These are the slides from a talk I gave to the Tampa Bay Technology Leadership Association in early 2016.

1. P re s e n t e d b y
The Lean Enterprise
Shifting IT from a Utility to an Innovation Center
Ryan Dorrell

2. Bio
• Co-founder, CTO @ AgileThought
• Co-organizer, Tampa Bay Agile Meetup
• Co-organizer, Agile Open Florida
• Board Member, TechStart Tampa Bay
• TBTF CIO of the Year, 2014
• Gulf Coast Business Review, 40 under 40, 2012
• Florida State University alumni

3. Alternative title #1:
How your competition is beating you to market

4. Alternative title #2:
Streamline your IT organization to deliver the right products

5. Alternative title #3:
10 crazy ideas to scare your boss…#8 will blow your mind!

6. For exploration
What are IT organizations today doing to improve alignment, agility and time to
market?
My goal for today: to give you new ideas to take back to your desk
What I can’t give you today: a plan to change your organization

7. Lean Enterprise

8. “The main obstacles to improved
business responsiveness are slow
decision-making, conflicting
departmental goals and priorities,
risk-averse cultures and silo-based
information.
— Economist Intelligence Unit
report on Organizational Agility

9. Stability vs. Throughput
• IT has traditionally been seen as a service, and this is
exacerbated by the traditional project model
• IT Ops priority is stability, so they work to actively slow things
down (change advisory boards, standardization) – this is a sign
of a low trust environment – a lean enterprise requires a high
trust environment
• Throughput and stability are NOT opposing forces – they can
be complimentary
Throughput
Stability

10. Three Horizons Model
Geoffrey Moore, Escape Velocity
Horizon 2 and 3 cannot be managed like Horizon
1, yet our organizations are structured to do just
that
Geoffrey Moore, https://hbr.org/2007/07/to-succeed-in-the-long-term-focus-on-the-middle-term

11. Deming Cycle
Plan
Do
Check
Act
Lean Enterprise Loop
Enterprise Loop

12. Lean Enterprise
The key is to enable those doing the work
to solve customers problems
in a way that is
aligned to the strategy of the enterprise,
with a focus on value and continuous improvement.

13. Exploring Uncertainty to Find Opportunity

14. 50% of startups fail…and enterprises waste money at about the same rate
Enterprises ask “can we build it?” but rarely ask “should we build it?”
A runway of questions – actually hypothesis - not requirements, are needed when talking about non-trivial
features
We believe that building
[this feature]
[for these people]
will achieve [this outcome]
We will know we are successful when we see [this signal from the market]
Source: Lean Enterprise by Humble, Molesky, O’Reilly

15. Applying Lean Startup
http://www.theleanstartup.com

16. Minimally Viable Product (MVP) - An oft-misunderstood acronym!
An MVP is…
• An experiment
• One or a few features done well
• Fast and cheap (minimal effort)
• Measurable
An MVP is not…
• A complete “Release 1”
• A bunch of features done poorly
• Necessarily a complete product
(could be a single feature in an
existing product)

17. Envisioning Customer Needs
• Business Model Canvas
• Framework for systematically describing new
business opportunities
• Story Mapping & Customer Journey Mapping
• Collaborative techniques for defining new
products to create

18. Practical Tools
• Lean Startup/MVP
• Business Model Canvas
• Story Mapping
• Customer Journey Mapping

19. Continuously Improving

20. Kaizen is the practice of continuous improvement
Everyone is responsible!
Big results come from small changes over time, but not all
changes have to be small
https://www.kaizen.com/about-us/definition-of-kaizen.html

21. Case Study: Cox Target Media/Valpak
• Established continuous improvement as a part of transition to agile software
development
• Since 2012, held over 1,000 sessions towards improving how work is done
• Team, portfolio, and executive levels
How different would your business be if you took the time to
make over 1,000 improvements?

22. Practical Tools
Improvement Kata
Mike Rother, http://www-personal.umich.edu/~mrother/Materials_to_Download.html

23. Stop Overworking

24. Polls:
Who has more work than they can do in the next 3 months?
How many of you have multiple projects going on at once?
How do you make decisions about what to do next?

