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Individually Smart,
Collectively Stupid
Lean Agile Scotland
Edinburgh
September 2012

David J. Anderson
David J. Anderson & Associates, Inc.
dja@djaa.com
Twitter @agilemanager
Division 3 is attracting a lot more interest this
season!

It’s not rational,
man!

2001
Agile Manifesto
Adam Smith

Lean
Agile
Scotland
@agilemanager
So was sending Rangers to Division 3, an act of
collective stupidity?
An act of spiteful schadenfreude
(taking pleasure from the misfortunes of others).
Is it irrational economically, serving no other
purpose
than providing that feel good factor from gloating
over the football results every weekend for the
next 3 years?

I don't think so!
Lean
Agile
Scotland
@agilemanager
What’s happening to Rangers is tribal & emotional!

Lean
Agile
Scotland
@agilemanager
Stack …


To understand how to be collectively smart,
we must understand tribal, social behavior.
Tribal behavior in the workplace can affect
performance and make us look collectively
stupid.



but more about tribes later...

Lean
Agile
Scotland
@agilemanager
Delays

Lean
Agile
Scotland
@agilemanager
Collective stupidity manifests in poor
flow efficiency

delay

work
time
The first Kanban implementation at Microsoft exhibited 8% flow
efficiency initially.

My personal experience is 5% - 15% before any improvement initiative
is started

Lean
Agile
Scotland

Hakan Forss, a consultant from Sweden reports clients typically exhibit
< 5% flow efficiency

@agilemanager
Flow Efficiency in manufacturing industries can
be >70% often >90%

Manufacturing workers appear to be
collectively smart!

Lean
Agile
Scotland
@agilemanager
Why is it important to improve Flow Efficiency
and eliminate delay?

Lean
Agile
Scotland
@agilemanager
Little’s Law

Lean
Agile
Scotland
@agilemanager
Little’s Law

Completion Rate

=

WIP
Lead Time
Lean
Agile
Scotland
@agilemanager
Easily validated by visual inspection of a
cumulative flow diagram

Avg. Lead Time

Time
Inventory

Started

Designed

Coded

Complete

30
-M
ar

23
-M
ar

16
-M
ar

9M
ar

2M
ar

eb

Avg. Comp Rate

Lean
Agile
Scotland

24
-F

eb

WIP

17
-F

eb

240
220
200
180
160
140
120
100
80
60
40
20
0

10
-F

Features

Device Management Ike II Cumulative Flow

@agilemanager
Little’s Law
…we increase this

…to maintain this,…

Completion Rate

WIP

=

Lead Time
As this increases,…
We observe that as lead times increases due to delay, we tend to
increase WIP in order to have a steady flow of delivery.
We keep starting stuff!
More WIP tends to cause longer leads times due to multi-tasking and
quality issues.

Vicious cycle can spiral out of control!

Lean
Agile
Scotland

We start more stuff!

@agilemanager
In 2005, HP printer firmware division in Boise,
Idaho discovered they had 4.5 years of WIP!!!
This was invisible until they plotted a CFD based
on data from their development tracking system

Lean
Agile
Scotland
@agilemanager
Induced Work
the longer the delay to
fix a defect, the longer it
takes to fix

Defect
rate

time

Lean
Agile
Scotland

The longer the delays in designing
something the more likelihood of
defects. This has been observed to
be non-linear.

@agilemanager
Eventually, these effects combine to slow the
delivery rate to a trickle while large quantities
of work remain in progress

Lean
Agile
Scotland

And finally we stop starting stuff!
But we still can't finish our work-in-progress

@agilemanager
Cost of Delay

Lean
Agile
Scotland
@agilemanager
Long lead times add risk and cost. The future is
uncertain and faster delivery gives us greater
certainty of the utility of what we delivering. Note
the use of the word "utility" from economics and
not "value". Utility isn't always a tangible
monetary value. It merely implies usefulness that
didn't previously exist.
The longer it takes to deliver something the less
certain we can be about its utility. There is an
opportunity cost of delay - the risk adjusted utility
of what we are building.

So faster delivery gives us more certainty and is
likely to deliver greater utility.
Lean
Agile
Scotland
@agilemanager
Stack…




1. Tribal Behavior isn't rational (as Adam
Smith defined it)
2. If we are to be collectively smart we must
address causes of delay

Lean
Agile
Scotland
@agilemanager
Lean

Lean
Agile
Scotland
@agilemanager
How does Lean improve Flow Efficiency?


Optimize the whole!



Use a Systems Thinking approach!



To understand this, let’s meet some well
known Scottish systems thinkers…

Lean
Agile
Scotland
@agilemanager
Graeme Obree

Lean
Agile
Scotland
@agilemanager
Alex Ferguson

Lean
Agile
Scotland
@agilemanager
So Lean typically employs a system thinking
designer like Graeme Obree or Alex Ferguson.
The designer designs a new system to optimize
the whole and eliminate the waste.
But how well does this scale?

Obree is a craftsman working empirically on a
small scale with few or any collaborators

Ferguson is arguably a (benevolent) dictator of a
small to medium sized enterprise
Lean
Agile
Scotland
@agilemanager
Lean text books will tell you to "map the valuestream." In knowledge work, we tend to use an
older term "workflow" as the metaphor of a
stream implies a single direction and knowledge
work flows tend to be complex and involve loops.

So we should "Map the Workflow".

This gives us a definition of our current
process.
Lean
Agile
Scotland
@agilemanager
How does Lean improve Flow Efficiency?


Optimize the whole!



Use a Systems Thinking approach!



Identify wasteful, delaying activities and
eliminate them

Lean
Agile
Scotland
@agilemanager
For knowledge work, this means identifying all the
delays and in turn the causes of delay, and then
designing them out of our future process.
So Lean employs a system thinking designer to
design out causes of delay and define our new
process.
The Lean consultant will then plan and manage
the transition from the old process to the new
process.
Lean
Agile
Scotland
@agilemanager
So let's take a look at how an experienced and
successful coach introduced a number of famous
Scots to their new future state process…

Lean
Agile
Scotland
@agilemanager
[Video clip from Damned United]

Lean
Agile
Scotland
@agilemanager
The team may not always accept the proposed
new process definition (or the designers opinion)!

Lean
Agile
Scotland
@agilemanager
Stack…






1. Tribal Behavior isn't rational (as Adam
Smith defined it)
2. If we are to be collectively smart we must
address causes of delay
3. People (often) resist defined & managed
change for emotional reasons

Lean
Agile
Scotland
@agilemanager
Self-organization

Lean
Agile
Scotland
@agilemanager
So, if people will resist being told what to do, or
perhaps our grand system designer can't get it
right all of the time, …
the Agile community argues that we should allow
individuals to self-organize to produce the best
outcome - it's written into the Principles behind
the Agile Manifesto.

