A bad system will beat a good person every time.
– W. Edwards Deming.
I believe that everyone does their best given the context and environment at hand. I subscribe to Deming’s views that it is the organisation as a system, not the people working in the system that determines the organisation’s performance. The other view is that the people, not the process or the organistation, is the source of low performance.
Due to the inherent complexity and variability of product development it is often difficult that the scope, details, or effort commitments estimates are certain. When things fall behind schedule (or finish ahead of schedule for that matter), it assumes that the original plan was correct in the first place, but this is often not the case. Plans often over-simplify the complexity of human interactions and creativity. Many of the challenges faced by teams today isn’t necessarily related to technology but can be described as a social problem – product development teams is a complex adaptive system that requires collaborative actions and shows complex behaviour as it adapts in and evolves with a changing environment.
So when there is a performance gap (actual performance vs desired/planned performance), there are generally 3 options that are considered:
- Add more people (or resources)
- Work harder
- Improve performance
Option One of adding additional people may make things later as described in The Mythical Man-Month Is Not A Myth. This option is also has budgetary and financial constraints and managers are reluctant to go down this path.
So when there is a performance gap, there is pressure for managers to close this gap to meet the original commitments by pressuring people to spend more time and energy doing work by working harder often in the form of overtime (Option Two). This is played for an apparent short-term win. This quick-fix reaction results in shortcuts which have a relatively long-delayed and indirect impact – it may be sometime before the decline in performance or capability is known. This is one way how technical debt occurs and requires more effort to maintain a level of performance. This technical debt often never gets rectified as managers deal with the next performance gap problem, and things get worse reinforcing the downward spiral. This option is a popular strategy as it solves today’s problems and meets the immediate KPIs.
The Third Option is improve performance through investment in training, applying agile and lean-thinking strategy of removing waste to improve the flow of value and experimenting with new ideas. Time spent on improving the capability of a process typically yields the more enduring change 1. An hour spent working produces an extra hour’s worth of output, while an hour spent on improvement may improve the productivity of every subsequent hour dedicated to product development.
In an MIT supported paper by Repenning and Sterman they observed that working harder (eg overtime) wasn’t merely a means to deal with isolated incidents, but is instead standard operating procedure. I have frequently overhead team members say “that is normal, we are used to it” when presented with overtime work. Agile Manifesto Principle #8 states that
Agile processes promote sustainable development. The sponsors, developers, and users should be able to maintain a constant pace indefinitely.
Some overtime work may be justified but don’t rely on constant overtime to salvage a plan.
When the focus is constantly on production work people are often “too busy delivering”, and working overtime and harder quickly becomes routine, we have no time to improve or learn. Capability starts to decay and as a result, the performance gaps increases forcing the need for heroic efforts (that are rewarded) and people to work harder and longer hours which takes them further away from improvement. This is sometimes called being in a constant “fire-fighting” or reactive mode.
Increasing pressure to do work (delivery) leads people to spend less time on non-work activities like breaks and to put in overtime. For knowledge workers such overtime is often unpaid and spills into nights and weekends, stealing time from family and community activities. There are, however, obvious limits to long hours. After a while there is simply no more time. If the performance gap remains, workers have no choice but to reduce the time they spend on improvement as they strive to meet their ever increasing objectives. -Repenning and Sterman
A key principle of Lean and Agile is to continuously inspect and adapt the way we work so we can improve the way we deliver to our customers. Agile Manifesto Principle #12 is about making improvements to the way you work continuously,
At regular intervals, the team reflects on how to become more effective, then tunes and adjusts its behavior accordingly.
One way to improve is to do regular retrospectives and operation reviews and then spend some time on the identified improvement activities. Kaizen, the Japanese word for continuous improvement, was popularised by the Toyota Production System. The culture of Kaizen is one of the reasons why Toyota has been more successful than many of the Western firms. Kaizen is about making small improvements continuously, so we can get 1% better every day. Just like compound interest on your savings account, overtime these 1% improvements can provide significant performance gains. As the performance gap falls, workers have even more time to devote to improvement, creating a virtuous cycle of improved capability and increasing attention to improvement.
