David J. Anderson and Associates

Kanban Weekly Roundup - Nov 29, 2011

2011-11-30T04:30:08Z

By Dominica DeGrandis

There’s been a flurry of activity in South America and on the kanbandev yahoo group this week and some are noted below.
It’s been challenging to get to all the Kanban articles and discussions popping up everywhere.
If you should come across something worthy of this forum, please call my attention to it.

News

Why Kanban for Software Engineering matters
http://www.kanbanway.com/why-kanban-for-software-engineering-matters

Holistic Risk Management?
Mike Burrows (@asplake) suggests we, “... think about where, when and by
whom you want risk to be managed; sucking it all into the dev team may not the best way”
http://finance.groups.yahoo.com/group/kanbandev/msearch?query=holistic+&submit=Search&charset=ISO-8859-1

What’s the kanban in Kanban?
http://www.software-kanban.de/2011/11/whats-kanban-in-kanban.html

Using the Mutual Learning Model to achieve Double Loop Learning
by Benjamin Mitchell (@benjaminm) (50 min)
An entertaining video on learning. I like the part about, “The gap is greatest under conditions
of embarrassment or threat.”, where the gap in this case is the difference between what you say and what you do.
http://vimeo.com/30599611

Collaborative spirit of Kanban
http://blog.brodzinski.com/2011/11/collaborative-kanban.html

An older post by Karen Greaves, Kanban Evolution, resurfaced on twitter this week. While some of the terminology
has since changed (ex: “Balance demand against throughput, has been replaced with “Balance demand against capability”),
it’s still a nice concise overview of the Kanban Method.
http://scrumcoaching.wordpress.com/2010/02/13/kanban-evolution/#more-20

Lean and Kanban for IT Operations: How well are you performing?
http://jchyip.blogspot.com/2011/11/lean-and-kanban-for-it-operations-how.html?utm_source=feedburner&utm_medium=twitter&utm_campaign=Feed%3A+YoudThinkWithAllMy+%28You%27d+think+with+all+my+video+game+experience+that+I%27d+be+more+prepared+for+this%29#!/2011/11/lean-and-kanban-for-it-operations-how.html

Events

David J. Anderson presentation in Rio de Janeiro
1 hr 10 min
http://www.youtube.com/watch?v=xMwVwcD4GoI&feature=player_embedded

Agile and Beyond Conference - Dearborn, MI. March 10, 2011
http://agileandbeyond.org/

Lean Software Systems Conference – Boston May 2012
Lean Software and Systems Conference 2012 Keynote Speakers Announced http://t.co/bCt3lLsI #lssc12
http://lssc12.leanssc.org/

Please contact dominica@djandersonassociates.com with questions.

Kanban Weekly Roundup - Nov 22, 2011

2011-11-22T21:54:14Z

By Dominica DeGrandis

Apologies for missing last week’s post. I was completely immersed working with a team in NYC helping them design their first kanban board. Hopefully the extra content will make up for the delay.

News

A nice post by Jason Yip, “Lean and Kanban for IT Operations: What is the Nature of the Demand?” suggests why you should be interested in predictability and how you might go about shaping demand.
http://jchyip.blogspot.com/2011/11/lean-and-kanban-for-it-operations-what_19.html

David Joyce explains why kanban adaption meets resistance from management and includes a bonus link to the 10 min satire, “I want to run an agile project”.
http://leanandkanban.wordpress.com/2011/09/10/agile-lean-and-kanban-change-management-thinking/

Esther Derby continues the discussion of the role of managers in this preview interview with Lean Magazine:
http://www.estherderby.com/2011/11/new-roles-for-managers-interview-with-lean-magazine.html

An article titled, “Scrum and Kanban: Both the same only different”, by Liz Keogh includes an especially interesting section, “Kanban visualizes what’s happening; Scrum visualizes an ideal.” It points out that with Kanban, a key ingredient is making process policies explicit, so they can be addressed and improved upon.
http://lizkeogh.com/2011/11/20/scrum-and-kanban-both-the-same-only-different/

The “Quotable Kanban” ebook is now available on Kindle
http://www.amazon.com/Quotable-Kanban-ebook/dp/B00679LFFW/

Here’s a fun Pecha Kucha talk on “Pimp my Board” by Arne Roock
http://www.software-kanban.de/2011/11/chocolate-bar.html

Events

AgileDayChile2011 – Occurred on Nov 17th - Keynote slides available at
http://www.slideshare.net/chileagil/intro-to-kanban-agiledaychile2011-keynote

Lean Software Systems Conference – Boston 2012
Lean Software and Systems Conference 2012 Keynote Speakers Announced
http://lssc12.leanssc.org/conference/news/

Please contact dominica@djandersonassociates.com with questions.

Why “Capability”?

2011-10-11T22:55:11Z

The eagle-eyed observer of Kanban will have spotted that recently, I and my team have subtly changed some of our messaging. We’ve adopted the word “capability” where previously the term “throughput” was typically used. Why the change?

