Successfully reported this slideshow.
Your SlideShare is downloading. ×

Stop setting up projects and start moving to a product based operating model

Stop setting up projects and start moving to a product based operating model

Download to read offline

"Got funding for an idea? Great let’s set up a team" is an all too familiar path that many organisations follow. They may "tinker" with agile and set up "agile teams", but continue to build their operations around 'project funding" and siloed structural hierarchies, that have complex governance at the apex, from which all decisions flow down. As the lessons of COVID pandemic of the last year have highlighted, organisations are quickly facing the reality that what may have helped them succeed in the past, may not serve them now. A new strategy is needed.

Moving from a project to a product-based model is vital for business agility; when a more modern way of operating is needed to link strategy to detailed organisational design.

Mia will examine the elements of an operating model and discuss the Operating blueprint model she developed for a large retail wholesale organisation.  This model helped this organisation to start the process of moving away from a traditional project-based model with its associated rigid organisational structure, to one that was product based and shifted the focus from deliverables to value. We will discuss how an agile operating model will help you achieve this as well as examine a blueprint for changing.

The topic will cover the 6 elements in an agile operating model including: accountability, structure, governance, talent, metrics and behavioural expectations, and show how these elements all work together as a bridge between strategy and operations.

Rethinking how and where critical work gets done may sound daunting, but organisations that apply these elements are able to make the important changes—and address the biggest pain points.

"Got funding for an idea? Great let’s set up a team" is an all too familiar path that many organisations follow. They may "tinker" with agile and set up "agile teams", but continue to build their operations around 'project funding" and siloed structural hierarchies, that have complex governance at the apex, from which all decisions flow down. As the lessons of COVID pandemic of the last year have highlighted, organisations are quickly facing the reality that what may have helped them succeed in the past, may not serve them now. A new strategy is needed.

Moving from a project to a product-based model is vital for business agility; when a more modern way of operating is needed to link strategy to detailed organisational design.

Mia will examine the elements of an operating model and discuss the Operating blueprint model she developed for a large retail wholesale organisation.  This model helped this organisation to start the process of moving away from a traditional project-based model with its associated rigid organisational structure, to one that was product based and shifted the focus from deliverables to value. We will discuss how an agile operating model will help you achieve this as well as examine a blueprint for changing.

The topic will cover the 6 elements in an agile operating model including: accountability, structure, governance, talent, metrics and behavioural expectations, and show how these elements all work together as a bridge between strategy and operations.

Rethinking how and where critical work gets done may sound daunting, but organisations that apply these elements are able to make the important changes—and address the biggest pain points.

More Related Content

Similar to Stop setting up projects and start moving to a product based operating model