However, there sometimes can be a delay before the benefits from the improvement efforts will be realised, so you need to have a strategic view and an emphasis of investing in improvements. Treat each improvement activity as an experiment and learn from your mistakes.
As illustrated below, working harder results in an immediate performance impact at the expense of improvement work but has a delayed capability trade-off in the long run. Whilst working smarter requires some investment in improvement that will require a short-term negative performance impact before things improve but has a longer lasting productivity gain. In reality, both of these continuously reinforce each other with each decision loop either having a virtuous cycle of reinforcing the performance curve positively (working smarter) or a vicious cycle lowering performance (working harder). Which one will you choose?
Note about the ‘Too Busy To Improve?’ image:
This image has been adapted from Hakan Forss’ work. His ‘Too Busy To Improve’ image is not free to use so I have adapted his image which can be shared under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International license. Whilst this image is not as evident as Hakan Forss’, it hopefully still convey’s the same theme. You may share my image but you cannot create a derivative of it to respect Hakan Forss’ intellectual property. I would like to thank Hakan Forss for allowing me to adapt his work.
1 Nobody Ever Gets Credit for Fixing Problems that Never Happened, Repenning & Sterman, California Management Review, 2001
[Thanks to Daniel Prager (@agilejitsu) for passing on this paper]
It is not the strongest species [organisation] that survives, not the most intelligent, but the one most responsive to change.
Over two jam packed days, there were a lot of new ideas to experiment with but there were also some basics to cater for those just starting out on their agile journey. The vibe at the conference is that Agile is no longer a fad and is transforming across the wider organisation – we have crossed the chasm from IT agility to business agility. However, speaking with people from the trenches there are still many struggling to get the benefits of agile with existing hierarchical management style at odds with the horizontal product delivery focus of agile. James Shore summaries this well when he said
agile is about how you think and that organisation thinking overrides team thinking. Therefore success with agile depends primarily on organisational culture and investments.
Here’s some highlights from the conference:
David Marquet (@ldavidmarquet) – Intent-based leadership
David Marquet is a former nuclear submarine commander and author of the book ‘Turn the ship around‘. His opening Keynote looked at the future of Leadership.
- In the future leaders will get people to think (not do)
- In the future Leaders will help people feel safe (not scared)
- In the future leaders will push authority to information (not information to authority)
- People doing the work can make better decisions because they have the information. You will get better speed of execution because you don’t have a delay.
- In the future leaders will focus on getting better (not being good)
- In the future leaders will fix the environment (not the people)
- In the future, leaders will give control & take leadership
- The only thing hard about this is you, we have been genetically and culturally to take control and attract followers. What you want to do is give control and create leaders.
During his keynote, David did a live poll of the audience on what it would like to work in an environment where the leadership style meant controlling people . I hope the managers and leaders in your organisation are not creating a work environment like this….
Jeremie Benazra (@jemben) – How forgotten knowledge will help you avoid regrettable decisions
Jeremie’s presentation took a interesting look at turning some common questions we may face into reality checks using some common principles that we know today. Whenever we make decisions we need to be grounded (and often reminded) that there are certain principles that may challenge our biases.
|Principle||Question you want to ask||Question you should be asking|
|Moore’s Law: Information systems doubles capacity for the same price every two years||“Which technology is the best to invest in now?”||“How long do we want to maintain the product using this technology?”|
|Allen’s Curve: The communication efficiency decreases exponentially with the physical distance between the persons||“How much could I outsource?”Or what I come across a lot is a statement that “outsourcing is cheaper”.||“How much effort are you ready to dedicate to make outsourcing work?”|
|Parkinson’s Law: Work expands so as to fill the time available for its completion||“How long do you need to get this done?”||“Do you have any time constrain? What is your deadline?”|
|Little’s Law: The lead time is proportional to the number of items in the system and their time in the system.||“Tell me when I could expect to get this done as well?”||“How urgent is it compare to what is currently in progress?”|
|Meskimen’s Law: There is enough time to do it right, but there is always enough time to do it over.||“How complete are you? How far along are you?”||“Could you help me clarify what we consider complete?”|
|Brooke’s Law – The Mythical Man Month: Adding manpower to a late software project makes it later.||“How many people do you need to get this Done? Faster!“||“What are you ready to trade off, scope?”|
|Conway’s Law: Organisations are constrained to produce designs which are copies of their communication structures||“How could you improve our customer experience?”||“How could we remove some organisational silos to work better together?|
Bernd Schiffer (@berndschiffer) – Concrete experimentation in Agile environments
Bernd talked about a problem that many organisations face today, struggling turning change ideas into tangible outcomes so they get better at being Agile. What we need is a way to use experiments to drive change throughout the organisation and Bernd introduced a nice mnemonic to help us remember how to perform an experiment to drive change and improvement – CAT SHOE, SIC! It’s really simple of course:
- Clear goal – what are the outcomes you want to achieve
- Arranged – A plan how you will approach the experiment
- Trackable through metrics – measure the improvement/change. did it have an impact?