Those familiar with my Recipe for Success in its various forms published here and in my Kanban book, will know that one of the steps has gone through several changes. Originally, “Balance Demand against Capacity” was replaced in 2007 with “Balance Demand against Throughput.” Why this original change?

Well the original wording was ambiguous and if you follow Eli Goldratt then you will know that he had previously pointed out the folly in such thinking. “Capacity” he pointed out was a volume not a flow. So “capacity” in a kanban system would be the number of (virtual) kanban in circulation (or the total WIP limit of the system.) You don’t balance demand against this. You balance demand against the rate of work being delivered, so the correct term was “throughput,” where throughput means the rate (or quantity over time) of completed work being delivered out of the kanban system.

Throughput

So, why the recent change to “capability” moving away from “throughput”? This change will be reflected in the 2nd edition of the Kanban book (no planned publication date) and in all of our materials going forward. The Recipe for Success will now read “Balance demand against capability.” Why?

I came to realize that using throughput as the metric for success or of determining customer satisfaction is not always appropriate. The customer demands are seldom for more throughput. The demands are often expressed in other ways. There are many contexts where better due date performance or shorter lead times would be more desirable. “Capability” is in this sense an abstract term. Capability can be expressed in many ways. Throughput is just one way of expressing capability. Lead time, its mean, and spread of variation would be another, and due date performance (or on-time delivery performance) would be another. I think these three - throughput, lead time and due date performance - represent the three most likely choices for expressing capability when using Kanban. However, I’d like to leave the definition abstract and encourage other interpretations.

So in future look for us to be communicating that the system level problem is one of a lack of balance between demand and capability. We are pursuing improvements in order to better balance demand against capability. We are assuming that greater customer satisfaction will come from this improved balance. We will therefore design the kanban system solution from the outside, in. Well seek to understand demand and capability and to examine the reasons why capability is impaired and look at how it might be improved. Part of the solution may involve the use of a kanban system and the adoption of an evolutionary approach to future improvements. This is the Kanban Method in action.

Some readers will recognize that this new articulation of getting started with a Kanban initiative by understanding capability and demand and by seeking to identify system effects that affect capability are inspired by the work of John Seddon. This is correct. John has provided me with a better way of expressing what we are doing. Those familiar with the XIT story from MIcrosoft will also recognize that this understanding of capability and demand is exactly what Dragos Dumitriu did before we acted to implement a kanban system solution for his department. Hence, this isn’t new to Kanban but I and my team are constantly learning how to better articulate our work in order to facilitate faster and better understanding amongst those leading change in their organizations through the use of Kanban.

So “thoughput” isn’t out of fashion, it has been relegated to a context specific choice!

Deming and CMMI

There is another reason I love the word “capability”. It is a term that Deming would recognize. It is also the “C” in CMMI for the same reason. CMM (as was) was inspired by the work of Crosby (the Manufacturing Maturity Model) and Deming (the Theory of Profound Knowledge). The “C” in Capability Maturity Model is intended to be interpreted as Deming would have used it. By adopting the use of the term “capability” in Kanban, we are providing clear links to the work of Deming, which we find foundational to much of our teaching and coaching advice. Identifying sources of variability that adversely affect capability and eliminating them through kanban system design, management policy and improved capability, are at the core of Kanban and how we teach it. Further by adopting the term “capability” and providing the guidance that it should be interpreted as throughput (aka “velocity”), or lead time, or due date performance, we are providing clear hooks into CMMI and showing how Kanban can be used as part of a CMMI initiative or how it can be compatible with maintaining or improving a CMMI appraisal rating.

Complexity & Cynefin

In his key note at Lean Kanban Benelux Dave Snowden state that in the complex domain we seek to use an evolutionary approach to change that probes (or experiments) with ideas and then amplifies the successful ones (attractors). He went on to explain that unlike a typical managed change initiative (typical of the 20th Century but sadly still all to common in the Agile community) where a there is a defined destination designed to offer a particular capability - think of “We will adopt Scrum for our next project” or “We will be CMMI ML3 by end of calendar 2012” - a complex space solution must not define a destination but simply allow evolutionary steps to happen. This is exactly how Kanban is designed to operate. However, it creates a problem. How do we know if things are improving? How do we justify encouraging and promoting change? Dave explained that in the complex domain we must measure the impact of a change to know if it is an improvement. This can only be measured retrospectively.

Capability gives us the means with which to measure impact in an emergent reaction to a complex domain problem. By showing improvements in terms of throughput, lead time, or due date performance (as measures of capability), we provide a direct means to assess impact.

