In this session, I share how we made three very important mental leaps to make the transition to Agile and Lean ”stick” including concrete examples of what we have done at Ericsson 3G. Leap #1: From Methods & Tools to Principles & Mindset Tools and methods can work in some contexts and not in others. If you have your own principles and mindset, then you can adapt or create your own methods and tools that fit your context. When realizing this, we made a mental leap from a focus on methods and tools to a focus on principles and mindset. Leap #2: From Resource Efficiency to Flow Efficiency With a need reduce both costs and time-to-market we were looking for alternatives to “resource efficiency” focus (keeping people and equipment fully utilized at all times). We realized that our ability to innovate around state-of-the art algorithms for optimizing packet data flow in mobile radio networks is also applicable for our product development processes. We made a mental leap from “resource efficiency” to “flow efficiency”, i e a focus on keeping work items moving through the process without waiting times, delivering value as quickly as possible Leap #3: From Scattered Experiences to Continuous Innovation We were solving problems as they occurred using task forces in fire-fighting mode, lacking corporate memory and a common direction. By creating a shared direction and a common purpose around the need to improve, we made the leap from scattered experiences to a culture of continuous innovation. Ericsson is the driving force behind the Networked Society - a world leader in communications technology and services. Our long-term relationships with every major telecom operator in the world allow people, business and society to fulfill their potential and create a more sustainable future. With approximately 115,000 professionals and customers in 180 countries, we combine global scale with technology and services leadership. We support networks that connect more than 2.5 billion subscribers. Forty percent of the world's mobile traffic is carried over Ericsson networks. Net sales in 2014 were EUR 23.4 billion.

1. The Mental Leaps
at Ericsson 3G
@erik_schon
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.
Lyon, April 16, 2015

2. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 2 (47)
The Mental Leaps
at Ericsson 3G
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

3. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 3 (47)
ERIK SCHÖN
@erik_schon
Co-creator of conditions
where people, teams
and organizations
grow @ericsson
SERVING
Product Development Group Radio Base Stations
Product Development Unit 2G, 3G & Multi-Standard
Development Unit Radio
Business Unit Radio
Ericsson in Stockholm, Sweden
Proud member
of the FlowFans
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

4. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 4 (47)
Ericsson 3G:
Facts & Figures
>40% Of all 3G traffic
in Ericsson networks
10R&D sites
1 800 people
Ericsson’s Vision: A Networked Society where every person and
every industry is empowered to reach their full potential
#1 Mobile 3G
networks
~100Teams
1,5B€ software
sales

5. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 5 (47)
3G Network Overview
Radio
Network
Controller
Radio
Base
Station
Internet
Telephone
networks
Complex Network, Complicated Product

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8. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 8 (47)

9. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 9 (47)
Our heritage: Improving The
Waterfall for 30+ years …
2-3 year projects, 100 000-200 000 person hours
2010: Improvement potential questionable …
We must try something fundamentally different
System
Design
Test
System
Design
Test

10. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 10 (47)
The Mental Leaps
at Ericsson 3G
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

11. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 11 (47)
Inspiration: our
Colleagues in finland …
XFT1
Release
Verification
Customers
Product
Management
Product
Owner
PPO
PPO
PPO
ScM
XFT2 ScM
XFT3 ScM
XFTn ScM
Main
software
branch
PPO Product Proxy Owner
XFT Cross-Functional Team
ScM Scrum Master
Product
Backlog
Continuous
Integration

12. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 12 (47)
Flow
Visualization
Continuous
Learning
Initial focus on
needs and direction
Inspiration from
Thought Leaders
Culture of thinking
for ourselves
Continuous
Integration
“Kanban”
Scrum
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13. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 13 (47)
Principles & Mindset:
Point to the destination
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14. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 14 (47)
EMpower people
Reduce lead-time
to be more Responsive
Increase efficiency
to enable more output
Build quality into
our way of working

15. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 15 (47)
Principles & Mindset:
From large batches …
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16. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 16 (47)
Principles & Mindset:
… to Small batches
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17. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 17 (47)
Try: Improvements as
Small experiments
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18. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 18 (47)
Smaller slices → faster value delivered
Early feedback → direction change if needed
Try: elephant carpaccio
Original Feature
1 2
3 4
5 6
7 8
Split Feature Split Feature
1 2
5
6
Kudos to @totheralistair & @henrikkniberg!

19. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 19 (47)
Principles & Mindset:
From local “Kanban” …
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20. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 20 (47)
Principles & Mindset:
… to global awareness
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21. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 21 (47)
How can You
See the FLOW in
Your ways of
working?
2 minutes discussion in pairs

22. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 22 (47)
Try: End-to-end
Visualization room

23. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 23 (47)
Try: End-to-enD
Visualization room
Requirement
Area
Swimlane
Process
Step
Column Feature
Blocked
Feature
Meeting
Checklist
Priority
Order

24. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 24 (47)
The Mental Leaps
at Ericsson 3G
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

25. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 25 (47)
As long as
I’m busy …
What can I
start next?
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26. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 26 (47)
Flow Efficiency
Resource
Efficiency
Low High
Low
High
Prioritize continuous learning
Prioritize flow efficiency
Niklas Modig
Stockholm School of Economics
@LeanOnMyself
Inspiration: What is Lean?
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

27. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 27 (47)
Flow Efficiency
Resource
Efficiency
Low High
Low
High
Prioritize continuous learning
Prioritize flow efficiency
Niklas Modig
Stockholm School of Economics
@LeanOnMyself
Inspiration: What is Lean?
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

28. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 28 (47)
Flow Efficiency
Resource
Efficiency
Low High
Low
High
Prioritize continuous learning
Prioritize flow efficiency
Niklas Modig
Stockholm School of Economics
@LeanOnMyself
Inspiration: What is Lean?
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

29. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 29 (47)
Flow efficiency:
Visualize end-to-end
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30. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 30 (47)
Try: End-to-enD Flow
Visualization Room
10 meetings per week, 10-15 people per meeting - using video conference
Area Product Owner, Operative Product Owners, Line Managers, Program Managers

31. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 31 (47)
Try: End-to-End flow
trend Visualization
Pre-
prestudy
prestudy Development Launch
Cumulative number of features
Time
Work in
Process
(WIP)
Lead-Time
Throughput

32. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 32 (47)
Flow efficiency:
In product & Process
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33. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 33 (47)
Flow and queues in
traffic …
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34. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 34 (47)
Don Reinertsen
@DReinertsen
“Ericsson: you already know this,
you use it in your products
every day!”
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.
Inspiration:

35. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 35 (47)
Try: Story-Telling around
flow in product & Process
Arrival Departure
Radio
Network
Controller
Radio
Base
Station
Admission
Control
Congestion
Control
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

36. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 36 (47)
Try: Active Flow Handling
Experiment: Limiting number of parallel activities
Result: Reduced lead-time by 40%
Initial lead-time
10 weeks
In execution initially
42 items
In execution
20 items
New
Backlog
Execution
Done
Lead-time
6 weeks
Cumulative number of items
Time

37. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 37 (47)
The Mental Leaps
at Ericsson 3G
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

38. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 38 (47)
How can You
Secure time for
Innovation?
2 minutes discussion in pairs

39. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 39 (47)
Try: Plan for innovation
Time
Capability 100% capability
Planning with less than full utilization
creates environment for innovation
Capability at 70%
planned utilization
Innovation = value from ideas in product and product development

40. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 40 (47)
Try: Continuous Innovation
towards the vision
Small experiments
towards next CHALLENGE

41. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 41 (47)
Try: Learning Days
Full day, multi-site, multi-track, internal conference
with own content & external speakers - every sprint

42. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 42 (47)
Inspiration: the #1
Sports Car Company
Source: Peter Blackert, http://www.flickr.com/search/?w=29987108@N02&q=ferrari%20458%20italia%202010
The best Ferrari car
we have every produced
is the next one.
Enzo Ferrari
Founder & CEO, 1898-1988
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

43. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 43 (47)
The Mental Leaps
at Ericsson 3G
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.

44. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 44 (47)
What will
your next
Mental Leap be?

45. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 45 (47)
Q&A
DISCLAIMER: LEGO® is a trademark of the LEGO Group, which does not sponsor, authorize or endorse this presentation.
Methods &
Tools
Resource
Efficiency
Scattered
Experiences
Principles &
Mindset
Flow
Efficiency
Continuous
Innovation
The Mental Leaps
at Ericsson 3G

47. @erik_schon | @ericsson | #mixit15 | April 16, 2015 | Page 47 (47)
Inspiration
Craig Larman & Bas Vodde (2008)
Scaling Lean & Agile Development
Niklas Modig & Per Åhlström (2012)
This is Lean
Donald G. Reinertsen (2009)
The Principles of Product Development Flow
Håkan Forss
Flow Sensei / Plumber