Lean/Agile - The Art of Doing Less

Our traditional ways of managing software development projects center around generating ideas that are deemed valuable and then attempting to estimate at a detailed level the effort involved by having a team of people work to document ‘all’ of the requirements up front before the project even begins. These projects often will take many months to complete before anything of value can be delivered to the business.

Agile focuses on delivering value as quickly as possible, often within 2 weeks to 2 months. Lean focuses on maximizing work not done, which combined with Agile speaks to doing less as a part of our delivery process.

But what do we mean by less when looking at taking on a large feature/product development effort? 

There are couple of ways that this comes into play:

1.   Software is often littered with features that someone thought would be important to the customer, yet fails to deliver the value (need) to the customer. Worse still this code becomes part of our legacy application, stuff we have to code around and test against regardless if the feature is being used or not.

2.     Often the perceived value of something changes once the project begins, causing the business to pull the plug on work before it is complete and anything of value can be derived by your software development team. This is costly both in terms if financing and employee happiness.

In both cases the business has expended money to have software developed with the end result being the business received reduced or no value.

When looking at Agile Product/Project Management we are asking the business to act not just as the agent of funding but as the consumer of the work as well. Too often the business is a distant or non-existent participant with respect to how their product is unfolding. Instead they rely on project plan updates that speak solely to progress against the agreed upon scope of the project at its inception over viewing what has actually been developed and delivered to date.

In an Agile setting business needs to review the work at regular touch points, often the Sprint review and actually see what is being developed. There is often a great difference between what the business ‘thinks’ they want and what they actually need. Seeing working software lets them see their idea in action, often with enlightening results. What they envisioned may not in fact be what they are seeing and more importantly not what they need (the value). They funded a Ferrari but maybe only needed a good old family sedan.

Business is typically missing in this very powerful process in Agile, a process which allows them to make course corrections and even stop working on features as soon as they reach their maximum value. 

At one large entertainment organization I worked for several years ago, the business had us working on a large rewrite of a heavily used widget that resided on hundreds of thousands of pages. After performing a Discovery and Story mapping session we determined that the work should be done in three releases. At the end of the first release the business reviewed what we had completed and decided that this was actually good enough and then pivoted us to working on an even more valuable redesign of a key customer facing web app.

In the waterfall days the work that we did for that first release would have been put on the shelf, the money invested would have delivered no value to the business. With Agile we were able to complete the work and deploy to production, providing the business real value for their investment. They made the decision to stop this work and move on to more valuable work.

The Art of Doing less is about developing more mature approaches to how your organization funds and manages work. Instead of funding projects fund your teams, allowing for work to flow to them over having them focus on managing project scope to the bitter end of the project.

Move away from believing you have to have fixed scope to one that understands that Agile is about powerful flexibility and maximizing the value of the work that we do, while minimizing the amount of legacy code we leave behind. 

A legacy system that is littered with large amounts of un-needed or under-utilized capabilities is code that is harder to scale, develop in and test against. When your teams talk to you about Tech Debt, this is what they are referring to and as a business you are both a direct owner and contributor to this reality.

The Art of Doing less brings with it a greater ability to maximize an organizations investment in its software and product development.

The focus for business should be on what is needed not what is wanted. Project funding models encourage asking for more than is needed so one of the first things you need to do is to move to a team based funding model. Develop a framework to assess value and risk so you can appropriately prioritize work as it flows through your teams.

Understand that each of your Scrum teams has a fixed cost (~40k per sprint), this should guide you further in questioning what you want your teams to work on.  At some point in time in most projects there comes a point where there is a diminishing value relative to the investment.  

Lean and the Art of Doing less requires changing your organizational mindset to understand there is also value in work NOT done.

Investment Portfolio Management Applied to Product Management

I've been telling myself that I needed to attempt to apply formal investment portfolio management techniques to how we value, prioritize and manage our portfolio of product development efforts, so here goes (definitely still a work in progress)

Back in 1950's Dr. Harry Markowitz created an investment model called the 'Efficient Portfolio'.  Markowitz stipulated with his theory that an "Efficient Portfolio is one where no added diversification can lower the portfolio's risk for a given return expectation (alternately, no additional expected return can be gained without increasing the risk of the portfolio)".

The Markowitz Efficient Frontier is the set of all portfolios that will give the highest expected return for each given level of risk.

 

This model set the framework for how current money managers build a portfolio of securities that provide range of investment returns to meet each investors risk profile.  Providing investors with a broad range of risk/return choices allows individual investors to build an investment portfolio that meets their specific risk threshold with respect to a given rate of return.

An efficient portfolio looks like this:

 

When you are younger and have time to take chances your risk/return profile might be higher on the frontier, whereas at retirement you will slide down that scale as you are more interested in protecting your total investment.  One thing to note is that if your risk/return data falls above the efficient frontier, then you are accepting a level of risk that is not in line with the rate of return you might receive.  Pushing past the efficient frontier can open you up to unexpectedly high returns but conversely you can also expect very high negative returns due to the risk you are taking on.

