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Value

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In Agile we like to deliver valuable software to our customers on a regular basis. However, while it’s pretty clear what “software” means, we cannot really say the same about “valuable”.

The definition of Value in a project (with an uppercase “V”) is frequently fuzzy and confused. Even within the same project, asking different stakeholders what Value means to them produces different answers; and the same stakeholder will likely provide different definitions of Value, depending on their perception and role in the project.

Most stakeholders will naturally associate Value to money, sometimes through surprisingly creative correlations; but there are other dimensions, equally valid, such as strategic positioning, company image, innovation and learning, and so forth.

Understanding the multidimensional nature of Value becomes therefore critical to drive the project to success. In this talk we’ll address what Value means in Agile for different stakeholders; how to map and categorize the stakeholders; how to describe Value on different dimension and how to track it. We’ll also see what happens when we don’t do that.

Also, assuming different stakeholders on the same project have different and multifaceted perceptions of Value, how can we coordinate the production effort in a balanced way? Which kind of corporate culture and corporate values (plural) support that?

Published in: Business

Value

  1. 1. VALUE Andrea Provaglio @andreaprovaglio
  2. 2. Nice to Meet You! I assist executives, managers and teams in knowledge-based organizations in implementing better ways of doing business in the 21st century. In over 20 years in IT, I worked with multinationals and small companies in three continents and I had a U.S. work visa for “extraordinary abilities in Sciences”.
  3. 3. What is your definition of value?
  4. 4. What is their definition of value?
  5. 5. The Agile Manifesto “Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.” Mentions — but doesn’t define — value for Sponsors and Users.
 Also lists Values.
  6. 6. The Scrum Guide 17 occurrences of the word “value” no definition
  7. 7. Training Materials “[Value is] the benefit to the [profit] organization, represented in money terms, that results from the use of a product or service”
  8. 8. Ron Jeffries “Value is what you want”
  9. 9. Tom Gilb “Value is perceived benefit: that is, the benefit we think we get from something.”
  10. 10. Gojko Adzic & David Evans “The value of software is a vague and esoteric concept in the domain of business users”
  11. 11. And Then We Have Values Learning Capital Product Speed Information Company Survival Rapid Progress Human Life Helping the Customers People’s Happiness Joy Creativity Collaboration Money Revenue Ability to Keep Working Be With People We Care About Adapted from a list by Ron Jeffries
  12. 12. Deliver What to Whom? — and Why
  13. 13. Let’s Talk About Money It’s important. It’s also a trailing indicator Duh.
  14. 14. Beyond Profit “Profitability is a necessary condition for existence and a means to more important ends, but it is not the end in itself for many of the visionary companies.” — Collins and Porras
  15. 15. One More Thought “[most executives] are running a company with a 90-day mandate. It's a quarterly report. If you're not good in 90 days, you're out” — Ricardo Semler Interview on TED video “How to run a company with (almost) no rules”
  16. 16. Why We Want To Quantify Goals Having the conversation is the key point SCALE Past Goal Tolerable Benchmark Constraint Target “The main purpose of ‘quantification of performance objectives’ is to force us to think deeply, and debate exactly, what we mean.” — Tom Gilb
  17. 17. Why We Need To Identify Actors “Stakeholder: anyone who can influence, or is influenced, by the outcome of an initiative.” Identifying who are the stakeholders and their relationships is a critical, complicated and frequently overlooked activity Interest Power EngageKeep Happy Monitor Inform Prj Mgr Prd Mgr IT Dep Supplier Account Support Legal Reseller HQ Clients Question: is the development team a stakeholder?
  18. 18. Why We Need To Identify Goals Adapted from an example by Portia Tung Stakeholder Goal Strategy 1 (with scales) Strategy N Customer Operations Manager Provide good customer service 50% reduction of customer complaints by next year Customers recommend our service to friends Increased NPS from 8% to 15% Lower operational cost Reduced number of call centre staff and costs Shorten cycle time Reduced from 2 days to 24 hours, eventually to 2 hours … Compliance to regulations Regulator directives met and no fines paid … Customer … … … Connecting ends to means
