value stream management example

An IT team can be deploying a hundred times per day, but if their work is not connected to the needs of the business, the results will not materialize for the business either. Flow Metrics are constructed from the combined work of all the contributing practitioners across the value stream. The software industry has seen amazing organizational transformations with DevOps, which has evolved from its early focus on teamwork and empathy to driving actual value to the organization. agile, DevOps and value stream management are complementary forces, and together can help drive the most possible value by creating visibility and metrics for success. But theyve only partially delivered; at the current rate of disruption, half of S&P 500 companies will be replaced in the next ten years. Or to even know what your value streams are. Theyve gone from taking weeks or months to release a new version to deploying changes multiple times per day. But how do you know if your software delivery factory is efficiently delivering value to your customer? However, because software development and delivery is complex in large organizations, it can be difficult to map the value stream from end-to-end. This unlocks the ability not only to measure what is in the value streams now, but how they got there, and trends over time. This includes where there are delays, where there are more defects and rework being created, and insights into how to remove that waste. The ratio of cost to value is essentially a profit and loss (P&L) for each team. Flow Metrics create a clear set of end-to-end value stream metrics that can be shared by both IT and business leaders. Unfortunately, proxy metrics are misleading, as they do not tie directly to business outcomes and cannot be relied upon to present an accurate picture. For example, during the release process additional testing is executed (security, static/dynamic analysis), and if issues are found during that stage, work will go back to Engineering. It is not a small task to align business objectives with IT work, accelerate the software delivery process, and improve software quality. But is that all that flows through a product value stream? This creates dependencies on things like shared services and resources. This allows release managers to put their effort towards improving the value stream through release planning and scoping, assessing release risk, and improving the efficiency of the SDLC through automation and efficient orchestration. It enables organizations to do value stream management given the complex nature of software delivery knowledge work. Lean and value stream thinking originated in manufacturing (Toyota car manufacturing, to be precise) but have become highly popularized in software delivery by the DevOps movement: With developers releasing code changes more frequently thanks to Agile, DevOps set its sights on getting those code changes running in production faster. Project to Product. Lean product development is a much less developed, researched and applied practice. It begins by creating a value stream map, identifying the desired business outcomes, and implementing a value stream management platform. The Product Model is crucial here. The Lean Institute, Introduction.). They can identify where work is slowing down and piling up, so you can find the fastest routes to production. The Integration Model connects the tools and routes the work as it progresses from team to team, discipline to discipline, specialized tool to specialized tool. But keeping the job has become much harder. Value Stream Management: Is the process and automation that enables people to manage dependencies across a complex organization Provides insights into how to break those dependencies to optimize flow Supports the transition to agile ways of working Enables automated, continuous compliance and auditability. From each relevant tool, the Product Model carves out the subset of data pertaining to a specific product value stream and includes only that data in the value streams Flow Metrics. They visualize current and historical flow for a product in terms of business value creation and protection, and they correlate Flow Metrics with business outcomes. To optimize the return on investment and the ability to delight customers, each step in the value stream should be creating value in the customer-centric definition of the term. For value stream management to work, an organization has to invest across people, process and tools so its imperative that these investments are justified. Well explain how to do that later on in this article. Consider Flow Metrics as the vital signs for software delivery. Test environment managers constantly receive booking requests for specifically configured environments. This means eliminating waste throughout the SDLC, including test environment management. What is a value stream in software delivery? (Martin, K. & Osterling, M. (2014). Value Stream Mapping. All Rights Reserved, This is a BETA experience. Once you have created your value stream map you can begin to work with your software development and delivery workflow from end-to-end. They provide a clear indication of whether your flow is healthy, trending positively, and can support the business results youve targeted. Product quality, implementing DevOps, executing SAFe, even increasing release velocity, all require an optimization of value streams to succeed. Naturally, with the stakes so high, there is zero tolerance for another failed transformation. Value stream management solutions are capable of collecting and compiling all those data points and drawing a map of how value flows through your teams. Forrester defines value stream management as A combination of people, process, and technology that maps, optimizes, visualizes, and governs business value flow (including epics, stories, work items) through heterogeneous enterprise software delivery pipelines. Again, value stream management is all about being able to better