Product Development organizations can utilize the Frontier as well, for example, a young startup will have a much higher appetite for risk as they understand that to take market share from competitors they need to take risks with speed to market.  However there are specific elements of risk that need to be considered as you speed your product to market.  Ensuring that Usability has been considered, Prototypes have been developed, code quality is considered and test automation all need to play part when you are building your risk/return Efficient Frontier for your Product Portfolio.

If we were to apply the Efficient Frontier to how we manage our Software Development investments we could build a risk/return profile that is easy to understand and align with the organizations risk/return profile.   There are many software projects that at inception are known to be risky, however a lack of empirical data often means that the projects will get the green light and then fail miserably.  The organizations inability to accurately asses risk/return at any time with their software development investments is a huge blind spot and keeps us from consistently delivering the value that the organization needs to stay competitive.

Agile addresses the value (return) part of what the Efficient Frontier speaks to however it talks nothing of Risk overtly.  Risk is more implied with the notion that we manage it by delivering in short increments and focus on shipping value consistently.  However Risk is more quantifiable as I mentioned earlier.

Building an Efficient Frontier in the investment world is a data intensive effort, which our current product/software development processes doesn't easily support.  However I believe that we can use the formula that Markowitz created to generate an Efficient Frontier for Product and Software Development organizations.

For this effort we will make some assumptions with respect to the Frontier model and changes to Markowitz's formula so that it works with our limited data set:

1. Portfolio = Product Development
   1. An organization can have several Products in their Portfolio -
      1. Consumer Facing
      2. Internal Facing
      3. Infrastructure
      4. Research and Development
2. A security is equivalent to a Scrum Team.
   1. These would equate to the individual securities that Markowitz speaks to in his model.  Where an investment portfolio consists of many securities, each with their own risk/return profiles so to does an organizations product development portfolio consist of the same.  Each team is a security that can on its own provide return that comes with an associated risk.
   2. Though we don't think of investment securities as having dependencies (as software development teams have) in fact a diversified investment portfolio consists of a range of investments that will perform a certain way based upon the dependency that business has to the market that they operate in, so in this case the notion of a portfolio still holds as a viable means to build a Product Development Efficient Frontier.
3. Potential Risk Parameters:
   1. Development Lifecycle - Waterfall, Agile, RUP, XP, Blended (use at macro level). You could equate this potentially to Bonds, Stocks or other investment instruments.
   2. Experience of Team
   3. Number of Scrum Teams
   4. % Test Automation
   5. Code Complexity
   6. Speed to Market
   7. Roadmap volatility

In my next post I'll provide some supporting ways we can 'build' an efficient frontier for Agile Product Portfolio analysis that both Product and Program Managers can utilize to assess priorities for the entire organizational backlog.

PMO Role in Agile - Part 2

My initial blog seemed to have some interest judging by the number of views it's received so I'm guessing that it's a topic that many are looking for input on.   So I thought I'd provide some more thoughts as to what a PMOmight  look like in an Agile organization. One of the key things that changes with a traditional Project managed organization is that they must change to one that is Product managed.  What this means is that the organization changes the way that it funds its business by essentially providing Product Owners with Scrum teams that will deliver on their vision for their product.  Given this paradigm, along with the creation of the Scrum Master role, the PMO and subsequent project managers are left outside looking in.

Managing Product driven teams means that you are managing towards outcomes that delivery value over projects that deliver features.

In my previous post I provided some suggestions as to what individual Project Managers could do to make themselves more valuable and productive to their teams.

In this post I will suggest a PMO structure that focuses on the Portfolio view and leaves the operational execution of the roadmap to the Scrum Teams and Product Owner.

For this structure to work the organization needs good Scrum Masters and preferable ones that aren't also individual contributors for their team.

The structure of the PMO will be lighter than you might think is right, but I'll argue that if you have the same number of Scrum Masters and Project Managers you will set up role confusion that will make your entire project management process cumbersome and less productive.

The PMO structure would look something like this:

I think one of the things that a PMO organization needs to be aware of is that their focus is not on control of projects and people but on how teams are performing.

With this structure you have a thinner level of Project Managers who are focused on Program level Product Management (PPM new acryonym anyone?). Your Project Management function becomes one of oversight of Scrum Masters and working closely with Program Managers in other Product groups who probably will have cross org dependencies.  The Program Manager level in this structure is more about working to ensure that teams are working on the right things based upon the Product Roadmap and escalating when individual team priorities become out of line with the overal corporate product objectives.

What we want with a PMO is confidence and how we do that historically is to place controls, gateways and processes designed to show that teams are checking off boxes that we believe represent how a successful project should unfold (aka Project Governance)

How we do that in an Agile organization is to ensure that our teams we have a clear Product roadmap, that we are performing effective planning both in the areas of Product Discovery and Release Planning, that teams are provided time to review and estimate the work that they are being asked to commit to AND ensure that teams perform continual inspect and adapt cycles via Retrospectives.

If teams are allowed to form into solid high performing teams what you get from that is an organization that learns how to estimate accurately, which leads to consistent velocity which in turns leads to predictability....which is what we in the PMO (and Sr Management) are looking for, simple right?

What I learned years ago from my Project Management days is that Agile actually provides you with much more visibility and transparency about what is happening with your commitments,  providing you as the stewards of the product an ability to have fact based conversations with stakeholders who rarely understand the complexity of what they are asking for.