  19. 19. Multi-level Goals and Strategies Business Value Training Costs User Productivity Profit -10% +40% Market Share +50% +10% Stakeholder Val. Intuitiveness Performance Training Costs -10% +50% User Productivity +10% +10% Adapted from an example by Tom and Kai Gilb - Agile Record Product Value GUI Design Optimization Intuitiveness -10% +40% Performance +50% +80% OrganizationalTiers (Goals) (Strategy) (Strategy) Strategies recursively turn into goals Goals are hierarchical
  20. 20. About Motivation "Working for external, measurable goals destroys intrinsic motivation." -- Dave Snowden, Cynefin training class
  21. 21. Things Are More Organic Interest Power EngageKeep Happy Monitor Inform Prj Mgr Prd Mgr IT Dep Supplier Account Support Legal Reseller HQ Clients A complex adaptive system
  22. 22. System Thinking for Value Individual Goals and Strategies for different stakeholders may amplify or dampen each other in a system dynamic. SH1 SH2 SH3 Reinforcing Loop Balancing Loop Delay
  23. 23. Values Abstract reference points in anybody’s decisional processes Individuals have different criteria to assess if their values are met or violated Values are hierarchical, one has contextual precedence over another
  24. 24. Some Example Of Values By Persona Measurability over predictability Impact over scope Directness and root cause problem solving Business Owner Delivery Company Owner Making the world a better place Helping people make their lives better and more fulfilling IT Manager Sustainability Compliance Product Owner Making Things Happen Learning Constructive negotiation From real interviews
  25. 25. Values In The Organization “We are in the business of preserving and improving human life. All of our actions must be measured by our success in achieving that goal” — Merck & co, internal management guide A Core Ideology (Values + Purpose) comes from founders and owners.
  26. 26. Start From The Values “When you are faced with a difficult decision situation, start by thinking about your values. Do not start by thinking about alternatives, as that will limit you.” When we start from alternatives, the assumptions of the first one will anchor our thought process.
  27. 27. It's Not About Finding Compromises “The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time, and still retain the ability to function.” — F. Scott Fitzgerald The “Genius of the AND” over the “Tyranny of the OR” — “Built to Last"
  28. 28. Connecting Values to Value Values Criteria Goals Measurable Impacts Actor's Conceptual Levels Elements are interconnected on multiple dimensions
  29. 29. The Nature of Value Multi-dimensional Systemic Contextual Subjective Dynamic
  30. 30. Prioritizing Is Not The Main Point Find the causality chain that delivers what the actors currently need most Repeatedly select slices of the value system (every few weeks) Validate hypotheses by measurable impact of deliverables Top-level Values Stakeholder Goals Product Goals Deliverables Can be hard to assign value to single deliverables Value Loop Impacts Loop
  31. 31. Beware Of Local Value Optimization From a system perspective, many of the pain points in projects are symptoms of a (frequently tacit) local optimization of value. Personal Agendas Unused Product Features Excessive Bureaucracy
  32. 32. Understand the Value System with… Transparency Empathy Nonjudgmental attitude
  33. 33. Use a Common Space Invite as many actors as you can into the same room Let them be aware of complexity of their value system Ask “why”, not just “what" and “how” And yes, it might become interesting
  34. 34. Or just brew your own! Use a Common Visual Language Discuss deeply and precisely the meaning of value Use visualizations Pick one of the many available approaches to describe it
  35. 35. Want to Talk? provagl.io/linkedin provagl.io/twitter provagl.io/contact Click on these links!
  36. 36. Many Thanks To… Tom Gilb Christian Hassa Olaf Lewitz and many others… you know who you are ! Tobias Mayer David HussmanDave Snoden
  37. 37. Main References Jeffries, Ron - “The Nature of Software Development” Collins, Jim and Porras, J. - “Built to Last” Adzic, Gojko and Evans, D. - “50 Quick Ideas to Improve your User Stories” Hubbard, Douglas - “How to measure everything” Keeney, Ralph - “Value-focused Thinking”
 Stakeholder Map - http://www.stakeholdermap.com Gilb, Tom in “Agile Record #3” - http://agilerecord.com Semler, Ricardo - http://www.ted.com/talks/ ricardo_semler_radical_wisdom_for_a_company_a_school_a_life
 Portia Tung and Pascal Van Cauwenberghe - Presentation “Agreeing on Business Value with Systems Thinking”

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