Rapid changes in the workplace have necessitated the development of several working solutions. One vital solution in recent years is agile working alongside other flexible working methods. Companies in the new world face new opportunities and problems due to the precarious state of the global markets and various industries, thus, necessitating rapid adjustment policies for new working methods. In a world where technological solutions have become necessary, companies in the software development space may also be roped into the search for effective workplace strategies to optimize their core competencies and retain market dominance. This research paper reviews agile workplace strategies in the context of Spotify, an audio streaming service company, and presents compelling recommendations for further implementations of agile workplace strategies.

Background

            Spotify has grown into one of the ubiquitous applications in the modern world. Founded by Daniel Ek and Martin Lorentzon in 2006, a proprietary Swedish company has grown to become one of the most extensive music streaming, audio, and media services providers (“About Spotify,” n.d). The company’s headquarters are in Stockholm, Sweden (“About Spotify,” n.d). As of December 2020, Spotify had 271 million active users, including 124 million paying subscribers (Zhang et al., 2013). Spotify offers two tiers of service: a free, ad-supported tier and a paid subscription tier. The free tier allows users to listen to music on demand, but with ads between tracks (“About Spotify” n.d). The paid subscription tier removes ads, allows users to download music for offline listening, and gives access to exclusive content and features (“About Spotify,” n.d). Spotify has been a public company since 2018 and is traded on the New York Stock Exchange (“About Spotify,” n.d). The company has been profitable since 2017 but has faced criticism for its slow growth from some financial insiders (“About Spotify,” n.d). Nonetheless, the company provides a practical foundation to understand the potential of using an agile workplace strategy within a large institution.

Spotify has a broad set of external stakeholders, mostly comprised of listeners (consumers) globally. The firm’s digital music service provides access to millions of songs, is available in more than 60 countries, and has more than 200 million active users (“About Spotify,” n.d). The company is organized into three main divisions: Spotify Technology, Spotify Global, and Spotify Labs, with each division serving unique roles (Zhang et al., 2013). For instance, Spotify Technology is responsible for developing and maintaining the Spotify platform, whereas Spotify Global is responsible for marketing, sales, and business development (“About Spotify,” n.d). On the other hand, Spotify Labs focuses on research and development (“About Spotify,” n.d). Based on the company’s past, it is evident that Spotify’s core competencies include its user-friendly interface, robust brand positioning, vast music library, and ability to stream music without requiring a download (Skog et al., 2021). In addition, the subscription numbers indicate a critical element of the company’s competitive advantage by showing how the firm has a loyal user base (Skog et al., 2021). Therefore, the firm will likely continue recording significant positive results in the future.

Industry Needs

            Digital music services such as Spotify require a high-speed Internet connection to stream music without interruption (Kniberg & Ivarsson, 2012). For several reasons, a high-speed internet connection is essential for digital music services companies (Kniberg & Ivarsson, 2012). Firstly, it allows for near-instantaneous music streaming, essential for a good user experience, by minimizing buffering and other problems that can occur when streaming music (Kniberg & Ivarsson, 2012). Additionally, a high-speed internet connection reduces the amount of data that needs to be downloaded, which can save on bandwidth costs (Kniberg & Ivarsson, 2012). Finally, it can allow for higher-quality music streams, improving the listening experience.

Digital music services also require ample storage space to keep a library of songs and albums. The importance of ample storage space for digital music services cannot be overstated. With the ever-growing popularity of streaming music, it is more important than ever for music services to have ample storage space (Kniberg & Ivarsson, 2012). This assertion is because an ample storage space allows music services to keep many songs and albums on their servers, allowing them to offer their users a wider variety of music. Furthermore, a large storage space also allows music services to keep many songs and albums in high-quality audio formats, which is essential for users who care about audio quality.

There is also a need for digital music services to be compatible with a variety of devices, including smartphones, tablets, and computers. Digital music services need to be compatible with a variety of devices in order to be accessible to as many people as possible. Smartphones, tablets, and computers are all common ways people listen to music, so digital music services must work well on all of these devices. If a digital music service is not compatible with a particular device, it may be difficult or impossible for people to use it, limiting its popularity.

Content Analysis

The following section presents theories and concepts related to the effective development of an agile workplace strategy. The section will provide a foundation to understand agile workplace strategy as applied by Spotify and present potential recommendations for improvement.

