Costs of compliance: agile in an inelastic organization

Doing agile development in a relatively inelastic environment, where policies and procedures are virtually unchangeable, creates an impedance mismatch between the agile team and its host organization. Our experience on a variety of embedded Java projects has shed some light on the costs of complying (or failing to comply), where we trialed everything from "refusal to comply" to "full compliance". Regardless of approach, there was always an associated cost, whether in redrafting documents, reducing functionality, spending time in meetings, losing focus on deliverables, or deteriorating morale. In keeping with the Agile philosophy, when our efforts were failing, we refactored our approach to managing the project in an effort to minimize the costs of compliance without adopting more risk to ensure success. In the end we were faced with the questions "How did we fare in the end? Which costs were worth bearing? Was it all worth it?".