Summary

Adopting the term “capability” is more general than “throughput” and reflects the general application of kanban systems and use of the Kanban Method across a range of software development projects, maintenance and IT work. “Capability” is better aligned with the ideas of Deming and modern systems thinkers like John Seddon. It provides a clean way to explain from the outside, in, why Kanban makes sense and the value it is adding - allowing us to better balance demand against capability. “Capability” also better aligns with CMMI and enables those in regulated environments to communicate the value and purpose of Kanban as well as cleanly map Kanban practices such as Cumulative Flow Diagrams to required elements for an appraisal. And finally, “capability” gives us a way to measure the impact of emergent behavior when considering Kanban within a complexity science model such as Cynefin.

We’ve been making some other nomenclature changes. What out for more blog posts explaining the emergence of other new terms in the lexicon of Kanban.

Kanban Training London Dec 5-6, 2011

2011-10-03T15:13:14Z

David J. Anderson’s

Official “Kanban - Successful Evolutionary Change for Your Technology Business” Class

with Mike Burrows (instructor)

This intensive 2-day Kanban training class provides an introduction to Lean, Pull Systems and Kanban and will explain how established industrial engineering theory can apply to software development process.

This class is based on David J. Anderson’s book “Kanban - Successful Evolutionary Change for Your Technology Business”. Attendees of the class will receive a copy of the new book.

For more information or to register, please go to: London Kanban training

Participants in the class will learn how to use the simple process of limiting work-in-progress as a driver of change. Kanban is a change management method and a different approach to striking agreements between IT and the business.

You’ll learn how to define the policies that constrain the collaborative game of software development. You’ll learn how to use those policies to manage risk and to reset negotiations and recast them as collaborative problem solving.

Used effectively, Kanban will change you and your organization. If your workplace has been stagnating and you are looking for new ideas to unleash productivity, innovation, collaboration and creativity, take 2 days and come along.

What you will learn

Day 1 Kanban Mechanics
- Demand Analysis
- Value-Network Mapping
- Visualization
- Work Item Types
- WIP Limits
- Classes of Service
- Service Level Agreements (SLA)
- Kanban Simulation Game

Day 2 Why Kanban
- Recipe for Success
- Case Studies
- Improvement Opportunities
- Understanding Variation
- Bottleneck Management
- Economic Cost Model for Lean (Waste)
- Metrics

About the presenter

Mike Burrows offers experienced thinking and innovation in management and leadership through training and coaching in the UK and throughout the world. He has a background as development manager and IT director in a variety of industries including aerospace, finance, energy and software. Mike implemented his first Kanban systems at the energy risk management consultancy Encore International. In addition to his programme delivery and portfolio management responsibilities, Mike has led a number of successful improvement initiatives, ranging from division-wide capacity management to improved training for business analysts.

Is this for you?

If you are a software development executive, project manager, development manager, project lead or developer and you would like to learn how Lean, Pull Systems and Kanban can provide a useful perspective to consider the entire value chain beyond the pure software development, this Kanban class is for you!

Location:

London, UK

Venue:

TBD

Kanban Weekly Roundup - 9/27/11

2011-09-27T18:32:27Z

For the past seven years, David J. Anderson has frequently blogged on kanban news and events from around the world. Due to his crazy busy traveling schedule, David’s staff will continue the communication through the “Kanban Weekly Roundup”.

News
Geek Wire’s interview with David Anderson, “How an Automotive Secret Can Make For Better Software”, talks about the kanban principles that many people associate with the production of cars.
http://www.geekwire.com/2011/qa-secrets-automakers-software

Here’s a real life example from @Vanwynsberghea of a development team implementing Kanban.
We like this post “How We Use Kanban in Our Development Team” because it’s written from a beginners perspective in a practical manner.
http://vanwynsberghea.posterous.com/72087262

A free Ebook titled “Quotable Kanban” has been released. It’s a collection of wisdom from attendees of the Kanban Leadership Retreat in Reykjavik, Iceland, 2011.
http://agilemanagement.net/index.php/site/quotable/

Events
The programme at Agile Cambridge UK 2011 this week looks expansive with case studies, tutorials hands-on workshops, lighting talks & birds of a feather sessions.
http://www.agilecambridge.net/ac2011/

SD Times is offering a webinar on Leaders of Agile: Best Practices for Agile Development with Kanban hosted by Kent Beck
http://www.sdtimes.com/content/resources.aspx?ShowOnlyResourceID=527

Lean Agile Scrum Konferenz 2011‎ in Zurich with keynotes by Steve Denning and David J. Anderson.
Keynote slides at http://agilemanagement.net/index.php/Learn/

Please contact dominica@djandersonassociates.com with questions.

Kanban Leadership Workshop Miami, FL - Jan 11-13, 2012

2011-09-26T17:28:26Z

This 3-day leadership/coaching workshop with David is limited to just 12 people.

This workshop is for anyone tasked with leading a change initiative in their organization or at a client organization in 2012. It is suitable for managers, process engineers, change agents, experienced Agile, Lean, or project management coaches and consultants, existing Kanban practitioners with 1 year of experience, and those who have previously taken David J. Anderson’s Kanban class and are actively using Kanban at work. Attendees are expected to be familiar with the content of the book, “Kanban - Successful Evolutionary Change for your Technology Business.

