Updated: Jul 27, 2020
It is expected that businesses will invest $7.4 trillion on Digital Transformation between 2020 and 2023.
That said, in 2018 businesses invested £1.3 trillion into transformation initiatives but, a massive 70% was wasted on failed programs.
The biggest reasons for failures are not people or Agile teams. It is the business's failure to communicate value and purpose of the transition effectively with Agile teams.
Here are 10 reasons how Value Streams can help identify, communicate value and purpose of Digital Transformation.
But what is value stream and why should businesses invest time and energy in mapping value streams?
Value Stream represents a series of steps that businesses use to implement Solutions which provide a continuous flow of value to customers. It includes all the steps from a concept to implementation of the solution. It also includes people who do the work and tools that will be used to deliver this value.
Value stream visualises these steps in a simple flow diagram available for everyone in the business to view. This activity is called Value Stream Mapping.
First reason: Bridge function silos
Generally, businesses are organised around function silos such as departments or divisions. Each department or division typically has their respective objectives and limitations. This results in delay and inclusion of waste during delivery. In this setup businesses loose customer centricity and fail to deliver optimal customer value.
Value streams cross over job functions, departments and divisions aligning people and tools to a common mission. Hence bridging function silos.
Businesses that invest time and effort in mapping value streams deliver value to their customers in shorter lead times compared to their competitors.
Second reason: Minimise delays with the delivery of solution
One of the biggest reasons for delays is the time Agile teams have to wait for other Agile teams to complete their work or resolve a bottleneck.
Value stream connects people from different areas of the business into a cross-functional team with built in capabilities such architecture, software development, operations that have full autonomy to define, build, test, implement including release if needed.
Therefore, reducing the time people and teams have to wait before they can deliver their work. Ultimately, reducing the overall time to deliver a solution.
Third reason: Eliminate waste
The larger a business is, it is likely that each function or department of that business will have their own goals and objectives. This can lead to the inclusion of wasteful activities that consume resources but do not add value to customers.
Some common examples of wastes are:
Context switching - when a developer working on different priorities is constantly interrupted
Over-production : Producing features that customers are never going to use
Over-processing : investing time in developing complex solutions to address simple problems
Unfinished software: Work that is still in the queues not earning any money
Value Stream mapping enables businesses to see the big picture and highlights non-value adding activities. This is so that businesses can focus on value-add activities and deliver solutions in shortest sustainable time scales.
Fourth reason: Build lasting and stable Agile teams
With a project-oriented setup, teams are built to do a specific piece of work and then dispersed. What happens to that project after the team has been disbanded? It becomes unsustainable overtime. Usually after a number of unsuccessful attempts to hand over the solution to service teams or even unresolved defects and technical debts.
Value streams ensure a continuous flow of work is brought to stable cross-functional teams. Resulting in the development of high-quality sustainable solutions by teams empowered to design, build, test, deploy and release.
Fifth reason: Identify and address bottleneck quickly
I am sure you have often heard team members saying; “I am blocked” . Do you always know where your bottlenecks are? You may know some of the bottlenecks that often block team members. But, will addressing that bottleneck ensure quicker delivery of value to your customers?
Value streams help with the identification of the biggest bottlenecks in the process.
Take a look at this example:
A simple new feature request should take a maximum of 11 hours, if there were no waiting time. However, it takes 7 weeks to deliver a simple new feature due to delays because of bottlenecks.
After plotting a Value Stream map, it helps identify biggest delays or bottlenecks in the flow. In this example the biggest bottleneck is waiting for developers to be free.
Starting by addressing the biggest delay or bottleneck will help improve the overall time scales for the delivery of value to the customers
Sixth reason: Manage Work-in-progress limits
One of the main reasons for poor quality of work and under performing teams is too much work-in-progress. That is, overloading teams with more work that can be done with reasonable comfort.
According to lean product development, If teams are given an appropriate amount of work they are likely to deliver with high quality and on time.
Value stream prevents overloading of work by limiting the number of task items at every step. Thus ensuring that team members are not working on multiple tasks or switching context frequently, which adds unwanted waste.
However, getting to an ideal work-in-progress limit is not an easy task, it requires in-depth knowledge of the product, adherence to process and commitment from all the stakeholders.
If you want further help or advice, feel free to get in-touch with me, either by leaving a comment below or via my website agile4k.com.
Seventh reason: Optimise as a whole
Most businesses focus on improving only a few steps in their process. This is generally motivated by focused individuals who want to improve delivery they are responsible for or the improvements are triggered by changing market needs. However, focusing on a few steps rarely improves the overall delivery of value to customers.
Value stream focuses on the optimisation of the entire process.
Value stream mapping typically spans multiple teams, processes and toolsets. This optimises not just a few steps but the entire process needed to deliver a solution.
For example, a simple value stream map will highlight all of the bottlenecks at every stage in the process.
Eighth reason: Visualise the end-to-end process and offer increased transparency
Most of the points we have discussed so far regarding the Value steam, highlights the importance of flow. That is, first establishing the end-to-end process, then bringing together people & tools and finally streamlining the process by identifying and addressing all bottlenecks.
Value stream mapping visualises the end-to-end process in a simple flow diagram that creates transparency among Agile teams and stakeholders. This also leads to increased ownership and knowledge sharing.
Ninth reason: Build a culture of relentless improvement
We are working in a Digital Age, which is characterised by ever changing technological innovations. To be successful, businesses have to keep up with the change and embrace the disruption. Businesses do this by constantly improving their products, solutions and processes.
Value stream map is an essential tool for constantly improving processes. This is so that businesses can identify improvement opportunities.
Value stream facilitates fast and effective learning at every step of the process by leveraging the collective knowledge within a business.
Teams across functional departments start to focus towards delivering value to customers and contribute collectively to solution development and problem solving.
Tenth reason: Value Stream is inexpensive and easy to map
The final point, Value stream mapping is a fairly inexpensive exercise to run and maintain. It does not always require to start at a business level. It can be done at Portfolio, Programme or even at a team level.
However, for it to be successful Value Stream does need a basic understanding of lean-agile mindset and representation from the relevant teams and stakeholders.
Develop the skillsets needed to guide the delivery of value in a Lean Enterprise by becoming a SAFe 5.0 Product Owner/Product Manager (POPM)
The next course run by Mani Maun (Scaled Agile Partner and SAFe Programme Consultant) is on the 7th of August, register now for £599.99.