- Small – make small incremental experiements, short timeframe, small/one team.
- Has due date – do I need to say more? timebox the experiment
- Out in the open – make the experiment visible eg use ganban boards
- Evaluated through hypothesis – leveraging the lean startup approach, what hypothesis are you trying to prove? what does success look like? what does failure look like?
- Safe-To-Fail – it is an experiment after all so we need to take some risks, but balance risk taking with impact if it fails. You need to be able to recover (and learn) from failure
- Impelled by champions – need people (1 or 2) to sponsor and champion the experiment – they will own the outcome and be impelled to make it happen
- Communicated before start – be transparent and make sure everyone understands and is comfortable with the experiment before starting
Stuart Bargon (@StuartBargon) – Don’t scale Agile. Descale your organisation.
Anders Ivarsson (@anders_ivarsson) – Autonomy and Leadership at Spotify
Linda Rising (@RisingLinda) – Myths and patterns of organisational change
|Myth||Pattern for Change|
|Myth #1: Smart People are rational
||Take on a role of a Evangelist.You need to believe and have a passion for the change. What you have is your belief that your idea is a good one and that it will work.Create short term goals – build on your successes and learn from your failures – do small experiments, just do it, time for reflection, baby steps.|
|Myth #2: Good always triumphs over evil. (Just World Fallacy, one of our many cognitive biases.)
Data clearly shows, that when we are eating we are more open to influence.All languages speak to this connection. When we eat together, there’s a feeling these are the people we trust – its a great influencer even if its a bad idea.
|Myth #3: If I just had enough power I could make people change.
||Personal Touch.You must address a genuine user need. Data does not equal empathy. You need to reach out and try to understand the viewpoint of people who you want to change and give them a reason (sell your idea as a way for them to be better).Different people accept new ideas differently, so you will need to address people differently and answer the “What’s in it for me?” and bring them along the journey.|
|Myth #4: Skeptics, cynics, resistors—THOSE people, well, they must be BAD or STUPID or BOTH!! Ignore them!!
||Fear LessUse resistance to your advantage.
Listen, really listen and learn all you can, even from the cynics. Respect and build on the resistance.Find a Champion Skeptic: Encourage a resistor to play the important role of “Devil’s Advocate.” Treat the person as valued partner in the change effort. Get them to help get better.
|Myth #5:You’re a smart person, so you don’t need help from others. After all, it’s your idea!||Ask For HelpThe idea is yours and you believe in it, but the change must NOT be “all about you”.You need other people’s help. And when others help you, recognise their contribution with Sincere Appreciation – this is a powerful influencer! The thanks must be sincere, timely, contain details of what they did and the impact of their help.|
I was recently approached about the relationship between Systems Thinking, Lean And Agile. Without going into too much depth and using too much terminology I have tried to summarise it in the following diagram.
Agile is an iterative and incremental approach for developing product and services through collaboration between self-organising, cross-functional teams. It promotes adaptive planning, evolutionary development, early and continuous delivery, continuous improvement, and encourages rapid and flexible response to change.
Lean is a management mindset and a set of tools to create customer value, using the least amount of human effort, capital, inventories, time and capital investment in the process. Lean focuses on continuously improving work processes, increasing throughput and flow and removing waste.