These intensive 3 day workshops are intended to transfer the knowledge and skills to enable you to lead Lean transformations using the Kanban Method

The 2012 price for this workshop is $3500 USD per person.

Don’t miss out! Read what others are saying about this workshop.

- Rachel Davies, Kanban Coaching Insights
- Karen Graves, Kanban Evolution
- Armond Mehrabian, Part 1, Part 2, Part 3

Enter Discount code: MIAMI12EARLYBIRD
expires October 31, 2011

A copy of the book will be supplied upon registration. Attendees will maximize the value if they are already familiar with the material.

The intent is to have an interactive collaborative session designed to facilitate knowledge sharing and learning. Attendees should come prepared to discuss their own experiences with Kanban and challenging situations they’ve faced with change initiatives at clients or employers

The workshop will open with a round table of introductions and shared Kanban experience. Each participant will be asked for a list of questions they’d like answered over the 3 day session and from this a topic backlog will be built. David will augment this backlog with essential topics and foundational material. The agenda for the remaining time will then be set to insure the fullest of coverage and the maximum value for all participants. The focus will be on shared experience and discussion of the hard questions that clients and team members ask coaches during the introduction of Lean ideas through the use of a kanban pull system. The workshop will include the use of the GetKanban game simulation and discussion of its value as a teaching aid.

The goal is to enable participants to go back into the field and successfully coach Agile/Lean transitions using the Kanban approach. Every workshop is different because of the unique experiences of each participant and their specific focus and desired outcomes. Each participant will received a personal recommendation from David J. Anderson as a result of participating in the class.

Kanban offers agile and project management coaches another tool in their transformation and coaching toolbox. Kanban is proving to be a facilitator of evolutionary change with low resistance and an enabler of accelerated high levels of organizational maturity.

For more details download the PDF flyer

Location: Miami, FL
Venue
DoubleTree by Hilton Grand Hotel Biscayne Bay
1717 North Bayshore Drive, Miami, Florida, United States 33132-1180
Tel: 1-305-372-0313 Fax: 1-305-539-9228

Emerging Signs of Kanban at Scale in Healthcare

2011-09-22T21:14:55Z

By Dominica DeGrandis

Yesterday, I visited a large health services organization that is in the early stages of implementing kanban. Founded in Seattle in 1947, Group Health Cooperative provides health coverage and care, and with approx.10,000 staff, is one of the largest private employers in the state of Washington. It is a fine example of a large, long-established organization that has turned to kanban as an instrument for improving performance.

GHC management has a long history of being at the forefront in implementing systems and technology to refine its services. About ten years ago it became one of the first large health services organizations in the country to transfer all of its patient records from paper to digital. And now, they are embracing Lean concepts in knowledge work to improve productivity.

The healthcare giant’s “Core Operations” team is leading the initial kanban effort, using it for production maintenance. This is a classic area for introducing kanban into an organization - making small incremental improvements is well-suited for sustainment work. I particularly enjoy how this kanban board is cross-functional and includes “SysAdmin” tasks.

Kanban is spreading through the organization. A development team is now adding kanban practices to its current process to improve visibility. The objective is to better understand when work is truly ready to be pulled to avoid the thrashing that has been flattening out their burndown charts. Making the work visible is helping them see the actual state of their progress and is revealing crucial work that was previously unplanned.

This large company appears to be on course for ongoing improvement by gradually implementing changes to their kanban system design. It was a pleasure to watch their kanban-in-action, and I’m delighted that we have yet another case study from a large organization to add to our training material – just in time for the next Kanban for IT Services & Operations class.

Kanban Training Class - San Francisco Bay Area, CA Sept 12-13, 2011

2011-07-13T23:06:30Z

David J. Anderson’s

Official “Kanban - Successful Evolutionary Change for Your Technology Business” Class

Masa K. Maeda (instructor)

This class is based on David J. Anderson’s book “Kanban - Successful Evolutionary Change for Your Technology Business”. Attendees of the class will receive a copy of the new book.

Enter Discount code: BEL995EARLY
expires Aug 23, 2011

What you will learn

Day 1 Kanban Mechanics
- Demand Analysis
- Value-Network Mapping
- Visualization
- Work Item Types
- WIP Limits
- Classes of Service
- Service Level Agreements (SLA)
- Kanban Simulation Game

Day 2 Why Kanban
- Recipe for Success
- Case Studies
- Improvement Opportunities
- Understanding Variation
- Bottleneck Management
- Economic Cost Model for Lean (Waste)
- Metrics

About the presenter

Masa is an internationally recognized figure in the agile and lean communities who has focused most of his career on making organizations successful through the balance between value-to-customer, value-to-enterprise, and quality. He has brought Kanban, Scrum, lean, and agile to organizations of diverse size in three continents. With 25 years of experience, his career path has taken him from Fortune 100 to startups from diverse industries in USA, Japan, Mexico and Panama. Before focusing entirely on Lean and Agile, Masa worked at Apple Inc. and was founding team member at several startup companies in Silicon Valley in the fields of genomics/proteomics, online entertainment and online socialization.