More from Scrum Australia Pty Ltd

Related Books

Free with a 30 day trial from Scribd

See all

Stop setting up projects and start moving to a product based operating model

  1. 1. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. May 2021 Stop Setting up projects and start moving to a product based model Mia Horrigan – Zen Ex Machina
  2. 2. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Achillies Running Club GLOBAL DISABILITY AWARENESS DAY MAY 2021
  3. 3. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. LEAN SYSTEMS THINKING TELLS US TO THINKING ABOUT THE WHOLE SYSTEM …. AND HOW THE HUMAN SYSTEM CONTRIBUTES TO THIS SYSTEM ZXM’S GOAL FOR OPERATING MODELS
  4. 4. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. "GOT FUNDING FOR AN IDEA? GREAT LET’S SET UP A PROJECT TEAM AROUND THE FUNDING" • Siloed structures • Governance at apex • Decisions flow down hierarchy • Disband when finished
  5. 5. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Comparing Benefits Traditional Agile
  6. 6. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. The Domain of Agile Product Management Ideas Strategic filter Product Backlog Customer feedback metrics Squads (Agile Teams) Increment Roadmap Definition of Done Product Goal Leadership Strategy Stakeholder feedback Write User Stories Fixed milestones and deliverables
  7. 7. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. The Domain of Agile Product Management Ideas Strategic filter Product Backlog Customer feedback metrics Squads (Agile Teams) Increment Roadmap Definition of Done Product Goal Strategy Stakeholder feedback Make all this add value to the customer
  8. 8. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. We need a Network of Teams • Hierarchy gives you structure • But Hierarchy is slow to make decisions • You need an operating model that helps you make fast decisions • You need a network • Work is delivered through the network of teams • Align objectives to a single, prioritised, Program Backlog. • Plan, commit, and execute together. • Produces valuable and evaluable system-level solutions. Source: https://www.scaledagileframework.com/business-agility/
  9. 9. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. MOVING FROM A PROJECT TO A PRODUCT BASED OPERATING MODEL IS VITAL FOR BUSINESS AGILITY TO LINK STRATEGY TO THE DETAILED ORGANISATIONAL DESIGN
  10. 10. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Why a New Operating Model? Growth We’re growing and need a better model that supports managing the business as well as supporting our people Self-organisation We want you to be self-organising, and not work in silos. Scalability and bottlenecks Existing model creates bottlenecks that limit the speed at which products can be delivered and dependencies on specialist expertise . Culture We want to keep true to our values while we grow, and support a manageable workload Talent proposition We need to be clear about the types of skills and capabilities needed to achieve department and organisational goals. Behavioural expectations We want clear role expectations so people can can demonstrate through actions that they are aligning to the values. A new strategy needs new ways of working.
  11. 11. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. • A combination of custom talent, processes and capabilities that dictate how the organisation works, and how people within the organisation work together • Serves as the vital link between company’s strategy and the detailed organisation design that it puts in place to deliver on the strategy • Designed so that organisational structure, accountabilities, governance and employee behaviours, along with the right people, processes and technology, all work together to support the strategic priorities Principles of Operating Framework GOALS VISION OPMODEL
  12. 12. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Strategy and Design Operating model Organisation design Strategy Elements • Drivers of Value • Priority customer needs • Critical capabilities • Cost/profitability targets Where to play • Customer experience (CX) • Product ecosystem • Customer engagement • Staff engagement How to win • Ecosystem thinking • Product lifecycle • Expert power • Short lead times • Feedback loops • Empower others’ decision-making Culture and Values • Agile mindset and principles • Transparency • Openness • Respect • Focus • Courage • Commitment Structure and Decision Roles • Establishing appropriate level for decision-making and point of accountability • Cadence that enables cross-group processes and interfaces to support strategic and operational decisions Clarity on priorities • Transparency of product vision, roadmap and product backlog • Align teams around clear strategic objectives and priorities People , Processes, and Technology • Talent requirements and recognition • What information flows, technology and tools are needed to support • Consultation and advice on standards and optimal industry practices Feedback loops and key metrics • Focus on top company priorities and the metrics for measuring success Cultural Dimensions • Go beyond communicating values to being explicit about which behaviours make for effective execution Structure - Boundaries for lines of business and defining shared services to leverage scale and expertise Accountabilities - Defining the agile roles and responsibilities and how self organisation will work Talent & Capabilities - Combining people, process and technology in a repeatable way to deliver desired outcomes Governance - Executive forums and processes that yield decisions on strategic priorities Metrics - Aligning around key clear strategic objectives and priorities. Ways of working - Expected cultural norms for how people collaborate, especially across the boundaries between functions or teams Operating Framework