The father of self-organization is, of course, a
Scotsman...
Lean
Agile
Scotland
@agilemanager
Adam Smith’s Invisible Hand

Lean
Agile
Scotland
@agilemanager
Smith believed that all we required was to
construct a set of rational incentives to guide
individual behavior and markets would selforganize around optimal, efficient solutions.
Loosely regulated markets would produce the
optimal system outcome as each individual would
act in his/her own best interests.

Lean
Agile
Scotland
@agilemanager
Renee Descartes

If we were to
optimize the whole,
all we needed to
do was optimize
the parts by asking
each to act
rationally.

Donaldson Brown

Lean
Agile
Scotland

Fredrick Taylor

Couple this with Cartesian
decomposition and it was
inevitable that the ScottishFrench version of the
Renaissance would deliver us
to Taylorism and the invention
of another great Scotsman,
Donaldson Brown,
CFO at GM, cost
accounting.

@agilemanager
Unfortunately, it is this line of thinking that caused
the need for a Lean revolution.

Lean
Agile
Scotland
@agilemanager
In recent times, the Internet has enabled and
encouraged self-organization on a massive scale.
But the best of these, such as the open source
software development communities like Linux, do
not survive without a benevolent dictator. The
Invisible Hand is indeed very visible and attached
to a human leader.

Lean
Agile
Scotland
@agilemanager
We might conclude from this that selforganization of large systems of humans is
challenging.

Lean
Agile
Scotland
@agilemanager
The alternative to
Smith's Invisible Hand
was
constructed by an
Englishman - Thomas
Hobbes and his
Leviathan

Lean
Agile
Scotland

The concept is simple the people cannot be
trusted to act rationally
(ethically or morally)
and hence
must be controlled
through command and
the rule of law.

@agilemanager
It was an English
version of the
Renaissance that
gave us socialist 5
year plans and
command and control
structures in
corporations - albeit a
Frenchman, Henri
Fayol, who
documented it as an
approach to
management around
the turn of the 20th
Century.
Lean
Agile
Scotland

Henri Fayol

@agilemanager
Now in the 21st Century, we are aware that both
of these extremes don't work. The command and
control Leviathan with its designed outcomes and
5 year master plans have been shown to fail us.
Equally, we suffer at the Invisible Hand that
supposedly guided the markets to act rationally
and optimize the outcome.

Lean
Agile
Scotland
@agilemanager
Men (and women)
don't act rationally.
Modern knowledge
workers will not be
commanded and
controlled.

Lean
Agile
Scotland

And those that would
command and control
are often working with
flawed plans and
designs built on
incomplete models
and false
assumptions.

@agilemanager
Stack…








1. Tribal Behavior isn't rational (as Adam
Smith defined it)
2. If we are to be collectively smart we must
address causes of delay
3. People (often) resist defined & managed
change for emotional reasons
4. After 250 years of the Leviathan & the
Invisible Hand, we need a new philosophy to
guide the organization of human activity in the
21st Century
Lean
Agile
Scotland
@agilemanager
Complexity

Lean
Agile
Scotland
@agilemanager
So why didn’t Mark Cavendish win Gold at the
Olympics?...

Mark Cavendish
Lean
Agile
Scotland
@agilemanager
[video clip of Mark Cavendish]

Lean
Agile
Scotland
@agilemanager
The point of this story is that the obvious script
based on observed team capabilities didn't play
out because of the psychology of the people
involved and pre-race events that changed
perception. Had Cavendish not won the final
stage of the Tour De France so convincingly, he
may indeed be the Olympic champion today.

Lean
Agile
Scotland
@agilemanager
The British, the Germans and the Australians
were "all-in" with their strategy of a sprint finish
with their top sprinter taking the Gold. They
lacked adaptability and despite this lack of
adaptability they also lacked the ability to
collaborate in order for their strategy to have a
chance. They were collectively stupid and
sprinted for 17th place to save face.

Lean
Agile
Scotland
@agilemanager
Risk
(or, the future is uncertain)

Lean
Agile
Scotland
@agilemanager
Risk is the idea that
things may not
work out exactly as
we would like them
to. If we wanted to
measure risk it is
the chance and the
magnitude of an
actual outcome
being different from
our intended
outcome.

Lean
Agile
Scotland

Managing risk is the science of minimizing the
difference between a desired outcome and an
actual outcome

@agilemanager
The British, Australian and German cycling teams
failed to manage their risk appropriately. The
complexity of the situation meant that effective
risk management required collaboration that did
not emerge.

Lean
Agile
Scotland

If we ran the race over again, the outcome would
be different, as the starting psychological starting
conditions would be different.

@agilemanager
Stack…










Lean
Agile
Scotland

1. Tribal Behavior isn't rational (as Adam
Smith defined it)
2. If we are to be collectively smart we must
address causes of delay
3. People (often) resist defined & managed
change for emotional reasons
4. After 250 years of the Leviathan & the
Invisible Hand, we need a new philosophy to
guide the organization of human activity in the
21st Century
5. Human collaboration creates complexity
from psychological and sociological
influences. Results will change based on the
starting conditions, all other things being
equal

@agilemanager
Risk in Knowledge Work

Lean
Agile
Scotland
@agilemanager
Unlike manufacturing industry, we often don't
know exactly what benefit will be derived from a
piece of software. It is almost impossible to
determine what a feature or function might be
worth. Individually, one might be worthless, but
combined with others it will have some utility but
precisely how much? This can generally only be
determined retrospectively.

Lean
Agile
Scotland
@agilemanager
As a result, we can't know with certainty which
ideas for features and functions will produce the
greatest utility. Our reaction to this is to hedge our
bets by working on more than one at a time.
Hence, due to the nature of knowledge work,
multi-tasking is inevitable. It is the economically
smart thing to do.
It turns out, some multi-tasking isn't stupid at
all, it's smart. Multi-tasking helps us mitigate risk.
Multi-tasking buys us options. Options have value
in the face of uncertainty.
Lean
Agile
Scotland
@agilemanager
But multi-tasking means things take longer, and
longer is likely to affect quality, and incur a cost of
delay. So there is a conflict!

Lean
Agile
Scotland
@agilemanager
This should immediately make you think there is
an optimization problem here. What is the
optimum amount of multi-tasking (or additional
work-in-progress) to mitigate the uncertainty of
the future while providing the shortest possible
lead times to maximize the utility of the work-inprogress?

Lean
Agile
Scotland
@agilemanager
The truth is there is unlikely to be a recipe for this.
The answer will be situational and context
specific. As we can only have perfect knowledge
from hindsight, the nature of this problem, means
it is unlikely we can design a process to produce
an optimal outcome.
The GB Cycling team showed us this dramatically
during the Olympics.

Lean
Agile
Scotland
@agilemanager
Instead we want our system to be adaptive and
for it to evolve to produce the fittest possible
process given current circumstances. And should
circumstances change, for that evolutionary
capability to be inherent to our system so that it
can adapt again and again, optimizing the whole
around the current economic challenges of our
business and the risks we are managing.