Is this for you?

Location:

San Francisco Bay Area (Belmont - short drive between San Francisco and San José airports), CA USA

Venue:

Hyatt Summerfield Suites Belmont
400 Concourse Way, Belmont CA 94404
Between San Francisco and San Jose airports.
http://www.belmont.summerfieldsuites.hyatt.com

Webinar - Introduction to Lean-Agile and Kanban

2011-03-23T21:38:43Z

Presenter: Masa Kevin Maeda

Tuesday, April 19, 2011 6:30 PM - 8:30 PM MDT

Agile and its methodologies have had very positive impact in many organizations. Methodologies have matured over time to make them more effective, and limits have been identified as diverse discussions at conferences have shown in the last few years. Lean has been gradually accepted as a way to broaden our perspective to mature teams and organizations; and Kanban is a recent method that has been showing tremendous benefits through continuous improvement and accelerating maturity. In this webinar Masa will give us: • An introduction to Lean and to how it fits perfectly well with Agile • A brief introduction to Kanban to understand some of its benefits.

Kanban and the DoI

2010-12-21T21:09:35Z

In 2004 I was involved with a group of recognized professionals in the field of project management who came together to define what agile project management ought to mean. The outcome of those meetings was a statements of values, published in February 2005, given the name Declaration of Interdependence. While I’m not in love with the name and find it rather pompous, I find the content of the Declaration has stood the test of time over 6 years. While the declaration sought to define a value system by which modern 21st Century project managers should live, it’s secondary purpose to galvanize a community around general application of agile project management failed to materialize. Five years on, it is worth reflecting on my contribution to the DoI and how it aligns with the Kanban work that I am best known for since then.

Declaration of Interdependence

We are a community of project leaders that are highly successful at delivering results. To achieve these results:

We increase return on investment by making continuous flow of value our focus.
We deliver reliable results by engaging customers in frequent interactions and shared ownership.
We expect uncertainty and manage for it through iterations, anticipation, and adaptation.
We unleash creativity and innovation by recognizing that individuals are the ultimate source of value, and creating an environment where they can make a difference.
We boost performance through group accountability for results and shared responsibility for team effectiveness.
We improve effectiveness and reliability through situationally specific strategies, processes and practices.

[©2005 David Anderson, Sanjiv Augustine, Christopher Avery, Alistair Cockburn, Mike Cohn, Doug DeCarlo, Donna Fitzgerald, Jim Highsmith, Ole Jepsen, Lowell Lindstrom, Todd Little, Kent McDonald, Pollyanna Pixton, Preston Smith and Robert Wysocki.]

We increase return on investment by making continuous flow of value our focus

As many of my readers are aware kanban systems limit work-in-progress and signal new work to start only when there is capacity to process it. This “pull” mechanism is used to improve the flow of work. So kanban systems are focused on flow. However, the way kanban systems have developed for software development goes well beyond a typical manufacturing implementation, as Don Reinertsen pointed out to me during a visit to my office in 2007. In the Kanban method we use classes of service linked to (opportunity) cost of delay and explicit visualization of handling policies to improve the return on investment made in operating the software development activity. By visualizing the workflow, limiting WIP, managing flow, measuring lead times, and optimizing risk and value delivery with classes of service based on the economics of delay, Kanban explicitly delivers on the first statement of the DoI. It is no surprise that it is this first of the six statements that are so heavily associated with my contribution.

We deliver reliable results by engaging customers in frequent interactions and shared ownership.

Kanban engages customers through visualization, through interaction and escalation when items are blocked, through the regular cadence and collaboration of input queue replenishment meetings and through the regular cadence of delivery and the planning of each delivery. Kanban asks customers to take shared ownership of the system and its effectiveness and to throttle their demand to the rate at which the system can deliver.

We expect uncertainty and manage for it through iterations, anticipation, and adaptation.

Kanban embraces uncertainty and it manages for it through provision of classes of service such as “Expedite.” This demonstrates anticipation of demand. It also manages for it through use of quantitative measurement such as statistical process control and definition of target lead times based on statistical observation of capability. This again shows how the system can anticipate an outcome and manage for variability and uncertainty. Kanban is also design to encourage adaptation by using the WIP limit and the social interaction of standup meetings and operations reviews to reflect upon performance, observed capability and effectiveness and allow for process improvements to be suggested based on a scientific approach that uses models of process flow, variation, uncertainty and complexity to facilitate implementation of successful adaptations. Kanban is specifically design to anticipate and adapt as the method is designed using concepts of both Systems Thinking and Complex Adaptive Systems.

