Transforming into Agile IT organisation

Management of Agile / SCRUM teams
Draft version
WWW.IRP-MANAGEMENT.COM
page: 1 Date: 3/12/2015
Implementation of
Management Control
Agile / SCRUM teams-version 0.1-
Hans Oosterling
December 2014
Version 0.1 12-Mar-15

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Management Control Models
 Work outcomes are well
understood before execution
 Given well-defined set of
inputs the same outputs are
generated every time
 Follow the predetermined
steps to get predefined
results
 Frequent inspection and adaption
occurs as work proceeds
 Processes are accepted as
imperfectly defined
 Outputs are often unpredictable
and unrepeatable
Defined Action Empirical Action
Process
• Product / Services flow
through Resources
One-off (project)
• Resources move to
Product / services

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Landscape
Technology
Requirementsunknown
Very uncertainClose to certainty
Known
 Simple
– Rational decisions
– Waterfall approach
 Complicated
– Complicated decisions
– Transformation
 Complex
– Multiple stakeholders
– Political decisions
– Business model change
– Culture change
 Chaos
– Too much people involved
– Anarchy, no hope
(Source: Ralph Stacey)
Agileapproach

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Success Factors of Agile / SCRUM
Agile / SCRUM
Execution teams
Planning
And
Control

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Management Basics for Empirical Actions
-One-off Initiatives-
TIME
- Inevitable time
- Waiting
Deliverables / Results
- Quality
- Functionality
- Non-functional:
- Standards
- Security
Capacity
- Resources
- Skills
- Performance
 Typical Management focus of Project Manager:
Timely delivery of Results

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Variation and Variability or uncertainty
TIME
Deliverables / ResultsCapacity
 Management attitude:
– First reflex: more capacity
– Second reflex: less results
– Third reflex: later delivery or combination

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Committed Project delivery
 Typical Management attitude:
– Bad planning experiences drives out good planning practices
– Parkinson’s Law: work expands so as to fill the time available for its
completion
– Variability and uncertainty buffered by Capacity (underutilization)
IT Delivery
Actual / Forecast
1
Committed time

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Management Focus on Project Delivery:
Operational
 IT Management:
– Methodology and Standards
– Project Planning and Control
– Exceptions / Escalations
– Status and Progress Monitoring
– Business Alignment
– IT Resources (skills) allocations
– Costs and Funding
 Business Management:
– Requirements Management
– Business Case / Project Justification
– Commissioning
– Accept Deliverables / Results

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Tactical
 IT Management:
– IT Portfolio Management (supply)
– IT Headcount
– …………….
– IT funding (annual budgets)
– IT Portfolio Management (demand)
– ……………...

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Strategic
 IT Management:
– Make or Buy
– Sourcing
– …………….
– IT Roadmap
– Alignment Strategic Objectives / Business Goals
– Determine Business Value through IT
– ……………...

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History of IT Performance Improvements
Functionality
Programming
Techniques
IT Project
Management
Service Centers
CMMi, Lean
SixSigma
Agile
SCRUM
1970 1980 1990 2000 2010

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 1970 – 1990
Focus on Functionality
Design techniques
 1990 – 2000
Organisational Efficiency
Cost Control
 2000 – 2010
CMMi, Lean, SixSigma
Cost reduction
 2010 onwards
Agile, SCRUM
History of IT Performance Improvements
Impact and Effectiveness
Reasonable effect
Limited effect
No impact, process adjustments without
changing concepts of projects is not successful
Cost reduction impacts IT performance
? Work in Progress, but it’s important to
abandon the concept of projects and take full
process approach (E2E Business, IT
development and IT operations!)

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SCRUM Teams in Execution

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Transformation from Project oriented to full
Process view (E2E)
 Installation SCRUM teams:
 Business Product Owner
 IT DevOps members
 IT Facilities, office, tools etc
How to facilitate, plan and control
SCRUM teams at:
- Operational level
- Tactical level
- Strategic level

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Paradigm Shift from Project to Process
 Projects
– Push
– Milestone Control
– Resources move to
Products (=project
deliverables)
 Analogy to Henry Ford
 From Building carriage together Assembly Line
 Factory approach
 Process
– Pull
– Performance Control
– Products flow through
Resources (SCRUM
teams)

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Parts and resources flow to product

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Product flows through Workstations

