Governance - Friend or Foe?

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Is governance focused on the right things? Governance is set up to manage risks, resources, and productivity, and operates to assure programs get delivered to realize promised benefits. What if customers don’t buy what’s delivered? What if users hate it? What, if anything, was assured in the business case? Were the benefits guaranteed? Is governance missing an opportunity to add greater value?

There is a tension between agile teams and governance models. Governance is geared more to the things that are valued less in the Agile Manifesto – tools, plans, contracts and documentation. So why not design a governance model that embodies agile and lean principles? What if governance looked for opportunities to create value and eliminate waste instead of asking whether programs are on schedule and within budget? What would governance and portfolios need to look like to enable greater business agility? What new roles would governance take on and what would its operating principles be?

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  • For each conversation …
  • Senior managers often have stronger psychological attachment to bigger projects .They’re assumed to have a bigger payback over the long term.Unfortunately, the bigger the investment, the less likely it will be questioned. Business cases get treated as statements of fact by those responsible for delivery.People get carried away on the expectations of gains.Governance should be should be asking what can we afford to lose?
  • How can we truly know?We can find that the ideas made sense, technology was great and the plans were well executed, but the project still failed.There’s no way to reliably predict what will be valuable and what won’t.It feels like governance has become more concerned with maintaining control than delivering value. It has become about doing the wrong things righter, to use John Seddon’s words.
  • By making small bets we create multiple, repeating opportunities to test for value. We’re enabling massive flexibility to achieve business objectives. We’re building capability through learning about customers.We’re folding innovation into delivery through creative discovery and experimentation.Making small bets doesn’t mean there’s no bold ambition.
  • Extending the idea of small bets, why not make incremental investments based on concrete and measured performance of business services.With this information we can stop investing early when enough value has been realized. This way we don’t waste money on features that won’t be used.We can continue investing, making small bets to test for further value.Or we can exit.We can stop investing in punts that aren’t delivering any value.We can stop investing in systems approaching their sell-by date.By sensing impending obsolescence, letting something become a legacy can be made an explicit portfolio decision based on risk, rather than it just happening in the background.Today’s projects are tomorrow’s legacies.
  • To do this we need end-to-end cross-functional IT capabilities on the front-line in business services. Lean calls this product-orientation.
  • NO EDGEA method, repeated over time, that’s expected to net a profit./ Superior market entry./ Superior market exit./ Superior money./ Risk management./ Stand aside – don't enter the market.NO PLANNINGWinners don't rely on tips or hunches. Tips and hunches only suggest a market entry. What about the exit, money management and risk management?Winners usually have:/ An annual plan./ A detailed short-term plan – next week, next day./ A written method and rules.WRONG BET SIZEThe amount you stand to lose should not exceed 2% of your account.Beware overtrading – having too many bets, one bet too big, betting too frequently.NO RISK MANAGEMENTManage the downside as well as the upside. Stop a single loss getting out of control. Keep the total exposure in the portfolio under control./ Where you will enter the market?/ Where you will get out if taking a loss?/ How much will you bet?/ Where is your initial profit target?MISTIMING EXITSRide your wins and cut your losses. People have the tendency to get out too early on winners and hold their losses.OUT OF CONTROLYou can either win, lose or break even, and you can't know the outcome in advance. If you’re running on gut feel and don't frequently recheck your positions against what you expect, then you're out of control.NOT IN TUNE WITH THE MARKETMost people have a bias to the long side (increase in value) but markets go up and down. A lot of people lose money because they don't adjust their approach to the change in market conditions and direction.RUNNING BEFORE WALKINGIt can take a year to become proficient. There's no substitute for experience and practice. In the end the real teacher is the market.EMOTIONALLY UNSTABLEYou can do everything right and still lose. Your idea can be well thought through, executed exactly as planned but the market moves against you and you lose. If you can't handle this or it takes too much of a toll on your life, do something else.NOT TAKING RESPONSIBILITYExcuses and blame cover up the real issue – how can we improve based on the failures experienced? The result is down to you.
