by Scrum.org – Improving the Profession of Software Development
Evidence-Based Management
of Software Organizations
Gunthe...
MIN
2© 1993-2014 Scrum.org, All Rights Reserved
How would you describe your contribution to the wonderful
act of software ...
3© 1993-2014 Scrum.org, All Rights Reserved
Have you also heard?
“Managers are useless and not
needed in Agile.”
I wonder…...
4© 1993-2014 Scrum.org, All Rights Reserved
Agile. Full Stop?
Evidence-Based Management of Software Organizations
I promis...
MIN
5© 1993-2014 Scrum.org, All Rights Reserved
Raise your hand if:
• You are Agile?
• You are becoming Agile?
• You have ...
Remember: ‘Agile’ refers to the mindset, the values and the principles expressed in
the “Manifesto for Agile Software Deve...
stam·pede/stʌmˈpiˈd/
© 2013 Tomasz Włodarek. This work is licensed under a Creative
Commons Attribution–NonCommercial–NoDe...
© 2013 Tomasz Włodarek. This work is licensed under a Creative
Commons Attribution–NonCommercial–NoDerivs 3.0 Unported
1. Sudden frenzied rush of (panic–stricken)
companies to do Scrum because they want to
be Agile, too.
2. To flee in a head...
© 2013 Tomasz Włodarek. This work is licensed under a Creative
Commons Attribution–NonCommercial–NoDerivs 3.0 Unported
11© 1993-2014 Scrum.org, All Rights Reserved
How To Recognize Scrum
12© 1993-2014 Scrum.org, All Rights Reserved
How Some Organizations and Many Consultants See It
13© 1993-2014 Scrum.org, All Rights Reserved
Scrum frames the creativity of people:
• Discovery,
• Experimentation-based l...
14© 1993-2014 Scrum.org, All Rights Reserved
• Agility is the state envisioned by moving to Agile processes;
a state of co...
15© 1993-2014 Scrum.org, All Rights Reserved
Managing Agile Software Development
Evidence-Based Management of Software Org...
MIN
16© 1993-2014 Scrum.org, All Rights Reserved
1. How long has your journey to Agile been so far (2014)?
– 1 year, or le...
17© 1993-2014 Scrum.org, All Rights Reserved
• IT is a cost center.
• Software development is an expense,
some of which ma...
18© 1993-2014 Scrum.org, All Rights Reserved
• Scrum is the new methodological flavor for
delivery from IT to business.
• ...
19© 1993-2014 Scrum.org, All Rights Reserved
Remember?
“Our highest priority is to satisfy the
customer through early and
...
20© 1993-2014 Scrum.org, All Rights Reserved
Evidence-Based Management (“EBM”):
• Roots in medical practice.
• The applica...
21© 1993-2014 Scrum.org, All Rights Reserved
Current Value Ability to InnovateTime to Market
Direct Evidence Of Value
Rele...
22© 1993-2014 Scrum.org, All Rights Reserved
An Overall Indicator of Direct Value
23© 1993-2014 Scrum.org, All Rights Reserved
Mind (1): Metrics Come In Sets
24© 1993-2014 Scrum.org, All Rights Reserved
Mind (2): Trends Say More
25© 1993-2014 Scrum.org, All Rights Reserved
Distinguishing Direct from Circumstantial Evidence
Direct
Evidence
Circumstan...
26© 1993-2014 Scrum.org, All Rights Reserved
• Adapting organizational practices should ultimately have a
positive impact ...
MIN
27© 1993-2014 Scrum.org, All Rights Reserved
The People‟s Financial Group is a strong retail bank with 1500
branches, ...
MIN
28© 1993-2014 Scrum.org, All Rights Reserved
Yet, the development manager reports an impressive increase
in productivi...
MIN
29© 1993-2014 Scrum.org, All Rights Reserved
At the next board meeting however:
• The VP of product management shows c...
MIN
30© 1993-2014 Scrum.org, All Rights Reserved
Take A Hunch At The Actions PFG Should Take 5
31© 1993-2014 Scrum.org, All Rights Reserved
Have you also heard?