However, depending on how you define “iterations”, Kanban implementations often do not use them! Time-boxed increments (often referred to as “iterations” by agile practitioners) are replaced with cadence. The core activities of accepting new work and delivering finished work are usually still performed regularly but each activity has its own cadence. For example, input queue replenishment may happen once per week - a cadence of weekly - while delivery may happen every second week - a cadence of bi-weekly. Cadence is a more sophisticated tool than time-boxed iterations.

“Iteration” meaning “to rework or refine” is supported by Kanban. However, it is still relatively unusual to see such implementations. If for example, a team follows an explicitly iterative method such as Barry Boehm’s Spiral Model, then it would be possible to wrap a kanban system over that and to limit WIP at each step on each loop of the spiral. There have even been instances of team’s visualizing such a process with a board that resembles a dart board or archery target rather than the familiar columns and rows typically associated with Kanban.

We unleash creativity and innovation by recognizing that individuals are the ultimate source of value, and creating an environment where they can make a difference.

Kanban is specifically designed to enhance the power of the people within the system. By limiting WIP, kanban systems both create slack to allow creativity and innovation room to sprout and flourish, and the act of making process policies explicit provides protection for those working within the system, limiting abuses and attempts to exploit individuals and work around limitations. The explicit policies, often visualized on a board, enable individual team members to make high quality decisions about the economics, risks and intangible expectations of all stakeholders. As a result Kanban enables individuals to be creative about their process, to innovate and adapt to improve customer service and value delivery. It gives them the empowerment to make their own decisions and to optimize the economic outcome to the benefit of customers, business owners, value-stream partners and team members.

We boost performance through group accountability for results and shared responsibility for team effectiveness.

Kanban uses a monthly operations review meeting that involves all team members across an organization, plus senior management, and up- and down-stream stakeholders. At operations review quantitative, objective, statistical data on the performance and capability of the system is reviewed openly by all involved and design changes to the system are proposed and assigned to managers for implementation. Through this operations review process Kanban insures that performance is boosted continuously through the wider group of stakeholders taking shared responsibility for the effectiveness of the system and the team of people operating it.

We improve effectiveness and reliability through situationally specific strategies, processes and practices.

The first emergent property of Kanban is that each process is uniquely tailored to its context. For each system, the value creation network will be different; the risk profile will be different; the team and its skills and capabilities will be different; the nature of demand will be different; and the cost of delay in work items will be different. Every context deserves a uniquely tailored process in order to optimize the economic outcome for all stakeholders. The foundational Principles of the Kanban Method are based on the premise that process definition starts with whatever is happening now and evolves it incrementally through a process of small changes each justified economically and based on a scientific approach to improving performance. Situationally specific strategies, process and practices are core to the Kanban Method.

Conclusions

Not only is it easy to see how the Kanban Method relates to the Declaration of Interdependence and to see how my emerging “agile” work at the time was aligned with it, we could go further and say that Kanban is in fact a full implementation of the Declaration of Interdepedence. It is a manifestation of how 21st Century Project Managers ought to be working. The irony of this may be that Kanban encourages a service-delivery rather than a project-centric approach to work.

Meanwhile, for me personally, I look back on the Declaration of Interdependence as a piece of work that I and the other authors can rightly be proud of, 6 years on. I am also happy that this review of the Kanban Method and how my work evolved in those 6 years shows a high level of consistency and that Kanban demonstrates that it lives the values defined in the Declaration.

I’ve been guilty of not publicizing the Declaration of Interdependence enough. I’m not the only author who fails to make enough use out of it. It rightly is something to be proud of and it deserves a higher profile within the Agile and Lean/Kanban communities.

Agile 2009 Slides Now Available

2009-08-26T07:01:17Z

I’ve made my slides for Agile 2009 available in the document archive of agilemanagement.net for everyone who attended or not to use. The great news is that Ryan Martens is interested in applying these ideas at Rally Development already.

I should also mention that my 3rd technique in these slides is similar to Todd Little’s model which appeared in the recent book, Stand Back and Deliver! The model uses four classifications of projects that Todd calls Sheep Dogs, Colts, Bulls and Cows. The Cows are analogous to my Cash Cows, Bulls to Major Growth Market and Colts to Innovative/New. If there is a difference it’s that my model is entirely market driven / external while Todd considers a complexity a dimension in the classification. These models are so similar that I will consider merging mine with Todd’s with full attribution.

Chris Matts’ believes that my first technique, previously published here in 2005 is similar to but less useful than Neil Nickolaisen’s model also published in the recent book, Stand Back and Deliver! Neil’s model maps projects at a portfolio level into 4 categories via a 2x2 matrix or dimensional assessment of market differentiation and alignment with corporate mission. He calls the segments: Don’t Care; Partner; Differentiating; Parity. While this model is certainly compatible with my model they are not the same. Neil’s model works at the project and portfolio level and assumes that the corporate mission is somehow correctly aligned with a strategic position and the market demands. My model works at the individual feature level and is again directly market facing insuring that the feature mix chosen for a project or iteration are aligned with the strategic positioning of the business and the allocation of types is aligned with the propensity for risk in the business plan or prospectus. Neil’s model is certainly compatible with mine. If for example, a project initiative assessed as “Parity” but the product owner was picking a lot of “Differentiator” class features for the product mix then there is clearly a miss match. So I believe that Neil’s model could be added as a fourth technique to the three presented here.

