A strong foundation for your Agile and SAFe Transformation

The two large benefits

Value Streams help IT departments to enable their business counterparts end-to-end by applying systems thinking. For instance, Daniel Pink mentioned a good analogy during his sales and persuasion Master Class: “You don’t only want to be in the vacuum cleaner business. You want to be in the home and office cleanliness business”. Think of the Operational Value Stream providing clean homes and offices, and the Development Value Streams, providing vacuum cleaners, electricity, and cleaning staff. Before IT was organized around the value stream, the business had to ensure that the electric power is compatible with the vacuum cleaner (e.g., 110V vs. 230V) and that the cleaning staff were trained for the particular vacuum cleaner model being used. After organizing around the value stream, IT shifts from understanding the user’s needs to understanding what the user wants to achieve. That’s why IT is not only responsible for coordinating the Development Value Streams and ensuring that all the components work together to make the Operational Value Stream’s cleaning business possible, but also for enabling IT to think about the best possible solutions to solve business problems.

Value Streams are an enabler for transforming an IT department from an output driven feature factory towards a value creator. A long-term strategy for the Value Stream can focus on improvements such as a significantly improved time-to-market, improved product quality or reduced costs to the business. This input can be used by IT to define outcome-based KPIs to measure the value contribution of IT application to the Operational Value Stream and to prioritize features based on their value contribution to the business strategy. In the long term, organizing around value streams helps to optimize the return on IT investment for companies.

The SAFe Value Stream and ART Identification Toolkit is a great help to achieve the benefits described above, but several companies have experienced that the benefits have not been realized. With this in mind, the question arises as to why this is happening.

Why don't all companies achieve these benefits?

Often, Value Stream Identification is driven mainly by IT with little or no business involvement, although Scaled Agile emphasizes the importance of involving the business from the very beginning. When approaching the business with the idea to conduct a 2-day Value Stream Identification workshop, we received either no response at all or the feedback that the business did not care how IT organized itself as long as it continued to deliver the required features.

Many IT departments are even afraid to approach their business stakeholders to ask them to collaborate on this activity. Furthermore, many business departments continue to operate in a project setup focused on delivering a predefined feature on time and on budget. This clashes with the newly established product mindset of IT departments talking about value and flow. For more than a year, we were unable to convince some clients to adopt the approach suggested by Scaled Agile.

While thinking about this problem, our Deloitte team met Edward O’Brien, a Lean expert working for a Boutique Consultancy called WikiFlow. Their focus is on Lean methods and Operational Excellence. They run Value Stream Mapping Workshops with Business Departments, promising to make them 10 times faster while maintaining at least the same level of quality. This helps to generate interest among key business stakeholders and Operational Excellence Initiatives, as they can see a clear benefit in the optimization of flow in their own value streams. The improved business performance helps the business to serve customers much faster than before and to adapt to changing market conditions.

Once business buy-in has been achieved, IT can step in and ensure that it contributes to performance optimization by organizing around the common value stream. They will be able to enable their business department end-to-end along the entire value stream, transforming from an output-driven feature factory to a value creator, and use the results of the Value Stream Mapping as a strategic input to create flow in the Operational Value Stream through improvements in the supporting system landscape (e.g., higher levels of automation, interfaces between systems that eliminate unnecessary manual work).

Fig. 1: The three steps of Value Stream Identification

Our recommendation

Below you can find our advice on how to get started:

1. Address business stakeholders with the complete approach and explain the benefits for them (e.g., IT contributes to their goal of being 10 times faster).
2. Start with a Value Stream Identification workshop with the goal to organize employees around value.
3. Conduct a Value Stream Mapping workshop in alignment with Operational Excellence Initiatives with the aim to deliver value 10 times faster.
4. Use improvement activities (e.g., Kaizen events) of the operational value stream as strategic input for Agile Release Trains within the IT. This ensures the value contribution of IT to optimize the flow in the Operational Value Stream.
5. Apply DevOps practices to improve flow in the Development Value Streams to enable much faster delivery of IT systems while increasing their stability and quality.

If you have any further questions or would like to learn more about this approach or how it can be applied in your company, please do not hesitate to contact us. We use the latest Value Stream & ART Identification toolkits provided by Scaled Agile Inc. and enhance them through the knowledge gained during our client work and the cooperation with our partner Wikiflow.

Ihre Ansprechpartner

Stephan Kahl 
Director | Agile & DevOps Transformation 
Mobile: +49 151 5807 4853
skahl@deloitte.de

Benjamin Scheffold 
Senior Manager | Enterprise Performance
Mobile: +49 711 1655 47467
bscheffold@deloitte.de