deliver value to the customers. The implementation process is straightforward as value stream management platforms like Plutora integrate directly with your existing tools. How then can a software delivery organization optimize the end-to-end value stream, if its made up of two very different value stream segments? Every CIO and VP of Software Delivery hears their department heads and managers saying they simply have too much work and too little resources. Systematically improve your digital transformation journey while scaling Agile and DevOps across the enterprise. Enterprises and agencies that have implemented DevOps have reaped dramatic benefits. These metrics are used as indicators of the health of your value stream and how it is changing over time. These metrics build on the concept of the flow item to provide insight into what is happening within the value stream itself. However, too often, the headlong pursuit of higher productivity in software delivery leads to well-intentioned initiatives that ultimately fall short of their goals. After all, software products and services that delight customers are what fuel the growth of organizations today. It also helps to improve the flow of value to the organization, while managing and monitoring the software delivery life cycle from end-to-end. IT Revolution, p. 9). Traditional businesses have been implementing digital transformations for nearly two decades, in an effort to achieve parity with digital natives. Software delivery organizations have a value stream per product, application or service. If youre after end-to-end Flow Metrics, there is no choice but to mine the ground truth from the enterprise tool networks where the work is done and knit the data together. measuring process, activity, and operational efficiencies that are indicative of siloed, local optimizations. Value stream management platforms operate with an integration model that converges toolchains into a common data model that delivers end-to-end visibility and traceability across the value stream. To manage value streams from end-to-end, operational silos between tools and teams must first be broken down. This is because todays CIOs have a mandate to create more business value with fewer resources. Day to day he combines his love for technology with the excitement of telling people about it. There are six Value Stream Flow Metrics, each looking at a different aspect of your value stream. Work moves back and forth between contributors as it progresses through each phase, morphing, changing, and converging in a highly creative process. This can swing engineering and product teams from having little to no insight into their processes to an overwhelming amount of real-time performance metrics. But how do you know youre improving your value stream and not just forcing through a release? Three key organizational characteristics drive the need for value stream management. Organizations cant stop at simply becoming a software company, they need to be a high performing one. IT Revolution, p. TheFlow Framework is a prescriptive approach to value stream management that recognizes this complexity and solves for it. The Value Stream Metrics, as defined by Gartner in Analyze Value Stream Metrics to Optimize DevOps Delivery include: As you decrease your cycle time and lead time, your throughput will begin to increase. With VSMPs, the teams are able to measure both their cost of operating and the value that they are creating. DevOps is a start, but will only take you so far. The three tenets of improving flow in software delivery value streams are Connect, Visualize, and Measure. Scott started in engineering, and soon enough that turned into teaching. Discipline-specific metrics can often be provided by the tool used to perform that function. This elevates software delivery into a state of continuous compliance as everyone involved will automatically adhere to the governance requirements defined in the value stream management platform. This network of activity takes place in many best-of-breed and specialized tools that have grown through the Agile and DevOps movements. McGraw-Hill, p. If an organization manages software delivery in terms of value streams, it can identify what steps are value-adding, and which create waste to begin to optimize the flow of work through the value stream. Fixes for defects that impaired product usage is another clear example of a flow item. Furthermore, the Integration Model also provides the tool network with the elasticity to expand and contract, to evolve and change, to absorb newly acquired networks, experiment with the latest tools, and gradually wean off old ones. 8.). The first step is changing the mindset of your organization to see software development activities as closely linked to business goals. This means no one is stepping back to make sure theres alignment. In addition, they communicate the overall picture of how value flows from inception till its final destination, helping organizations make adjustments to get there fastest by eliminating roadblocks, circumventing bottlenecks and rerouting as necessary. This real-time, decentralized P&L information can drive the conversation around changing funding models to more agile ones, such as capacity-based-funding models. All the while, it normalizes, relates and synchronizes the individual work items (artifacts) across tool boundaries, eliminating silos and information bottlenecks and all the non-value adding manual work. Often these are kept very distant from one another in an organization and software teams may be caught up in a completely different set of priorities. It all comes down to the people. The ideal value stream visualization tool gathers the individual work item statuses in real-time and reframes them in business terms, so people can see how business value is flowingnot just work. In order to evaluate the effectiveness of your software practices and tools, you need total visibility throughout the software delivery life cycle. Things that