users asking for accessibility features like audio capabilities. Your team was able to begin building and releasing the prioritized accessibility features within just a few weeks. 

The company's iterative development process ensures that the development team promptly addresses real-time product performance and feedback. This workflow allows the team to incorporate their new learnings into short-term product plans for rapid product improvement and high customer satisfaction.

Waterfall Comparison: The waterfall model doesn’t use iterative development but follows a strict, step-by-step process. Because accessibility features were not included in the initial project plan, a team using the waterfall model didn't begin working on the initiative until several months later. The company's lack of iterative development prevents the team from promptly acting on customer feedback and incorporating it into its current project plans. 

2. Emphasis on Customer-Centricity

two people looking into different customer profiles and information

Agile methodology places a strong emphasis on customer-centricity. The benefits of customer-centricity for knowledge work include improved:

Customer-centricity refers to focusing on customer feedback loops throughout the development process. This strategy ensures that the product continues to evolve with customer needs and market conditions. 

Collecting customer feedback can include conducting customer interviews, interacting with customers on social media, conducting customer product testing, and reading reviews. The agile team will then discuss the feedback and decide if a change is necessary to improve customer satisfaction. 

Emphasis on Customer-Centricity Example: Two artists create and sell one-of-a-kind phone cases online. Their small business has a growing social media following, so the owners often seek design feedback from their audience. 

When the business owners prepare a mock-up for a new phone case design, they ask their TikTok audience for feedback. They read through comments to learn what customers think about the overall layout, colors, and whether to remove or add elements. Some commenters also provide new design suggestions. 

By collecting feedback on mock-up phone case designs before moving into production, the artists can tailor the design to suit the audience's interest. This process improves the likelihood of their customers taking an interest in the phone case designs and ultimately purchasing.

Waterfall Comparison: What would happen if the same small business followed a waterfall approach? The artists would create the mock-up and design the phone case without customer input. In this case, the artists create phone case designs based on their assumptions instead of tailoring them to customer preferences.

3. Frequent Value Delivery

cartoon of a person from a company providing value to a customer

Another key agile principle is delivering value to customers often. The benefits of frequent value delivery for knowledge work include improved:

  • Resource management
  • Customer satisfaction
  • Customer retention
  • Competitive advantage

When teams prioritize continuous value delivery, they aim to release new product updates often. Valuable product updates can include a brand-new product capability or an improvement to the user experience. Further, agile teams won’t wait until an update or product is “perfect” but instead release the update with minimum capability, also known as a minimum viable product. 

Frequent value delivery ensures that the agile team consistently delivers and innovates something new on their product. As a result, the product remains competitive in the market, and customers are consistently delighted.

Frequent Value Delivery Example: You work for an airline and are planning the next iteration of work items. Your team will enable users to submit questions and concerns directly through the airline app instead of calling or emailing. 

By the end of the iteration, your team has added the capability for all app users to submit a ticket through the app. The new feature has limited functionality, as users can submit a ticket, but the communication will still take place over email. 

Even though the beta version has limited functionality, users can take advantage of the immediate benefits. 

Waterfall Comparison: Using the waterfall approach, the team would not release the new feature until all the capabilities of that feature are built. However, this prevents customers from taking advantage of benefits sooner, which can make the product less attractive compared to agile competitors.

4. Cross-Functional Collaboration

cartoon of people in a meeting with two people working on a white board with another next to a computer offering an idea

Cross-functional collaboration is paramount to creating dynamic products. The benefits of cross-functional collaboration for knowledge work include improved:

Collaborating only with colleagues of similar knowledge can create an echo chamber and result in stale solutions. Agile teams seek dynamic solutions through cross-functional collaboration.

By bringing together expertise and perspectives on the customer experience, cross-functional teams can align on key themes, solve complex problems, and develop creative solutions.

Emphasis on Cross-Functional Collaboration Example: The same airline from the previous example organizes a cross-functional customer experience team to reduce the number of support tickets. 

The cross-functional team includes customer service, marketing, IT, and product experts. Through discussion and brainstorming, the group realizes that the support tickets focus on the lack of flexibility in their booking policies. 

Their solution was to build a case and an action plan to make their booking policies more flexible. This pivot would positively impact revenue and the customer experience, ultimately reducing the number of support tickets. 

Waterfall Comparison: Conversely, the waterfall model primarily focuses on maintaining work within particular departments. In the airline example, the customer experience team is likely to have been tasked with finding a solution to reduce support tickets. However, this limits the support team to solutions under their control. 

Conclusion

cartoon of a person showing icons of the four advantages of agile methodologies over waterfall

Many agile organizations utilize both agile and waterfall approaches to achieve business outcomes. Teams that leverage agile methodology to manage knowledge work can benefit from continuous improvement, customer-centricity, frequent value delivery, and cross-functional collaboration. Conversely, the waterfall model is useful for repetitive tasks in the realm of “best practice,” requiring little external input or innovation.

Want to learn more about how to apply agile methodology within your organization? Join our next Agile Fundamentals course. You’ll learn:

  • The history of agile & cultivating an agile mindset
  • Value-driven development
  • Including customers and users in the development process
  • Process and product adaptation

Read & download the full PDF of the Agile Fundamentals learning outcomes to learn more. 

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TAGGED AS:
Foundations, Agile Fundamentals, Business Agility Foundations

About the author

Emily May | ICAgile, Marketing Specialist
Emily May is a Marketing Specialist at ICAgile, where she helps educate learners on their agile journey through content. With an eclectic background in communications supporting small business marketing efforts, she hopes to inspire readers to initiate more empathy, productivity, and creativity in the workplace for improved internal and external outcomes.

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