A system is defined as two or more parts that work together to accomplish a shared aim. An organisation viewed as a system consists of not only its departments but also all of its interactions (both internal and external) including customers and suppliers. The success of all workers within the system is dependent on management’s ability to optimise the entire system.
Systems thinking is about:
- looking at the whole instead of focusing on components
- understanding components within their context, not in isolation
- paying attention to the interactions between components
- seeing cycles instead of linear cause and effect
By thinking of their organisation as a system, managers can begin to understand and address the problems facing them, their staff and their customers. W. Edwards Deming, an American statistician and management theorist, found the majority of possibilities for improvement are in the system (95%) and the remainder are with the worker (5%). He learned that if you want to change behaviour, then change the system.
Like most of us, one of your goals for the new year may include growing as an Agile coach, making a difference in your life & career. 2015 presents an opportunity with Agile Coach Camp Melbourne. Agile Coach Camp is a practitioner-run unconference for peer-to-peer learning and exploration.
Do you have a technique or practice worth sharing with your peers? Or an idea you’d like to test out with some leaders in the community? Are you facing challenges and want to get some perspective from other practitioners, or hear how they do things? If you feel you would benefit from connecting with 50 like-minded peers to talk, draw, discuss and explore ideas, then this unconference is for you.
Bernd Schiffer and I are in the final stages of organising Agile Coach Camp for Melbourne 2015. We have locked in a location, thanks to our venue Sponsor Nintex. On March 21 you are invited to join some of the most engaged learners and practitioners who, like you, are passionate about their work, active in the field and willing to share what they’ve learned.
You don’t have to be an expert to propose a topic or ask a question at Agile Coach Camp. You are simply inviting people into a conversation with you – other people who are also passionate about your topic or question. These conversations can build knowledge, and often lead to future collaborations. Open Space is great for networking!
Tickets go on sale on Tuesday 10 March 9am at acc2015mel.eventbrite.com.au
For more information visit www.agilecoachcampaustralia.org
In the last issue of AgileTODAY, I was interviewed by SlatteryIT to find out more about myself as one of the Agile Australia chairs. For Agile Australia 2104 I was one of the chairs for the ‘Approaches’ stream and in 2015 I will be chairing the ‘Build Measure Learn’ stream.
Here’s the transcript of that interview on page 10:
[AT] How many Agile Australia conferences have you been to? What has been your favourite moment from a past conference?
[CC] I have attended all of them and each year it gets bigger and better. I have enjoyed many of the keynotes at the conferences including Fiona Wood’s inspirational passion to “learn something from every day so that tomorrow is better”. Another was Jeff Smith’s keynote about providing executive sponsorship for “Living Agile” as a way of increasing business value through simplicity. However, my favourite moment was last year when a few of us gave the Aussie rite of passage for a few overseas attendees with the ‘Tim Tam Slam’.
[AT] Tell us about your Agile ‘A-ha’ moment.
[CC] I was a technical lead for a project and my life was ruled by crunching numbers and trying to work out an impossible project plan, knowing in my heart that it would be out of date the very next day. Ultimately, this planning turned out to be making lots of assumptions that didn’t take into account the realities of the world.
As the delivery got underway, we used iterative and Agile approaches. We discovered new things that we couldn’t predict in the beginning. Through the real progress of working software it was soon clear that the original plan was false. The amount of work required didn’t fit expectations.
We interacted with the customer regularly to understand what they really needed and developed in short cycles. Our customer said it was a great level of communication and collaboration, however, the new discoveries and real progress didn’t win favours with management. We were faced with a project that had a 9 month window but was 2+ years in the Gantt chart. I realised that the people doing the work will figure out the best way to get from point A to Z. I didn’t need to predict everything upfront and it was liberating to experience empirical processes and Agile.
[AT] Attendance at Agile Australia has tripled since the first conference. What changes have you seen in the community, in Agile approaches, in your work, over the years?
[CC] Ten years ago we had to justify Agile approaches and prove that it works. When I first came across Agile it was mainly XP, Scrum or FDD. Now Agile encompasses a whole range of ways of working including Lean Startup, Design Thinking, Lean and Kanban, Complexity Theory, Systems Thinking, Servant Leadership, Beyond Budgeting and Scaled Agile Framework to name a few. I am no longer spending time justifying Agile and instead helping teams with their Agile transformation and scaling Agile.
