The document presents a novel approach for identifying value streams using a modified SIPOC analysis to address organizational complexity in Agile environments. It discusses the complexity stemming from communication, dependencies, and scaling, while providing cases and insights on implementing the modified SIPOC for better SAFE transformations. Key takeaways include managing relationships between customers, systems, and teams to enhance organizational efficiency and reduce complexity.

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A Novel Approach for Identifying
Value Streams and ARTs
Maarit Laanti, Nitor

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Maarit Laanti
Agile Coach
PhD, SAFe Fellow, SPCT5
Nitor Delta Oy

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Contents
1. Value stream analysis in SAFe
2. What is SIPOC and how can you apply it to create better SAFe
transformations?
3. Customer experiences with applying a modified SIPOC analysis
4. Summary and key takeaways

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The complexity problem in any organization comes from
1. Communications – how we
communicate with each other or
how disconnected we are (and
thus not aligned)
2. Number of dependencies and
interfaces between systems – how
we split and manage the work
3. Scaling; number of people
developing same system or
solution
COMPLEX
probe
sense
respond
CHAOTIC
act
sense
respond
SIMPLE
sense
categorize
respond
COMPLICATED
sense
analyze
respond
DISORDER
ORDERED
UNORDERED

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SAFe® tackles the complexity in your organization
1. Roles who are responsible for communication, facilitation, and
collaboration
2. Special attention to dependencies; planning work and dependencies
together
3. Time-boxing, prioritization, flow
4. Prioritization; job sequencing
Complexity can be eased up also by architectural decoupling

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Complexity at different levels of organization
Portfolio
• Epics – Will the
customers need and
want it?
• Business models – Will
customers be willing to
pay for it?
• Business environment
– Will our competitors
offer something better?
Value Stream
• Dependencies – We
cannot deliver this part
before that is ready
• Inter-team collaboration
• Systemic complexity of
the system to be
developed and the
organization that
develops it
Essential
level
• Technical complexity –
Tamed by DevOps &
splitting the work into
stories
• Team level
competency –
collaboration within
organization

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What is a value stream?
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A value stream is a set of activities, materials, people and information
that is needed to produce value for customers
• What is the trigger that
starts the flow of value?
• What steps are needed
to create value?
• Who is the customer?
• What value do
customers receive?
Defining a value stream:

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Identifying development value streams
Operational
Value Stream
Development
Value Stream

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Case #1
Loan is just one of
the operational
value streams;
how to balance
between different
needs?

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Case #2
What if you have
just enough
people for one
value stream?
How do you
understand the
whole picture?

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Identifying the development value streams
USER VALUE
STREAM
SYSTEMS
TEAMS
à ARTS

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Value streams and complexity
Reasons to enhance Value Stream analysis from complexity point of view:
1. Additional complexity may come from multiple teams supporting several (operational)
value streams
2. Some user value streams using multiple (same) underlying systems
3. There may be special competences needed to operate several systems (and getting away
from that bottleneck will take some time)
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Additional to inter-team coordination, dependencies & sequencing!

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© Scaled Agile, Inc.
What is SIPOC and how you could apply it in creating
better SAFe ® transformations

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What is SIPOC?
SIPOC is a tool that summarizes the inputs and
outputs of one or more processes in table a form. It
is used in:
• Lean (Kaizen events)
• Six Sigma
• Business Process Management
4S UPPLIERS
4I NPUTS
4P ROCESSES
4O UTPUTS
4C USTOMERS
LUOTTAMUKSELLINEN 14
SIPOC was developed by Peter Scholtes as an elaboration on Dr Deming’s systems
diagram and is an excellent tool to help you understand the process you want to improve

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SIPOC example
Example SIPOC: Automobile repair
Supplier Input Process Output Customer
•Vehicle owner
•Customer service
representative
•Facility manager
•Parts window
•Repair inquiry
•Vehicle for repair
•Permission to
proceed with
individual
recommendations
•Open bay
•Parts for approved
repairs
•Observations
•Schedule visit
•Diagnose problem
•Prepare work order
•Source parts
•Perform repairs
•Notify that service is
complete
•Appointment date
and time
•Repair
recommendations
and cost estimates
•Work order
•Parts for approved
repairs
•Repaired vehicle
•Telephone/e-
mail/text message
notification
•Vehicle owner
•Mechanic
•Customer service
representative
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Source: Wikipedia

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Problem:
What about dependencies?

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SIPOC mapping
11.5.2020 CONFIDENTIAL 17
Suppliers Outputs
Processes
Inputs Customers
A
B
C
D
…we can map the dependencies…!

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Modified SIPOC
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Teams
Inputs Systems Outputs Customers
Suppliers Processes
…we can insert Teams & systems!
…and Suppliers are often visible in Teams, not as process input!

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Modified SIPOC
11.5.2020 LUOTTAMUKSELLINEN 19
Teams
Inputs Systems Outputs
Customers Processes
…you can start from customer…
… several user value streams may use same underlying systems!
…processes may not be needed!

