The effects of working agile on team performance and engagement

Purpose This study aims to examine the relationship between the agile way of working and team performance and engagement. Furthermore, psychological safety climate was investigated as a mediator of this relationship. As organizations are increasingly adopting the agile way of working method beyond the information technology (IT) setting, the authors researched its effects in teams across a variety of functional domains. Design/methodology/approach Survey data was collected from 97 agile teams working in various functional domains in a multinational bank. The data was analyzed using structural equation modeling. Findings Results indicated that the agile way of working is directly and positively related to team engagement and performance. Moreover, psychological safety climate acted as a partial mediator of each of the respective outcomes. Originality/value This study illustrated that the agile way of working is beneficial for teams beyond the IT setting, as it is positively associated with psychological safety climate, engagement and performance across functional domains.