Lean
Agile
Scotland
@agilemanager
Stack…










Lean
Agile
Scotland



1. Tribal Behavior isn't rational (as Adam Smith defined
it)
2. If we are to be collectively smart we must address
causes of delay
3. People (often) resist defined & managed change for
emotional reasons
4. After 250 years of the Leviathan & the Invisible
Hand, we need a new philosophy to guide the
organization of human activity in the 21st Century
5. Human collaboration creates complexity from
psychological and sociological influences. Results will
change based on the starting conditions, all other
things being equal
6. To cope adequately with complexity and risk we
need a system that is adaptive and has an inherent
evolutionary capability

@agilemanager
Introduction to Kanban

Lean
Agile
Scotland
@agilemanager
Kanban systems model workflow and limit WIP at each
step, signaling available capacity, effectively creating a pull
system for work orders. First used at Microsoft in 2005

Lean
Agile
Scotland

White boards were introduced in 2007 to visualize
workflow, signal capacity and show work orders flowing
through the system

@agilemanager
Boards typically visualize a workflow as columns (input) left
to (output) right
WIP Limit – regulates
work at each stage in
the process

Pull

Flow – from Engineering
Ready to Release Ready

Lean
Agile
Scotland
@agilemanager
Tickets on the board are “committed”
Backlog items remain “options”
Kanban systems defer commitment & enable dynamic
prioritization when “pull” is signaled
5

4

Analysis
Input
Queue In Prog Done

3

4

Development
Dev
Ready In Prog Done

Commitment point

2

Build
Ready

Test

Release
Ready

Stage

Prod.

Lean
Agile
Scotland

Flow

2

@agilemanager
Tickets on the board are committed. Items in the
backlog are merely options
5

4

Analysis
Input
Queue In Prog Done

3

4

Development
Dev
Ready In Prog Done

2

Build
Ready

Test

Release
Ready

Stage

Prod.

Lean
Agile
Scotland

Pink tickets show blocking issues

2

@agilemanager
Pull criteria policies encourage a focus on quality
& progress with imperfect information
5

4

Analysis
Input
Queue In Prog Done

4

Development
Dev
Ready In Prog Done

Policies
~~~~~~
~~~~

2

2

Build
Ready

Test

Policies
~~~~~~
~~~~

Release
Ready

Stage

Policies
~~~~~~
~~~~

Prod.

Lean
Agile
Scotland

Policies
~~~~~~
~~~~

3

@agilemanager
Cost of delay function sketches provide
a qualitative taxonomy to delineate
classes of risk
Function
impact

Expedite – white; critical and immediate cost of
delay; can exceed other kanban limit (bumps
other work); 1st priority - limit 1
time

impact

Fixed date – orange; cost of delay goes up
significantly after deadline; Start early enough &
dynamically prioritize to insure on-time delivery

impact

time

time

time

Standard - yellow; cost of delay is shallow but
accelerates before leveling out; provide a
reasonable lead-time expectation
Intangible – blue; cost of delay is not incurred
until significantly later; important but lowest
priority

Lean
Agile
Scotland

impact

Colour

@agilemanager
Allocate capacity across classes of service
mapped against demand
5

4

Analysis
Input
Queue In Prog Done

3

4

Development
Dev
Ready In Prog Done

2

Build
Ready

2 = 20 total

Test

Release
Ready

Allocation
+1 = +5%

10 = 50%
6 = 30%

Lean
Agile
Scotland

4 = 20%

@agilemanager
Benefits of a Kanban System


There are predictable benefits from the
merely complicated, mechanical nature of the
system...






Deferred Commitment
Reduced & more predictable lead times
Improved quality from removing overburdening
Improved quality due to focus
Controlled quality due to explicit policies

Lean
Agile
Scotland
@agilemanager
The Kanban Method


What I didn’t predict was that kanban
systems, coupled with visualization would
create a positive tension catalyzing process
evolution
Seeing (lack of) flow, understanding system
level effects, enabled improvements in small
evolutionary steps



While kanban systems dealt with merely
complicated system dynamics, they enabled
an evolutionary response to complex
problems

Lean
Agile
Scotland



@agilemanager
Definition of
The Kanban Method

Lean
Agile
Scotland
@agilemanager
Foundational Principles

1.
2.

3.

4.

Lean
Agile
Scotland

Start with what you do now
Agree to pursue incremental,
evolutionary change
Initially, respect current roles,
responsibilities & job titles
Encourage acts of leadership at
all levels in your organization

@agilemanager
Lean
Agile
Scotland

Kanban in Action tried to visually capture the principles

@agilemanager
Core practices to enable evolutionary capability

1.
2.
3.
4.
5.

6.

Lean
Agile
Scotland

Visualize
Limit Work-in-Progress
Manage Flow
Make Policies Explicit
Implement Feedback Loops
Improve Collaboratively
(using models & scientific
method)

@agilemanager
System Thinking Approach to Introducing Kanban
Understand Sources of Dissatisfaction

1.




From viewpoint of internal & external stakeholders
Source of variability that cause dissatisfaction

Demand and Capability Analysis

2.


(Ideally) By work item type & class of service

Risk Analysis

3.


Identify dimensions to manage & taxonomies

Model Workflow

4.


Understand the knowledge discovery process by type

Kanban System Design
Visualization
Roll out Plan

5.
6.

7.

Negotiation & shuttle diplomacy

This process tends
to be iterative

Lean
Agile
Scotland



@agilemanager
Philosophy Behind
The Kanban Method

Lean
Agile
Scotland
@agilemanager
People resist change for emotional reasons. If
resistance wasn't emotional, the logical,
reasoning part of the brain could be persuaded
with rational argument showing improved
economics or risk management.

Lean
Agile
Scotland
@agilemanager
Emotional reasoning, in this sense, means the
older parts of our brain that process sensory
information and match patterns rather than the
more recent, in evolutionary terms, logical
reasoning part of our brains.
The mistake is to assume humans behave based
on logical reasoning. They don't when there is a
dissonance between the newer logical, thinking
part of our brain and our older, sensory,
emotional brain, the emotional part always wins.

Lean
Agile
Scotland
@agilemanager
There is a psychological and sociological
component to resistance to change:
The psychology of the individual ego, self-image
and how they derive self-esteem.
The sociology of the workplace tribe, an
individuals position in the tribal hierarchy, how
they are respected and valued within the tribe,
and the tribes own self-image and how it derives
its tribal pride and sense of worth.

Lean
Agile
Scotland
@agilemanager
When a change is perceived to threaten the
individual’s sense of self or the tribe then it will be
resisted.

Lean
Agile
Scotland
@agilemanager
Kanban embraces the Zen influenced philosophy
of Bruce Lee. Kanban should be like water! It
should flow around the rock! The rock is
emotional resistance to change.

Lean
Agile
Scotland
@agilemanager
Initial Kanban implementations should be
designed to avoid emotional resistance by
anticipating the self-image, and tribal
memberships of the individuals
involved. Kanban implementers predict how selfesteem and tribal worth are derived and avoid
changing mechanisms that are core to the
psychology and sociology of the individuals
involved in the change.