“Managers are useless and not
needed in Agile.”
Do you w...
32© 1993-2014 Scrum.org, All Rights Reserved
Closing
Evidence-Based Management of Software Organizations
The future state ...
33© 1993-2014 Scrum.org, All Rights Reserved
Gunther Verheyen
• eXtreme Programming and Scrum
since 2003
• Professional Sc...
34© 1993-2014 Scrum.org, All Rights Reserved
Connect with the Scrum.org community
Twitter
@scrumdotorg
LinkedIn
LinkedIn.c...
35© 1993-2014 Scrum.org, All Rights Reserved
Thank you
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Evidence-Based Management of Software Organizations (closing keynote ScrumDay France 2014)

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Gunther Verheyen introduced “Evidence-Based Management (for Software Organizations)” as the closing keynote of the ScrumDay France 2014.

‘Evidence-Based Management’ has its roots in medical practice and promotes evidence-based decision-making in the managerial domain.
For software organizations, direct evidence of value needs to be gathered on the outcome of the work; not on the way the work is performed (teams, practices or individuals). Evidence on the latter is supportive and circumstantial. People and teams adapt processes and implement practices to improve the actual outcome.
If no direct evidence is collected on value, informed management decisions to maximize value cannot be made.

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  • http://www.scrumday.fr/en_US/keynote-de-cloture-evidence-based-management-for-software-organizations/The survival and prosperity of organizations thriving on software products highly depends on the VALUE they deliver with their services. If no evidence is collected on value, informed management decisions to maximize value cannot be made.‘Evidence-Based Management’ has its roots in medical practice and promotes evidence-based decision-making in the managerial domain. Outcome is measured as the only appropriate source of direct evidence of value; not teams or individuals. People and teams adapt processes and implement practices to improve the actual outcome, and provide supportive evidence, evidence on the ability to create value.
  • Indeed, the Agile movement promotes emergence. Indeed, Agile thrives on self-organization. Indeed, Scrum has no defined role of ‘manager’.But is that sufficient to label managers as useless or not needed?The Agile movement successfully established a set of values and principles that better fit the creative and complex nature of software development. The focus is on teams, collaboration, people, self-directed discovery. The Scrum framework provides a great foundation for organizations to grasp ‘Agility’.The adoption of the Agile thinking via Scrum represents a major and on-going shift in our industry. Even without Scrum having prescriptions for management, it is clear that the self-organizing fundaments of Scrum have a profound impact on the role, approach and act of managing. The challenge is to discover and implement the new needs and demands for managers.Self-organization requires boundaries, and shared goals and objectives. Self-organizing teams benefit from the provision of information on the market and company strategie. Self-organizing teams benefit from facilitation with standards, expectations, infrastructure and tools.
  • http://alistair.cockburn.us/oath+of+non-allegiance
  • Fad: a practice or interest followed for a time with exaggerated zeal:  craze
  • A hard lesson
  • Many software professionals know about scrum as a simple line drawing that describes the Scrum frameworkAdvanceSome think of Scrum as “That thing IT people do once a day when they stand in a circle.”AdvanceSome oppressive managers, project managers, and self-anointed Scrum Masters have caused some developers to think of Scrum this wayAdvanceBizarrely, some see Scrum and agile in the exact opposite mind frame.An excuse to focus on drama instead of getting down to business
  • Scrum-driven organizations see Scrum as a way to make money. Lots of it.Why? What do they know that you don’t?They know that Scrum is rooted in empiricism, and they learned how to apply this to their entire business.What’s empiricism?
  • Nimble.Resilience.Agility is a need that arises from the fact that building software is complex and can’t be perfectly planned given the speed and amount of change. It takes courage to admit it, more courage to live by this fact.
  • ExploreEmpiricismComplexity AgilityLearning ObjectivesGain understanding of complexity in software environmentsHow empiricism controls risk, and provides predictability in complex environmentsWhat is agility and what is Scrum’s place within the Agile discussion?