However, it’s worth noting that these are tools that can be used as choices and are not necessarily all designed to be used together. My 3rd technique, like Todd’s and Neil’s are designed to allocate resources to control commitment to projects across a portfolio. To spread risk effectively. It may not make sense to use more than one of these techniques at any one company or division. Choose the one that resonates best with your organization. Technorati tag: David+Anderson, Agile+Management, Agile, Lean, Kanban, Software+Engineering, Project+Management, Risk+Management, Risk, Portfolio+Management, Program+Management

Agile 2009 - New Approaches to Risk

2009-08-26T06:58:35Z

I’ve uploaded a PDF of my slides for Agile 2009.

Download New Approaches to Risk Management PDF

Here is the original session submission…

Presenter: David J. Anderson

Title: New Approaches to Risk Management

Background

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For almost a decade the agile community has claimed that agile development is a risk-driven approach. Yet there is very little published material on agile risk management. A survey of the transactions of the Agile conference over 4 years reveals no explicit presentation on risk management. An online search reveals a number of blog entries and articles on agile risk management(of which more later.)

Traditional risk management (defined in the PMBoK, Prince II, CMMI and other frameworks) takes an event driven approach to risk. It seeks to model external variations that affect schedule, budget and scope on projects. Traditional risk management focuses on what Walter Shewhart called “assignable cause” variation [Deming renamed this “special cause”.] The model is simple: try to build a list of external events that might occur; assess the impact and likelihood of occurrence; assess the cost of mitigation options; decide whether to mitigate (reduce chance of occurence) or create a contingency plan (to recover in the event of occurence.)

Most of the agile risk management articles surveyed look at how to implement traditional risk management in a more agile way. They address how to fit risk management into iterative, incremental development and how to assess and manage risks in a collaborative, transparent manner. There appears to be no literature that discusses how to apply agile and lean ideas that revolutionize risk management.

Meanwhile, traditional (non-agile) project scheduling techniques treat all tasks homogeneously from a risk management perspective. Elementary scheduling techniques do not account for variance in task completions, e.g. the Gantt chart technique. More advanced techniques (PERT, Critical Chain, Last Planner) account for variation and provide some risk mitigation against chance (or common) cause variation through time buffering. However, these techniques still tend to treat all tasks homogeneously from a risk perspective.

Project risk management literature does not appear to have advanced much in the last 30 years.

New Approaches

———————

The application of Lean pull systems (kanban) and Real Options Theory in agile methods is providing new sophisticated means to manage overall business risk in technology projects and software delivery.

This tutorial will describe in detail 3 techniques that have evolved in the kanban community that provide improved project flexibility and business agility together with increased sophistication in risk management.

(1) Using classes of service based on cost of delay/failure functions

Classifying customer-valued deliverables according to the cost of delay (or failure) function allows for different prioritization policies to be implemented on the fly by self-organizing teams significantly reducing the business risks of late delivery. This scheme classifies customer deliverables such as user stories heterogeneously according to the loss incurred due to late delivery. Assigning different colored sticky notes, or index cards according to the classification allows team members to quickly assess risk and pull the most important item through the system in a self-organizing manner

Four example classes of service will be discussed along with their related pull system policies (for prioritization and scheduling) will be presented. The examples are: expedite; fixed delivery date (unit step cost of delay function); quantitative value delivery; and qualitative value delivery. Other classification schemes are possible and would be domain specific.

(2) Iteration Backlog selection based on market risk

This scheme allows for classification of customer-valued deliverables into 4 categories that are aligned with strategic planning and marketing objectives, namely: commodity (or table stakes); differentiator; spoiler; and cost saver. Features or user stories in each category exhibit different risk of change (deletion from scope, or change in definition) due to market conditions during the lifetime of the project, prior to release. The variance in market risk can be used to quickly prioritize iteration backlogs and target backlog items for iterations within an overall project schedule. The scheme mitigates the risk of rework (or waste) caused by changes in scope associated with changing market and business conditions.

(3) Risk-based Portfolio Management

This scheme allows the balance of resources and funding across a portfolio of projects or business initiatives based on the alignment of a project or development initiative with the strategic positioning of the business and its desired risk exposure.

Projects can be classified in to 3 categories: cash cow; mainstream developing market; and emerging market. Portfolio management is conducted similar to investment portfolio management by balancing investments and risk according to the risk preference of the investor. Hence, cash cow is analogous to bonds in an investment portfolio, mainstream developing market, is analogous to large cap stocks, and emerging market to small cap stocks. Resources and funding are allocated according to desired risk profile and kanban systems established for each line of business (or business initiative). Market releases (or projects) are defined to release value optimally based on transaction and coordination costs of making such a release.

