A deep dive into the most powerful concepts of Agile, Scrum and Lean: Iterations & Interactions.
Also, an historical view of how Scrum emerged from Lean, why every organization should first develop its People before developing customers and products and how PDCA's gave rise to Sprints.
Finally, we explain how compound interest is applied to a team's accrued knowledge, leading to a compound knowledge effect that boost value and/or decrease costs over time.
7. John, money and his father
When John turned 25 his father gave him $30,000.
His Dad taught him that money makes money.
And advised John to build his retirement.
16. Compound Interest
𝑨 = 𝑷 × ( 𝟏 +
𝒓
𝒏
) 𝒏𝒕
A = Amount accumulated after t periods
P = Principal amount (initial investment)
r = Nominal Interest rate (%) within period t
t = Number of periods to compound
n = Number of compoundings per period t
17. Compound Interest
𝑨 = 𝑷 × ( 𝟏 + 𝒓 ) 𝒕
Simplified (n=1)
A = Amount accumulated after t periods
P = Principal amount (initial investment)
r = Nominal Interest rate (%) within period t
t = Number of periods to compound
41. Scrum
Manifesto
Flows
XP Practices
Pull vs Push
Kaizen
Systems
Constraints
Complexity People
Kanban
Hyper Productivity
Science of Teams
Scrum Patterns
Lean Thinking Agile Transformation
Culture
44. Outcomes:
Emergence on solutions.
Boost team morale and confidence.
Excellence on engineering practices.
Dramatically improve client’s trust.
#2
Working
Software
Mindset
53. Post-World War II... 1949-1950
Low Japanese purchasing power.
Therefore, low sales and production.
Company's financial situation deteriorated.
And, on top of it… massive strikes!
64. Toyota breakthroughs
From Push to Pull production.
From Mass (Ford) to Lean production.
From Workers & Thinkers to Thinkers only!
From Resources to a Systems Management.
From disruptive Innovation to Continuous Improvement.
69. One Thinker = One PDCA
D
P
C
A
0
1
2
3
T1 T2 T3 T4
Standard 1 Thinker
Standard 1 Thinker
Mechanics
70. Two Thinkers = Two PDCAs
D
P
C
A D
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C
A
0
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T1 T2 T3 T4
Standard 1 Thinker Standard 2 Thinkers
Mechanics
71. N Thinkers = N PDCAs
D
P
C
A D
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A D
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A D
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A D
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21
T1 T2 T3 T4
Standard 1 Thinker Standard 2 Thinkers Standard N Thinkers
Mechanics
72. N Thinkers = N PDCAs
D
P
C
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D
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AD
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D
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A
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AD
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AD
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A
Organizational View
73. Only top hierarchy are Thinkers and so competent to develop Product
(N-Workers) Thinkers = (N-Workers) PDCAs
Organizational Blockage
D
P
C
AD
P
C
A
D
P
C
A
D
P
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A
Workers in production line to execute only!
76. Thinkers versus Workers? Organizational blockages?
Toyota’s employees did not fall into this cultural trap!
After all, they all are Thinkers!
And with discipline and resilience from their Culture…
They embraced the change!
Embrace the change
78. After 40 years of learning...
...and literally, gazillions of PDCA’s after...
PDCA compound effect
0
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0
7
14
21
T1 T2 T3 T4
Standard 1 Thinker Standard 2 Thinkers Standard N Thinkers
79. On Toyota:
From bankruptcy to world’s 1st automaker
From 11,706 (1950) to 10,117,274 (2013) vehicles/year
From bankruptcy to world’s 11th company by revenue
From bankruptcy to world’s most profitable automaker
PDCA compound effect
80. On Japan:
From defeat & destruction to a postwar miracle
From bankruptcy to world’s 2nd developed economy
From bankruptcy to world’s 3rd economy by nominal GDP
PDCA compound effect
82. From Lean to Scrum
1986 – ‘The New New Product Development Game’ paper.
Japan’s emergent study on Product Development:
Type C – Overlapping Phases of Development
Also referred as “Moving the Scrum Downfield”.
83. From Lean to Scrum
1993 – First Scrum Experiments (Sutherland, Schwaber).