Seven years ago there weren’t any Agile meetups in Melbourne, and now we have a vibrant Agile community. Whilst many people have been on their Agile journey for a few years, it’s also great to see many new faces at the local meetups who are learning about Agile for the first time.
Over time we sometimes forget about the Agile Manifesto and just do the practices. I think we we need to continually reinforce the values because that is what makes it work.
[AT] On your blog you mention you care about ‘humanising the workplace’ – what do you mean by that?
[CC] Organisations and machines don’t build great products and services, people do. It is the collaboration and the human spirit that are at the heart and mind of great work. We need to stop viewing people as ‘resources’; treating them as robots or commodities who are easily interchangeable. We need to enable performance rather than manage performance. The importance of people is reflected at this year’s conference with a whole stream dedicated to building people oriented-organisations through Individuals and Interactions.
Humanising the workplace is about making a work environment that puts a greater emphasis on knowledge, passion, inspiring people to collaborate towards common goals, and fostering teamwork where creativity can flourish. We need to adapt the models, processes and restrictions of work to fit humans better. It may seem obvious when I say this, but as an Agile Coach I have spoken to many people about how alienating the workplace can get. I think we have improved a lot in this area over the years, but we need to be very careful we don’t turn Agile processes into Waterfall 2.0.
[AT] What is the strangest situation you’ve applied an Agile principle to?
[CC] I use Agile in range of situations including creating Kanbans for moving house, big visible charts for our kids’ reward system, acceptance criteria for household chores and a Santa backlog! To some this might seem strange but for me its a way life. I have even got my wife limiting her WIP and using Kanban!
You can get more information about the publication including past issues at the AgileTODAY website.
Towards the end of last year I was interviewed by Shane Hastie from InfoQ about Agile Coach Camp. The interview was published in the article An Update on Agile Coach Camps Internationally.
Coach camps are volunteer organised events which typically happen over a weekend and are designed to be cost neutral, sharing the venue and catering costs across the attendees without a profit motive. Coach Camps run using an Open Space format.
Bernd Schiffer and I are bringing Agile Coach Camp to Melbourne in March 2015. We have been busy finding a suitable venue and we are very close to finalising one soon.
For more information and how to get tickets (once they go on sale) for the Agile Coach Camp in Melbourne, please visit www.agilecoachcampaustralia.org
Here’s the transcript of my interview on InfoQ:
I was one of the few people from Melbourne who traveled up to Sydney for Australia’s first Agile Coach camp in 2013. I didn’t know what to expect from the event other than wanting to network and meet other people who were passionate about helping others deliver customer and business outcomes through agile ways of working. In the end I caught up with a great bunch of like-minded people and walked away with some new ideas and hopefully provided some inspiration for others.
I want to increase my competency as an Agile Coach and help others by forming a community of practicing Agile Coaches. Through this desire I formed the Agile Coaching Circles Meetup (www.meetup.com/agile-coaching-melbourne) in Melbourne to provide support for the role of the Agile Coach. Naturally Agile Coach Camp is another outlet to learn and become more effective in the role of an Agile Coach and anyone else involved in coaching, training, mentoring and leading Agile organisations, teams and individuals through a community of practicing coaches. It is a practitioner-run event and the sessions are planned collaboratively on the day with the participants. I find the peer-to-peer Open Space discussions to be diverse, cooperative, stimulating and interactive.
I am looking forward to the coach camp in Sydney and I am excited about collaborating with Bernd Schiffer in hosting Melbourne’s inaugural coach camp in early 2015 and making this a regular event in every coach’s calendar. We want to run the Melbourne coach camp as a grassroots event that is cost neutral with little or no sponsorship other than a sponsor who can denote a venue for us to use. We want to encourage everyone to bring their best ideas or problem they want help with, unleash their enthusiasm and together we can discover how we can be even better coaches.
I hope to see you in March at the Melbourne Agile Coach Camp.
