Do you know how and what to measure for Business Value?
Do you know how to create collaborative conversations with Businesses? With IT?
Are you measuring the right things to justify investment tradeoffs in your Scaled-Agile Transformation?
Whether you are just emerging from traditional project methods, in the throes of a Scaled-Agile Transformation or getting settled into your Scaled Agile Framework for Enterprise Transformation, business, operations, and technology leaders need to be laser focused on understanding how to measure predictability in terms of the flow of value through the system.
The enterprise and government level of your SAFe Transformation uses Value Stream and Lean Portfolio Management (LPM). Adopting LPM provides a plug-in method to visualise and measure the flow of business value. We measure and track how the results of business products are supported or not by technology. And both the former and latter enable us to support our people to continuously experiment and improve.
In this article and a few more, we will show you how to measure organisational flow of value so that you can develop the mature practices needed to inform the Lean Portfolio.
- Understand the flow of value for key business processes which helps align the virtual organisation.
- Use the right metrics to collaborate with your enterprise partners, business or technical and external suppliers so you can organise and strategize.
- Leverage these to begin communicating [to teams] the need to trial new processes, tools. Thus, modelling how to grow people into managers and empowering them to be the change agents of the status quo.
- Shift organisation’s focus to long-term value, ensure you’re working on the right thing at the right time so you can move toward participatory budgeting.
- And, importantly, provides enough insight to govern by measuring so leaders can confidently communicate the need for teams to continually look for waste and other inefficiencies in processes, try new practices and innovate so you can grow and outpace the competition.
If you are struggling to bring alignment to participatory budgeting, the metrics above and throughout this series will help.
First: Align with the right metrics to drive business outcomes
Too often business and IT cannot find alignment because they are focused on proxy metrics. These metrics bind perspectives at localised levels of attribution; tragically at the cost of a more mature enterprise Agile perspective. We can’t dictate the need to fund value streams across silos but we can show people the data for it.
The close working relationship between business and IT makes this first step easy. Really. Using objective data to track and observe how work moves through the system from ideation to implementation. Flow Time and Flow Velocity need to be measured to understand the impacts of IT on business needs and results.
How To:
Plot Feature Flow Velocity data from your portfolio Kanban Cumulative Flow Diagram against Revenue. They should be synchronised with releases. Everyone should have access.
Figure 1: Tracking value flow during PI execution
The subtlety of presenting these two trends allows you to have compelling conversations around economic trade-offs and prioritisation relative to speed to market vs. accuracy and quality. Flow Velocity isn’t just about speed. In this context, it is a thermometer for the value being delivered relative to the maturity of an Agile Transformation.
Because you are measuring Flow Velocity over time, Figure 1 also indicates the health of the relationship between business and IT as the thing of value passes through the system from ideation to cash. Ergo, whether you are both aligned on the definition of what a Value Stream delivers and equal value of internal products like platform architecture and refactoring.
Second: What are your constraints to better Flow Velocity and Flow Time?
Do you experiment and measure them?
Experimentation and Innovation isn’t just for Development teams or Product Owners. Wherever you need to do an experiment, track it on a timeline. Clarify tangible markers; usually minor and major integration points, release of an MMF, etc. Yes, anyone can be a kind of scientist when we use empiricism as the discipline. In this case, SAFe provides the knowledge base and framework.
When you use insights from the section above on measuring Flow Velocity to determine the experiment time and parameters, communicate to those doing the work. Set the mission and vision with clear objectives and in no uncertain terms that the organisation needs them to also be scientists and innovate.
The Metrics for this need to also be simple. Figure 2 illustrates each series of a coordinated effort to use Set-based Design to migrate massive quantities of data from on-premises to the cloud over the course of 6 months.
Figure 2: Flow time
Third: Lead by Example
How did they pull this off? It wasn’t easy for sure. It was scary. But it succeeded because leadership began doing instead of talking. Teams began to notice the Portfolio Manager from the APMO. Other managers and even the VP would just show up in the open-space work area with them. Except for specific ceremonies appropriate for their attendance all these leaders were just working on their own assignments. They had conversations about the migration experiments in the open.
All along the metrics were displayed for all to see. With consistent practice, you will now start to master one of the 7 Core Competencies of SAFe Business Agility.
This did several things in a very short time to the culture of the organisation:
Leaders made themselves a part of the ‘danger’ which immediately created a sense of psychological safety.
Stay tuned for the next two steps in the articles that follow where we continue to show you the right metrics CIOs and Epic Owner’s and other Scaled-Agile practices leaders use to grow and empower their Scaled-Agile Transformations.
Next time we will talk about measuring Organisational Agility, to support saying ‘no’ and creating true transparency of resource capacity.
Read Part Two: Lean-Agile Leadership call to action
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