Day 4: The Value Stream Impedance Scorecard
This continues the daily reading of Amplio Development: The Path to Effective Lean-Agile Teams. Please ask questions and disagree respectfully in the comments here or on the LinkedIn Amplio Community of Practice User Group. Everyone is invited to the Amplio Community of Practice workshop (free) that meets every other Thursday at 7am Pacific time. Learn more about Amplio at a free seminar on September 8.
The Value Stream Impedance Scorecard
Purpose
Provide us with a way of looking at complex situations where we can make decisions based on a few factors. Making decisions on how to do our work is complicated. We need a guide to help us see which of two or more options is better. One way to do this is to see what resistance, or impedance, is in the value stream that slows value creation.?The Value Stream Impedance Scorecard (VSIS) indicates how well we are doing and whether a new way of working will be an improvement.
Why
It is not always clear how to improve our work in complex systems. It is helpful to have a guide that can help us make better decisions on whether a change to our way of working will be an improvement. The Value Stream Impedance Scorecard (VSIS) can be used to predict whether a speculated action will improve the current situation. The decision is guided by taking actions that improve the factors of the scorecard and avoiding actions that make them worse. The contention is that the more we abide by these factors, the more excellent value we will achieve.
While suggested changes still need to be validated, with a deep understanding of the VSIS, we can make changes with high confidence that they will be an improvement. Otherwise, we’ll be left to try things we have less than full confidence in. This often leads to stasis in our methods as people don’t like to fail. If an intended improvement doesn’t manifest itself, the issues we look at will provide us with learning.
Description
Time for reflection
Consider when you were introduced to an organization where your immediate reaction was, “Wow, this place is cool. I can see why they get so much done!”
Now consider when you were introduced to an organization where your immediate reactions were, “Wow, this place is horrible. How do they get anything done?”
You are likely reacting to your tacit knowledge –what you know but are not always consciously aware of. Consider what factors you are looking at. For example, are people talking to each other? How busy are they? These factors are likely present in both situations, but in one direction, they are being done well, and in the other, they are not.
Consider how consistent these tacit judgments are in different places. While each may appear different, a set of actions should be taken that make places easier to work in. That value stream impedance scorecard is a suggested set.
The Value Stream Impedance Scorecard assesses how much resistance there is to specify, create, and realize business and customer value based on observing several factors. These factors relate to what work is done, how it is done, and how people are organized to accomplish it.?
The factors for the Value Stream Impedance Scorecard are:
[1] A handback is when one person hands some work to someone else, and then later they come back and hand it back or ask questions about it. This shows up as work moving backward in the value stream.
They are asked in the form of a question to see the direction of what helps (when answered with yes) and what hurts (when answered with no). The selection of these factors is not sacrosanct, and they can be adjusted as you learn and for your context. The factors have the following characteristics:
In other words, are they of use while providing coverage and not being too complicated?
A deeper “why” the Value Stream Impedance Scorecard is so important
Doing things poorly will slow us down. But consider that other things are taking place as well. For example, not getting quick feedback will create extra work for us since we’ll make a mistake and work on the wrong things and the wrong way. Therefore, attending to the VSIS can enable us to work without delays and not create much extra work we don’t need to do. Therefore, attending to the VSIS enables us to eliminate the creation of waste.
Key point
It is worth considering that there are two different types of waste. The first is work we didn’t need to do, for example, over planning.?The other is work we created that we now need to do but only because we created it—for example, fixing bugs.
The Factors Work Together
It is essential to notice how the factors work together. As you improve one, it either improves the others or makes it easier to improve them. For example, notice how working on small items will help us achieve quicker feedback. This is consistent with Dr. Eli Goldratt’s (creator of the Theory of Constraints) view that work principles are harmonious. He called this “Inherent Simplicity” in his and his daughter’s seminal book “The Choice” and contends that complex problems are more straightforward than they look if one knows where to look.
The value stream impedance scorecard provides a holistic view by attending to different aspects of a system. This makes it very useful.
How we use the value stream impedance scorecard
The VSIS will be used in two ways.?First, it will help identify what we’re doing causing our problems. The second way it will be used will be to verify if a new practice being considered to replace a current one will be an improvement. If the change violates the VSIS, we shouldn’t try it.
Examples of Each Factor
1. Build in small increments of high value. You accomplish this by working on small items that will provide value in and of themselves or are small slices of functionality that will provide feedback. We’ll learn business artifacts that will assist with this later in this book.
