DevOps Institute

Here’s Why We Need Value Stream Management

Value Stream Mapping and Management

By: Romnick Acabado

April 13, 2020

Register for SKILup Day: Value Stream Management on March 18, 2021

It is crucial to have transformational leadership, elastic architecture, DevOps design (CICD, continuous testing and monitoring), technical practices, and cultural norms to increase our ability to deliver applications and services faster. Previously, I looked at the transformation of idea to business value. We know that it is impossible to improve the value stream without connecting the concept to deployment and to value realization. Within the value stream, we have learned that we start with the customers’ challenges, uncertainty and ambiguity, then we come up with a solution that will give us high confidence, stability, and opportunity for business growth.

In another article I wrote about the core behaviors of leaders, I showed that, based on Gartner statistics and published experiences, many organizations are failing in DevOps adoption. Still, the market agrees that more and more organizations will be adopting DevOps as the standard way of delivering software and its maintenance.

To be successful in DevOps adoption, we need to improve inspection, transparency, adaptation and connections between people, processes, and technology.

Without value stream management, an organization can encounter the following:

·   Misalignment of business vision, strategies, and goals with the IT Teams

·   Missing focus lead and lag measures which are both important

·   Inability to provide better visibility and traceability of results which removes awareness on what to keep and improve

·   IT is a cost center and not a profit center

·   Scattered IT landscape

Why Value Stream Management is necessary

It’s essential to understand the flow of work across the value stream from the idea to software deployment and ensure that we set up feedback loops until the customer or the user realizes the business value.

In the flow, we expect to see the constraints, bottlenecks, capacity concerns, redundancy, negative emotions that affect behaviors and performance, or any other waste that can stop the business in achieving the goals of the company. By understanding the end-to-end flow (value and time) and by taking the best practices and empirical research, we can measure, strategize, and continuously improve based on target business outcomes.

These things are not easy to execute and require the right people and higher engagement with innovation.

Every business’s goal should be to focus on enabling business responsiveness and success by reducing the lead time from an idea to software delivery and value realization. Every strategy needs to have an execution plan and metrics to achieve the goals from the organization level down to the team level. The cadence of accountability is also part of the discipline.

What is Value Stream Management?

The technical definition is, “Value Stream Management is a new strategic and operational approach to the data capture, analysis, planning, and implementation of effective change within the core cross‐functional or cross‐company processes required to achieve a truly lean enterprise. The new approach involves a strategic review of a business or supply chain’s activities, the delimitation of key processes, and the mapping of these processes. A description of how to analyze and synthesize these data is followed by a section on an approach to planning strategic and operational change together with a framework in which to do this. The benefits and limitations of the new approach are summarized.” Source: researchgate.net

My definition is that Value Stream Management is a management approach that focuses on the end-to-end flow of customers, their challenges, and ideas (as input) to target business value (as output) through best practices and by the elimination of wasted time and resources. This type of management helps companies to be more competitive in their markets and improve their business performance.

In Value Stream Management, we aim for product rather than project orientation. We aim to architect the value stream based on the results that the business needs.

Value Stream Management Best Practices:

  • Being product or market-focused by living with the products which are strategic for the organization, focusing on the enhancements with high ROI, stability, and scalability
  • Removing skill-centric silos and adapt to an autonomous or dedicated squad model with cross-functional and application members
  • Directly mapping IT teams or squads to business requests – the Spotify model is a good example
  • The team or squad wholly owns change management or pushing of code and releases through a continuous approach and decentralized structure (peer-reviewed)
  • In terms of timelines, product lifecycle measures and adjustments are essential within end-to-end flow from customer to ideation to operation to release and to the creation of products
  • Build the product through agile principles and the Scrum framework to shorten and amplify feedback loops
  • The team has a culture of “high trust and fail early” within the value stream
  • The focus is on the flow (cycle time): this works well for constantly changing applications
  • The team has a focus on the realization of value outcomes and not just about doing their job
  • Understanding on how to share business strategy and its measures compellingly is essential
  • Proper change management process and engagement of DevOps Leaders are necessary

What Flows in a Value Stream?

This table is an excellent reference to understand flow items and their importance:

Flow Item Delivers Pulled by Description Example Artifacts
Feature New business value Customers New value-added to drive business result; visible to the customer Epic, user story, requirement
Defect Quality Customers Fixes for quality problems that affect the customer experience Bug, problem, incident, change 
Risk Security, Governance, Compliance Security and Risk Officers Work to address security, privacy and compliance exposures Vulnerability, Regulatory requirement
Debt Removal of impediments to future delivery Architects Improvement of the software architecture and operational architecture API addition, refactoring, infrastructure automation

‘Project to Product’ (Mik Kersten)

Value Stream Metrics Examples

  • Velocity
    • a simple measure that can be used to measure the rate at which the Scrum development team has been able to complete a task and delivered the business value.
  • Efficiency
    • correlation of actual work time and waiting time
    • Efficiency = Actual work time / (Actual work time + waiting time)
  • Lead Time
    • Start to end time of a process from the customer perspective
  • Cycle time
    • Start to end time of an internal process (ex. code integration to deployment)
  • Value Stream Flow Time
    • total duration from request to release a feature
  • Team Capacity
    • can be analyzed by the trend of Done over time
  • Happiness
    • can be measured on a scale of 1-10

VSM: Where to Start?

To start with value stream management, we need to start small and take the first step by identifying a pilot product value stream that may have low risk but can be visible and impactful to the business.

[Check out: Value Stream Management: The Good, Bad, and Ugly]

In my previous articles, we talked about why it is important to not begin with big-bang transformation and why it should be through incremental productivity. We do not want to start with a reorganization or with a specific application only.

Then, we have to identify the innovators and early adopters who will be part of the change agents. They have to be dedicated members of the team and not just working on this ‘side of the desk’. These change agents will be empowered to lead the setting of shared goals and corresponding execution plans. They will play an essential role in understanding the value stream flow. One of the ways to do it is by using a value stream mapping tool, which helps in getting a time diagnostic and illustrates how work is done end-to-end.

It is crucial to collaborate visually, understand the flow across activities, and identify waste and make improvements.

The goal is to plan in short horizons (weeks not months) through the use of tools that can allow us to achieve continuous flow to reinforce desired behavior. The target is to model the chosen pilot product, make the adoption, work, and success stories visible primarily to the executives.

The happiness of the team that works within the product value stream is also a priority. It will be necessary to celebrate success, especially when the business results related to value, cost, and quality are achieved.

LINK TO ORIGINAL ARTICLE

 

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