Summary

———-

These three techniques combine elements of Lean Thinking and Edwards Deming’s New Economics (cost of delay/failure functions, waste (transation and coordination costs, rework or scrap)), Real Option Theory and Decision Tree analysis to provide methods that enable simple, fast, and often self-organizing approaches to maximize business value and manage risk throughout a portfolio and the project lifecycle.

Notes

——-

Most of this material has been previously presented anecdotally as part of presentations on kanban. Some of it has been documented at agilemanagement.net as blog posts. However, this tutorial will pull it all together, formalize it as a risk management approach and refine and develop some of the ideas.

The material is therefore new in this format but based on work and presentations given over the last 2 years.

The presentation will likely be trialed at various smaller venues prior to Agile 2009. In the first instance at the kanban conference in Miami in February 2009 to an audience of perhaps 50 people. Other opportunities of rehearsal performances will be available at local events such as the San Diego XP Users Group in May 2009.

I intend to submit a formal paper for the transations.

Reference Material

—————————

Survey of online articles on agile risk management

Appelo, Jurgen, http://www.noop.nl/2008/06/agile-risk-management.html

Cottmeyer, Mike, http://blog.versionone.net/blog/2008/05/agile-risk-mana.html

Cottmeyer, Mike, http://blog.versionone.net/blog/2008/05/agile-risk-ma-1.html

Cottmeyer, Mike, http://leadinganswers.typepad.com/leading_answers/2007/09/agile-risk-mana.html

Fitzgerald, Donna, http://www.cutter.com/research/2006/edge060711.html

Griffiths, Mike, http://leadinganswers.typepad.com/leading_answers/2007/09/agile-risk-mana.html

Rangaswami, JP, http://confusedofcalcutta.com/2007/07/06/how-risk-management-affects-agile-approaches/

Smith, Preston and Roman Pichler, http://www.ddj.com/architect/184415308

Thomas, Steven, http://www.itsadeliverything.com/articles/agile_risk_management.htm

Changes @ AgileManagement.net

2009-06-17T22:10:53Z

I’ve been making some changes at AgileManagement.Net to make it easier for readers to find information and follow new posts. I’ve created separate blog pages with separate RSS feeds for Lean, specifically Kanban, and Agile+CMMI.

For now the existing Agile Management blog will continue to aggregate all the content. Later I will reduce it to Management topics only. However, I will maintain the existing RSS feed for both the home page and the Agile Management blog. The RSS feed will continue to aggregate everything that is posted to this site. The new RSS feeds should enable aggregators to be more focused. Kanban sites can pull the Channel Kanban RSS feed while CMMI sites can pull the Channel CMMI RSS feed.

As a result of these changes, some content in the site has disappeared the navigation or the archive search. The articles specifically about the Agile Management book are no longer available through the site navigation. However, they are still in the content management system and still available on the Internet via direct links. Older news articles that do not appear on the front page will also not be navigable but again they have not been deleted and are still accessible via direct links.

I hope that these changes provide a genuine improvement in utility for users of the site and those who value its content. There are yet more changes to come as I prepare my web presence for the next decade and modify it to accommodate my newer interests in Kanban, CMMI, and other newer areas like Real Option Theory, Management, Decision Making, Decision Bias, Neuro-psychology and Risk Management.

Agile+CMMI Conference Anyone?

2009-06-10T16:40:19Z

In a similar vein to the Lean & Kanban 2009 conference I am thinking of pulling together an Agile & CMMI event. I really feel that a small focused event is needed to kickstart the Agile CMMI community and energize potential adopters.

After some initial market research via my Agile Management Yahoo! group and Hillel Glazer’s Agile CMMI LinkedIn group and Twitter, it looks like we are targeting early December or mid-January somewhere in Florida.

Please leave comments indicating which dates you would prefer, which location (a) Tampa, (b) Orlando, (c) Miami, and please recommend anyone you feel should be an invited speaker at such an event. Would you like 1.5 days or 2.5 days and how much of that time should be dedicated to open space?

[Current voting as of 6/17 - will try to update this daily for a while]

Tampa 60%
Orlando 20%
Miami 20%

Your comments and commitments to attend are vital if this event is to go ahead. Without sufficient interest we won’t run the event. Technorati tag: David+Anderson, Agile, CMMI, SEI, Hillel+Glazer

Review on Agile Journal

2009-06-10T15:35:24Z

This is a very thorough review by Brad Appleton. It was posted to Agile Journal several years ago but I don’t remember reading it. It accurately describes how the book synthesizes Don Reinertsen’s work with Eli Goldratt’s work and applies them to agile software development. Brad describes me as the Peter Drucker of software management. Quite a compliment!