How much of this looks familiar to you?

If you're working in a software or product delivery team,  you probably recognize quite a few of these symptoms, but what are the causes, and how do we get to better?

It starts from becoming clear on what today looks like, along with what better looks like. Everything could always be better, but what's going to make the most positive impact, with the least amount of effort? What's holding us back from getting there today?

To move towards flow and away from friction it takes focus. This is why the Theory of Constraints (TOC) is still the king of continuous improvement models. By mapping the value stream and identifying the most critical source of friction, we can focus on it and improve it. To do that, we have to be able to see, measure, target, and isolate the biggest impacts on flow. That starts by focusing on our goal, so we can make sure we're all seeing the same flow, and have a model for understanding what's between the current flow and our desired outcome.

Let's say we'd rather be here:

Everyone wants to get to automation, but like our symptoms of friction, automation is just a side effect of many other pieces falling into place. 

It all starts with clarity and alignment around a desired outcome, and flows from there through effective collaboration across the value stream.

To find out how to get moving in the right direction, check out my article on Outcome Mapping and the free Flow Engineering ebook and course series

Case: Ambitious Software Delivery Team

Let's look at the example of a team aiming to boost their performance:

Starting from: “We want to deliver software twice as fast without sacrificing quality” we first map that outcome to reveal top contributing factors.

We created an outcome map to clarify a team understanding of the goal, why it's valuable, what obstacles could impact success, key investigations to improve odds of success, and indicators that will reveal progress. The team discovered that out of 8 members, everyone had a different idea of what would contribute to the outcome.

Next we mapped the value stream to reveal the visual flow and collect data on how the work is performing currently, and how it could be improved. We revealed handoffs, delays, tool challenges, meeting impacts and more. The team discovered that 30% of the current process was waste that could be eliminated within the next 3 days. Their target state map was less than 1/3 the time of the current state.

We then mapped out dependencies beyond the team and value stream in question to highlight external factors affecting our desired outcome. Approvals, cross-team meetings, SLAs, and shared services interactions were all clearly revealed as measurable impacts on the team. As one example, the team revealed that there was a 3 business day SLA with shared services that affected the team almost every single sprint.

Finally, we mapped out team capabilities to see what internal factors could affect our progress to the outcome. The team could see how their key capabilities and gaps were affected by available resources and support, as well as ownership and cognitive load. Along with other insights, the team identified ownership gaps and missing backup roles that were needed to support automated testing.

All of this clarity and data fed into prioritization and a clear roadmap defining next steps. The team set off working with awareness, confidence, and alignment. With a few weeks of effort, the team was operating far beyond their target outcome and on to bigger and better things.

What's affecting us from inside the Value Stream?

In the example, you can see how feature delivery is being affected by your two primary bottlenecks which are dependent on validation and test automation, how they are connected to external tooling and infrastructure, and a gap in capabilities. By combining the 4 Key Maps, you can trace a clear path from desired outcome to actionable next steps. In fact, this method will work for any situation, not just identifying how to improve your performance for technical teams, but any process or outcome you want to address. 

"We can now see how contributions within the team are affecting our most critical constraints and our ability to address dependencies. If we can create a playbook to fix the simplest 80% of our build failures, we could resolve issues quickly within the team. We've identified a lead and backup to focus on building out test automation, and highlighted necessary support and training." 

Armed with these compasses and maps, the team has a clear direction, knowledge of the landscape between their position and destination, and supporting metrics to keep them on track. They can easily tackle a prioritized set of initiatives aligned to their true north. They have velocity and quality metrics to inform them when something is pulling them in the wrong direction. They can see the path to success, which they have confidently defined to avoid obstacles and mitigate challenges. They can clearly and constructively collaborate along the way with everyone involved or affected.

"We can now see a clear path to success, together. Everyone from individual contributors to leadership can share the same view and alignment. We went from 8 different ideas of where to focus to 2 clear, prioritized opportunities. We know exactly what to do next, and can act safely in the knowledge that our compasses and maps will keep us on track. We can craft data-driven hypotheses that drive rapid, measurable experiments. We can periodically measure against our baseline to see, share and celebrate progress."

You may have noticed by now that the focus of these efforts is not merely DevOps or software delivery performance, but value stream performance. Well beyond the boundaries of software development and delivery, value streams are the true engines of value in every organization. They encompass every role, department, function, capability, and purpose throughout your company. This means that the skills you develop to improve value stream performance can be leveraged in any scenario where performance is constrained, and targeted improvements can have massive impacts throughout your organization. Value Stream Thinking and these techniques can empower you to drive powerful change.