  • Indeed, the Agile movement promotes emergence. Indeed, Agile thrives on self-organization. Indeed, Scrum has no defined role of ‘manager’.But is that sufficient to label managers as useless or not needed?The Agile movement successfully established a set of values and principles that better fit the creative and complex nature of software development. The focus is on teams, collaboration, people, self-directed discovery. The Scrum framework provides a great foundation for organizations to grasp ‘Agility’.The adoption of the Agile thinking via Scrum represents a major and on-going shift in our industry. Even without Scrum having prescriptions for management, it is clear that the self-organizing fundaments of Scrum have a profound impact on the role, approach and act of managing. The challenge is to discover and implement the new needs and demands for managers.Self-organization requires boundaries, and shared goals and objectives. Self-organizing teams benefit from the provision of information on the market and company strategie. Self-organizing teams benefit from facilitation with standards, expectations, infrastructure and tools.
  • Many investments may provide more agilityNew methodologies exists that claim to make you AgileIs Agile/Agility a fad?What value is IT contributing to the organization?Outcome: deliver increased value.
  • ORGANIZATIONAL:Revenue per EmployeeProduct Cost RatioEmployee satisfactionCustomer satisfactionFOUNDATIONAL:Release frequencyRelease stabilizationCycle TimeInstalled Version IndexUsage IndexInnovation RateTotal defects
  • Try something that is hot in the market; or,Use evidence based management:Observe and analyze how work is done now;Assess and analyze the capability of the people doing the work;Identify the most likely improvement to add value.Does not include marketing, sales, or new product ideas.
  • Indeed, the Agile movement promotes emergence. Indeed, Agile thrives on self-organization. Indeed, Scrum has no defined role of ‘manager’.But is that sufficient to label managers as useless or not needed?The Agile movement successfully established a set of values and principles that better fit the creative and complex nature of software development. The focus is on teams, collaboration, people, self-directed discovery. The Scrum framework provides a great foundation for organizations to grasp ‘Agility’.The adoption of the Agile thinking via Scrum represents a major and on-going shift in our industry. Even without Scrum having prescriptions for management, it is clear that the self-organizing fundaments of Scrum have a profound impact on the role, approach and act of managing. The challenge is to discover and implement the new needs and demands for managers.Self-organization requires boundaries, and shared goals and objectives. Self-organizing teams benefit from the provision of information on the market and company strategie. Self-organizing teams benefit from facilitation with standards, expectations, infrastructure and tools.
  • Evidence-Based Management of Software Organizations (closing keynote ScrumDay France 2014)

    1. 1. by Scrum.org – Improving the Profession of Software Development Evidence-Based Management of Software Organizations Gunther Verheyen Directing the Professional series, Scrum.org ScrumDay France April 10-11, 2014
    2. 2. MIN 2© 1993-2014 Scrum.org, All Rights Reserved How would you describe your contribution to the wonderful act of software creation? (Raise your hand) • Coding • Testing • Architecting • Designing • Analyzing • Documenting • Coaching • Managing Short Survey About You 3 Thank you for thinking in terms of activities and (multiple) skills, not titles and positions.
    3. 3. 3© 1993-2014 Scrum.org, All Rights Reserved Have you also heard? “Managers are useless and not needed in Agile.” I wonder… An Endangered Species
    4. 4. 4© 1993-2014 Scrum.org, All Rights Reserved Agile. Full Stop? Evidence-Based Management of Software Organizations I promise not to exclude from consideration any idea based on its source, but to consider ideas across schools and heritages in order to find the ones that best suit the current situation. - The oath of non-allegiance (Alistair Cockburn)
    5. 5. MIN 5© 1993-2014 Scrum.org, All Rights Reserved Raise your hand if: • You are Agile? • You are becoming Agile? • You have been told to be Agile and are going to start soon? • Agile is not in your immediate horizon? or: • You have done Agile but discovered it was a fad? Where Are You On Your Journey? 3
    6. 6. Remember: ‘Agile’ refers to the mindset, the values and the principles expressed in the “Manifesto for Agile Software Development”. Now, that was a focus. Bastardo! You can’t do Agile! Agile is not a verb or a noun. Admit you’ve been doing waterfall all along! © 2013 Tomasz Włodarek. This work is licensed under a Creative Commons Attribution–NonCommercial–NoDerivs 3.0 Unported ” ”
    7. 7. stam·pede/stʌmˈpiˈd/ © 2013 Tomasz Włodarek. This work is licensed under a Creative Commons Attribution–NonCommercial–NoDerivs 3.0 Unported 1. Sudden frenzied rush of (panic–stricken) animals. 2. To flee in a headlong rush.
