Organizing for faster innovation - People, process, culture, and technology

innovation
People, process, culture, and technology

Survey results
Hardware obsolete in 3 years
Lack of control over some
kinds of outages
On prem solutions that are not as good as newer products
Funding to refresh hardware
Vendor lock-in makes it difficult
to move if necessary
Controlling the costs
Lack of resources
Disparate systems
Fear of the unknown
Processing power (speed)
Lack of visibility in one unified platform
Outages
Lack of support

Amazon’s Innovation Equation
f(innovation) = (org * platform)
(culture * mechanisms)

The Great Stall
Value
Time
Desired
state
Inception
Project Foundation
THE GREAT STALL
Ineffective
Operating Model
APIs
Cost
Management
Processes,
manual
operations
People
Business
Alignment
People : skilling, project, agile-fall, antagonists, uncertainty, norms, org structure
Reinvention
Optimization
Migration

© 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Amazon Confidential and Trademark
Becoming a high frequency organization

Reduced batch size and frequency of releases
Continuous refactoring and improvement
HiPPO-based decision-making
1
2
3
Software and processes that aren’t nimble

Focus your teams around business outcomes
- Measured by output - Measured by output and outcomes Roadmap defined by customer
feedback based on business outcomes
KPIs
focus in achieving business value instead of delivering “on-time on-badged”
Retire Adopt

Cost is optimized by distributing accountability across pools of resources
Biz Case & Reqs
Business
Creative & Functional
Design
Finance & PMO
Prioritization
Software Development
Engineering
Integration & Perf.
QA & Testing
Deploy & Manage
Infra & Ops
Policy & Compliance
Security
Idea
Value
Defects
Defects
Defects
Defects
Defects
Wait
Wait
Wait
Wait
Wait
Wait
Wait
Wait
Defects
Each Step Delays Time-to-Value
Defects passed downstream are often discovered late in the delivery cycle and have to be revisited.
In the process, pervasive handoffs, bottlenecks, and defects are created.

Retire
Retain Rearchitect /
Refactor
Repurchase
Replatform
Rehost
Determine
Discover
Rearchitect
Lift
& Shift
Lift
& Reshape
Drop
& Shop
Sustain
Grow
Optimize
Traditional
Operations
Distributed
DevOps
Decentralized
DevOps
Operations
Engineering
Platform
Applications
Dev
Ops
Application
Engineering
Cloud Platform
Engineering
ITSM
Operations
Engineering
Platform
Applications
Dev
Ops
Application
Engineering
ITSM
Cloud Platform Engineering
Migration and modernization path impact on Operating Model
Migration paths should be chosen to support desired business outcomes,
not to speed up migration.
Operations
Engineering
Platform
Applications
DevOps
Cloud
Platform
Engineering
Application
Operations
Application
Engineering
AWS Managed
Services
Cloud Platform Engineering
ITSM

Speed and agility disproportionately matters in business
Normal
6
Months
Fast
2
Weeks
AWS
5.2
per day
1
per month
1
per day
60M
per year
1
in six months
3
in 14 weeks
100s
per year

Team topologies
The team structure and the way teams interact with each other can be an strategic advantage that
accelerates innovation. E.g. Amazon Two-Pizza teams or Spotify tribe model
- Product teams: Autonomous team that is responsible of
the value stream of their product.
- Platform team: Team that provide a product for other
type of teams – AWS Xray, Data API
- Enabling team: helps product teams to overcome
obstacles, and remediate missing capabilities.
Core types of teams
Team 1
Team 2
Team 3
Team 4
Platform Team A
Platform Team B
API API API API
Team C
Illustrative
Team D

Product teams
authority over the product roadmap
long-term commercial viability
technical debt
small end-to-end autonomous teams
high-velocity high quality decision making
technical components architecture decisions
build, deploy, and operate
business outcomes
Team B Roles
Product
Manager
Cloud Infra
Engineer
SRE
FinOps
Team A
Illustrative

Platform teams
automation of manual work
product teams expertise needs
self-service capabilities
on-boarding and enablement of new product teams
internal adoption rate
Team B Roles
Product
Manager, Technical
AWS Architects
AWS Operations
Data Scientist
Team A
Illustrative

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Amazon Product Teams: Re-envision the world as products at Amazon
Advertising

Amazon Product Teams: Our Journey from projects to products

”
“

Andy Jassy
CEO
Sales
VP
Marketing
VP
Services
VP
Services
GM
Service
Manager
PM
Manager
Two-Pizza teams
AWS Product Teams: BusProdDevOps model
Our primary organizing unit is a two pizza team

Amazon platform teams: Pipeline platform team reduced 90% cycle time across
1000s of teams
2010
16
days
2020
90%
reduction
1
2
3
3
1 2

Amazon Teams: Mechanisms
- Working Backwards
- Data driven decisions
- Two way doors mental model
- Weekly business review
- Correction of errors
- Bar raisers

