Here’s how value stream management can help enterprises still struggling to know exactly what value is being derived from their software development efforts.
By Eveline Oehrlich
Originally published on enterprisersproject.com November 19, 2020
The next normal requires organizations to advance their journey toward digital savviness. The need for ongoing software innovation and delivery is becoming a top priority for all businesses today thanks to the new digital demands organizations are facing from their employees and customers.
And while many businesses have already adopted some flavor of new methodologies, such as Agile, DevOps, and SRE (to name a few), to support their software development initiatives, organizations that want to mature their efforts should also be adopting Value Stream Management (VSM).
Value Streams help ensure that software and services under development deliver value for employees or customers. Plenty of enterprises still struggle to know exactly what value is being derived from their software development efforts.
[What are value streams?]
Both IT and business leaders are constantly being questioned about business value, customer satisfaction, ROI, and whether their approach is successful. They’re all hungry for key performance indicators (KPIs) that prove the increase in quality of software products and can provide details on positive impacts on customer and employee experience. VSM can play a critical role in answering these questions. However, for VSM to be truly effective, IT and business executives must be aware of some of the challenges that need to be overcome.
Here’s what you need to know about the good, the bad, and the ugly of Value Stream Management.
Value Stream Management’s key benefits
To understand the benefits, one must look at the hierarchy of processes. At the highest level, value streams examine the work across organizations, functions, or departments. The goal is to eliminate waste and disconnection. The process level is work within a process, function, or department. The goal is to increase efficiency and quality within the process. And the task level is that of steps that are performed within a process.
The goal is to standardize the way of work. By understanding the interdependencies and details within the value streams, the interacting processes, and the different tasks performed within the different teams, quality and velocity improvements can be made while cost and risks can be reduced all with the goal of optimizing continuous improvements. When starting at a value stream level, it enables a product team to develop an integrated, top-down, strategic transformation plan for key processes and depending tasks.
The good: Conversations are shifting from the “what” to the “why” of Value Stream Management
There’s little debate about what VSM is thanks to the continuous evangelizing and success stories from organizations that have adopted it. The increased desire and demand for improved software delivery with associated value has finally settled the discussion on what VSM really is. Now the conversation is shifting to “why:” Why is VSM so important?
The biggest driver – and benefit – for VSM is the opportunity it offers to balance business value versus resources. With CIOs and business technology leaders aiming to accelerate into high-performing software delivery teams, this balance is extremely important.
The good news is Value Stream Management is being finally adopted for the right reasons. Any organization is bound to fail with VSM anytime it’s used to reduce staff sizes, add work without eliminating waste, or simply focus too heavily on just the technology. And while some organizations may have adopted this type of VSM approach, the true adopters are leveraging VSM for sustainable and continuous improvements around velocity, quality, efficiency, and performance.
The other good news for VSM is that the stakeholder map used as part of the discipline is expanding to include a broad set of owners across the value delivery chain, including members from a variety of teams such as program management, business teams, and representatives across the software delivery value chain. By expanding the stakeholders included in this discipline, organizations using value streams are making strides in their efforts to shift from a project to product mindset.
The bad: Total commitment is still a challenge (but that’s changing)
The single most significant key to a VSM implementation is that all stakeholders of the value chain must adopt total commitment to VSM theories, concepts, and tools. For example, if the planning team and the development team adopt VSM as a concept and solution but the Ops team is not included, key customer feedback details that arise from the support stages are lost. Therefore, to drive change, total commitment must be present across the product team, and there must also be executive support.
The software delivery stream is a complex network of linked stages and activities. Organizations need to understand what happens before “Dev” in the plan, design, and creation stages, and after “Ops” in the customer feedback and support stages. Organizations that do not invest in fully comprehending these different linked stages are missing out on the overall benefits of achieving wasteful handoffs and improving the software delivery process.
The ugly: Existing silos prohibit progress
It doesn’t matter if your organization understands why VSM is important and has even made a commitment to including the right stakeholders. The ugly truth is that silos still exist in many IT organizations. And some good work may be happening within these silos, in the traditional sense – we all know those siloed teams that achieve high output, solid performance, and deliver on their projects. Unfortunately, this is a very narrow focal point because of conflicts in priorities and goals for siloed projects, with dependencies causing additional toil and potential blame.
Ultimately these organizations are hindering value instead of delivering value from a holistic perspective, regardless of whether they deliver software or services. To enable progress, these leaders must change their focus from working on projects to delivering products. Once that begins to happen, VSM stands to make great headway in organizations. Among the ways this can be achieved is by creating new organizational roles such as a product owner. These product owners can see the abysmal, suboptimal work being performed across the value chain, and identify where to further reduce waste and improve collaboration to achieve efficiency, speed and quality.
Building trust and motivation
The Agile Manifesto states: “Build projects around motivated individuals. Give them the environment and support they need and trust them to get the job done.” This principle is a critical requirement for organizations that truly adopt Agile. The leverage of value stream management, with measurements and details shared across the value stream, supports the Agile concepts. Having such broad information available across a value stream makes people see waste and allows them to uncover true cause and value without finger-pointing. This results in much-needed trust and motivation.
While there are still some kinks to iron out in Value Stream Management, it’s encouraging to see how much progress is being made.
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About the Author
Eveline Oehrlich is an industry analyst, author, speaker and business advisor focused on digital transformation. Eveline is the Chief Research Director at DevOps Institute where she leads the research and analysis for the Upskilling: Enterprise DevOps Skills Report and other research projects.