    8. 8. © 2013 Tomasz Włodarek. This work is licensed under a Creative Commons Attribution–NonCommercial–NoDerivs 3.0 Unported
    9. 9. 1. Sudden frenzied rush of (panic–stricken) companies to do Scrum because they want to be Agile, too. 2. To flee in a headlong rush back to prescriptive ways of doing things because Scrum is hard work. scrum·pede/skrʌmˈpiˈd/ © 2013 Tomasz Włodarek. This work is licensed under a Creative Commons Attribution–NonCommercial–NoDerivs 3.0 Unported
    10. 10. © 2013 Tomasz Włodarek. This work is licensed under a Creative Commons Attribution–NonCommercial–NoDerivs 3.0 Unported
    11. 11. 11© 1993-2014 Scrum.org, All Rights Reserved How To Recognize Scrum
    12. 12. 12© 1993-2014 Scrum.org, All Rights Reserved How Some Organizations and Many Consultants See It
    13. 13. 13© 1993-2014 Scrum.org, All Rights Reserved Scrum frames the creativity of people: • Discovery, • Experimentation-based learning, and • Collaboration, through: • Short, high value iterations, • Self-organizing, cross-functional teams, and • High visibility to solve complex problems. What I Always Hoped With its distinct rules, Scrum is an actionable way to shift to the Agile paradigm for software development.
    14. 14. 14© 1993-2014 Scrum.org, All Rights Reserved • Agility is the state envisioned by moving to Agile processes; a state of constant change, evolution, innovation, improvement and re-invention. • Agility is the capability to respond to challenges, change direction, take advantage of opportunities, cause change. Agility Provides A Why To Scrum React Explore (options) Lead
    15. 15. 15© 1993-2014 Scrum.org, All Rights Reserved Managing Agile Software Development Evidence-Based Management of Software Organizations Not everything that can be counted, counts, and not everything that counts can be counted. - Albert Einstein
    16. 16. MIN 16© 1993-2014 Scrum.org, All Rights Reserved 1. How long has your journey to Agile been so far (2014)? – 1 year, or less? – 1-5 years? – 5-10 years? 2. How Agile are you? What is your… Agility? – 100%? – Less, but more than 90%? – Less, but more than 75%? – Around 57,305%? How do you know? What is the importance? A Step Back 3
    17. 17. 17© 1993-2014 Scrum.org, All Rights Reserved • IT is a cost center. • Software development is an expense, some of which may be capitalized. • Expenditures are „managed‟ through projects. How IT Budgets Are Typically Managed Success = f { Planned_Time, Predicted_Scope, Allocated_Budget }
    18. 18. 18© 1993-2014 Scrum.org, All Rights Reserved • Scrum is the new methodological flavor for delivery from IT to business. • Delivery is done through projects. But we now measure and compare at the team level, no longer the individual‟s level. • The goal = Scrum adoption. How Scrum Is Typically Managed Success = f { Practices, Velocity, Performance }
    19. 19. 19© 1993-2014 Scrum.org, All Rights Reserved Remember? “Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.” How do you know? Back To The Drawing Board
    20. 20. 20© 1993-2014 Scrum.org, All Rights Reserved Evidence-Based Management (“EBM”): • Roots in medical practice. • The application of direct, objective evidence by managers to make decisions. • For software organizations, EBM is employed to maximize the value of software to the organization. A Matter of Managerial Culture