How do you get from a desired outcome to a target value stream?

If we take a desired outcome like: "Release 2x faster", it's easy to target the release value stream for the product in question. 

• Release what? We want to release our mobile app in half the time.
   
• Why do we want to release twice as often? This may be obvious to you but it's safe to assume it's not obvious to everyone you need involved. Do you want faster feedback from customers? Why else?
   
• What obstacles are in the way? Testing takes a long time, we need approvals from 3 different departments.
   
• What investigations can we do? We could send out a survey (which may raise alarm bells depending on the culture). We could approach our director to ask for support. We could try to map the existing value stream.
   
• How will we measure progress? The first stream will be a big milestone. Having all the streams in a single portfolio is another (maybe aim for 10 a week). Assigning owners for each stream is huge. Having each team assigned to a stream is another big one. Creating a living visual reference would be great as well.
   
• What methods will we use to make progress? Should we collect survey data and document it in a wiki? Create a visual representation? Will it be maintained by the owners?

Having a well understood outcome helps us focus on a specific value stream, because there's a value stream involved in the delivery of that outcome. There's a value stream behind every outcome. Once we know the outcome, we can identify the customer involved, and work backwards to the start of the stream.

By starting with the clarity of the Outcome Map, the team is heading in one direction together. Having a map makes it easy to communicate within and beyond the team.

"We're all on the same page and aware of what may lie ahead. We revealed that our regulatory requirements will demand a careful mitigation strategy, and our lack of test automation is a sore spot."

Let's talk about your next target outcome, or the one you're struggling with now

Book a free discovery call in 2 minutes here

Welcome, I'm so glad you're joining us!

It's the perfect time to learn more about Value Streams and how working with Flow can revolutionize your work.

It seems everyone in the Agile, DevOps and Tech scene are talking about Value Streams in 2021, and for good reason! Business and manufacturing folks have been focused on value streams for decades, but as maturity and capability evolve in tech, these areas are now combining and the best of each world is being applied everywhere.

Who am I?

I'm a tech veteran who's been through support, development, delivery, infrastructure, management, leadership, and now consulting for over 20 years. I live in Toronto, Canada, love running, biking, and frisbee, sci-fi, philosophy, history, and anything I can hear about in a podcast (lets share recommendations!).

I've focused on value streams and flow after seeing the common threads and patterns that have worked best across industries, and organizations of all sizes. I'm sharing Flow Engineering as the culmination of everything I've learned and used to get incredible results for teams.

Course Overview

This course will give you everything you need to start dramatically improving the flow of value across your organization. It's structured as 7 consecutive days (starting tomorrow!) like this:

• Day 1: How to Begin with the End in Mind - Outcome mapping
• Day 2: How to Map your Value Stream - Value Stream mapping
• Day 3: How to See what's Affecting Flow from Outside - Dependency mapping
• Day 4: How to See what's Affecting Flow from Inside - Capability mapping
• Day 5: How to Run the whole Process - An example case study
• Day 6: How to Get Results - Creating a Flow Roadmap
• Day 7: How to Get Help - More Resources and a Special Offer

Flow Engineering

Imagine the path of your workflow from idea to customer as a stream that currently winds throughout the landscape, off into the distance around you, from upstream to downstream. From where you stand, you can see part of the stream as it approaches you from upstream, and you can see a part downstream as it continues into the distance. If you wanted to improve the flow, you could widen the portion around you, or perhaps carve a more direct path from one curve to the next. You wouldn’t truly be able to see what effect your change had on the stream without a view of the entire flow, and the downstream outcome. The stream could be restricted far upstream beyond your view, or downstream. If you had a map of the stream’s path, and measurement of the flow within the stream, you could ensure it followed the most direct path to your destination, and improve the flow precisely where it would have the most positive effect.

This is the power of a mapping approach to improvement. By creating and leveraging maps of the flow of value in your organizations, you can create the optimal flow of value, by changing precisely what will have the greatest impact. 

4 Key Maps to Improve Flow

The 4 Key Maps provide a comprehensive view of the landscape that your value stream traverses. Using the maps to guide your focus, decisions, and efforts, you can scientifically approach your improvement efforts using a visual and easily understood medium.

Homework

• Write down a list of all the value streams that you are connected to in your job (hint: if there's a customer - internal or external - there's a value stream)

Resources

• What is a Value Stream?

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Thanks for reading, feel free to reply with any questions!

- Steve

Who participates in mapping?