            Agile workplace strategy presents a sensitive relationship between personal interests and firm welfare. Sometimes referred to as Activity-based working (ABW), agile workplace strategies ensure that employees can work flexibly using agile methods by selecting and hopping between various unassigned workstations with differing levels of privacy (Kavantera et al., 2020). Organizational imperatives and personal preferences are not conflicting issues. However, they must work in tandem and intersect to provide optimal preferences, as elucidated by the models operated in specific countries like the Netherlands (Kavantera et al., 2020). Therefore, Kavantera et al. (2020) infer deliberate and conscious measures to ensure that agile organizations have lucid objectives that combine personal and firm objectives for the best possible outcomes.

According to Owusu (1999), agile workplace strategies require employee involvement. Owusu (1999) focuses on human resources development, arguing that employee involvement is a vital component of a world-class agile management system. Therefore, according to Owusu (1999), improving management systems in an agile setting necessitates a sufficient employee-centric framework to achieve the core aims and objectives. Some reflective attributes of an agile working space that values employee involvement are that employees are proactive and forward-thinking and value open communication with healthy interpersonal feedback channels (Owusu, 1999). Additionally, Owusu (1999) posits the strategic value of employee involvement and communication for agile world-class management systems accentuating the value of effective communication and the positive impacts of employee involvement in agile management techniques.

Even though agile workplace strategies offer significant benefits, there are several innate shortcomings that firms must consider to ensure they accentuate potential outcomes. One critical challenge of agile workplace strategies is the load on collaboration projects (Lal, 2018). According to Lal (2018), combining different workplace strategies in the same setting, for example, combining waterfall precepts with agile strategic aspects, can trivialize the inherent challenges one strategy presents and accentuate the aggregate benefits of both elements. Therefore, Lal (2018) asserts the need for an agile workplace strategy to reflect precepts of other strategies in tactful congruence to present optimal outcomes.

Julian et al. (2019) present a novel theory of agile process evolution, which includes theoretical and practical precepts of execution surrounding aspects of agile workplace strategies. The first stage in the agile process evolution is the “big bang” process, where people in the higher ranks in an organizational structure offer a broad set of principles that the team follows in the initial stages (Julian et al., 2019). Through individual and collectivist aspects, the teams accumulate experience with the principles and offer their inputs about practices that could be improved or replaced (Julian et al., 2019).On the other hand, a divergent theoretical perspective that can infer critical information related to adopting an agile methodology is the gradual adoption process (Julian et al., 2019). In this process, the teams are presented with an initial choice of the various practices that suit them in a workplace setting (Julian et al., 2019). Therefore, according to Julian et al., 2019 understanding the agile process evolution is necessary because it can infer critical directions on the potential outcomes of the workplace objectives

Spotify Employee Retention and Recruitment

Spotify values employee retention and recruitment congruent with the precepts of agile workplace strategies. According to Issa et al. (2019), agile workplace strategies prioritize employee retention to ensure that the organization can benefit from workers’ abilities. Spotify is cognizant of employee retention and recruitment elements associated with agile workplace strategies. Additionally, Spotify accentuates employee retention because of the need to maintain a strong company culture (Tingvall, 2022). Furthermore, employee retention fosters a sense of belonging, optimism about the future, and engagement among remote workers (Tingvall, 2022). Therefore, Spotify is conscious of the aspects of employee retention associated with the agile workplace strategy.

An additional aspect of Spotify’s agile workplace strategy is effective employee recruitment. According to an interview with Daniel Ek, the company head, the firm is conscious of specific aspects of the working environment, arguing that the firm must expunge static jobs (Cain, n.d). According to the firm’s head, the agile workplace strategy encompasses efforts to include employees in decision-making frameworks, where the firm seeks information on redundant jobs and positions requiring new talent (Cain, n.d). These abovementioned efforts are critical in ensuring conformity with the broader agile workplace strategy.

Cost Control Measures

Cost control measures entail strategies for determining the actual expenses of an organization against budgeted or estimated expenses to address variances (Salameh & Bass, 2020) proactively. The measures include directly addressing the company’s budget variances to initiating corrective actions that reduce unexpected costs. Various cost control measures can be taken in order to keep costs down. One measure is to keep track of all expenditures and set a budget. Another measure is to make use of cost-effective methods and materials. Spotify carries out regular maintenance checks to ensure that all equipment and resources are in working order and only uses necessary equipment and resources to control costs (Salameh & Bass, 2020). This process includes checking all electrical and mechanical systems, as well as any software systems. Spotify also regularly checks the premises and grounds to ensure that everything is in good condition and that there are no health and safety hazards (Salameh & Bass, 2020). Therefore, the firm has a practical framework to keep its costs within control.