  • Kent Beck describes the four key variables for software development as being time, scope, cost and quality.The idea behind much of the agile ethos is to avoid fixed time fixed scope fixed cost endeavours as the only remaining free variable is quality - a variable that can only take so much abuse (to which much of the history of software development can attest).Instead the approach is to fix the time, cost and quality (i.e. don't cut corners) and, using a 'backlog' of items broken down to a manageable size and prioritized by value, deliver the maximum value possible in the allotted time by delivering the highest value items first.There's an implicit link between scope items and value.If the value of something is unknown or difficult to determine (i.e. it takes a long time to find out) - if the link between value and the work is missing or severed - then we are on treacherous ground. Why is this work happening? Why should we continue to invest in it? Without being able to clearly demonstrate the value we are delivering, we are left with a subjective argument around why delivery should be quicker, cheaper, or why more should be delivered in the same time-frame for the same cost.
  • Quality levels drop - especially on those qualities that are not being measured or easily determined (e.g. usability, security) - as corners are cut to meet unrealistic time and cost constraints. The result is a product that maybe fit for purpose but certainly not fit for use.Should a role of governance be to ensure that this doesn't happen?
  • Does governance try to create measures to ensure that people are productive? Could this possibly work?/ If someone isn't skilled enough, they will remain so./ If someone isn't committed, would these measures make them so?Approaches to this can take a variety of forms - timesheet tracking, cost code allocation.Using what was specified (often by someone else) to determine what gets done rather than what the people doing the work think the right thing is to do in the given circumstances. Function takes precedence over quality.
  • Ideas are free and timeless != Opportunities are hard to seize, perishable and resource dependent. Opportunities come from:/ Large scale trends/ Experience or observation/ Research and development/ Adapt, replicate, modifyInnovation has different levels: / Brand new / Semi-radical / Rework or extend
  • It's easy for people in governance to become over-responsible. The uncertain nature of software development can make us feel like we need to improve our control over the current situation. There can be a lot at stake and we tend make more errors when we are time pressured and feel forced to make decisions. There are numerous pitfalls and potential conflicts of interest in the realm of governance. Consider two major fears you may have if you work in governance:1) The delivery teams are not able to deliver what was expected to the business (for whatever reason)2) The business has unrealistic expectations of what will be delivered, for how much and whenIn the first instance we really want the delivery teams to be successful. We've built a good working relationship with them and, of course, their performance reflects on us. Therefore we might adopt the strategy to play down any bad news and try to intervene and sort things out ourselves. We create a reality mismatch between the investors and those doing the work.In the second instance - that of unrealistic expectations - we may have the unpleasant job of curbing the enthusiasm of senior executives. We don't want to appear like typical IT departments do: too slow, too expensive, black box, out of touch and business inhibiting. We want to come across as competitive and competent. Maybe we choose to leave some ambiguity in the discussion. Again, we create a reality mismatch between the investors and those doing the work.Local concerns usually outweigh programme or portfolio needs - it can be difficult to get stakeholders and delivery teams to adjust so that other stakeholder needs - needs beyond their immediate business area - are also satisfied.
  • Much of the language around governance relates to the concept of responsibility. What should governance be responsible for? -Should governance be responsible for the successful delivery of the projects in the portfolio? - Should governance be answerable to senior business stakeholders concerning the actual value delivered? - Should governance be accountable to delivery teams for providing sufficient resources to enable them to deliver successfully?- Should governance be responsible for risk management and be able to decide how those risks are mitigated?It's worth noting that responsibility doesn't have to be all or nothing. The book "The Responsibility Virus" describes a tool called the "responsibility ladder" with which people can agree to take one of six levels of responsibility in a given situation:1. consider options and make decision, inform superior afterwards2. provide options to superior with own recommendation3. generate options for superior and ask superior to make choice4. describe problem to superior and ask for help in structuring it5. give problem to superior, watch and learn for next time6. drop problem on superior's desk and indicate helplessnessCan we design ways to equitably share the risk and responsibility between governance, stakeholders and delivery teams?