It’s important to involve representation from at least the responsible and accountable parties within a given value stream. That means if design is a part of the stream, there should be someone from design present during mapping. That also means that leadership and those who are able to change the system, workflow, and team must be present and involved. Once you identify your key bottlenecks, you can narrow the involved parties to those who are critical to those areas, but until the number of people exceeds a manageable 12 (for a professional facilitator), it’s better to include as many voices and perspectives as possible.

In order to get the highest quality information about the stream, it helps to have 2 voices from each role in order to get a second opinion. If one engineer states it takes 20 minutes to code review, it could be because they're thinking of a section of the code they know very well, or simply being optimistic. Having a senior and junior perspective can be very valuable to paint a more accurate picture of the value stream.

In the case of a large, complex stream like a large, monolithic product, you may have legal reviews, marketing consultations, graphic design, etc. If they're in the stream, they should be on the map, but if including them brings you to an uncomfortable headcount it may be wise to request their data directly prior to the mapping session and then plugging it in. You can use the following format for a survey:

[Product X release process]

1. Which activities do you perform in the [Product X release process]?
2. For each activity, thinking of what has happened the last few occurrences, on average:
   1. What triggers the start of the activity? [e.g. Jira Ticket from Role Y, a meeting, a direct verbal request, etc]
   2. How long does the work sit before you can act on it? [e.g. in a queue, or inbox, etc]
   3. How long does the activity take from start to finish? [e.g. from the time you start looking at it to when you hand it off to the next activity or transition to another activity]
   4. How much of that time is time spent working on the task? [e.g. not waiting for things to load, looking up context, trial and error, etc]
   5. How often do you have to send the work back to a previous step because of an issue? [e.g. missing information, unclear instructions, etc]
   6. How long does the work sit completed before the next role picks it up? [If you know]
3. What do you feel is the biggest bottleneck in the process at the moment?
4. What do you feel is the largest contributor to that bottleneck?

As you can see, it can be a lot of information to collect and synthesize, but the biggest issue is not knowing it. If a survey seems like too much work or a hard sell, you can also complete the value stream mapping in phases with different stakeholders.

This scoping and participation challenge exists only when the value stream itself is too large and cumbersome, which is something we can address through mapping! By moving to smaller, more autonomous, stream-aligned teams, you can map faster, easier, and at higher quality.

Who guides this process?

It pays to have skilled, outside facilitation for this process for a few reasons: A perspective from outside the organization is far less likely to bring an agenda, bias, or political influence to the process, which will drive superior results. A skilled facilitator knows where to dig, and when to move on. They will know what questions to ask, and what seems like a strange measurement based on experience with other teams. All of that saves valuable time and maximizes value. Gathering a team can be expensive if you’re not getting value from the session, and it can impact morale and trust to waste time. A skilled facilitator can likely complete a session in half the time, while keeping the team engaged. You may find you have skilled facilitators right now as agile coaches, scrum facilitators, dojo trainers, community of practice leads, or teachers. It’s ok to pilot the process with a facilitator and team willing to try and learn!

The highest performing companies build alignment around three questions: Why are we doing this? What should we do? How do we implement the transformation?

Boston Consulting Group, 2020

The Outcome Map

Clarify the goal and contributing factors to explore your challenge/opportunity and align those involved. “We want to deliver changes every week” is a fine outcome to aim for, but your odds of success and ability to make key decisions depend on why that’s valuable, as well as what could get in the way.

Why? 

Begin with the end in mind. See and share factors between you and your goal. The Outcome Map allows team members to dig into a desired outcome and begin charting the path to achieving it with open eyes. Doing so will help the team define a clear roadmap towards better.

How do you build it? 

The team comes together to define their desired outcome, and then consider what could impact their ability to deliver it. Defining the Why(s) sets the foundation supporting the effort. Obstacles are the key challenges standing in the teams’ way. Investigation lists your immediate actions to address obstacles. Measures are TBD when you define the map at first, because until you create the following 3 maps, defining effective measures is impossible. You’ll loop back and fill them in. Optionally, you can dig even deeper to add Indicators, Impacts, Roles, and Methods. Indicators list how you will know you’re progressing. Impacts list factors that will affect your progress. Roles list the contributors to the process. Methods, like Measures, wait until you know more. Deciding what to do and how to measure it can’t be done effectively until you truly know where your risks and opportunities are.

How do you use it? 

The Outcome Map is an excellent way to create energetic communication, clarity, and alignment from the start. It also reminds you to stay on track as you progress, and how to know when we’re drifting from the path. By adding measurements and methods, you can describe where you want to go and how you plan to get there.

How do you get from a desired outcome to a target value stream?

If we take a desired outcome like: "Release twice as often", it's easy to target the release value stream for the product in question. 