may inhibit value stream management thinking from taking root and producing positive change in an organization could be a culture that is resistant to change. Similar to live traffic apps like Google Maps and Waze, you should be able to visualize and analyze the flow of value as it traverses the value stream network of tools and practitioners. Otherwise, IT and the business will never bridge the crippling divide between them and will remain on opposing sides of a fence. According to the Flow Framework, value stream networks require an information backbone that connects the tools and orchestrates near real-time data synchronization between them. Instead, you must find the metrics that directly correspond to business outcomes. Instead of using their time to handle these requests and discover conflicts, value stream management platforms centralize booking requests and test environment scheduling automatically. PwC Cloud and Digital Transformation BrandVoice, How To Earn Cash Rewards For Everyday Spending. IT Revolution, p. You can identify where flow slows downwhere a constraint is impeding business value deliveryand start doing whats needed to relieve the bottleneck. Together they evaluate how work flows through your value stream so you can understand how your planning, release and investment decisions are improving and protecting your value delivery and how you are progressing on your DevOps journey. Using the latest tools and practices are only as valuable as the business benefit and customer experience. All Rights Reserved . This allows test environment managers to focus on generating value in the SDLC by creating and configuring test environments instead of sorting through hundreds or thousands of requests. As people focus on their product or value stream, project-based funding ceases to make sense. Digital transformation and disruption are driving a transition from waterfall to agile ways of working. Yet IT leadership understandably struggles to make sense of all that complicated activityto see it clearly and to extract insight from it. A CIOs performance is no longer measured by operational efficiency, rather by customer experiences, digital products and revenue generation. Thats where flow efficiency comes in. Value stream thinkers ask: How can we provide greater and greater value to our customersthrough innovationwhile eliminating delays, improving quality and reducing cost, labor and employee frustration? Turnkey, purpose-built value stream management tools can provide Flow Metrics within days. Learning to See. Value stream management is a lean business practice that helps determine the value of software development and delivery efforts and resources. To keep up with software-driven innovation you need fresh approaches to keep teams focused on what delivers or creates the most value. In theory, and when effectively applied, these core elements drive efficiency, high-quality software and faster release cycles. Evaluate the people, processes and tools that are involved and what their dependencies are so that the IT leadership has visibility into how things are working. Value stream management aims to remove waste from value streams by identifying both necessary and unnecessary non-value-adding work. The easiest example of a flow item is a feature that delivers a new product capability, as customers will clearly pay for it if they need it or are delighted by it. If the underlying infrastructure of developing and delivering flow items through the value stream is so complex, how can you truly measure how fast youre capable of delivering critical business capabilities? This is where value stream management (VSM) comes in. Case in point recently, I sat in on a meeting at one of the top 10 largest organizations in the world. Value stream management is much more than metrics. It also means that leadership has an organization-wide performance heat map to help them direct their efforts to support discovery and improvement in teams.As organizations continue to transition from a waterfall, silo-based working model to one built on autonomous teams delivering value incrementally, a key change is needed to financial models. Whenever there is a product for a customer, there is a value stream. (Rother, M. & Shook, J. Value stream management involves taking a look at all the steps in the software delivery process from idea to production the value stream and then identifying silos, bottlenecks, and other inefficiencies in the flow of work to the customer receiving the product. Value Stream Management is a management technique or practice that focuses on increasing the flow of business value from customer request to customer delivery. Value Stream Mapping. The concept of value stream mapping is a part of the lean approach that allows you to analyze the current state of your processes and build a better future state based on the series of events that take your product/service from initial concept to the finished product that the customer receives. For example, Jeff Bezos urged his shareholders to resist proxies for decision making. The practice of value stream management is meant to answer these questions and help to overcome these common pitfalls. Most organizations are complex and made up of many value streams that often interact with each other. However, as teams become autonomous and use VSMPs to measure their value stream, the funding model can be shifted. The DevOps Handbook. The complete view of the value stream captures every aspect of the software delivery process. Ultimately the value of software products is determined by the customer. Even after Agile and DevOps, organizations find themselves unable to accelerate delivery fast enough to preempt or react rapidly to disruptions from startups, competition and market changes. Is it moving in the right direction? With innovation rapidly changing, the software development and delivery landscape, organizations must remember what is most important.

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