Lean
Agile
Scotland
@agilemanager
The systems thinking approach to introducing
Kanban is designed to identify what can be
improved. The implementation should then be
designed to introduce only the changes that will
not meet with initial resistance while highlighting
and raising awareness of possible future
improvements.

Lean
Agile
Scotland
@agilemanager
How many psychologists does it take to change a
lightbulb?

Lean
Agile
Scotland
@agilemanager
Kanban's visual, tactile and collaborative nature
acts to move the participants to conclude for
themselves that changes need to be made!

Lean
Agile
Scotland

The lightbulb decides to change itself!

@agilemanager
There are no teams or organizational structures
defined in Kanban. Keeping existing
organizational structures avoids emotional
resistance.
Changes to roles, team and organization
structures must be self-motivated. Roles and
organizational structures must evolve.

Lean
Agile
Scotland
@agilemanager
It turns out that the initial implementation of the
kanban (pull) system can often be argued
logically because it does not invoke an emotional
reaction.
Kanban does not threaten the self-image of
individuals or the tribes they are members of.

Lean
Agile
Scotland
@agilemanager
As a result many of the predictable benefits from
the mechanical side of implementing a kanban
system are easily realized.
Predictability improves
Lead times are reduced
Quality improves
But often it is not enough. To cope with the
uncertainties of demand and future risks, the
organization needs a capability to evolve.

Lean
Agile
Scotland
@agilemanager
Kanban is not a software development lifecycle
or project management process. It is a method
for creating institutional evolutionary capability.

WIP limits and visualization and a focus on flow
provide the tension to catalyze discussion of
improvement. Hence the cartoon on the cover of
the book!

Lean
Agile
Scotland
@agilemanager
Conclusions

Lean
Agile
Scotland
@agilemanager
And so, to pop some things from our stack…


Kanban is an approach to institutional
evolutionary capability. This enables an
organization to better cope with complexity.

Lean
Agile
Scotland
@agilemanager
And so, to pop some things from our stack…




Lean
Agile
Scotland

Kanban is an approach to institutional
evolutionary capability. This enables an
organization to better cope with complexity
Whether a new method or process will be
embraced and implemented successfully
depends a lot on the starting conditions, and
the psychological and sociological elements
in play - just like planning to win the Gold
medal in the Men's Road Race! As a result,
every implementation has to be unique and
the results from one implementation cannot
fully predict the outcome elsewhere

@agilemanager
And so, to pop some things from our stack…




Lean
Agile
Scotland

Whether a new method or process will be
embraced and implemented successfully
depends a lot on the starting conditions, and
the psychological and sociological elements
in play - just like planning to win the Gold
medal in the Men's Road Race! As a result,
every implementation has to be unique and
the results from one implementation cannot
fully predict the outcome elsewhere
The field of Behavioral Economics is
emerging to incorporate human psychology
(neuropsychology) and sociology into our
models for economic behavior

@agilemanager
And so, to pop some things from our stack…




The field of Behavioral Economics is
emerging to incorporate human psychology
(neuropsychology) and sociology into our
models for economic behavior
Defined and managed change on a large
scale doesn't work because the people
involved resist the changes. Change must be
self-motivated and the organization must be
willing to experiment, mutate and evolve to
cope with changes in the market and the
economic environment.
Lean
Agile
Scotland
@agilemanager
And so, to pop some things from our stack…
Defined and managed change on a large scale doesn't work
because the people involved resist the changes. Change
must be self-motivated and the organization must be willing
to experiment, mutate and evolve to cope with changes in the
market and the economic environment.



We need a new philosophy to guide how we
organize for the 21st Century economy. The
dichotomy of the Invisible Hand versus the
Leviathan no longer serves us well. Selforganization requires leadership and a
guiding light by which to steer it. Controls
need to define clear boundaries and be neatly
aligned to the risks we are managing. Both
the True North that guides self-organization
and the rules that define the boundaries of
empowerment must be capable of evolving as
conditions change.

Lean
Agile
Scotland



@agilemanager
How to be Collectively Smart?

Lean
Agile
Scotland
@agilemanager
Waste has to be eliminated by a self-aware
system that mutates and evolves using models to
guide changes
gradually improving

shortening lead times
improving flow efficiency
minimizing cost of delay
and managing business risk better.

Lean
Agile
Scotland
@agilemanager
The guiding light is faster delivery of work to
produce the better economic results at a
sustainable pace. We must visualize key risks
such as cost of delay, customers to be served
and the quantity and nature of their demand

Lean
Agile
Scotland
@agilemanager
An institutional capability to reflect and adapt
needs to be present and we need leadership that
is tolerant to failure and encourages
experimentation.
Our organization should be constantly adapting
and evolving. In doing so waste will be eliminated
– not through grand design & managed change
- but incrementally through evolutionary
adaptation

- self-motivated change, led from within and
implemented without resistance.
Lean
Agile
Scotland
@agilemanager
A Decade of Influences
Published June 2012

Lean
Agile
Scotland

115,000 words of
anecdotes explaining
my approach to leadership,
management & change

@agilemanager
Kanban Method Explained
Published April 2010

Lean
Agile
Scotland

A 72,000 word
intro to the topic

@agilemanager
Thank you!

Lean
Agile
Scotland

dja@djaa.com
http://djaa.com/

@agilemanager
http://leankanbanuniversity.com
http://www.limitedwipsociety.org

Yahoo! Groups: kanbandev

Yahoo! Groups: kanbanops
About…
David Anderson is a thought leader in
managing effective software teams. He leads
a consulting, training, publishing and event
planning business dedicated to developing,
promoting and implementing sustainable
evolutionary approaches for management of
knowledge workers.

He has 30 years experience in the high
technology industry starting with computer
games in the early 1980’s. He has led software
teams delivering superior productivity and
quality using innovative methods at large
companies such as Sprint and Motorola.
David is the author of three books. The latest is
Lessons in Agile Management – on the Road
to Kanban. 2010 saw publication of the best
selling Kanban – Successful Evolutionary
Change for your Technology Business.

http://leankanbanuniversity.com
Email: dja@djaa.com Twitter: agilemanager

Lean
Agile
Scotland

David is a founder of the Lean Kanban
University, a business dedicated to assuring
quality training in Lean and Kanban for
knowledge work throughout the world.