25. 30-50% of time to market
activities have a near zero
value
Most enterprises are
drowning in a sea of
overwork
So we are doing a lot of
near zero value work…and
drowning in too much of
it. What can we do?
https://www.flickr.com/photos/aah-yeah/

26. Introducing…Cost of Delay
Cost of Delay enables us to make rational prioritization
decisions based on economics
Cost of Delay changes how we work in a significant
way – it’s not simple, and it works best when there is a
significant amount of overwork
Limit WIP, only work on the highest value based on
Cost of Delay or Weighted Shortest Job First (WSJF),
which is Cost of Delay Divided By Duration
http://blackswanfarming.com/cost-of-delay/

27. Calculating Cost of Delay / WSJF
• User Business Value
• What do users prefer? What is the
revenue impact? Is there a penalty?
• Time Criticality
• How does user/business benefits
decay over time? Is there a fixed
deadline? Can users wait for
another solution?
• Risk Reduction-Opportunity Enablement
Value (RROE)
• What else does this do for our
business? Does it reduce a risk?
Are there new opportunities?
From http://scaledagileframework.com/wsjf/
Cost of Delay = User Business Value + Time Criticality + RROE
WSJF = CoD / Job Size

28. Case Study: Maersk
• World’s largest shipping company, 550 vessels, 2.2 million containers
world-wide
• $150M annual IT budget, 20 teams around globe
• On average, took 150 days to get value out of the IT pipeline – WHY?
http://blackswanfarming.com/experience-report-maersk-line/
Unconstrained WIP and long wait states – the system was not optimized for flow!

29. Practical Tools
• Value Stream Mapping
• Cost of Delay
• Weighted Shortest Job First

30. Deliver Continuously

31. Lean Engineering: Safely, Quickly, Sustainably
The cornerstone of lean engineering is the concept of Continuous Delivery
Key Principles
• Everything is version controlled
• Code, configuration, scripts, database
artifacts, libraries – everything required
to create the software
• Deployment flexibility is critical – must be able to
deploy to new environments easily
• Automate almost everything
• If it hurts, do it more frequently
• Practice makes perfect
• Move binaries through stages
• Pass a stage, automatically move to the next one

32. Deploy a new version of your system to a small set of users alongside the existing version
Benefits:
• Measure effectiveness of new features via A/B test
• Easy to rollback
• Live performance tests
Canary Releasing
Source: Continuous Delivery by Humble, Farley

33. Practical Tools
• Continuous Deployment Pipelines
• Canary Releasing

34. Transforming Your Organization

35. What is most often the biggest barrier to organizational change?
A. Leaders believe it is too difficult
B. Lack of urgency
C. It costs too much
D. The culture won’t respond to it

36. What is most often the biggest barrier to organizational change?
A. Leaders believe it is too difficult
B. Lack of urgency
C. It costs too much
D. The culture won’t respond to it
Source: Lean Enterprise by Humble, Molesky, O’Reilly

37. 10 Tools You Can Use
Exploring
Uncertainty to
Find
Opportunity
Lean
Startup/MVP
Business
Model Canvas
Story
Mapping
Customer
Journey
Mapping
Improving
Continuously
Improvement
Kata
Stop
Overworking
Value Stream
Mapping
Cost of Delay WSJF
Deliver
Continuously
Continuous
Deployment
Canary
Releasing

38. Getting Started towards a Lean Enterprise
Have a clearly
defined
direction
Define and
limit scope
Pursue culture
of continuous
improvement
Start with the
right people
Delivery
valuable and
measurable
results early
Source: Lean Enterprise by Humble, Molesky, O’Reilly

39. Resources

40. Stay Connected
If you have questions or would like more information, feel free to
contact me via email ryan.dorrell@agilethought.com
• www.agilethought.com
• www.linkedin.com/company/AgileThought
• @AgileThought
• @ryan_dorrell
• www.linkedin.com/in/ryandorrell