  13. 13. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Value Product Based Model - Scalable Product Increments Product & Release Feedback Metrics & Transparency Product Goal Team Process Continuous Improvement Backlog Prioritisation Backlog Refinement Delivery Release Planning Executive Metascrum Cross-team Self-organisation Impediment Removal Scrum Master Cycle Product Owner Cycle Executive Action Team Adapted from Scrum @ scale, Scrum.inc
  14. 14. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Strategic Drivers Outcomes and Impacts Strategic Investments Tactical Objectives Delivery Strategic Goal Strategic Goal Strategic Goal Strategic Initiative Strategic Initiative Product/Service Feature Product/Service Feature Product/Service Feature Teams and Sprints Organisational Goals • Measurable targets to achieve and report progress against strategic drivers • What impact are we trying to make? • What outcome do we want to achieve? • Prioritised backlog of initiatives that contribute toward an outcome/impact • Investment boundaries to achieve the impact • Made transparent in a Portfolio Backlog • Prioritised breakdown of outputs that are hypothesised to deliver the outcome • Made transparent in a Program Backlog. • Long lived cross-functional teams • Self-organising • Quality and standards for delivery defined as Definition of Done • Delivery using Scrum • Cost of delay • Market change • User needs • Market growth • Sustaining current markets • Internal capability development Realising strategic benefits through an agile product management framework Strategy in a Lean Agile Enterprise
  15. 15. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Execuitve Leadership Team • Quarterly planning • Reflect on outcomes achieved over the last quarter • Assess new initiatives • Review vision and goals • Review service catalogue • Apply strategic filter to incoming initiatives • Identify capability gaps and actions to mitigate • Agree on valued outcomes to deliver this quarter Product Owners (PO) Sync • Product Owner Collaboration • Work coming from vision/goals • Work coming from stakeholders • Dependencies of work between teams • Assess relative value of incoming work • Align local work with Strategy and Vision • Optimise the value delivered by the team Scrum of Scrums • Scrum Master collaboration • Blockers and impediments • Risk management and transparency • Learning and development • Optimising the flow of work • Continuous improvement Daily Scrum • Team plans their day • Identify blockers and impediments • Act to remove blockers/impediments • Deliver as a Team Continuously • Collaboration • Risk assessment • Optimise flow • Review quality Daily • Daily Scrum • Completion of Stories • Update metrics • Feedback loops Team Sprints (2- weeks) • Collaborate • Deliver • Reflect • Improve Strategy and Vision (3-monthly) • Vision • Goals • Epics Sprint Planning • Agree on what to deliver • Create a two-week goal and plan • Identify optimal delivery methods • Integrate and refine delivery improvement practices Sprint Review • Inspect the Sprint outcome(s) • Review decisions made • Understand what is delivered and not delivered • Understand impact on work forecast over the next two weeks Retrospective • Reflect on the last Iteration/Sprint • Reflect on metrics • Identify opportunities to improve • Identify opportunities to remove waste • Create actions for improvement Backlog Refinement • Understand what is in the Backlog • Size the work • Undertake exploratory/discovery activities to ensure work is ready for an upcoming Sprint Planning Horizons Program Management (fortnightly) • Deliver Stories of strategic capability • Support Teams to deliver outcomes • Align teams’ work with vision and goals Product management • Break Initiatives into smaller feature (projects) slices • Deliver strategic capability Stories from Epics • Give Stories to Teams to deliver on Epics Horizon Planning • Quarterly planning • All teams get together (Big Room Planning) to create a 3 month plan to deliver strategy and vision • Identify capability gaps and actions to mitigate • Agree on valued outcomes to deliver Governance Forums and Management
  16. 16. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Operations Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Team Members Team Members Team Members Executive Backlog Manage leadership initiatives throughthe executive backlog • Strategic goals • Management initiatives • Operational change • Strategic roadmaps
  17. 17. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Operations Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Manage organisational change through the program backlog • New projects • New client work • Delegated team work Team Members Team Members Team Members Executive Backlog
  18. 18. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Operations Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Team Members Team Members Team Members Manage team work through a team’s Product Backlog • Team work • Sprint work • BAU • Team-based capability development • Team improvements Executive Backlog
  19. 19. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Product Owners Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Chief Product Owner Manage delivery of value through Product Owners • Prioritise all work by value to the organisation Executive Backlog Team Members Team Members Team Members