Spotify keeps track of all expenditures to set a budget and control costs. This process includes monitoring employee spending, vendor contracts, and product costs. Spotify does so a software called “Finance.” This software allows Spotify to see how much money is being spent on what and where they can cut back if need be (Vonderau, 2019). For example, if Spotify sees that they are spending a lot of money on marketing, it may decide to cut back on that area to save money. The organization further uses such information to make informed decisions about where to allocate its resources and how to best control its costs. These measures help Spotify keep its overhead low and maintain a profit margin.

Spotify uses cost-effective methods to keep its costs down. One way they do this is by using lower-quality materials. For example, the company uses lower-quality audio files, which take up less space on their servers (“About Spotify,” n.d). This strategy saves them money on storage costs. Additionally, Spotify uses cheaper marketing methods, such as online advertising, allowing them to reach a larger audience without spending as much on marketing campaigns (“About Spotify,” n.d). Lastly, Skog et al. (2021) posit that Spotify is a prolific user of the freemium marketing strategy where the firm offers a free version of its digital music services without specific services, allowing it to attract more users and gain more subscriptions.

The organization has well-defined communication channels that help control costs by preventing unnecessary wastage of time and resources. In order to establish good communication channels between all team members, Spotify relies on several tools and processes (Smite et al., 2019). First, the company uses a tool called “Slack,” a messaging platform that allows for real-time communication between team members(Smite et al., 2019). This strategy is crucial for Spotify because it allows for quick back-and-forth between team members to resolve problems or discuss new ideas (Smite et al., 2019). Secondly, Spotify holds regular team meetings to ensure everyone is on the same page and knows what needs to be done (Smite et al., 2019). Lastly, the company has a process for handling conflict resolution, which helps keep communication channels open and prevent problems from festering (Smite et al., 2019). Therefore, current applications of agile workplace strategy have assisted the firm in having a credible hold on communication, reflected in optimal outcomes.

Remote Workplace Issues and Challenges

The Covid-19 pandemic has necessitated a change in tactics by most firms adjusting to the new norm. Most firms had to incorporate changes in strategies when encompassing the myriad of variables in the remote working environment. According to Marek et al. (2021), agile software development teams (ASDT) were not materially affected during the pandemic because of the innate benefits of an agile workplace strategy. Most ASDTs had prior experience working remotely or in distributed teams (Marek et al., 2021). As a result, most ASDTs could make the switch to complete remote work (Marek et al., 2021). Therefore, switching to remote work during the pandemic significantly reduced expected workplace issues and challenges.

In addition, various challenges associated with the pandemic’s effect on the workplace were aggravated by considering ongoing projects. Because of the transient nature of software development and the significant reliance that Spotify company has formed on its online platform, the pandemic increased anxiety about the potential of handling product backlog and vision. Even though the company has not released an official report on the state of affairs, Marek et al. (2021) assert that the pandemic had no substantial effect on the product backlog and vision for firms adopting an agile workplace strategy. Additionally, most ASDTs did not alter their Definition of Done (DoD) or release frequency, elucidating the minimal effect of the pandemic on the caliber of work (Marek et al., 2021). Therefore, an agile workplace strategy allowed most firms to reconcile some innate challenges associated with remote workplace experiences and the projected effects on the core competencies and the general outcomes.

Recommendations

Implementations of further developments of agile workplace strategies at Spotify require several considerations, including

• Evaluation of the remote working capacities
• Current product backlogs
• The vision of potential future development
• Competition from other firms and the potential for change

Therefore, Spotify should have compelling directions on the future trajectory of their workplace strategies

Conclusion

In conclusion, Spotify’s agile workplace strategy has been implemented to fruition. The inherent pillars are critical to understanding the strategy’s resilience during the Covid-19 pandemic. The future of Spotify’s agile workplace strategy is associated with the firm’s vision, the current backlogs, and the potential trajectories of the industry to reflect potential competition.