Introducing Enterprise Services Planning

sales@leankanban.com @leankanbanu Copyright Lean Kanban Inc.

Improving agility one service at a

Anticipating demand across an ecosystem of shared services

Enterprise Services Planning

Scaling the benefits of Kanban

Presenter

David J. Anderson

Swift Kanban

Webinar

18 February 2015

Lean Kanban North America 2015 conference

• “Back to our roots”

• Implementing Kanban

• Looking to the future…

• Enterprise Services Planning

Kanban Coaching Professional Masterclass

5-day course with David J Anderson

March 2-6, 2015 www.djaa.com/kcpm-031

Hilton Alexandria Mark Center

Learn how to lead successful Kanban initiatives.

Improve service delivery and achieve better customer satisfaction

• Coaching for evolutionary change

• Assuring fitness for purpose

• Using the Kanban Method

• Designing a service-oriented organization

Learn useful improvement models and all of our consulting tools

Microsoft XIT Sustaining Engineering

Deferred commitment pull system coupled to probabilistic understanding of lead time

• Improved productivity over 200%

• Greatly improved predictability

• Shortened lead times by ~90%

Use of Kanban systems is minimally intrusive for engineers. Process methodologies didn’t change

• PSP/TSP remained in use throughout

Conclusion

Kanban is good for service delivery

Kanban Method Emerges

Kanban systems aren’t enough when there is too much variability in the workflow and too much heterogeneity of work types and trouble matching worker skills & experience

• Now known as a system liquidity problem

• Visual boards are introduced

• Kanban limits create stress & provoke process improvements

• Multiple classes of service emerge

Kanban Method Matures

A combination of elements of Kanban such as system replenishment, classes of service, understanding cost of delay, transparency and metrics start to change entire company culture

Operations review drives BU wide improvements and starts to influence other BUs within the firm

Conclusion

The Kanban Method is a management system for

cultural change & improving organizational maturity

First Kanban Software

Digital Whiteboard application developed by Darren Davis at Corbis runs on top Microsoft Team Foundation Server

Workers run Digital Whiteboard on their desktop but continue to use physical boards in parallel

Conclusion

We need software to get good metrics easily and amplify the management value of Kanban

Kanban on Big Projects

$11 million budget project with up to 55 people, 16 month schedule, approximately 2400 user story scope

2-tiered kanban boards emerge to visualize parent-child dependencies in requirementsIntroduces hybrid of dedicated

teams and floating project personnel using avatars

• Specialists such as architects, UX

• Generalists who can help any team

Conclusion

Kanban is useful on large projects to improve

predictability.

More guidance on prioritizing backlogs is required at large

scale.

STATIK

Recognizing the need to teach people how to get started with Kanban, training classes adopt the use of the STATIK exercises

STATIK = the Systems Thinking Approach To Implementing Kanban

• the method is presented at conference in 2012

• the acronym will not be introduced until 2013

Kanban has 3 approaches to scaling

Scaling out a service delivery workflow Expand kanban systems both upstream and downstream

Scaling out across a network Scale out using the service-orientation concept to build a

network of independently operating but interdependent services (with a kanban system for each service)

Control WIP on unbounded queues between services

Scaling by scale-free understanding – apply the principles & general practices at each level Personal / small team

Tasks completed in hours

Service delivery / workflow Work items e.g. user stories completed in days

Portfolio Projects, MVPs, MMFs completed in months

The Kanban Lens

Learn to view what you do now as a set of services (that can be improved):

What to look for…

• Creative work is service-oriented

• Service delivery involves workflow

• Workflow involves a series of knowledge discovery activities

What to do…

• Map the knowledge discovery workflow

• Pay attention to how & why work arrives

• Track work flowing through the service

Treat each service separatelyDem

ObservedCapability

Analyze demand & capability for each service independently

Design a Kanban system for each service using the STATIK method. Scale out in a service-oriented fashion, one service at a time

Anticipating Demand, Allocating CapacityDem

ObservedCapability

Looking downstream, you want the system to help you anticipate and

manage dependenciesLooking upstream, you want the system to help you anticipate and

manage demand

Combine the two, and across the organization you smooth flow end-to-end and help keep demand in balance withoverall system capability

Scale-free understanding

Eliminating unbounded queues• Proto-kanban to full

workflow kanban• Coupling interdependent

network of kanbansystems

Andy Carmichael’s Smallest Possible Definition of Kanban

See Flow,Start Here,

With visible work & policies, validate improvements

Core practices renamed “general practices” with specific practices at different scales

• Personal/team Kanban• Service Delivery /

Workflow Kanban• Portfolio Kanban

• 2 Days of Learning Sessions

• Choose Your ½ Day Workshops

• Risk Profiling – David J Anderson

• Cost of Delay – Don Reinertsen

• Project Management with Kanban

• Cynefin 101 for Portfolio Kanban

• Simple Probabilistic Forecasting

…and more!

• Becoming Data-Driven

• Objective Retrospectives

• Forecasting

• Enterprise Kanban & Lean Startup

• Scrumban

• Kanban Coaching

• Blockers for Improvement

• RBS Project Sizing

• Kanban Academic Research …

Enterprise Services Planning

Enterprise Services Planning is a new modular 5-day training program from Lean Kanban which will be available from 2nd quarter 2015

Kanban is now table stakes. Large scale benefits are enabled by implementing Enterprise Services Planning

Here are two small sections of the training material highlighting some planning & risk management concepts for scheduling & sequencing work at project or portfolio level …

Lean Kanban Training RoadmapThe

KanbanMethod(2 days)

Intro toKanban(1 day)

Ready Trained

GettingStarted

with Kanban(2 days)

Enterprise Services Planning(5 days)

Ready Trained Ready Trained Ready Training Trained

Train the Trainer (5 days)Ready Trained Qualified

Coaching Masterclass (5 days)Ready Trained Qualified

Kanban Proficiency

Moving the conversation away from process improvement and towards management and decision frameworks

conf.leankanban.com edu.leankanban.com

leankanban.com

“Power in Simplicity”

Essence of the Lean Kanban brand

Pragmatic, actionable evidence-based guidance!