It was great co-chairing a stream at the Agile Australia 2014 Conference with Renee Troughton and Kim Ballestrin. At the conference the friendly folks from The Agile Revolution, Craig Smith and Renee Troughton, grabbed me for a quick chat for their podcast, Episode 77: Agile Australia 2014 Vox Pop #2.
You can hear my interview starting at the 9 min 20 second mark.
Recently I was posed the question “how can we shape organisations to be successful in an environment of digital disruption?”
The convergence of technologies, such as cloud, social, mobile and information (the Nexus of Forces) …. are driving the Digital Industrial Revolution (Gartner). The convergence of these technologies has formed what Fred Wilson has described as the Golden Triangle:
“The three current big megatrends in the web/tech sector are mobile, social, and real-time.”
However, technology is just one part of the digital disruption equation. You can forget about digital disruption if you don’t disrupt your existing (traditional) business models.
Over the years oragnisations have updated their technology roadmaps and invested in new technologies to support their business strategies. Yet organisations have retained their legacy processes and policies and have not adapted new ways of working to compete effectively. Most organisations are built to sustain their existing business models which are not geared towards creating digital experiences for customers. Existing governance structures are often too slow, too siloed, stifles innovation, adds bureaucracy and all too inconsistent.
Increasingly organisations are embracing new paradigms and principles in the way they work in the era of digital. Many of these incidentally come from Agile and its related areas such Lean, Kanban, Design Thinking, Systems Thinking, and Lean Startup. Take for example the U.S. Digital Services Playbook:
- Understand what people need
- Address the whole experience, from start to finish
- Make it simple and intuitive
- Build the service using agile and iterative practices
- Structure budgets and contracts to support delivery
- Assign one leader and hold that person accountable
- Bring in experienced teams
- Choose a modern technology stack
- Deploy in a flexible hosting environment
- Automate testing and deployments
- Manage security and privacy through reusable processes
- Use data to drive decisions
- Default to open
and the UK Government Digital Services Design Principles:
- Start with (user) needs
- Do less
- Design with data
- Do the hard work to make it simple
- Iterate. Then iterate again.
- Build for inclusion
- Understand context
- Build digital services, not websites
- Be consistent, not uniform
- Make things open: it makes things better
Adoption of an Agile models, Lean Principles, a lean way to create a business model and a way to continuously innovate is vital if you want to compete effectively. These (modern) delivery models and principles no longer play a supporting role, but are center stage – it is becoming essential to the success of businesses in the age of digital disruption.
None of the principles and policies by the U.S. Digital Services and UK Government Digital Services is about technology. They are more about how work and business is to be done. The companies that will be successful in the disruptive digital era will be those who look beyond technology solutions but also disrupt their traditional organisation and governance structures and invest in new business models.
The digital disruption is forcing businesses to change how business is done. This requires a business transformation that uses technology to create digital experiences for customers AND equally adapt or introduces new processes and systems to successfully compete. Through evolution of work design, organisations need to adapt and change processes and policies (and we are not just talking changes in IT only). This will be BIG – it means changing one way of being to another. A butterfly is nothing like a caterpillar.
 W. Edward Deming defines a system as a network of interdependent components that work together to try to accomplish the aim of the system. In this case the system is not an IT system, but the organisation as a system.
“One of the big success factors at Spotify is the Agile Engineering Culture.” – Henrik Kniberg
Spotify started as a Scrum company in 2008 but the standard Scrum practices were getting in the way as they grew, so they made them optional. Here’s an awesome video how Spotify scaled their Agile Engineering Culture. They decided that:
- Agile matters more than Scrum
- Agile Principles matters more than any specific Practices
- Agile Coach is needed rather than ScrumMaster (Servant Leaders more than Process Masters)
In today’s era, organisations especially large enterprises are often challenged with shrinking revenues from existing products and services. Furthermore technological breakthroughs and incremental product development no longer necessarily provide the competitive differentiators to grow their business. Management need to investigate how to reinvent ways to sustain innovation and to stay in front of their competitors.
The process of innovation is often seen as being very linear, with business models created from market research results, leading to large development efforts creating products that fail to meet customer’s need.