2. Manage delays in the workflow by reducing queue size and avoiding handbacks.
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Attend to the number of items waiting to be worked on. While you need enough items to be ready to be worked on, having too many causes delays in the workflow. One way to manage queues is to lower the overall number of things being worked on. One way to accomplish this is when someone finishes something, they look to see what else they can finish instead of starting something new. Queues occur when work is handed off from one person to another. It is essential that this handoff also be managed to avoid the work being handed back later.
3. Get quick feedback. Communicate with product owners as often as practical. Build things in a way that enables quick feedback.
4. Focus on high product quality – from the stakeholders’ perception and how the product was built. Get clear on what it means to achieve a requirement before working on it. Use the feedback when you complete anything to ensure you’re working on the proper functionality.
5. Keep workloads within the capacity of the people doing the work. Avoid having people working on too many things. Don’t overschedule people with work. Allow people to “pull” work when ready instead of pushing work onto them.
6. Keep all work and workflow visible. Have all the work being done visible. Also, have the agreements of how you are working be clear to everyone.
7. Organize people and have them agree on how they work to reduce waiting for others. Cross-functional teams are one way of doing this when they are practical and achievable. Consider delays, handoffs, and handbacks symptoms of a poorly organized team structure.
8. Have development teams work primarily on one value stream. Organize people who are needed to support multiple teams work in as few value streams as possible while remaining appropriately loaded. When people need to work in multiple value streams, manage what they work on with Kanban boards.
9. Have people attend to the value stream. When making decisions look at the overall effect the action will have. Local optimizations rarely affect overall value add unless the action relieves a constraint.
The value stream impedance scorecard in three sentences
Build in small value increments (1), with few delays in the workflow (2) to get quick feedback (3) and high-quality products (4).
Achieve this by keeping all work visible (5), avoiding too much work-in-process (6), focusing people on one product (7), and having them work together to avoid delays in the workflow (8).
Continuously learn with value stream management (9).
Reflection on how the Value Stream Impedance Scorecard tells us if we’re following first principles.
While keeping the list of factors of the value stream impedance scorecard (on a printout of them or the screen), go back and look at the first principles chapter earlier in this book. See how consistent the VSIS is with them.
Assessing how cross-functional teams are consistent with the value stream impedance scorecard
The cross-functional team is the ideal case for building new products. Let’s see how having one reflects the VSIS.
Build small items of high value. This is independent of whether we have a cross-functional team or not. Notice how such a team would be able to create and build value, however.
Manage delays in the workflow by reducing queue size and avoiding handbacks. With everyone focused on building the same product, a cross-functional team could work together to have few delays.
Get quick feedback. Cross-functional teams will not only be able to build items quickly and therefore get quick feedback, but they will also be able to get quick feedback between each step.
Focus on high product quality – from the stakeholders’ perception and how the product was built. Achieving high quality requires everyone to agree on what that is. A cross-functional team is likely to be more aligned here than groups from multiple teams working together.
Keep workloads within the capacity of the people doing the work. It’s easier to gauge the work the team can do when they pull it off the backlog together.
Keep all work and workflow visible. Keeping work visible across a team is much easier than across multiple teams. However, just having a cross-functional team doesn’t guarantee this.
Organize people and have them agree on how they work to reduce waiting for others. Cross-functional teams can avoid delays by coordinating the work to be done with each other.
Have development teams work primarily on one value stream. Organize people who have to support multiple teams to work on as few value streams as possible while remaining appropriately loaded. Cross-functional teams are intended to be used for one product – one value stream.
Have people attend to the value stream. With cross-functional teams, much of the value stream is in the team.
Using the Value Stream Impedance Scorecard: A Case Study
Many organizations have the challenge of not having a well-defined intake process before adopting agile. A lot of work is happening, but people aren’t sure what the work is, who is doing it, or at what stage the work is in. The table below illustrates how doing this adversely affects most of the factors of the VSIS. And severely as well. In this mini-assessment, we turn the VSIS actions statements into questions by adding “did we” in front of each one.
VSIS Is about the impedance, not how to change it
The value stream impedance scorecard is focused on what helps or hurts the flow of value. It intentionally leaves out factors like how we got here, how we can change it, or what factors help change it. These are critically important. They have been left out because we want the VSIS to measure the resistance and indicate what we can do to improve things. In later chapters in this workbook, we will deal with these other issues of how to change things.
Key Points
How We’ve Manifested the Purpose
We started this chapter by stating, “we need a guide to help us see which of two or more options is better.” The Value Stream Impedance Scorecard asks us questions about how well we are doing. Each question points out whether we follow the first principles of knowledge work.