  • Governance people can view agile delivery teams as "gung-ho", reckless or worse. Agile delivery teams can view governance as a bureaucracy, inhibiting and out-of-touch.We're looking at a clash of approaches and a gap in understanding. Let's take a closer look.The Agile manifesto asks people to value "individuals and interactions over processes and tools". If you're governing a portfolio which comprises of 10,000 people, how are you supposed to apply this? It's no surprise the topic of how to "scale agile" continuously crops up at conferences, on blogs and LinkedIn groups. Along with that is a lot of widely recognized experience and wisdom that strongly recommends avoiding big team sizes. If we followed this advice while maintaining the same level of investment, a major part of which went towards labor costs, we would end up with lots of small teams. Do we now have a different problem? How would these numerous smaller teams work together and not work against each other? According to the world academy online, the reason for management is to handle the situation whereby people find that they couldn't perform all the work personally and need to delegate to others. However if you have a large portfolio, you can't manage all the projects personally either - the reason for governance. If we can only handle so many interactions we can reduce our exposure to the number of individuals involved through use of representatives (e.g. project managers) or reduce the number of interactions required by introducing some other mechanism (e.g. numerical measure, report). Can this reality and approach remain consistent with "individuals and interactions over processes and tools"?
  • Many governance processes may be legacy and of little or no value – they could be waste.
  • Governance - Friend or Foe?

    1. 1. GOVERNANCE FOE? FRIEND OR #abcfriendorfoe An Energized Work Production Agile Business Conference / 11 Oct 2012
    2. 2. Simon Baker / @energizr Gus Power / @guspower {first name}@energizedwork.com #abcfriendorfoeLICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 2
    3. 3. ✪ GOVERNANCE – FRIEND OR FOE?Let’s try to reimagine governance.Get past “if only…” Explore the “what if’s…” Ask “why the hell not?”Think of it as an experiment. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 3
    4. 4. ✪ AT THE END/ Connect our experiences. / Explore our own situations with others./ Discover the right questions to ask about governance./ Learn new insights we can take back to our workplaces. / Establish links with people that last beyond this afternoon. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 4
    5. 5. Photo: http://www.flickr.com/photos/itupictures/✪ WORLD CAFÉ LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 5
    6. 6. ✪ THE POWER OF CONVERSATIONThis is a workshop, so please talk to those around you. The plan is to have 4 conversations on different topics. If you think you know everything, or you just want to disagree thenits not going to be beneficial to you. It’s not about winning or losing. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 6
    7. 7. ✪ SCHEDULE14:55 – Introduction.15:00 – Gambling.15:20 – Value (discussion).15:35 – Coffee.15:50 – Value (rotation).15:55 – People.16:15 – Questions / Open discussion. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 7
    8. 8. ✪ 1. SET THE CONTEXT/ 5 minutes./ Well share our thinking on the topic, maybe pose some questions./ See the handout for a reminder. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 8
    9. 9. ✪ 2. BEGIN THE CONVERSATION/ 10 minutes./ Doodle and discuss./ Build up a picture./ Focus on what matters. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 9
    10. 10. ✪ 3. MOVE TO ANOTHER TABLE/ 5 minutes./ 1 or 2 hosts stay with the table./ The rest move to other tables./ Hosts present what was discussed. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 10
    11. 11. http://www.flickr.com/photos/texaselephant/✪ GAMBLING LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 11
    12. 12. ✪ PURPOSE OF GOVERNANCEThe accepted purpose of governance is largely to monitor,report on, and ensure that the specified requirements willbe delivered in the agreed timeframe and within theagreed budget to realize the benefits stipulated in thebusiness case. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 12
    13. 13. ✪ PURPOSE OF GOVERNANCEAnd in so doing, to ensure processes are followed correctly,standards are adhered to, and the software is produced toan acceptable level of quality.Gating and approving / Ensuring compliance to processes and standards / Controllingbudgets and headcount / Auditing and quality assurance reviews / Monitoring progress /Reporting status / Managing issues and risks / Managing stakeholders LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 13
    14. 14. ✪ UNDERSTAND THE GAMBLECapital investments are made in IT £projects on the merits of business casesbuilt on assumptions. tWhen we build a feature and delayvalidating it with customers we’remaking a bet that it’s “right”. What ifwe’re wrong? Every feature done this way ups the ante Increasing inventoryuntil we’re betting the budget on a Increasing investmentbig-bang release. Bigger and bigger bet LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 14