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Factory Approach
 Collective ownership of the Factory is needed for success!
 Work Break-down complex business requirements (with business
value) into shippable / usable Products
– Collaborative approach
– Primacy with Business
 Assembly and Release Planning
– UAT
– Continuity Testing (Business and Technology)
– Collaborative approach
– Primacy with IT
Work
Break-down
and
Production
Planning
SCRUM
SCRUM
SCRUM
SCRUMSCRUM
SCRUM
SCRUM
SCRUM
Assembly
and
Release
Management

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Changing IT Management
Factory Approach
 Operational
– Methodology and standards
– IT resource allocations to SCRUM teams
– Cost management of SCRUM teams
– Performance Management (Measure and Analysis)
– Defects and Quality
– Reduce uncertainty and variability
– Collaborate on
 Work Break-down and Production Planning
 Assembly and Release Planning
 Tactical
– Funding and Sizing SCRUM teams
– Process / Performance Improvements
– …………
 Strategic
– Make – Buy
– Sourcing
– ……….

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Changing Business Management
Factory Approach
 Operational
– Business Case / Justification
– Allocate Product Owners
– Business commitment to Product Owners
– Reduce uncertainty and variability
– Collaborate on
 Work Break-down and Production Planning
 Assembly and Release Planning
 Tactical
– Funding IT (annual)
– IT Portfolio Management
– …………
 Strategic
– IT Roadmap
– Alignment to Strategic Objectives and Business Goals
– Determine Business Value through IT
– ……….

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Change Management Obstacles
 IT Organisation
– There is often a culture of fire fighting and ad hoc decisions
– Every delivery is managed as unique result
– IT organisation functionally divided
– Many transfers of responsibilities / work (“don’t blame me” culture)
– ………
– Limited involvement into IT projects
 Initiation
 Closure
 Acceptance of Results
– Changing requirements during execution
– Culture of Powerplay in the business-IT relationship
– ……….
 As-is situation is not always clear:
– Ownership of non-functional requirements
– Involvement of other (functional) departments
– Relationship to other developments

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Common Mistakes and Failure to Implement
Process Approach (O-PPOI model)
Changing Process without Redesign
Product Concepts, is bound to Fail
Planning&Control
Primary
Process
Objective
Product

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Process Design starts with clearly
defined Objective(s)
 Reduce time-to-market
 Increase customer satisfaction
 Increase employee satisfaction
 Be transparent
 Reduce costs of producing
 Reduce Overhead costs
 No inventory
 Be flexible
 Less Defects
 Reduce maintenance costs / running costs (Cost of Ownership)
 ………………..

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(Factory) Process Design and
Description (1)
Process: Work break-down and Production Planning
Function 1 Function 2 Function 3 Function 4 Function 5 Function 6
Action
Action
Action Action
Action
Action Action
Decision
Step 1
Step 2
Step 3
Step 4
Step 5

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(Factory) Process Design and
Description (2)
RASCI Matrix (Work break-down and Production Planning)
Function 1 Function 2 Function 3 Function 4 Function 5 Function 6
Step 1
Step 2
Step 3
Step 4
Step 5
A/R
R
A
R
A R
IRA
C
S
R: responsible
A: accountable
S : Supporting
C: consulted
I : Informed
S
Sanity Check:
• Two people are
accountable for step 2?
• Who is accountable for
process step 4?
• Who is accountable for
process step 5?

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Operational Excellence
 Realise efficient and effective operational processes
 Not single focus on cost reduction but also good view on
competitive product delivery
 In O-PPOI model: Describe in detail the interpretation of
Operational Excellence and the effects on process design in the
objective definition phase
 Define targets or standards for IT performance and how to cope
with variability:
– Buffering with Capacity, time, inventory
 ………..

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page: ‹#› Date: 12-3-2015
Change Management
Designing versus Evolutionary Approach
 Organisation is imperfect
 Blue print concept
 Top-down using abstract
models
 Stabile end-solution
 One-off linear process
 Technical-economical approach
 According (agreed) timelines
 Experts are in the lead
 Organisation has infinite knowledge
 Continuous gradual improvements
 Bottom-up based on practical
experiences
 Improve capacity to change
 Iterative process
 Social-political approach
 Adventure
 Stakeholders are in the lead

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Change Management according to Caluwé
 What should be the most successful way to transform to process based
organisation?
 By nature IT project delivery has a strong history of blue-print thinking!

Transforming into Agile IT organisation

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