How we made the journey from flow in our complex products to flow thinking for our processes. Ericsson is number 1 in mobile infrastructure thanks to our ability to innovate around state-of-the art algorithms for optimizing packet data flow. We made a mental leap when we realized that all this is also applicable for flow through our processes.

1. Flow ThinkinG
@ Ericsson 3G
@erik_schon
#LKN14

2. @erik_schon | #LKN14 | Page 2
Flow Thinking:
The Mental Leaps
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation

3. @erik_schon | #LKN14 | Page 3
ERIK SCHÖN
@erik_schon
Co-creator of conditions
where people, teams
and organizations
grow
Proud member
of the FlowFans

4. @erik_schon | #LKN14 | Page 4
Ericsson 3G:
Facts & Figures
>40% Of all 3G traffic
in Ericsson networks
10R&D sites
1 800 people
We lead the mobile broadband industry
towards a networked lifestyle for everyone
#1 Mobile 3G
networks
~100Teams

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3G Network Overview
Radio
Network
Controller
Radio
Base
Station
Internet
Telephone
networks
Complex Network, Complex Product

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Why CHANGE?

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Our heritage: Improving The
Waterfall for 30+ years …
2-3 year projects, 100 000-200 000 person hours
2010: Improvement potential questionable …
We must try something fundamentally different
System
Design
Test
System
Design
Test

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Flow Thinking:
The Mental Leaps
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation

9. @erik_schon | #LKN14 | Page 9
Flow
Visualization
Continuous
Learning
Initial focus on
needs and direction
Inspiration from
Thought Leaders
Culture of thinking
for ourselves
Continuous
Integration
“Kanban”
Scrum

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Principles & Mindset:
Point to the destination

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XFT1
Release
Verification
Customers
Product
Management
Product
Owner
PPO
PPO
PPO
ScM
XFT2 ScM
XFT3 ScM
XFTn ScM
Main
software
branch
PPO Product Proxy Owner
XFT Cross Functional Team
ScM Scrum Master
Continuous
Integration
Product
Backlog

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EMpower people
Reduce lead-time
to be more Responsive
Increase efficiency
to enable more output
Build quality into
our way of working

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Principles & Mindset:
Small batches

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Improvements are
Small experiments

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Flow Thinking:
The Mental Leaps
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation

16. @erik_schon | #LKN14 | Page 16
As long as
I’m busy …
What can I
start next?

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What is Lean?
an operations strategy!
Flow Efficiency
ResourceEfficiency
Low High
LowHigh
Prioritize continuous learning
Prioritize flow efficiency
Niklas Modig
Stockholm School of Economics
@LeanOnMyself

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Flow efficiency:
Visualize end-to-end

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End-to-end Flow:
Snapshot Visualization
44 [57] 57 [57] 9 [N/A]
53 18 20
WIP [limit]
30 [55]
0 4 0
Throughput
7 features per sprint
Queues
Removed
Pre-prestudy prestudy Development Launch

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0
50
100
150
200
250
300
Numberofworkitems
Week
WMR features cumulative flow diagram
G0 to G2
G0
2/3
G1
G2
Lead-time , autumn: -17%
Lead-time, spring
Reduced WIP
Starting WIP
WIP: -25%
End-to-End FLOW:
trend Visualization
Pre-prestudy
prestudy Development Launch
Cumulative number of features
Time
Spring
2013
Autumn
2013

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End-to-enD
Visualization Room

22. @erik_schon | #LKN14 | Page 22

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Flow efficiency:
In product & Process

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Flow
and
queues
in TraffiC …
Source: Irene Karpiczenko-Wasem, http://www.flickr.com/photos/jungle-jill/1160447677/

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Don Reinertsen
@DReinertsen
Ericsson: you already know this,
you use it in your products
every day!

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Configuring High
Capacity in our product
Arrival Departure
Controlling arrival and departure ensures high capacity
in both product and product development
Radio
Network
Controller
Radio
Base
Station
Admission
Control
Congestion
Control

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Securing performance
In our Product
Flow Efficiency
ResourceEfficiency
Low High
LowHigh
Performance
for many users
Performance
for few users
Functionality
for few users
First flow efficiency, then resource efficiency
in both product and product development

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Flow Thinking:
The Mental Leaps
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation

29. @erik_schon | #LKN14 | Page 29
Inspiration from the
#1 Sports Car Company
Source: Peter Blackert, http://www.flickr.com/search/?w=29987108@N02&q=ferrari%20458%20italia%202010
The best Ferrari car
we have every produced
is the next one.
Enzo Ferrari
Founder & CEO, 1898-1988

30. @erik_schon | #LKN14 | Page 30
Expectation:
Plan for innovation
Time
Capability 100% capability
Planning with less than full utilization
creates environment for innovation
Capability at 70%
planned utilization
Innovation = value from ideas in product and product development

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Continuous improvements
towards the vision
Small experiments
towards next target condition

32. @erik_schon | #LKN14 | Page 32
Flow Thinking:
The Mental Leaps
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation

33. @erik_schon | #LKN14 | Page 33
Q&A