1995 – ‘Scrum Software Development Process’ paper,
by Sutherland and Schwaber
2001 – Manifesto for Agile Software Development
84. From Lean to Scrum
D
P
C
A
Lean
Plan
Do
Check
Act
Scrum
Planning
Sprint
R2 = Review & Retrospective
Emerge into Backlog
S
P
E
R2
S
P
R
E
R
85. N Thinkers = N PDCAs
D
P
C
A
D
P
C
AD
P
C
A
D
P
C
A
D
P
C
A
D
P
C
A D
P
C
AD
P
C
AD
P
C
A D
P
C
AD
P
C
AD
P
C
A D
P
C
A
Organizational View
86. N Thinkers + X Scrum Teams = N + X PDCAs
D
P
C
AD
P
C
A
D
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C
A
D
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C
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S
P
R
E
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E
R
S
P
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E
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S
P
R
E
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P
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S
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E
R
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S
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E
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R
Organizational View
87. N Thinkers - X Scrum Teams = N - X PDCAs
Scrum Teams as Workers in production line to execute only blocking Emergence
D
P
C
AD
P
C
A
D
P
C
A
D
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C
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S
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S
P
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P
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E
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P
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E
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P
R
E
R
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P
R
E
R
S
P
R
E
R
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P
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E
R
Organizational Blockage
88. Project Driven Thinkers = 0 PDCAs = 0 Learning
Scrum Teams as Workers in production line to execute projects iteractively.
S
P
R
E
R
S
P
R
E
R
S
P
R
E
R
S
P
R
E
R
S
P
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S
P
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P
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S
P
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R
S
P
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R
Design
Plan
Execute
Design
Plan
Execute
Design
Plan
Execute
Design
Plan
Execute
Organizational Blockage
97. Outcomes:
Shared common goals.
Boost on all communication levels.
From a group of individuals to a Team.
#1
1 Week
Sprints
Lessons:
Leads to false felling of delivering value.
Iteration is nothing without Interaction.
98. Outcomes:
Emergence on solutions.
Boost team morale and confidence.
Excellence on engineering practices.
Dramatically improve client’s trust.
#2
Working
Software
Mindset
Lessons:
Working Software is not always what user
values the most.
Value capitalization impacts tremendously
on compound effect.
99. Outcomes:
Increase client’s engagement.
Amplify Learning & See the Whole.
Improve all communication channels.
Learn from the client, “fast & furious”.
#3
Scrum
On a Lean
Client
Lessons:
Customer Collaboration has huge
compound value.
It is easy to slow down iteration pace,
hence, a balance must be pursued.
100. Outcomes:
Boost on team morale!
Clarity on team capacity!
Development steady pace regained.
#4
Pulling
The Sprint
Lessons:
Overflow blocks Iteration.
Overflow blocks Interaction.
Overflow blocks everything.
Seeing the flow is amazing!
104. Money and Value
Money ≠ Value
Value can be expressed by:
Business Key Performance Indicators (KPIs)
Customer relationship metrics (NPS, engagement)
Other metrics… happiness metric ?!?
108. Compound Knowledge
𝑨 = 𝑷 × ( 𝟏 + 𝒓 ) 𝒕
Simplified (n=1)
A = Future Value accumulated after t sprints
P = Present Value (of the product/process)
r = Nominal Improvement rate (%)
t = Number of sprints to compound
111. Going back to Lean & Scrum
D
P
C
A S
P
R
E
R
Lean (PDCA)
Done by Quality Circles
Focus on Efficiency
Decrease Cost!
↑ Cycles ≫ ↓ Cost
Scrum (PSR2
E)
Done by Scrum Teams
Focus on Effectiveness
Deliver Value!
↑ Cycles ≫ ↑ Value
112. Going back to Lean & Scrum
Lean Scrum
Main Goal Reduce Cost Deliver Value
Focus On Efficiency Effectiveness
Dev. Teams QC Circles Scrum Teams
Dev. Cycle PDCA Sprint (PSE2
E)
Deliverables Process Improvements Product Increments
113. Going back to Lean & Scrum
Lean & Scrum are made by Thinkers!
PDCAs and Sprints are empirical iteration processes!
Learn by doing!
And only by learning a lot…
…your organizational knowledge is increased!
114. Going back to Lean & Scrum
Both Lean & Scrum have deliverables!
And only by delivering your process/product is improved!
You can deliver with an high or low frequency!
And you can also deliver high our low value improvements!
This is what we call the Improvement rate (per delivery).
115. Going back to Lean & Scrum
The Improvement rate is, therefore, a function of:
Team’s iteration (learning) cycle, the shorter the better.
Team’s delivery (compounding) cycle, the shorter the better.
Team’s interaction frequency & quality with social networks.
Team’s (compounded) knowledge over time
118. A Simple Example
Your 2 ecommerce sites’ monthly sales are $30,000/site.
You want to improve it
You assemble 2 Scrum Teams, 1 per site…
… and gave them a KPI to improve over 40 weeks:
Gross Transaction Value (GTV)
119. A Simple Example
Team A decides:
Iteration cycle = 2 weeks
Delivery cycle = once every iteration
120. A Simple Example
Team B decides:
Iteration cycle = 1 week
Delivery cycle = once every iteration
122. Summing up
Our experiments on the field, highlighted these 2 properties of an Agile
Ecosystem, hence, no matter what you do or how you do it, just:
Iterate & Interact
to unleash
The Power of I(n)teration