@agilemanager
German
published January, 2011

Lean
Agile
Scotland

Translation by
Arne Roock &
Henning Wolf
of IT-Agile

@agilemanager
Spanish
published May 2011

Lean
Agile
Scotland

Translated by
Masa K Maeda, PhD

@agilemanager
Kanban System Adoption Examples Globally
USA
McKesson
Vanguard
GoDaddy
Xbox
Motley Fool
CityGrid Media
Ultimate Software
Constant Contact
SEP
REI
Robert Bosch
Chile
LAN

Mainland EU
Ubuntu
Xing
BWin
Brazil ASR
BBVA
Petrobras
CESAR
Phidelils
O Globo

Israel
Amdocs
Answers.com
TypeMock

China & HK
Thomson-Reuters
Nike

Australia
Lonely Planet
Telstra

New Zealand
Ministry of
Social
Development
Lean
Agile
Scotland

Argentina
Huddle
ThomsonReuters

UK
BBC
IPC Media
Financial Times
Microsoft

Scandinavia
Unibet
Volvo
Skania
Spotify
Ericsson

@agilemanager
Kanban System Adoption by Industry


Media




Games




Vanguard, Motley Fool, Chase, ASR

Software & Telecoms


Amdocs, Ultimate, Constant Contact, Phidelis, SEP,
Huddle, CESAR, Ubuntu

Public Sector


Ministry of Defence (Denmark), Ministry of Social
Development (New Zealand)

Lean
Agile
Scotland



Includes Robert Bosch, Volvo, Skania, Petrobras,
Nike

Finance & Insurance




Mostly small studios includes video arcade thru
mobile games to online gambling such as Unibet &
Bwin

Manufacturing




Includes BBC, Sky, Lonely Planet, Time/Life, IPC,
Mobile.de, O Globo, Financial Times, NBC Universal,
Thomson-Reuters

@agilemanager
Individually Smart, Collectively Stupid - Lean Agile Scotland

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Individually Smart, Collectively Stupid - Lean Agile Scotland