AWS innovation pillars at Voltwagen’s Industrial Cloud Teams
Architecture
Organization
Mechanisms
Culture
Definition Focus Area Best in class
Require API/microservices based architecture for all cases,
Permit some duplication to make decision faster
Establish business and technical KPI and regular reporting cadence
Support ideas with facts, anecdotes and concrete data
Design LPs with an emphasis in Bias for Action

Through 2022, the talent pool for emerging
technologies will be inadequate to fill at least 30% of
global demand and effective skills development and
retention will become differentiating strategies2
”
“
Source 2: IDC FutureScape: Worldwide CIO Agenda 2019 Predictions, October 2018

New Roles and Capabilities
Chief Product
Officer
Product
Owner
Lead
architect/
Chief
Technology
Officer
Team Members Servant Leaders
Cloud Security
Engineer
Cloud
Architect
FinOps Lead SRE (Cloud
Operations)
Cloud
Infrastructure
Engineer
Migration SME

Next Step: Cloud Capability Assessment
The Cloud Capability Assessment consist of 30 or 200
questions equally divided among the six Cloud Adoption
Framework (CAF) business and technical perspectives. Each
question is assigned a rating from 1-5 that maps to
the cloud stages of adoption :
• Project
• Foundation
• Acceleration and migration
• Optimization and Reinvention
• Disruption
A report including highlights and observations, key
takeaways, a functional rating (1-5), and a radar chart with
recommendations to increase the rating across each of the six
CAF perspectives is generated from the assessment.
Tool type: Microsoft Excel Spreadsheet
Tool Usage: AWS VCP engagement required for tool
access/deliverables unless trained by AWS

Next Step: Experience Based Accelerator – People Workshop
The People Party is a 2-day interactive workshop focused on accelerating
an enterprise’s ability to create, sustain and govern the change that occurs
to enable cloud adoption. Objectives include:
• Develop well defined team structures with roles and responsibilities clearly defined
• Adapting a Clout Team ecosystem (engagement model) with respect to business-units, application
teams and IT stakeholders.
Goals
• The new operating model is articulated, based on customer portfolio and governance
structure
• Utilizing a product-team methodology for the internal cloud program (managing the cloud
offering to internal customers like a product).
• Crafting a communication template to be used to (1) Recruit critical Cloud Team resources; (2)
Identify application candidates for first move modernization; and (3) identifying key
performance indicators to measure progress. 4) organization structure Operating Models
Ecosystem
interactions
Organization

Next Step: Experience Based Accelerator - Modernization
Party
The Modernization Party is a sprint-based, interactive workshop
designed to transform applications and the business workflows they
support. Objectives include:
• Deploy an application in AWS, with new features, new code or implementing cloud-
native services / patterns (containers, microservices, serverless, etc.)
• Breaking down monolithic applications
Goals
• Deployment of a modernized application in AWS (business observable impact)
• Re-useable patterns and real-world, learnings for the organization to scale
application transformation
• Day-2 operations, people, organizational, and security models in place for in-
target application pattern
Deploy a
modernized
application
Deconstructing
Monoliths

Reading List

people, culture, process, and technology
skills gaps new roles
new skills, behaviours, values, and characteristics
Define KPIs and change incentives
Align hiring, training, and incentive practices
proponents and antagonists
Change organization and culture through success in a PoV
organization interaction models agility
guardrails and guiding principals high-quality high-
velocity decision making … document and communicate x 3

Thank you

Appendix

Historically, what have been your top 3 challenges in managing
technology ?
Looking forward, what do you anticipate as your top 3
challenges in managing technology post-migration (rehost) to
AWS?
Do you have any other comments / questions related to
managing technology AWS post-migration (rehost) you'd like to
discuss in our upcoming sessions with AWS ?
Three survey questions:

How do we measure success (Samples)?
• Organizational
§ CSAT scores
§ Cloud Adoption Maturity e.g. CSMatrix scores
• Cost/Spend
§ Cost per change
§ TCO ( Total Cost of Ownership)
§ Under or over-utilized resource cost
• People
§ Training coverage
§ # of certifications
§ Training hours
• Product/Development Approach
§ # of changes released/per period
§ Time to market
§ % of Incidents caused by Change
§ # of Defects per release
• Operations
§ Availability
§ Application Services Response time
§ Patching compliance
§ # of tickets raised/resolved
§ Incidents prevented without being impactful
• Platform
§ Infrastructure provisioning SLA
§ Under or over provisioned Capacity
§ Disaster Recovery test compliance
§ Monitoring coverage
• Security
§ # of vulnerabilities past due
§ # of security related incidents
§ # of DDOS attacks prevented