  20. 20. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Scrum Masters Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Chief Scrum Master Executive Backlog Team Members Team Members Team Members Manage boundaries of self-organisation through Scrum Masters • Scrum • Self-organisation • Cross-functionality • Impediment escalation • Collaboration
  21. 21. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Scrum Masters Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Chief Scrum Master Executive Backlog Manage impediments through the Executive Backlog • Impediment escalation from Scrum Masters and their teams escalation Team Members Team Members Team Members
  22. 22. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Capability Management Executive Leadership “Project” Work BAU Work Program Backlog Scrum Team Scrum Team Scrum Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Executive Backlog Team Members Team Members Team Members Communitiesof Practice • Leads work collaboratively across all teams to improve technical/skills excellence across teams • Don’t delegate or manage work Capability Leads
  23. 23. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Capability Management Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Executive Backlog Team Members Team Members Team Members Continuous Improvement • Contribute ideas and skills/capability improvement actions into team’s Product Backlogs. • POs align improvements to operational investments in capability w/ the Chief PO Capability Leads
  24. 24. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Capability Management Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Executive Backlog Team Members Team Members Team Members Escalate capability improvement initiatives • Escalate large capability investments to the Program Backlog for prioritisation and funding by executive Capability Leads
  25. 25. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Governance – Capability Management Executive Leadership “Project” Work BAU Work Program Backlog Agile Team Agile Team Agile Team Product Backlog Product Backlog Product Backlog Product Owner Product Owner Product Owner Scrum Master Scrum Master Scrum Master Executive Backlog Team Members Team Members Team Members Establish quality standards for all teams (Definition of Done) • Minimum standard of quality, compliance, performance, NFRs. • Review quality standards quarterly • Establish and improve quality standards and practices Capability Leads Definition of Done
  26. 26. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Clear structures – Roles at scale SM PO SM PO SM PO SM PO SM PO SM PO PO Chief SM Chief Agile Teams Capability (“Guild”) Leads Scrum Master Lead Product Owner Lead Same scaled structure across: • Scrum @ Scale • SAFe® • LeSS • Spotify (based on Scrum @ scale)
  27. 27. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Architecture Systems hardware Testing Back-end development Front-end development Agile Team Blueprints IT TEAM Scrum Team ProductOwner ScrumMaster Sprint Backlog Increment of“Done”work Solution Design Solution Development Product Development Hypothesis Testing User Feedback Scrum events Inspect/ adapt System analysis UX design UI design BAU Activities Product Backlog Scrum Team WORK TYPES AGILE FRAMEWORK CAPABILITY TYPES
  28. 28. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Team Blueprints PROCUREMENT TEAM WORK TYPES AGILE FRAMEWORK CAPABILITY TYPES Scrum Team ProductOwner ScrumMaster
  29. 29. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Agile Team Blueprints HR TEAM WORK TYPES AGILE FRAMEWORK CAPABILITY TYPES Scrum Team ProductOwner ScrumMaster
  30. 30. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Teams MARKETING TEAM
  31. 31. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Transparency of skills and capability
  32. 32. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. What creates an agile organisation? • Get everyone and all of the organisation Sprinting Sprinting • Team focus • Define agile roles and responsibilities • Define bounded environments for action Self-Organisation • Promote learning • Invest in learning • Make everyone’s job continuous improvement Continuous learning culture • Empiricism • Decentralised decision-making • Management participation Agile Values 4 primary behaviours make agile organisations These are the predictors of faster to market, lower costs, lower risk. AgileIQ
  33. 33. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Conclusions • Just setting up a teams for projects approach doesn’t change the whole system (only at team level) as rest of the organisation still operates in a traditional way • To change the whole system we need top down, bottom up and from the side approach • A new operating model is need to meet demands of modern organisations that is product based and aligns strategy to value based delivery • At the heart of the system is humans and its the network of how people work together that leads to enterprise agility
  34. 34. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. 34 OUR MISSION 2025 includingexecutives,leadershipandteamsby 1M people Improve the working lives of through contemporary ways of working www.zenexmachina.com/blog @miahorri Mia.Horrigan@zenexmachina.com
  35. 35. Copyright © 2010-2021 Zen Ex Machina (ZXM) Pty. Ltd. All rights reserved. Achillies Running Club HAWAII MARATHON DEC 2022 – HERE WE COME

×