• Release what? We want to release our mobile app twice as often.
• Why do we want to release twice as often? This may be obvious to you but it's safe to assume it's not obvious to everyone you need involved. Do you want faster feedback from customers? Why else?
• What obstacles are in the way? Testing takes a long time, we need approvals from 3 different departments.
• What investigations can we do? We could send out a survey (which may raise alarm bells). We could approach our director to ask for support.

The real secret to identifying value streams is here. Each value stream has a customer. If you find the customer, you find the stream. Some times the easiest way to map a mysterious value stream is to start from the customer and work backwards. Customer -> Customer Value (or need) -> What is delivering the value?

• How will we measure progress? The first stream will be a big milestone. Having all the streams in a single portfolio is another (maybe aim for 10 a week). Assigning owners for each stream is huge. Having each team assigned to a stream is another big one. Creating a living visual reference would be great as well.
• What methods will we use to make progress? Should we collect survey data and document it in a wiki? Create a visual representation? Will it be maintained by the owners?

Having a well understood outcome helps us focus on a specific value stream, because there's a value stream involved in the delivery of that outcome. There's a value stream behind every outcome. Once we know the outcome, we can identify the customer involved, and work backwards to the start of the stream.

Conclusion

By starting with the clarity of the Outcome Map, the team is heading in one direction together. Having a map makes it easy to communicate within and beyond the team.

"We're all on the same page and aware of what may lie ahead. We revealed that our regulatory requirements will demand a careful mitigation strategy, and our lack of test automation is a sore spot."

Other options

• Impact maps
• Fishbone diagrams
• Outcome orientation (check this out!)
• North Star Framework

The 4 Keys Maps in Context

Below you can see how each map addresses valuable questions, and flows from one to the next. As you progress through them, you add clarity, confidence, and context to support powerful decisions with maximum alignment.

In other words:

• Outcome: Define and clarify outcomes
• Value Stream: Identify and address constraints and waste
• Dependency: Visualize and address external needs and complexity
• Capability: Measure and address internal needs and opportunities

See all the details in the full Flow Engineering ebook @ https://flow.visible.is

I've been digging into and expanding my understanding of value flow in different contexts, and (as I do) visualizing it has been helpful to put it all into context. Have a look and if you're interested in further reading, check out the following for more detail:

Value Networks

Value Chains

Value Streams

Value Stream Mapping

How is Value Stream Mapping Different?

This is Your Organization on Value Streams

Value networks are focused on describing the social and technical resources that exist within and between organizations. The nodes in a value network represent roles or functions in an enterprise. The nodes are connected by interactions, which represent deliverables that might be tangible (product or money) or intangible (regulatory compliance or risk reduction). The primary purpose for creating a value network is to understand the complex web of relationships and areas of value exchange that exist within and between organizations.

A value network is not just a map of the business enterprise, but it is also the process for capturing the relationships between companies, individuals, roles and processes.

Value network mapping shows that all companies are much more alike than different. When leveraging a value network as a map of an enterprise, it becomes apparent how different organizational units can contribute to common needs within the organization, as well as to common requirements.

Many value networks are not attached to a specific organization; instead they are part of a larger consortium of organizations or 'ecosystem'.

To understand what is meant by value networks and how they differ from one other, we should first discuss value networks as research tools. Mapping a value network allows us to visualize, discuss, analyze, and define a value network in a clear and productive way.

How are value networks created?

Value networks can be derived from many different sources, including buyer and seller surveys, third party customer satisfaction research, competitor benchmarking, and historical unit cost data. You can also gather various stakeholders together to map a value network in real time. Value networks can be created for any number of purposes, including product teams to track costs and deadlines, marketing teams to track customer acquisition costs, and sales and operations teams to track performance metrics. Value networks can also be developed to identify potential alignment between companies that would result in greater value, i.e., enhancing efficiency, agility, product quality, marketing efforts, or executive talent.

The value network as a map of the enterprise

You don’t need to create a complete value network to understand how interdependent organizations are. You can map the organizational nodes into a basic diagram to understand how and where business can be performed effectively. Mapping the value network into a basic diagram gives you a clear, visual artifact that can help drive productive conversations and planning and avoid confusion involved in written documents, presentations, or meetings without a simplified representation to refer to.

While a value network provides a framework for identifying critical relationships and business value that exist within the organization, it does not define the value (the end-to-end value) that an organization should deliver. As such, organizations use the value network as a starting point to develop their own value chain and value stream mapping. Value chain mapping can look similar to a value network, but it should not be defined by its map shape.

