Value Streams and SAFe® are almost synonymous. Without the former, the latter would struggle to deliver business value. But, since the inception of SAFe way back in 2008, we have learned a great deal about how to view these value streams, and how to organize around them to promote true lean flow of value to the enterprise.
SAFe ® Value Stream Alignment
Before diving into this new learning, let’s review what a ‘value stream’ really is. We start with understanding our Operational value streams, which are the set of interconnected steps that we go through to deliver value to our customers. These value streams start with the concept, or the trigger or reason for delivering the value. For example, when a potential or existing bank customer learns they are going to have their first child they may start thinking about purchasing a new house. The trigger is the need for the value that the enterprise wants to provide. The steps the enterprise goes through to deliver that value successfully to the customer are the operational value stream steps, such as marketing the mortgage offering, accepting the application, processing the customer’s credit and information, and providing and servicing the mortgage. As the customer pays off the mortgage, we get to the other side of the operational value stream, the Cash. This term is often used a bit ambiguously, but essentially means the fulfillment of the value stream to the satisfaction of the customer and the enterprise, resulting in both the customer and enterprise receiving benefit for the value. Very often the actual money is transferred from customer to enterprise during the value stream (not always at the end), such as when the customer continues to pay the mortgage payments and the bank receives the mortgage principle and interest, but the operational value stream continues to flow as it services and eventually closes the mortgage.
While SAFe ® can be used to assist operational value streams to deliver, the sweet spot is really in supporting the Development value streams. Development value streams are the set of steps we go through to support operational value stream steps. They consist of the people, systems, and processes we use to support these operational steps. For our mortgage example, there is most likely a credit review system for the credit approval step, and a set of systems that support the mortgage servicing steps.
A Different Way of Thinking
SAFe ® was originally designed to organize Agile Release Trains around these systems to allow lean flow of value to increment and improve these systems. E.g. If we want to improve the Credit Review System, we would organize an Agile Release Train around the development of this system.
However, as we learn about the application of the virtual organization of an ART to deliver value, we have discovered that very often this does not promote lean flow of value. There are many reasons behind this issue, but the most prevalent is that very seldom does a single system alone support the Operational value stream step. There are almost always other aspects, such as Compliance, Regulatory, Marketing, Sales, Legal, Research, etc. To promote true lean flow, we need to rethink this paradigm and focus on all of the steps needed to improve these operational value stream steps.
The new way of thinking starts with a new way of identifying value streams. Traditional SAFe guidance helps us find the Operational value streams, then discover the Systems that support these steps, and then to find the people that support these systems. Dr Alan Ward defined Development value streams as the set of steps we go through to Create, Update or Deprecate Operational value stream steps, and he included all steps in this process. Applying his work and this new way of thinking we look at all steps we go through to positively impact these Operational steps, such as Business, Infrastructure, Research, Marketing, Legal, Sales, etc.
Let’s discuss a simple example from manufacturing. If a car maker is building cars, they are using an operational value stream to handle orders, bring in raw materials, create and assemble the parts, and ship and sell the car. In manufacturing the steps to create a part are typically called a recipe, which includes all the specific steps to heat, form, stamp, etc the material to create a part, such as a hood. The operational value stream step already is capable of producing this hood (via the recipe), but lets say we want to improve this hood. What are the steps we would go through to improve the strength of the hood? To improve the aerodynamic properties? To reduce the amount of metal used in the production? These steps are probably fairly similar, and would require the same people: designers, metallurgy specialists, marketing (for shape), compliance/legal (for safety), etc. These people would go through a somewhat generic set of steps to improve the recipe to create the hood. As they design, test, review, validate and confirm this new hood design, they update the Recipe, hence they are updating the Operational value stream step. We then repeat these same steps for the next improvement we want to make to this Operational step, such as reduce the cost of the hood, make it lighter, etc.Software and Hardware development is no different. The end result is still that we want to improve the operational step, and we need a variety of people to do so. In software we typically need the people in the SDLC process, but we also need people from Legal, Compliance, Marketing, Sales, Design, Infrastructure, etc to improve this Operational step. Hardware/Firmware is similar in that we also need the people that actually create the product, but also all the other players that are needed to actually update the operational step. These are the people we include in our virtual organization in the ART.
While coaching this method to a past client, I had the pleasure to work with a true Change Agent, Phil Purrington. As Phil came to understand this method, he explained it this way. “Imagine we have a deserted island, and we need to bring all the people needed to solve similar business problems to this island. This has to include all the skills needed because, well, we’re on an island!” This is a great visual as we understand the importance of having all the skills and experience needed on the ART to deliver value, and not just update a system. Having this island mentality will definitely promote lean flow!
While this method creates true lean flow, it does not come without it’s cost as we have to make some trade offs. When we focus an ART on a specific system we can create a high level of architectural integrity and consistency, as the same people are always updating the same system. Using this lean flow method we lose some of that singular focus on a system, but this can be easily overcome and compensated with good architectural design (loosely coupled, micro service based systems are great ways to relieve this issue), Community’s of Practice to distribute knowledge and proper usage, and clear strategic direction from leadership for a common vision to build upon. In reality, less focus on organizing around the systems leads to better architectural development out of necessity.
The result in focusing on this wider scope is that we reduce all the hand offs and delays created when we have to wait for legal, compliance, marketing, or other inputs. And, after all, that’s what we really want to focus on, Lean Flow. If there’s anything that the Toyota Production System, Don Reinertsen’s work, or any other lean expert will teach us, focusing on true lean flow of value streams will provide significant increases in value delivery. And, after all, isn’t that what SAFe ® is all about?