    15. 15. ✪ MORE CONTROL DOESN’T REDUCE THE BETOptimizing productivity so that projects aren’t late or over budget doesn’taddress the big risks in the following assumptions:/ The requirements define the right solution./ All requirements must be delivered before any value can be realized (all or nothing)./ If all requirements are delivered, the value will be realized. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 15
    16. 16. ✪ SMALL BETSCan we deliver less without delivering too little?Why not make smaller bets and find out?Bet what we can afford to lose £and get faster feedback toprove earlier what’s valuable and what’s not valuable. tLet’s be a bit more scientific. Less inventory; regular releases Series of small investments Small bets LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 16
    17. 17. ✪ INCREMENTAL INVESTMENTSWhy not make smaller incremental capital and operationalinvestments based on business measurements? / Business service cash flows. £/ Portfolio performance./ Risk exposure./ Impending obsolescence. Profitable/ Cost of delay. tUse fast actuals, flash forecasts Break-evenand moving averages in a rollingreview to inform continuous re-evaluation and prioritization. Self-funding LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 17
    18. 18. ✪ MORE BENEFICIAL GOVERNANCEThe compelling opportunity for governance is to help businessinvestors make investments that maximize business performance. The portfolio is of business services and not IT projects. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 18
    19. 19. ✪ BLOWING YOURSELF UP1. No edge.2. No planning.3. Wrong bet size.4. No risk management.5. Mistiming exits.6. Out of control.7. Not in tune with the market.8. Running before walking.9. Emotionally unstable.10. Not taking responsibility.Source: The Financial Spread Betting Handbook by Malcolm Pryor. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 19
    20. 20. ✪ VALUE LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 20
    21. 21. ✪ TIME, COST, SCOPE, QUALITY. VALUE?The word ‘value’ is used extensively. And Scopeambiguously. Value needs to be defined, quantifiedand measured. When it’s not we’re left in Compromise Qualitya subjective argument about scope andcost – “delivery should be quicker, Cost Timecheaper; more features should be Vary Scopedelivered in the same time-frame for thesame cost.”Backlogs have become the new functional Qualityspecification. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 21
    22. 22. ✪ FIT FOR PURPOSE AND FIT FOR USEThe focus is on functionality but how well are the functions performed? Condition Condition Resource FUNCTION Performance Design (Architecture) Source: Competitive Engineering, Tom Gilb LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 22
    23. 23. ✪ QUALITY CAN ONLY TAKE SO MUCH ABUSETo meet unrealistic time and Availabilitycost constraints corners are Workloadcut, especially on those Capacity Resiliencequalities not being measuredor easily determined. Resource Flexibility Saving Usability Interoperability Upgradeability Expected Actual LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 23
    24. 24. ✪ KNOWLEDGE WORKER PRODUCTIVITYA commonly held assumption is that to get the most out of yourinvestment utilization needs to be at or as near to 100% as possible.Idle resources, equipment or people are wasted investment. Effort is often confused with progress. Progress is often confusedwith value.Knowledge workers are described as people who “think for a living”. How do you measure thinking? LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 24
    25. 25. ✪ KEEP THE PORTFOLIO RELEVANTGovernance must ensure the portfolio stays relevant. We have to innovate to stay relevant – to continue to solve problemsthat people will pay to have solved.If the medium and long terms are 18 months and 5 years we face aproblem when the typical employee tenure is less than this. Not only does our knowledge become obsolete as markets andtechnologies change, but knowledge literally walks out the door. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 25
    26. 26. http://www.flickr.com/photos/75724809@N05/✪ PEOPLE LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 26
    27. 27. ✪ CREATING REALITY MISMATCHESGovernance attempts to manage the portfolio day-to-day and balancebusiness investors’ perceptions and situations in the delivery teams.With the best will in the world, trying to protect both sides, we can endup creating a mismatch. When we do so we become over-responsible. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 27
    28. 28. ✪ RESPONSIBLE FOR WHAT?/ Responsible for the successful delivery of the projects in the portfolio? / Answerable to business investors and stakeholders for the actual valuerealized? / Accountable to delivery teams for providing sufficient resources toenable them to be successful?/ Responsible for risk management and mitigation?Can we design ways to equitably share the risk and responsibilitybetween governance, stakeholders and delivery teams? LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 28