  • 1. Individually Smart, Collectively Stupid Lean Agile Scotland Edinburgh September 2012 David J. Anderson David J. Anderson & Associates, Inc. dja@djaa.com Twitter @agilemanager
  • 2. Division 3 is attracting a lot more interest this season! It’s not rational, man! 2001 Agile Manifesto Adam Smith Lean Agile Scotland @agilemanager
  • 3. So was sending Rangers to Division 3, an act of collective stupidity? An act of spiteful schadenfreude (taking pleasure from the misfortunes of others). Is it irrational economically, serving no other purpose than providing that feel good factor from gloating over the football results every weekend for the next 3 years? I don't think so! Lean Agile Scotland @agilemanager
  • 4. What’s happening to Rangers is tribal & emotional! Lean Agile Scotland @agilemanager
  • 5. Stack …  To understand how to be collectively smart, we must understand tribal, social behavior. Tribal behavior in the workplace can affect performance and make us look collectively stupid.  but more about tribes later... Lean Agile Scotland @agilemanager
  • 7. Collective stupidity manifests in poor flow efficiency delay work time The first Kanban implementation at Microsoft exhibited 8% flow efficiency initially. My personal experience is 5% - 15% before any improvement initiative is started Lean Agile Scotland Hakan Forss, a consultant from Sweden reports clients typically exhibit < 5% flow efficiency @agilemanager
  • 8. Flow Efficiency in manufacturing industries can be >70% often >90% Manufacturing workers appear to be collectively smart! Lean Agile Scotland @agilemanager
  • 9. Why is it important to improve Flow Efficiency and eliminate delay? Lean Agile Scotland @agilemanager
  • 11. Little’s Law Completion Rate = WIP Lead Time Lean Agile Scotland @agilemanager
  • 12. Easily validated by visual inspection of a cumulative flow diagram Avg. Lead Time Time Inventory Started Designed Coded Complete 30 -M ar 23 -M ar 16 -M ar 9M ar 2M ar eb Avg. Comp Rate Lean Agile Scotland 24 -F eb WIP 17 -F eb 240 220 200 180 160 140 120 100 80 60 40 20 0 10 -F Features Device Management Ike II Cumulative Flow @agilemanager
  • 13. Little’s Law …we increase this …to maintain this,… Completion Rate WIP = Lead Time As this increases,… We observe that as lead times increases due to delay, we tend to increase WIP in order to have a steady flow of delivery. We keep starting stuff! More WIP tends to cause longer leads times due to multi-tasking and quality issues. Vicious cycle can spiral out of control! Lean Agile Scotland We start more stuff! @agilemanager
  • 14. In 2005, HP printer firmware division in Boise, Idaho discovered they had 4.5 years of WIP!!! This was invisible until they plotted a CFD based on data from their development tracking system Lean Agile Scotland @agilemanager
  • 15. Induced Work the longer the delay to fix a defect, the longer it takes to fix Defect rate time Lean Agile Scotland The longer the delays in designing something the more likelihood of defects. This has been observed to be non-linear. @agilemanager
  • 16. Eventually, these effects combine to slow the delivery rate to a trickle while large quantities of work remain in progress Lean Agile Scotland And finally we stop starting stuff! But we still can't finish our work-in-progress @agilemanager
  • 18. Long lead times add risk and cost. The future is uncertain and faster delivery gives us greater certainty of the utility of what we delivering. Note the use of the word "utility" from economics and not "value". Utility isn't always a tangible monetary value. It merely implies usefulness that didn't previously exist. The longer it takes to deliver something the less certain we can be about its utility. There is an opportunity cost of delay - the risk adjusted utility of what we are building. So faster delivery gives us more certainty and is likely to deliver greater utility. Lean Agile Scotland @agilemanager
  • 19. Stack…   1. Tribal Behavior isn't rational (as Adam Smith defined it) 2. If we are to be collectively smart we must address causes of delay Lean Agile Scotland @agilemanager
  • 21. How does Lean improve Flow Efficiency?  Optimize the whole!  Use a Systems Thinking approach!  To understand this, let’s meet some well known Scottish systems thinkers… Lean Agile Scotland @agilemanager
  • 24. So Lean typically employs a system thinking designer like Graeme Obree or Alex Ferguson. The designer designs a new system to optimize the whole and eliminate the waste. But how well does this scale? Obree is a craftsman working empirically on a small scale with few or any collaborators Ferguson is arguably a (benevolent) dictator of a small to medium sized enterprise Lean Agile Scotland @agilemanager
  • 25. Lean text books will tell you to "map the valuestream." In knowledge work, we tend to use an older term "workflow" as the metaphor of a stream implies a single direction and knowledge work flows tend to be complex and involve loops. So we should "Map the Workflow". This gives us a definition of our current process. Lean Agile Scotland @agilemanager
  • 26. How does Lean improve Flow Efficiency?  Optimize the whole!  Use a Systems Thinking approach!  Identify wasteful, delaying activities and eliminate them Lean Agile Scotland @agilemanager
  • 27. For knowledge work, this means identifying all the delays and in turn the causes of delay, and then designing them out of our future process. So Lean employs a system thinking designer to design out causes of delay and define our new process. The Lean consultant will then plan and manage the transition from the old process to the new process. Lean Agile Scotland @agilemanager
  • 28. So let's take a look at how an experienced and successful coach introduced a number of famous Scots to their new future state process… Lean Agile Scotland @agilemanager
  • 29. [Video clip from Damned United] Lean Agile Scotland @agilemanager
  • 30. The team may not always accept the proposed new process definition (or the designers opinion)! Lean Agile Scotland @agilemanager
  • 31. Stack…    1. Tribal Behavior isn't rational (as Adam Smith defined it) 2. If we are to be collectively smart we must address causes of delay 3. People (often) resist defined & managed change for emotional reasons Lean Agile Scotland @agilemanager
  • 33. So, if people will resist being told what to do, or perhaps our grand system designer can't get it right all of the time, … the Agile community argues that we should allow individuals to self-organize to produce the best outcome - it's written into the Principles behind the Agile Manifesto. The father of self-organization is, of course, a Scotsman... Lean Agile Scotland @agilemanager
  • 34. Adam Smith’s Invisible Hand Lean Agile Scotland @agilemanager
  • 35. Smith believed that all we required was to construct a set of rational incentives to guide individual behavior and markets would selforganize around optimal, efficient solutions. Loosely regulated markets would produce the optimal system outcome as each individual would act in his/her own best interests. Lean Agile Scotland @agilemanager
  • 36. Renee Descartes If we were to optimize the whole, all we needed to do was optimize the parts by asking each to act rationally. Donaldson Brown Lean Agile Scotland Fredrick Taylor Couple this with Cartesian decomposition and it was inevitable that the ScottishFrench version of the Renaissance would deliver us to Taylorism and the invention of another great Scotsman, Donaldson Brown, CFO at GM, cost accounting. @agilemanager
  • 37. Unfortunately, it is this line of thinking that caused the need for a Lean revolution. Lean Agile Scotland @agilemanager
  • 38. In recent times, the Internet has enabled and encouraged self-organization on a massive scale. But the best of these, such as the open source software development communities like Linux, do not survive without a benevolent dictator. The Invisible Hand is indeed very visible and attached to a human leader. Lean Agile Scotland @agilemanager
  • 39. We might conclude from this that selforganization of large systems of humans is challenging. Lean Agile Scotland @agilemanager
  • 40. The alternative to Smith's Invisible Hand was constructed by an Englishman - Thomas Hobbes and his Leviathan Lean Agile Scotland The concept is simple the people cannot be trusted to act rationally (ethically or morally) and hence must be controlled through command and the rule of law. @agilemanager
  • 41. It was an English version of the Renaissance that gave us socialist 5 year plans and command and control structures in corporations - albeit a Frenchman, Henri Fayol, who documented it as an approach to management around the turn of the 20th Century. Lean Agile Scotland Henri Fayol @agilemanager
  • 42. Now in the 21st Century, we are aware that both of these extremes don't work. The command and control Leviathan with its designed outcomes and 5 year master plans have been shown to fail us. Equally, we suffer at the Invisible Hand that supposedly guided the markets to act rationally and optimize the outcome. Lean Agile Scotland @agilemanager
  • 43. Men (and women) don't act rationally. Modern knowledge workers will not be commanded and controlled. Lean Agile Scotland And those that would command and control are often working with flawed plans and designs built on incomplete models and false assumptions. @agilemanager
  • 44. Stack…     1. Tribal Behavior isn't rational (as Adam Smith defined it) 2. If we are to be collectively smart we must address causes of delay 3. People (often) resist defined & managed change for emotional reasons 4. After 250 years of the Leviathan & the Invisible Hand, we need a new philosophy to guide the organization of human activity in the 21st Century Lean Agile Scotland @agilemanager
  • 46. So why didn’t Mark Cavendish win Gold at the Olympics?... Mark Cavendish Lean Agile Scotland @agilemanager
  • 47. [video clip of Mark Cavendish] Lean Agile Scotland @agilemanager