Something you can take away and implement next Monday

ESP Training Modules

Module 1 Portfolio Management (Day 1 & 2) Strategy, fitness for purpose, KPIs, Cost of Delay, Scheduling,

Sequencing, Portfolio risk, risk hedging, risk profiling, aligning strategy & capability, strategy review

Module 2 Options, Commitment & Delivery (Day 3) Understanding kanban systems, real options, upstream Kanban,

commitment & replenishment, lead time, chance vs assignable cause variation

Module 3 Project & Demand Management (Day 4) Demand analysis, demand shaping, capacity planning, project

forecasting, risk review, labor pool liquidity, workflow liquidity

Module 4 Portfolios, Programs & Dependencies (Day 5) Scaling Kanban, dependencies, visualizing dependencies, portfolio

Kanban, stand ups, service delivery reviews, ops reviews

Beta test special offer

Offer an ESP training module and get up to 50% off list price through end of April 2014We are looking for a few select clients to test the new class materialIdeal test clients are medium-sized, privately held firms or business units of larger publicly companies where the VP is the sponsorESP class material is mostly tried and tested but not in its current configuration. Beta testing is primarily to check timing and understand whether the sequencing facilitates the desired learning outcomesTo order an ESP training beta test, contact Wes Harris, Commercial Director of David J. Anderson & Associates, wes@djaa.com

Scheduling

When should we start something?

impact

When we need it

percentile

Ideal StartHere

Commitment point

timeJan10

If we start too early, we forgo the option and opportunity to do

something else that may provide value.

If we start too late we risk incurring the cost of delay

If we pull the work into our kanbansystem on Nov 11 we have a 6 out

of 7 chance of on-time delivery

We can study sensitivity to different start dates

impact

When we need it

50th percentile

Later StartHere

Commitment point

timeJan10

If we start as late as November 25 we only have a 50% chance of on-

time delivery

However, the cost of delay incurred if we deliver within 60 days is

relatively small. We have an 85% chance of achieving delivery with

acceptable cost of delay

85th percentile

What is the latest we could start?

impact

When we need it

0th percentile

Very latestart

Commitment point

timeJan10

If we start as late as December 19 we have 0% chance of on-time

delivery

We have about a 10% chance of a total loss delivering the promotion

beyond the expiry date of the opportunity

85th percentile

total loss

To be certain of delivery without incurring any cost of delay is expensive

When we need it

percentile

Early Start

Commitment point

timeJan10

If we are conservative and do not wish to carry any risk of late

delivery or any risk of incurring an opportunity cost of delay, then we must start as early as August 13th.

We must commit to our Spring Break 2015 promotion during

Summer 2014!!!

Window of opportunity

When we need it

Earliest Start

timeJan10

Latest viablestart

Optimal Start

On August 11st the item becomes available for selection at Kanban

system replenishment.

The ideal time to start is November 11th.

After December 19th our option to deliver this item expires and we would discard it from our pool.

Lead time is perhaps the most important metric we gain from

kanban systemsLead time coupled with cost of delay sensitivity analysis is a key enabler of deferred commitment and consensus on when to make

commitments

Lesson

We need tools!

Existing Kanban software products largely seek to replicate the function of a physical board

They don’t actually help with real management problems

Enterprise Services Planning is easy to understand but laborious to implement• No one built a Gantt chart manually!

A new breed of tools will emerge in 2015 offering ESP support

Tools will facilitate decision making

ESP software tools will facilitate

the decision making to run the

enterprise

Assist with commitment &

replenishment

Assist with risk assessment &

hedging

Assist with capacity planning

Facilitate SDRs & Ops Reviews

Enterprise Services Planning“The Future of Kanban”

“Fit for Purpose” service delivery• Fitness criteria metrics & classes of service

tuned to market segments / source of customer demand

Anticipate Demand• Comprehend WIP limits, staffing levels and

required liquidity levels

Shape Demand• Allocate capacity to hedge risk

• Bifurcate demand with risk policies

Scheduling, Sequencing & Selection• Intelligent recommendation engine utilizing

risk profiles & risk management policies

Kanban experience reports

• Ultimate

• Software

• BazaarVoice

• web recommendationsapp and mobile development

Including…

Thank you!

David Anderson is an innovator in management of 21st Century businesses that employ creative people who “think for a living” . He leads a training, consulting, publishing and event planning business dedicated to developing, promoting and implementing new management thinking & methods…

He has 30+ years experience in the high technology industry starting with computer games in the early 1980’s. He has led software organizations delivering superior productivity and quality using innovative methods at large companies such as Sprint and Motorola.

David defined Enterprise Services Planning and originated Kanban Method an adaptive approach to improved service delivery. His latest book, published in June 2012, is, Lessons in Agile Management – On the Road to Kanban.

David is Chairman of Lean Kanban Inc., a business operating globally, dedicated to providing quality training & events to bring Kanban and Enterprise Services Planning to businesses who employ those who must “think for a living.”

Introducing Enterprise Services Planning

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