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Case #1
Loan is just one
of the user value
streams; how to
balance
between
different needs?

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Multiple inputs, teams and systems create value for several customers groups
11.5.2020 CONFIDENTIAL
Teams
Inputs Systems Outputs Customers
Modified
SIPOC
21

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Several Products, Same Platform (= Prioritization, Dependencies)
11.5.2020 CONFIDENTIAL 22
In flow Analysis Backlog Ongoing Done
A
B
C
Arch

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Case #2
What if you
have just
enough people
to one value
stream?
How to
understand the
whole picture?

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Single Art, Modified SIPOC
Benefits
• Create a systemic view on what is happening in
the organization; the links between teams
• Identify missing functionalities; missing
interfaces, missing information
• Clarify vision
1. Create first current state
2. Then create future state
• Helps to work on the architecture
modularization
What end result looks like…
11.5.2020 CONFIDENTIAL 24

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Customer Feedback
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”I got first time insight what
was happening in our
organization end to end”
”This was good – we we able
to look at our offering from a
new angle”
“We had just added things and not worried
about the complexity – now I understand
why things take so long to develop”
”We should have invited more
people here, how do we share
this result?”
”How often would you
recommend to do this kind of
mapping?”

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© Scaled Agile, Inc.
Experiences with customers on using modified
SIPOC

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How to work with modified SIPOC?
• The idea is to create a quick map that brings out lots of value
• It is a map that connects architectural view to organizational view
• It helps you to work both on the communication structure and the
architecture
• Always focus on just current state; but reserve time also for drawing the
future state
11.5.2020 LUOTTAMUKSELLINEN 27

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Potential improvements identified by modified SIPOC
4Streamline architecture
4Simplify communicatiuon structures
• Find out biggest architecture improvements
• Find out where where standard components could help most

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Every organization becoming an
Agile Enterprise will eventually invest
on architecture supporting fast
development cycles.

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Modified SIPOC Is Not A Value Stream Map
• Value streams map concept to cash; aim is to present processing times
& tact times
• Value stream maps help to identify waste & value in order to speed up
• The problem is if we have too many connections from one node as the
complexity grows exponentially with the amount of connections
• Modified SIPOC is a map of the complexity – it maps the nodes & their
interconnections
11.5.2020 LUOTTAMUKSELLINEN 30

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Reduction of complexity is the
key to fast deliveries

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Facilitation tips
4Max 20 persons
4Reserve a room with sufficient wall space and suppliers (post-its, pens)
4Reserve enough time (4 hours – 1 day)
4Encourage people to experiment – also the level of details (you can
always change it later)
4Often it is easiest to start from inputs, and then go to outputs
4Have an ally
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Potential challenges…
4”How can I connect systems to teams….” (you connect teams who are
developing those systems)
4“There is so many arrows / relations in-between” (mark only the most
important ones)
4”Should we add here also Outlook…” (or any other tool you are not
developing yourself – the answer is no)
4“I don’t like how it is currently!” (Bingo! Now you have change to
improve it!)
11.5.2020 CONFIDENTIAL 33

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© Scaled Agile, Inc.
Summary and key take-a-ways

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New Way Of Mapping & Managing
Complexity

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When to use a modified SIPOC?
1. Simple case: The number of people fit into one ART and as a coach
you need to understand the connections between customers, systems,
and the teams who are developing these systems
2. Complex case: Multiple operational value streams that are supported
by the same systems and teams – which are partially used by the
same customers.
3. Your case? Give it a try.
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Modified SIPOC is a new tool that allows
you to work on the organizational and
architectural complexity

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Key take-a-ways #1
Objectives
1. Gain the knowledge needed to understand
when a modified SIPOC approach would result
in better SAFe implementations
2. Understand the benefits of SIPOC for value
stream analysis
3. Learn how to run a value stream analysis
using a modified SIPOC approach
Results
1. To understand and manage complex relations
on value-stream or within value stream level
2. When only single ART
3. When multiple user value streams
implemented by single ART

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Key take-a-ways #2
Objectives
1. Gain the knowledge needed to understand
when a modified SIPOC approach would result
in better SAFe implementations
2. Understand the benefits of SIPOC for value
stream analysis
3. Learn how to run a value stream analysis
using a modified SIPOC approach
Results
1. To create alignment and common view how to
evolve your organization further
2. To reduce architectural complexity
3. To reduce organizational complexity (e.g. one
team being connected to everything)

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Key take-a-ways #3
Objectives
1. Gain the knowledge needed to understand
when a modified SIPOC approach would result
in better SAFe implementations
2. Understand the benefits of SIPOC for value
stream analysis
3. Learn how to run a value stream analysis
using a modified SIPOC approach
Results
1. Model out Customers, Inputs, Teams,
Systems, Outputs (CITSO) and their
connections
2. Stick to current state first!
3. Experiment!

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Questions

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Thank you!
Maarit Laanti
maarit.laanti@nitor.com
Presentation downloads coming soon at
europe.safesummit.com/presentations