    21. 21. 21© 1993-2014 Scrum.org, All Rights Reserved Current Value Ability to InnovateTime to Market Direct Evidence Of Value Release Frequency Release Stabilization Cycle Time Installed Version Index Usage Index Innovation Rate Defects Revenue per Employee Employee Satisfaction Customer Satisfaction Product Cost Ratio
    22. 22. 22© 1993-2014 Scrum.org, All Rights Reserved An Overall Indicator of Direct Value
    23. 23. 23© 1993-2014 Scrum.org, All Rights Reserved Mind (1): Metrics Come In Sets
    24. 24. 24© 1993-2014 Scrum.org, All Rights Reserved Mind (2): Trends Say More
    25. 25. 25© 1993-2014 Scrum.org, All Rights Reserved Distinguishing Direct from Circumstantial Evidence Direct Evidence Circumstantial Evidence Measure Change • Skills, Knowledge, Understanding  Product managers  Managers  Developers • Practices, Tools, Standards Hunch Facilitate
    26. 26. 26© 1993-2014 Scrum.org, All Rights Reserved • Adapting organizational practices should ultimately have a positive impact on the outcome, reflected in the metrics. • Evidence over the effectiveness of teams and practices is circumstantial evidence. Circumstantial Evidence Is Supportive, Not Direct
    27. 27. MIN 27© 1993-2014 Scrum.org, All Rights Reserved The People‟s Financial Group is a strong retail bank with 1500 branches, 3800 ATMs, and 17000 employees (of which 1100 in IT) and across the US. • PFG was a pioneer in online banking, has done it for several years with rich applications and is ahead of the competition. • PFG only recently added mobile banking capabilities, after seeing a significant loss of market share to a smaller player. • Entry to the mobile market seems very slow. Exercise: People‟s Financial Group 2
    28. 28. MIN 28© 1993-2014 Scrum.org, All Rights Reserved Yet, the development manager reports an impressive increase in productivity for the mobile teams which he claims is the result of adopting Scrum: Direct or circumstantial evidence? Productivity Is High 2 Productivity
    29. 29. MIN 29© 1993-2014 Scrum.org, All Rights Reserved At the next board meeting however: • The VP of product management shows customer satisfaction. • HR summarizes the last employee happiness survey. A future proof company? Where‟s The Value? 2 Employee Happiness Customer Satisfaction
    30. 30. MIN 30© 1993-2014 Scrum.org, All Rights Reserved Take A Hunch At The Actions PFG Should Take 5
    31. 31. 31© 1993-2014 Scrum.org, All Rights Reserved Have you also heard? “Managers are useless and not needed in Agile.” Do you wonder too? Case Closed?
    32. 32. 32© 1993-2014 Scrum.org, All Rights Reserved Closing Evidence-Based Management of Software Organizations The future state of Scrum will no longer be called ‘Scrum’. What we now call Scrum will have become the norm, and organizations have re-invented themselves around it. -Gunther Verheyen
    33. 33. 33© 1993-2014 Scrum.org, All Rights Reserved Gunther Verheyen • eXtreme Programming and Scrum since 2003 • Professional Scrum Trainer • Directing the Professional series at Scrum.org • Co-developing Agility Path at Scrum.org • Author of “Scrum – A Pocket Guide (A Smart Travel Companion)” (2013) Mail gunther.verheyen@scrum.org Twitter @Ullizee Blog http://ullizee.wordpress.com About
    34. 34. 34© 1993-2014 Scrum.org, All Rights Reserved Connect with the Scrum.org community Twitter @scrumdotorg LinkedIn LinkedIn.com /company/Scrum.org Facebook Facebook.com /Scrum.org Forums Scrum.org /Community RSS Scrum.org/RSS
    35. 35. 35© 1993-2014 Scrum.org, All Rights Reserved Thank you

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