The goal of a new product development is to figure out the right thing to build—the thing customers want and will pay for—as quickly as possible. But why do new products fail so badly everywhere we look? The first problem is the allure of a good plan, a solid strategy, and thorough market research. In earlier eras, these things were indicators of likely success. So what has changed? In today’s era this approach does not work as organisations operate under extreme uncertainty.
We must learn what customers really want, not what they say they want or what we think they should want. We need to go beyond asking hypothetical questions, and observe real customer behaviour.
The following model combines ingredients from 4 different disciplines to help with this innovation dilemma:
- Design Thinking
- Lean Startup
- Business Model Canvas
Each part is fit for purpose in the cycle of innovation.
Download PDF version.
1. Design Thinking – develop customer empathy to generate insights and create ideas
Design plays a significant part of innovative business models and it is important in creating value for users.
Through working with a product development team in a large enterprise I have observed how well Design Thinking complements Lean Startup. Lean Startup is taking the world by storm, however, the build-measure-learn cycle does not address the design and ideation cycle – how do organisations and teams identify ideas, customer insights and leap-of-faith assumptions that need to be validated?
Thinking like a designer certainly will help transform the way you develop products, services, processes and even strategy [Tim Brown, CEO of IDEO] through contextual inquiry and observing customer behaviours. Immersing yourself in the context and observing customer behaviours helps you unearth details and intricacies of the problem space. Accurate observations will help you generate insights, create ideas and develop initial product designs for a customer segment. These ideas, designs and leap-of-faith assumptions can then be further validated using Lean Startup.
2. Lean Startup – scientific experimentation and validated learning
Lean Startup supports the launching of businesses and products. It relies on validated learning, scientific experimentation, and iterative product releases to shorten product development cycles, measure progress, and gain valuable customer feedback. In this way, organisations can design their products or services to meet the demands of their customer base without requiring large amounts of initial funding or expensive product launches.
Lean Startup is a learning framework for “disruptive innovation” defined as unknown problem, customer & market, solution & the search for “the right thing to build”. The primary output being a validated business model through, rapid iteration, empiricism & non-vanity metrics to measure progress.
The design thinking process provides a vehicle to generate tested ideas quickly. The Lean Startup approach can then be used to validate the ideas, customer insights and leap-of-faith assumptions using experiments.
Both Design Thinking and Lean Startup take a very similar iterative and customer driven development design approach. The combined approach of Design Thinking and Lean Startup provides a systematic approach for organisations to create disruptive innovation.
3. Business Model Canvas – Rapidly create a business model
The Business Model Canvas is one of the most used business model frameworks. The Business Model Canvas allows you to rapidly create and capture the rationale of how an organisation creates, delivers, and captures value. Design Thinking informs the Business Model of opportunities (eg who our customers are and what they value). The Business Model can be systematically validated/invalidated through Lean Startup experiments. Lean Startup is the framework to rapidly iterate over the business model.
Ultimately, this allows us to test the business viability, and to change and adapt our business model to take advantage of the opportunities. Any part of the business model that is validated can be quickly delivered to customers through small releases (minimal viable products) using iterative and incremental approach of agile development.
4. Agile – Implement and continuously deliver product features to the customer
Lean and Agile values, principles and practices provides the means for organisations to amplify the leap-of-faith assumptions by continuously delivering value to users through iterative and incremental development.
Mixing it all together
In the race to create new innovative product and services, organisations will need to move away from the linear approach to innovation using assumptions based on market research. The combination design thinking, lean startup, business model canvas and agile is a holistic approach that has a push towards customer centricity that really helps provide a framework to create and sustain an innovation pipeline. Ultimately these 4 parts provides a model to build an innovative culture and delight customers with the right product that has the right solution and market fit.
To create a sustaining innovation pipeline organisations may circle back through design thinking, Lean Startup, and Agile for implementation more than once as the product team refines its ideas and explores new directions.
- You may also like to read a very nice article by David Bland describing the need to combine Lean Startup + Business Model Innovation + Continuous Delivery and why each by itself is not enough. I have adapted David’s venn diagram to explicitly include where I think Design Thinking fits.
- A previous post I wrote, Enlightened trial and error succeeds over the planning of the lone genius illustrates Design Thinking in action by IDEO.
- The Lean Startup, Eric Ries