One year roadmap
Alignment
• Identify the executive
sponsors
• Document why need for
Cloud Operating Model
• Determine if cloud first or
cloud optional
organization
• Communicate the plan
• Leadership embraces
iterative change,
expeditious decision
making, blameless
culture, failure
• Discovery and review of
operations processes
• Understand and define
roles and
responsibilities for
cloud and on-premises
• Define Operational
Readiness processes
• Automate where
possible, make self-
service when
automation not possible
• Create automation
pipeline (aka CI/CD
toolchain and process)
Operations People Transformation
• Codify what the organization
should look like in 2 years –
PR/FAQ
• Assess and improve
upskilling initiatives
• Ensure rewards,
compensation, promotions
and hiring are based upon the
new culture
• Continue to measure, refine,
and improve across products,
people, processes, and
organizational change
• Utilize the expertise of AWS
and partners
First Month 6+ months
Months 2-3
Product Thinking
• Identify rebels that will
define, execute, and
continuously improve
org and product change
• Define and document
product thinking
• Identify pilot
applications to
transformation to
products – including
AWS
• All new applications
should utilize product
‘mindset’ and
processes
Months 4-5

What Is Culture?
§ Culture is the “software of the mind.” It is the core
logic that organizes people’s behavior
§ The culture reflects the lessons learned that are
important enough to pass on to the next generation
§ Values, beliefs, and practices that have been
developed and reinforced over time
Culture Is “the Way We Do Things Around Here.”

Cultural Trends We Are Seeing
Moving from
§ Failure is not an option
§ Command-and-control
§ Silos “throw it over the wall”
§ Build/deploy in place
§ Long due diligence
§ Standardization
§ Talent outsourcing
Moving toward
Learning (start small, experiment, and iterate)
Decentralized ownership (guardrails via cloud team)
DevOps and cross-functional teams
Automate: Infra-as-code, redeploy every time
Adopt early and often
Reference architecture, no religion, few standards
Talent insourcing/niche partnering

Identify desired
attitudes and
behaviors for
successful
cloud adoption
Communicate
attitudes and
behaviors
Align explicit and
implicit reward
systems
Align hiring,
training, and
incentive practices
How to Influence Cultural Change?

A Thriving Product Culture
§ The entire organization understands
customer needs
§ Cross functional teams understand
how they contribute to product
success
§ Everyone rallies around both the
product strategy and roadmap

Apply a Structured Change Management Approach to
Accelerate Your Cloud Transformation
Source: Based on the work from our OCM consulting
partner
1. Mobilize Team
2. Align Leaders
3. Envision the Future
4. Engage the Organization
5. Enable Capacity
6. Make It Stick
TAG LINES
This change is critical and will succeed!
We are all leaders of this change!
This is the vision, where we are going!
This is how we get there together!
This is how we make it happen!
Are we where we want to be?
OBJECTIVES
• Confirm sponsorship
• Secure resources, expertise
• Form strong coalition of leaders
• Build momentum
• Articulate vision and roadmap for transition to Cloud
• Mobilize organization, build commitment, create change
urgency
• Establish communication channels to gain and maintain
buy-in, support and participation throughout entire
transition
• Ensure successful transition to Cloud
• Align IT org structure, roles, processes with AWS Cloud
platform
• Ensure all IT staff/key stakeholders can operate in new
environment
• Ensure Cloud benefits and objectives are achieved
KEY
ACTIONS
• Form team to lead change – executive sponsors, stakeholders,
line leaders, PMO, change management, communication,
training, etc.
• Establish program charter, roles, milestones
• Build guiding coalition, mobilize leadership
• Shape program governance structure
• Assess and align change leadership roles
• Leaders communicate future Cloud vision (via
comprehensive messaging plan)
• Impacted business leaders reinforce new op model
(process/tech/org)
• Identify/assess impacted stakeholders
• Enlist and mobilize Change Champion Network
• Drive ongoing communication, feedback – two-way
conversations
• Address “How does this impact me?”
• Celebrate progress and control issues
• Identify change impacts to IT roles, policy, org structure,
process, etc.
• Modify IT roles, org structure, job descriptions and
processes (if needed) to support AWS Cloud
• Align IT staff to new operating model
• Develop and implement targeted training
• Setup measurement structures
• Measure and evaluate outcomes
• Course correct where needed

Project v. Product
How is a ”product” different from a projects?

Business
Strategy
Governance
&
Prioritization
Design
&
Architecture
Software
Engineering
QA
&
Testing
Infrastructure
&
Operations
Security
Traditional Enterprises
activity-based teams
Business
Strategy
Governance
&
Prioritization
Design
&
Architecture
Software
Engineering
QA
&
Testing
Infrastructure
&
Operations
Security
High-performing organizations operate and organize to deliver outcomes
Two-Pizza Team Acceleration | Activities to Outcomes
Modern Enterprises
outcome-based teams
Product Team

Product Thinking at the core of the transformed IT organization
Everything can be a product
§ A product is a tangible (good) or
intangible (service, information,
technology) item that closely
meets the demands of a particular
market and yields enough value to
justify its continued existence.
§ It is characterized by its benefits,
features, functions and uses that to
satisfy the needs of the consumer.
Core Tenets from IT Capabilities
(development, service management,
IT life cycle management)
Traditional Business Driven
Capabilities
(R&D, product management, product
marketing)
A new technology product capability within IT

Organizing for faster innovation - People, process, culture, and technology

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