In the context of enterprise value networks, the network has 3 pillars:

Capability - The nodes in a value network describe capabilities, often attached to roles, functions or divisions, depending on the zoom level of the illustration.

Interaction - You can describe the complex relationship between nodes and describe the logic and terms that lead to value exchange between them as an interaction model. Examples of interactions can be communication, information flow, or value exchange.

Relationship - Your model describes the relationships that exist between nodes. The relationships are based on role (i.e., people, dollars) or function (i.e., design, security, process). Relationship is defined by an established and continued exchange of value and mutual benefit. 

In short, capabilities interact with each other based on their relation to one another. 

The value network as a network of value streams

The most decentralized, autonomous, and productive structure for a value network is a collection of value streams interacting as suppliers and customers. A platform team providing services to product teams, who consume a design system from a design team, and get approvals via a accessible self-service legal system provides an agile, high velocity network without hard dependencies. Each value stream has at least one defined customer (internal or external) and consumes the products and services of others as their customer. This is how a company like Amazon builds loosely-coupled services that can be used individually and interchangeably while providing services to other services and products like Amazon.com or customer applications atop that.

The value network as a map of your company

You can think of a value network as a map of your company, and it is comprised of a set of relationships between people and resources. Many of the relationships shown in the graph above can be understood as contracts between different organizations. For example, in a supply chain, the firm that provides the machines that fabricate the product, hires a firm that provides the design, processes the machines, and maintains the machines. The relationship between these two organizations are contractually clear and the value created by this relationship can be measured in dollars and cents. Similarly, the relationship between an enterprise that builds systems and an enterprise that uses the systems can also be characterized as a contract.

The value network as a map of your industry

If you zoom out, a value network can be created as a map of your industry. That map will evolve over time as industries change and industries are disrupted. You can apply the map to create new value by arranging your nodes into a novel structure, and if you do so well, the value network will evolve in a way that creates shareholder value. For example, if you’re in the AI data processing industry and you’re considering a merger with another company, you might create a map of the data processing industry that shows where both your companies have strengths and weaknesses. If you have a successful distribution system and you’re looking for scale, a merger might look like adding the distribution capability of another company to your existing network, while its products become a part of your network.

Conclusion

In a rapidly changing digital world, information technology is the new treasure chest. The ability to search across information sources and analyze and display them in real-time provides critical insight into the current and future state of your enterprise. This skill is becoming more important than traditional data analysis. With the access to this new, easily accessible information, employees can make better decisions. Data-driven decisions improve the quality of products and services and increase business efficiency.

Without off-the-shelf tooling to provide these insights in the short term, creating a value network map in an online whiteboarding application provides all the benefits of a systematic view of your organizations ecosystem that can help you make powerful, valuable decisions with little investment of time, and no investment in infrastructure. As is the case with all maps, the act of mapping will bring your team together and help generate collective insight, understanding, and innovation.

Read more about Value Chains and Streams here

What are you waiting for?

If you're interested in getting started, shoot me an email at [email protected] and let's talk about your challenges and possibilities.

The concept of Value Chains were introduced by Michael Porter in his book Competitive Advantage in 1985:

“The value chain disaggregates a firm into its strategically-relevant activities in order to understand the behavior of costs and the existing potential sources of (competitive) differentiation.”

In other words, the value chain is the connected activities (or capabilities) that are executed by an organization to create and deliver value.

Introduction

Economic value creation is the process of adding economic value to a business incrementally. Economic value creation is the sum of the value created by each business unit within a given economic system or value chain. Value-addition happens in two phases: 

1. creating a new value; and 
2. maximizing the economic value created. 

For instance, an organization creates a new value by providing a new product or service according to an unmet demand. The organization then maximizes the value creation by matching the end customer’s needs with the product or service which produces the highest economic profit. Value-addition at a company level is captured through the concept of value chain efficiency. In other words, getting the most bang for the buck.

Value Chains

In order to build a proper model of a business and create a more accurate value chain, we need to take a step back and think of the business as a closed system. We need to ask ourselves three questions: 

1. What is the state of the business? The activities which make up the business and the costs that are associated with each one are interconnected. 
2. What are the inputs that make up each activity? Input costs determine the price of the product. The relationship between inputs and prices affect demand and therefore sales, which in turn, influence costs and profits. 
3. What are the outputs? What are the products that are produced? Depending on the end-consumer, demand may also be influenced by competitive forces and government regulation.

The value chain provides a structure to model and frame that thinking, and informs how we can visualize and map it.

More on that in a following deep dive into Wardley (Value Chain) Mapping, coming up!