    29. 29. ✪ COMPLEXITY IS NOISYGetting a clear view and tangible Stakeholdermeasures of what’s happening perceptionacross a portfolio is hard. Time to market TeamJust getting the mechanics done, Adherence Stakeholderslike forecasting, budgeting and to plan Moralestaffing, is a full-time job. And the Objectives Plans Requirements Productionamount of data generated with incidents Budget /varying quality can get burn rateoverwhelming. Designs Defects Technology Operating costCan governance help reduce the Dependenciesnoise? Legacy integrations LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 29
    30. 30. ✪ CLASH OR GAPS?/ Trust people to get the job done./ Working software is the primary measure of progress./ The best means of communication is via face-to-face conversations./ The best architectures and designs emerge from self-organizing teams.Are agile principles practical, even applicable for governance?How practical is it to value “individuals and interactions over processesand tools” when the portfolio ‘employs’ 10,000 people? LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 30
    31. 31. ✪ OPERATING AT SCALEAn individual can only handle so many interactions. In a portfolio that‘employs’ 10,000 people, we have to limit the number of people wework with day-to-day. We end up relying on activity reports and assurances from individualsrepresenting groups of people, like project managers representingdelivery teams.Scale pushes governance further away from the work. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 31
    32. 32. ✪ CONTINUOUSLY IMPROVING GOVERNANCEHow can we measure the value and effectiveness of governance? How do we improve it? This is expected of operational and delivery teams. Why are the samestandards not applied to governance? LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 32
    33. 33. ✪ DISCUSSION Questions? Share your thoughts. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 33
    34. 34. Thank you for participating. If you’d be interested in a second café workshop looking at the financial and risk elements of governance please leave your business card or name and email address. #abcfriendorfoe @energizr / @guspowerLICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 34
    35. 35. LimitedGovernance – Friend or Foe by Energized Work Limited is licensed under a Creative Commons Attribution-ShareAlike 3.0 Unported License License. You are free: To share – to copy, distribute and transmit the work To remix – to adapt the work Under the following conditions: Attribution – You must attribute the work in the manner specified by Energized Work (but not in any way that suggests that Energized Work endorse you or your use of the work). Share Alike – If you alter, transform, or build upon this work, you may distribute the resulting work only under the same or similar license to this one. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 35
    36. 36. ✪ WELCOME TO THE WORLD CAFE1 SET THE CONTEXT 3 MOVE TO ANOTHER TABLE / 5 minutes. / 5 minutes. / Speakers share their thinking / 1 or 2 hosts stay with the table. on a topic and ask questions. / The rest move to other tables. / See handout for a reminder. / Hosts present what was discussed. 2 BEGIN THE CONVERSATION / 10 minutes. / Doodle and discuss. / Build up a picture. / Focus on what matters. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 36
    37. 37. ✪ GAMBLINGPURPOSE OF GOVERNANCE UNDERSTAND THE GAMBLE SMALL BETS INCREMENTAL INVESTMENTSThe accepted purpose of Capital investments are made Betting the budget on a big- / Business service cash flows.governance is largely to monitor, in IT projects on the merits of bang release is like betting all / Portfolio performance.report on, and ensure that the business cases built on our money on hitting a hole-in- / Risk exposure.specified requirements will be assumptions. When we build a one. Can we do less without / Impending obsolescence.delivered in the agreed feature and delay validating it doing too little? / Cost of delay.timeframe and within the agreed with customers we’re making a budget to realize the benefits bet that the feature is “right”. £ stipulated in the business case. What if we’re wrong? £ £ tAnd in so doing, to ensure processes are followed correctly, Profitable tstandards are adhered to, and the software is produced to an Less inventory; regular releases t Series of small investmentsacceptable level of quality. Small bets Break-even MORE BENEFICIAL GOVERANCE Make small bets based on what Self-fundingThe compelling opportunity for Increasing inventory we can afford to lose to prove governance is to help business Increasing investment earlier what’s valuable and Use fast actuals, flash forecasts Bigger and bigger betinvestors make investments that what’s not valuable. and moving averages in a rollingmaximize business review to inform continuous re-performance. This requires the Every feature done this way ups evaluation and prioritization.portfolio to be of business the ante until we’re betting theservices and not IT projects. budget on a big-bang release. COMMON SPREAD BETTING ERRORSCONTROL DOESN’T GUARANTEE VALUE Optimizing productivity so that projects aren’t late or over budget doesn’t 6. Out of control. 1. No edge.address the big risks in these assumptions: 2. No planning. 7. Not in tune with the market./ The requirements define the right solution. 3. Wrong bet size. 8. Running before walking./ All requirements must be delivered before any value can be realized 4. No risk management. 9. Emotionally unstable. (all or nothing). 5. Mistiming exits. 10. Not taking responsibility./ If all requirements are delivered, the value will be realized. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 37
