A couple of interesting articles by Jared Spool in which he shares his observations of effective and not-so-effective design and development teams as they strive for user-focused developments.
The first was, to me at least, a no-brainer. The way to make your team more user focused is to get them to watch and engage with end users on a reasonably regular basis. This needn't be a big thing; just a couple of hours every few weeks. But the benefits to both development and management focus are there to be seen in Jared's examples.
Fast Path to a Great UX: Increased Exposure Hours - article by Jared Spool
The second looks at user experience issues specific to agile development and what he terms "lean teams". To me at least (and I'm by no means an experienced design manager) the method of development is a bit of a red herring.
Agile or Waterfall? It depends on a number of factors. Agile does not necessarily equal good. Waterfall is not necessarily bad. Neither automatically bring user focus. Personally, I've had great experiences adopting an agile-ish approach to user-centred design techniques tacked on to the early stages of a waterfall process.
Essential UX Layers for Agile and Lean Design Teams - article by Jared Spool