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Lean Kanban India 2018 | Understanding Flow Debt | Sudipta Lahiri

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Session Title:
Understanding Flow Debt

Session Overview:

While CT and CFD and trailing indicators, we discuss one of the lead indicators - Flow Debt. In this session, we explain what is Flow Debt and its significance.

Learning objectives
Understand Flow Debt
Understand how it should be used for our Kanban systems

Published in: Education
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Lean Kanban India 2018 | Understanding Flow Debt | Sudipta Lahiri

  1. 1. @sudiptal Understanding Flow Debt Why some systems do not improve CT after reducing WIP? Sudipta Lahiri Head of Products and Engineering 1Sep 22, 2018
  2. 2. @sudiptal Influencers… Andy Carmichael Dr. Ramesh Patil, CTO, Digité https://xprocess.blogspot.com/2015/08/what-is-flow-debt.html 2Sep 22, 2018
  3. 3. @sudiptal Technical Debt • Technical debt is the implied cost of additional rework caused by choosing an easy solution now instead of using a better approach that would take longer • Compared to monetary debt • If technical debt is not repaid, it can accumulate 'interest', making it harder to implement changes later on. Source: Wikipedia Sep 22, 2018 3
  4. 4. @sudiptal Understanding Flow Debt • Given a finite capacity to service demand, when we prioritise working on one work items over another, we adversely impact the Cycle Time of the latter • This is typical of a Kanban system • Flow Debt means delivering more quickly now at the cost of slower delivery times later • Flow Debt quantifies this impact and helps understand the operations of Kanban Systems Sep 22, 2018 4
  5. 5. @sudiptal Flow Debt vs Other Metrics • Flow Debt is a measure that provides a view of what is happening inside our system • CT or TP or Velocity: are measures when the items is completed Sep 22, 2018 5
  6. 6. @sudiptal So, what is Flow Debt…? 6Sep 22, 2018
  7. 7. @sudiptal Let’s model a simple Kanban system… • Assume: • A Kanban System with a CT of 2 weeks • The cumulative number of items entering the system equaled the cumulative number of deliveries as of a given date (no WIP piling up in the system) • The arrivals and deliveries are smooth over the given period • The items are delivered in the precise order they arrived • All the items are delivered • Then • The time the last item spent in the process was also 2 weeks • The Average CT for the items = 2 weeks! Sep 22, 2018 7
  8. 8. @sudiptal System A: An ideal “queue” system • A simple system with Capacity (WIP) of X cards… • … with a Fixed Departure Rate of cards per unit time (1 week)… • … with the same Arrival Rate of Cards per unit time (1 week)… • … meaning 1 card is replenished when 1 card is delivered!! CFD • Average CT = Actual CT for each card • This system has 0 Flow Debt! 8Sep 22, 2018
  9. 9. @sudiptal System B: Order is not respected • What happened here… • For the items in the lightly shaded region, the FIFO condition is relaxed! • Since the Average Arrival Rate = Average Departure Rate, the Average CT is unchanged! • However, Actual CT for cards in NOT same anymore! • Items sloping down have less CT; Items sloping up have more CT • So, items sloping down are reducing their CT at the expense of the items whose CT is getting delayed • They are experiencing Wait Time now… 9Sep 22, 2018
  10. 10. @sudiptal Let’s take this to the next level… What happens when an item is expedited… 10Sep 22, 2018
  11. 11. @sudiptal For System A: An ideal “queue” system WIP = 5 (4 items ahead of a new item) Average CT = Actual CT = 5 11Sep 22, 2018
  12. 12. @sudiptal Flow Debt = 0 SurplusDeficit Flow Difference from Average CT Difference from Average CT Prioritising 1 card impacts 4 cards that were ahead of it…. 12Sep 22, 2018
  13. 13. @sudiptal SurplusDeficit Flow Flow Debt = 0 Flow Debt = Sum (Average CT – Actual CT) for all cards 13Sep 22, 2018
  14. 14. @sudiptal Why is understanding Flow Debt important? • Decisions you take today to prioritise one card over another clearly impact the CT of the future cards • This behaviour is ONE OF THE REASONS that will make your CT histogram look worse… let us understand why. Sep 22, 2018 14
  15. 15. @sudiptal We all know this... CT Distribution has a long tail! 15Sep 22, 2018
  16. 16. @sudiptal However, latter is better than former… Mode CT shifts left Spread is narrower 16Sep 22, 2018
  17. 17. @sudiptal Impact of Flow Debt on CT Histogram • While the Average CT may remain the same, the CT spread will look worse • Preferring one card over another will mean this: • High probability that the preferred card will finish earlier than the Average • High probability that the cards that started earlier will finish later => their CT will be longer than otherwise • This makes future predictability more error prone • Average is more misleading than helpful 17Sep 22, 2018
  18. 18. @sudiptal Beyond CT distribution… • Just like in the plots that we were showing… its important to periodically clear our Flow Debt! • This means that the cards that were held back (in order to prioritise another) actually get delivered • If these “delayed” cards continue to be in the process, your Flow Debt != 0 • It will keep growing! • Flow Debt comes to 0 when you finish all the cards that you had started • Therefore, START FINISHING! • If you are not going to work on it, drop it! Don’t leave it on the Board. Sep 22, 2018 18
  19. 19. @sudiptal • Reach me at: • @sudiptal • slahiri@digite.com • sudiptalahiri.wordpress.com “Absorb what is useful, discard what is useless and add what is specifically your own” Bruce Lee Sep 22, 2018 19

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