  • 48. The point of this story is that the obvious script based on observed team capabilities didn't play out because of the psychology of the people involved and pre-race events that changed perception. Had Cavendish not won the final stage of the Tour De France so convincingly, he may indeed be the Olympic champion today. Lean Agile Scotland @agilemanager
  • 49. The British, the Germans and the Australians were "all-in" with their strategy of a sprint finish with their top sprinter taking the Gold. They lacked adaptability and despite this lack of adaptability they also lacked the ability to collaborate in order for their strategy to have a chance. They were collectively stupid and sprinted for 17th place to save face. Lean Agile Scotland @agilemanager
  • 50. Risk (or, the future is uncertain) Lean Agile Scotland @agilemanager
  • 51. Risk is the idea that things may not work out exactly as we would like them to. If we wanted to measure risk it is the chance and the magnitude of an actual outcome being different from our intended outcome. Lean Agile Scotland Managing risk is the science of minimizing the difference between a desired outcome and an actual outcome @agilemanager
  • 52. The British, Australian and German cycling teams failed to manage their risk appropriately. The complexity of the situation meant that effective risk management required collaboration that did not emerge. Lean Agile Scotland If we ran the race over again, the outcome would be different, as the starting psychological starting conditions would be different. @agilemanager
  • 53. Stack…      Lean Agile Scotland 1. Tribal Behavior isn't rational (as Adam Smith defined it) 2. If we are to be collectively smart we must address causes of delay 3. People (often) resist defined & managed change for emotional reasons 4. After 250 years of the Leviathan & the Invisible Hand, we need a new philosophy to guide the organization of human activity in the 21st Century 5. Human collaboration creates complexity from psychological and sociological influences. Results will change based on the starting conditions, all other things being equal @agilemanager
  • 54. Risk in Knowledge Work Lean Agile Scotland @agilemanager
  • 55. Unlike manufacturing industry, we often don't know exactly what benefit will be derived from a piece of software. It is almost impossible to determine what a feature or function might be worth. Individually, one might be worthless, but combined with others it will have some utility but precisely how much? This can generally only be determined retrospectively. Lean Agile Scotland @agilemanager
  • 56. As a result, we can't know with certainty which ideas for features and functions will produce the greatest utility. Our reaction to this is to hedge our bets by working on more than one at a time. Hence, due to the nature of knowledge work, multi-tasking is inevitable. It is the economically smart thing to do. It turns out, some multi-tasking isn't stupid at all, it's smart. Multi-tasking helps us mitigate risk. Multi-tasking buys us options. Options have value in the face of uncertainty. Lean Agile Scotland @agilemanager
  • 57. But multi-tasking means things take longer, and longer is likely to affect quality, and incur a cost of delay. So there is a conflict! Lean Agile Scotland @agilemanager
  • 58. This should immediately make you think there is an optimization problem here. What is the optimum amount of multi-tasking (or additional work-in-progress) to mitigate the uncertainty of the future while providing the shortest possible lead times to maximize the utility of the work-inprogress? Lean Agile Scotland @agilemanager
  • 59. The truth is there is unlikely to be a recipe for this. The answer will be situational and context specific. As we can only have perfect knowledge from hindsight, the nature of this problem, means it is unlikely we can design a process to produce an optimal outcome. The GB Cycling team showed us this dramatically during the Olympics. Lean Agile Scotland @agilemanager
  • 60. Instead we want our system to be adaptive and for it to evolve to produce the fittest possible process given current circumstances. And should circumstances change, for that evolutionary capability to be inherent to our system so that it can adapt again and again, optimizing the whole around the current economic challenges of our business and the risks we are managing. Lean Agile Scotland @agilemanager
  • 61. Stack…      Lean Agile Scotland  1. Tribal Behavior isn't rational (as Adam Smith defined it) 2. If we are to be collectively smart we must address causes of delay 3. People (often) resist defined & managed change for emotional reasons 4. After 250 years of the Leviathan & the Invisible Hand, we need a new philosophy to guide the organization of human activity in the 21st Century 5. Human collaboration creates complexity from psychological and sociological influences. Results will change based on the starting conditions, all other things being equal 6. To cope adequately with complexity and risk we need a system that is adaptive and has an inherent evolutionary capability @agilemanager
  • 63. Kanban systems model workflow and limit WIP at each step, signaling available capacity, effectively creating a pull system for work orders. First used at Microsoft in 2005 Lean Agile Scotland White boards were introduced in 2007 to visualize workflow, signal capacity and show work orders flowing through the system @agilemanager
  • 64. Boards typically visualize a workflow as columns (input) left to (output) right WIP Limit – regulates work at each stage in the process Pull Flow – from Engineering Ready to Release Ready Lean Agile Scotland @agilemanager
  • 65. Tickets on the board are “committed” Backlog items remain “options” Kanban systems defer commitment & enable dynamic prioritization when “pull” is signaled 5 4 Analysis Input Queue In Prog Done 3 4 Development Dev Ready In Prog Done Commitment point 2 Build Ready Test Release Ready Stage Prod. Lean Agile Scotland Flow 2 @agilemanager
  • 66. Tickets on the board are committed. Items in the backlog are merely options 5 4 Analysis Input Queue In Prog Done 3 4 Development Dev Ready In Prog Done 2 Build Ready Test Release Ready Stage Prod. Lean Agile Scotland Pink tickets show blocking issues 2 @agilemanager
  • 67. Pull criteria policies encourage a focus on quality & progress with imperfect information 5 4 Analysis Input Queue In Prog Done 4 Development Dev Ready In Prog Done Policies ~~~~~~ ~~~~ 2 2 Build Ready Test Policies ~~~~~~ ~~~~ Release Ready Stage Policies ~~~~~~ ~~~~ Prod. Lean Agile Scotland Policies ~~~~~~ ~~~~ 3 @agilemanager
  • 68. Cost of delay function sketches provide a qualitative taxonomy to delineate classes of risk Function impact Expedite – white; critical and immediate cost of delay; can exceed other kanban limit (bumps other work); 1st priority - limit 1 time impact Fixed date – orange; cost of delay goes up significantly after deadline; Start early enough & dynamically prioritize to insure on-time delivery impact time time time Standard - yellow; cost of delay is shallow but accelerates before leveling out; provide a reasonable lead-time expectation Intangible – blue; cost of delay is not incurred until significantly later; important but lowest priority Lean Agile Scotland impact Colour @agilemanager
  • 69. Allocate capacity across classes of service mapped against demand 5 4 Analysis Input Queue In Prog Done 3 4 Development Dev Ready In Prog Done 2 Build Ready 2 = 20 total Test Release Ready Allocation +1 = +5% 10 = 50% 6 = 30% Lean Agile Scotland 4 = 20% @agilemanager
  • 70. Benefits of a Kanban System  There are predictable benefits from the merely complicated, mechanical nature of the system...      Deferred Commitment Reduced & more predictable lead times Improved quality from removing overburdening Improved quality due to focus Controlled quality due to explicit policies Lean Agile Scotland @agilemanager
  • 71. The Kanban Method  What I didn’t predict was that kanban systems, coupled with visualization would create a positive tension catalyzing process evolution Seeing (lack of) flow, understanding system level effects, enabled improvements in small evolutionary steps  While kanban systems dealt with merely complicated system dynamics, they enabled an evolutionary response to complex problems Lean Agile Scotland  @agilemanager
  • 72. Definition of The Kanban Method Lean Agile Scotland @agilemanager
  • 73. Foundational Principles 1. 2. 3. 4. Lean Agile Scotland Start with what you do now Agree to pursue incremental, evolutionary change Initially, respect current roles, responsibilities & job titles Encourage acts of leadership at all levels in your organization @agilemanager
  • 74. Lean Agile Scotland Kanban in Action tried to visually capture the principles @agilemanager
  • 75. Core practices to enable evolutionary capability 1. 2. 3. 4. 5. 6. Lean Agile Scotland Visualize Limit Work-in-Progress Manage Flow Make Policies Explicit Implement Feedback Loops Improve Collaboratively (using models & scientific method) @agilemanager
  • 76. System Thinking Approach to Introducing Kanban Understand Sources of Dissatisfaction 1.   From viewpoint of internal & external stakeholders Source of variability that cause dissatisfaction Demand and Capability Analysis 2.  (Ideally) By work item type & class of service Risk Analysis 3.  Identify dimensions to manage & taxonomies Model Workflow 4.  Understand the knowledge discovery process by type Kanban System Design Visualization Roll out Plan 5. 6. 7. Negotiation & shuttle diplomacy This process tends to be iterative Lean Agile Scotland  @agilemanager
  • 77. Philosophy Behind The Kanban Method Lean Agile Scotland @agilemanager
  • 78. People resist change for emotional reasons. If resistance wasn't emotional, the logical, reasoning part of the brain could be persuaded with rational argument showing improved economics or risk management. Lean Agile Scotland @agilemanager
