AgileLIVE Webinar: Measuring the Success of Your Agile Transformation - Part 1

1. Measuring the Success of Your Agile Transformation Part 1 June 19, 2014 #AgileLIVE

5. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company The Enterprise Transition Framework™ (ETF) for empirical change 1. Assess 2. Strategy 3. Pilot 4. Rollout http://www.agile42.com/en/agile-transition/etf/

6. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Goal PSF NC Agile Strategy Map™ Define the Goal we want to achieve Possible Success Factor (PSF) represents a hypothesis about a key factor that would enable us to achieve the Goal Necessary Condition (NC): what is needed in order to fulfill the Success Factor http://www.agile42.com/en/agile-transition/agile-strategy-map/ Agile Strategy Map™ - Framework for Strategy

7. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Goal Agile Strategy Map™ PSF#1 PSF#1: we believe that by consolidating all projects in one Portfolio, we will be able to make better business decisions NC#1. 1 NC#1.2 NC#1.1 .1 To validate the hypothesis, we define what is needed to run a pilot which will measure the validity of the PSF NC#1.1: we need to list at least 3 projects per product area NC#1.1.1: we need to choose projects and define comparable dimensions such as: business value, strategic alignment, cost... NC#1.2: we need to define a sample Portfolio funnel, and check that Teams can deliver with the provided information What conditions are necessary to achieve the success factor (PSF)?

8. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Success: we can compare the value of projects easily (using defined KPIs) and make consistent business decisions. Failure: we still have endless discussions about priority and it’s costly to prepare project info for the portfolio process Indicators (measures): •< 1 day to prepare 1 project business case •Allows objective comparison of projects •< 8 hrs to select priorities each quarter •No ‘exec overrides’ on priority decisions How will we measure PSF success and failure? PSF#1: we believe that by consolidating all projects in one Portfolio, we will be able to make better business decisions

9. agile42 | The Agile Coaching Company www.agile42.com | All rights reserved. Copyright © 2007 - 2014. Goal CSF#1 NC#1.1 NC#1.2 Agile Strategy Map™ CSF#1: we must consolidate all projects in one Portfolio, so that will be able to make better business decisions NC#1.1 .1 The Pilot was successful... The Potential Success Factor becomes a Critical Success Factor (CSF). Update the strategy to roll out and institutionalize the change. Pilot success! Now what?

10. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Sustainably faster delivery of solutions that delight customers Faster time to market Alignment & support across the org Engaged & joyful people Transparent empirical view of org performance Grow and sustain agile practices Culture of continuous learning & improvement Org priorities aligned with customer value Agile Transformation Example Goal + Success Factors (PSFs / CSFs)

11. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Sustainably faster delivery of solutions that delight customers Faster time to market Balance workload & capacity: limit WIP Alignment & support across the org Engaged & joyful people Transparent empirical view of org performance Grow and sustain agile practices Culture of continuous learning & improvement Org priorities aligned with customer value Dedicated Guiding Coalition Pilot projects Clearly communicated vision & strategy Training & coaching Build internal expertise Collaborative prioritization with stakeholders Collaborative cross-functional teams Automated testing & deploymentIncremental delivery Visible metrics Leaders to remove fear Empowerment Clear, realistic goals Servant leadership Action taken to improve Foster innovation Celebrate failed experiments Example: Necessary Conditions for the PSFs Clear career path

12. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company A few metrics (KPIs) for the goal Sustainably faster delivery of solutions that delight customers These are lagging indicators; some leading indicators are described soon…

13. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Leading & lagging indicators for each PSF / CSF PSF Leading Indicators Lagging Indicators • # total concurrent projects • Avg # concurrent projects/person • Program burn-up chart • Lead time: idea to 1st delivery • Cycle time: Dev start to 1st delivery • Deployment frequency post 1st delivery (MVP/V1) • Frequency & effectiveness of stakeholder collaboration on prioritization • Standard way to compare project value • Portfolio priorities highly visible • All teams working on top portfolio priorities; no ‘side projects’ • Delivered value is measured and meets expectations • Customer satisfaction survey • Sales and/or usage statistics 1. Faster time to market 2. Org priorities aligned with customer value

16. agile42 | The Agile Coaching Company www.agile42.com | All rights reserved. Copyright © 2007 - 2014. PSF 2: Org priorities aligned with customer value – leading indicators Churn = % change after commit point

17. agile42 | The Agile Coaching Company www.agile42.com | All rights reserved. Copyright © 2007 - 2014. Compare actuals with forecast PSF 2: Org priorities aligned with customer value – lagging indicators

18. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Leading & lagging indicators for each PSF PSF Leading Indicators Lagging Indicators • Sr. Leadership consensus on strategy • Frequency of comms on vision & strategy; # of different forums • Short-term wins visibly celebrated • # hours spent on Guiding Coalition activities • Poll: % who agree with strategy • Poll: % prefer new to old approach • # of teams asking to ‘go agile’ • # people trained on Agile • # people in coached projects • # people in the ‘coach the coach’ program • Agile team practices maturity level • # people completing ‘coach the coach’ • # people achieving 3rd party Agile certifications • Monthly attendance in Agile Community of Practice (CoP) meetings 4. Grow & sustain agile practices 3. Alignment & support across the org

21. agile42 | The Agile Coaching Company www.agile42.com | All rights reserved. Copyright © 2007 - 2014. Leading & lagging indicators for each PSF *Success ratio over 70% may indicate fear of failure PSF Leading Indicators Lagging Indicators • Poll: things getting better or worse? • Career path defined for all roles • Poll: employee job satisfaction • Attrition rate • # employee referrals for hiring • Avg frequency of team retrospectives • # of experimental learnings celebrated (fast safe failures) • Poll: Do you feel safe to experiment & innovate? • # team-initiated process changes • # team-initiated product innovations • Success ratio of experiments* 5. Engaged & joyful people 6. Culture of continuous learning & Improve- ment

28. agile42 | The Agile Coaching Company www.agile42.com | All rights reserved. Copyright © 2007 - 2014. Questions to ask about every metric 1. What decisions will be made based on this metric? 2. Is this the RIGHT thing to measure or an easy-to- measure proxy? 3. What might be the unintended consequences of this metric? 4. How could this metric be ‘gamed’? 5. What can we do to guard against unintended consequences and ‘gaming’?

29. agile42 | The Agile Coaching Company www.agile42.com | All rights reserved. Copyright © 2007 - 2014. Compensating / Balancing Metrics • What unintended consequences might happen if you measure speed of delivery? • What is a compensating metric to counteract it? • Measure speed AND quality!

30. www.agile42.com | All rights reserved. Copyright © 2007 - 2014.agile42 | The Agile Coaching Company Management vs. Team Metrics https://creativecommons.org/licenses/by-nc-sa/2.0/ https://www.flickr.com/photos/joeshlabotnik/ https://www.flickr.com/photos/jeroen020/

31. www.agile42.com | All rights reserved. Copyright © 2007 - 2014. agile42 - The Agile Coaching Company agile42 | The Agile Coaching Company Thank you! Brad Swanson Senior Agile Coach @agile42 brad.swanson@agile42.com @bradswanson

33. Thank you for joining us today! Join us for Part 2, June 25, Noon-1 PM ET #AgileLIVE

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