    38. 38. ✪ VALUETIME, COST, SCOPE, QUALITY. FIT FOR PURPOSE. FIT FOR USE KNOWLEDGE WORKERVALUE? The focus is on functionality but how well are the functions performed? PRODUCTIVITYThe word ‘value’ is used A commonly held assumption isextensively. And ambiguously. that to get the most out of your investment utilization needs to be Condition ConditionValue needs to be defined, at or as near to 100% as possible.quantified and measured. When Resource FUNCTION Performance Idle resources, equipment orit’s not we’re left in a subjective people are wasted investment.argument about scope and cost – Effort is often confused with“delivery should be quicker, p ro g re s s . P ro g re s s i s o f t e ncheaper; more features should be Design confused with value.delivered in the same time-frame (Architecture) for the same cost.” Source: Competitive Engineering, Tom Gilb Knowledge workers are described as people who “think for a living”.Backlogs have become the new How can you tell if someone isfunctional specification. QUALITY CAN ONLY TAKE SO MUCH ABUSE thinking? How do you measure it? To meet unrealistic time and cost constraints corners are cut, especially on those qualities not being measured or easily KEEP THE PORTFOLIO Scope determined. RELEVANT Governance must ensure the Availability Expected portfolio stays relevant. We have to Workload innovate to stay relevant – to Resilience Actual Compromise Capacity continue to solve problems that Quality people will pay to have solved. Cost Time If the medium and long terms are Resource Flexibility Saving 18 months and 5 years we face a Vary Scope problem when the typical employee tenure is less than this. Not only does our knowledge become Usability Interoperability obsolete as markets and technologies change, but Upgradeability knowledge literally walks out Quality the door. LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 38
    39. 39. ✪ PEOPLECREATING REALITY COMPLEXITY IS NOISY StakeholderMISMATCHES Getting a clear view and tangible perceptionGovernance attempts to measures of what’s happening Time to marketmanage the portfolio day-to-day across a portfolio is hard. Just Teamand balance business investors’ getting the mechanics done, like Adherence Stakeholdersperceptions and situations in the forecasting, budgeting and to plan Moraledelivery teams. staffing, is a full-time job. And the amount of data generated Objectives Plans Requirements ProductionWith the best will in the world, with varying quality can get incidentstrying to protect both sides, we overwhelming. Budget / burn ratecan end up creating a mismatch. DefectsWhen we do so we become Can governance help reduce the Technology Designsover-responsible. noise? Operating cost DependenciesRESPONSIBLE FOR WHAT? CLASH OR GAPS? Legacy/ Responsible for the successful / Trust people to get the job integrationsdelivery of the projects in the done.portfolio? / Working software is the primary OPERATING AT SCALE/ Answerable to business measure of progress. An individual can only handle so many interactions. In a portfolioinvestors and stakeholders for / The best means ofthe actual value realized? communication is via face-to- that ‘employs’ 10,000 people, we have to limit the number of/ Accountable to delivery teams face conversations. people we work with day-to-day. We end up relying on activityfor providing sufficient resources / The best architectures and reports and assurances from individuals representing groups ofto enable them to be designs emerge from self- people, like project managers representing delivery teams.successful? organizing teams. / Responsible for risk Scale pushes governance further away from the work.management and mitigation? Are agile principles practical, even applicable for governance? Can we design ways to CONTINUOUSLY IMPROVING GOVERNANCEequitably share the risk and How practical is it to value How can we measure the value and effectiveness of governance?responsibility between “individuals and interactions over How do we improve it? governance, stakeholders and processes and tools” when the delivery teams? portfolio ‘employs’ 10,000 This is expected of operational and delivery teams. Why are the people? same standards not applied to governance? LICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 39
    40. 40. Energized Work Ltd HMS President Victoria Embankment London EC4Y 0HJ www.energizedwork.comLICENSED UNDER CREATIVE COMMONS BY ENERGIZED WORK LIMITED | HMS PRESIDENT, VICTORIA EMBANKMENT, LONDON, EC4 0HJ | WWW.ENERGIZEDWORK.COM 40

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