  • 79. Emotional reasoning, in this sense, means the older parts of our brain that process sensory information and match patterns rather than the more recent, in evolutionary terms, logical reasoning part of our brains. The mistake is to assume humans behave based on logical reasoning. They don't when there is a dissonance between the newer logical, thinking part of our brain and our older, sensory, emotional brain, the emotional part always wins. Lean Agile Scotland @agilemanager
  • 80. There is a psychological and sociological component to resistance to change: The psychology of the individual ego, self-image and how they derive self-esteem. The sociology of the workplace tribe, an individuals position in the tribal hierarchy, how they are respected and valued within the tribe, and the tribes own self-image and how it derives its tribal pride and sense of worth. Lean Agile Scotland @agilemanager
  • 81. When a change is perceived to threaten the individual’s sense of self or the tribe then it will be resisted. Lean Agile Scotland @agilemanager
  • 82. Kanban embraces the Zen influenced philosophy of Bruce Lee. Kanban should be like water! It should flow around the rock! The rock is emotional resistance to change. Lean Agile Scotland @agilemanager
  • 83. Initial Kanban implementations should be designed to avoid emotional resistance by anticipating the self-image, and tribal memberships of the individuals involved. Kanban implementers predict how selfesteem and tribal worth are derived and avoid changing mechanisms that are core to the psychology and sociology of the individuals involved in the change. Lean Agile Scotland @agilemanager
  • 84. The systems thinking approach to introducing Kanban is designed to identify what can be improved. The implementation should then be designed to introduce only the changes that will not meet with initial resistance while highlighting and raising awareness of possible future improvements. Lean Agile Scotland @agilemanager
  • 85. How many psychologists does it take to change a lightbulb? Lean Agile Scotland @agilemanager
  • 86. Kanban's visual, tactile and collaborative nature acts to move the participants to conclude for themselves that changes need to be made! Lean Agile Scotland The lightbulb decides to change itself! @agilemanager
  • 87. There are no teams or organizational structures defined in Kanban. Keeping existing organizational structures avoids emotional resistance. Changes to roles, team and organization structures must be self-motivated. Roles and organizational structures must evolve. Lean Agile Scotland @agilemanager
  • 88. It turns out that the initial implementation of the kanban (pull) system can often be argued logically because it does not invoke an emotional reaction. Kanban does not threaten the self-image of individuals or the tribes they are members of. Lean Agile Scotland @agilemanager
  • 89. As a result many of the predictable benefits from the mechanical side of implementing a kanban system are easily realized. Predictability improves Lead times are reduced Quality improves But often it is not enough. To cope with the uncertainties of demand and future risks, the organization needs a capability to evolve. Lean Agile Scotland @agilemanager
  • 90. Kanban is not a software development lifecycle or project management process. It is a method for creating institutional evolutionary capability. WIP limits and visualization and a focus on flow provide the tension to catalyze discussion of improvement. Hence the cartoon on the cover of the book! Lean Agile Scotland @agilemanager
  • 92. And so, to pop some things from our stack…  Kanban is an approach to institutional evolutionary capability. This enables an organization to better cope with complexity. Lean Agile Scotland @agilemanager
  • 93. And so, to pop some things from our stack…   Lean Agile Scotland Kanban is an approach to institutional evolutionary capability. This enables an organization to better cope with complexity Whether a new method or process will be embraced and implemented successfully depends a lot on the starting conditions, and the psychological and sociological elements in play - just like planning to win the Gold medal in the Men's Road Race! As a result, every implementation has to be unique and the results from one implementation cannot fully predict the outcome elsewhere @agilemanager
  • 94. And so, to pop some things from our stack…   Lean Agile Scotland Whether a new method or process will be embraced and implemented successfully depends a lot on the starting conditions, and the psychological and sociological elements in play - just like planning to win the Gold medal in the Men's Road Race! As a result, every implementation has to be unique and the results from one implementation cannot fully predict the outcome elsewhere The field of Behavioral Economics is emerging to incorporate human psychology (neuropsychology) and sociology into our models for economic behavior @agilemanager
  • 95. And so, to pop some things from our stack…   The field of Behavioral Economics is emerging to incorporate human psychology (neuropsychology) and sociology into our models for economic behavior Defined and managed change on a large scale doesn't work because the people involved resist the changes. Change must be self-motivated and the organization must be willing to experiment, mutate and evolve to cope with changes in the market and the economic environment. Lean Agile Scotland @agilemanager
  • 96. And so, to pop some things from our stack… Defined and managed change on a large scale doesn't work because the people involved resist the changes. Change must be self-motivated and the organization must be willing to experiment, mutate and evolve to cope with changes in the market and the economic environment.  We need a new philosophy to guide how we organize for the 21st Century economy. The dichotomy of the Invisible Hand versus the Leviathan no longer serves us well. Selforganization requires leadership and a guiding light by which to steer it. Controls need to define clear boundaries and be neatly aligned to the risks we are managing. Both the True North that guides self-organization and the rules that define the boundaries of empowerment must be capable of evolving as conditions change. Lean Agile Scotland  @agilemanager
  • 97. How to be Collectively Smart? Lean Agile Scotland @agilemanager
  • 98. Waste has to be eliminated by a self-aware system that mutates and evolves using models to guide changes gradually improving shortening lead times improving flow efficiency minimizing cost of delay and managing business risk better. Lean Agile Scotland @agilemanager
  • 99. The guiding light is faster delivery of work to produce the better economic results at a sustainable pace. We must visualize key risks such as cost of delay, customers to be served and the quantity and nature of their demand Lean Agile Scotland @agilemanager
  • 100. An institutional capability to reflect and adapt needs to be present and we need leadership that is tolerant to failure and encourages experimentation. Our organization should be constantly adapting and evolving. In doing so waste will be eliminated – not through grand design & managed change - but incrementally through evolutionary adaptation - self-motivated change, led from within and implemented without resistance. Lean Agile Scotland @agilemanager
  • 101. A Decade of Influences Published June 2012 Lean Agile Scotland 115,000 words of anecdotes explaining my approach to leadership, management & change @agilemanager
  • 102. Kanban Method Explained Published April 2010 Lean Agile Scotland A 72,000 word intro to the topic @agilemanager
  • 105. About… David Anderson is a thought leader in managing effective software teams. He leads a consulting, training, publishing and event planning business dedicated to developing, promoting and implementing sustainable evolutionary approaches for management of knowledge workers. He has 30 years experience in the high technology industry starting with computer games in the early 1980’s. He has led software teams delivering superior productivity and quality using innovative methods at large companies such as Sprint and Motorola. David is the author of three books. The latest is Lessons in Agile Management – on the Road to Kanban. 2010 saw publication of the best selling Kanban – Successful Evolutionary Change for your Technology Business. http://leankanbanuniversity.com Email: dja@djaa.com Twitter: agilemanager Lean Agile Scotland David is a founder of the Lean Kanban University, a business dedicated to assuring quality training in Lean and Kanban for knowledge work throughout the world. @agilemanager
  • 106. German published January, 2011 Lean Agile Scotland Translation by Arne Roock & Henning Wolf of IT-Agile @agilemanager
  • 107. Spanish published May 2011 Lean Agile Scotland Translated by Masa K Maeda, PhD @agilemanager
  • 108. Kanban System Adoption Examples Globally USA McKesson Vanguard GoDaddy Xbox Motley Fool CityGrid Media Ultimate Software Constant Contact SEP REI Robert Bosch Chile LAN Mainland EU Ubuntu Xing BWin Brazil ASR BBVA Petrobras CESAR Phidelils O Globo Israel Amdocs Answers.com TypeMock China & HK Thomson-Reuters Nike Australia Lonely Planet Telstra New Zealand Ministry of Social Development Lean Agile Scotland Argentina Huddle ThomsonReuters UK BBC IPC Media Financial Times Microsoft Scandinavia Unibet Volvo Skania Spotify Ericsson @agilemanager
  • 109. Kanban System Adoption by Industry  Media   Games   Vanguard, Motley Fool, Chase, ASR Software & Telecoms  Amdocs, Ultimate, Constant Contact, Phidelis, SEP, Huddle, CESAR, Ubuntu Public Sector  Ministry of Defence (Denmark), Ministry of Social Development (New Zealand) Lean Agile Scotland  Includes Robert Bosch, Volvo, Skania, Petrobras, Nike Finance & Insurance   Mostly small studios includes video arcade thru mobile games to online gambling such as Unibet & Bwin Manufacturing   Includes BBC, Sky, Lonely Planet, Time/Life, IPC, Mobile.de, O Globo, Financial Times, NBC Universal, Thomson-Reuters @agilemanager