Toyota way « Thinking for a Change

Aug

The cost of confusing requirements and solutions

A simple requirement

danger_workarounds Imagine this situation: the CIO of a large company decrees that from now “all applications we develop must be browser based“. This becomes a non-negotiable constraint for every new project.

Unfortunately, a browser platform is not the best platform for all types of applications or all environments. A browser based application may not deliver the best user experience or support intensive workloads. It may be hard (or impossible) to access peripherals. It may be impossible to clearly show complex data sets. And when the network goes down, everybody’s work grinds to a halt.

But all the nice developers and project managers say “Yes boss!” and struggle to find workarounds for these difficulties, to satisfy the users. All of these workarounds make development and maintenance more complex. Users make do with what they receive and add more workarounds to deal with the deficiencies in the applications.

The real requirements

What he really meant was that from now on “all applications we develop must run on a small number of standard environments, be easy to deploy to all our users and centrally managed so that development, release and application support costs stop growing.” What’s the difference between this statement and the previous one? This statement sets a goal and constraints within which creativity can flourish. The first statement stifles creativity and stands in the way of achieving the real goal.

How do we find out what the real goal is? Because someone had the courage to ask “Why?” until it was clear what value we were generating for whom. As the “Discovering Real Business Requirements for Software Project Success” book says:

A requirement describes some value we need to deliver to someone.

Do your “requirements” fit this definition? Why not?

The value of analysis

The difference in value and cost can be staggering. The first statement costs the company lots of money and frustration from everyone who uses, develops and supports hobbled, complex applications. It’s a world of compromises. It doesn’t have to be this way. The second statement gives us a fighting chance to achieve the goals.

All it requires is someone to play the role of analyst to help the customer clearly describe what they need. Someone who acts like a detective to discover the real motives and issues.

A good analyst creates options and keeps them open as long as possible. The “Discovering Real Business Requirements for Software Project Success” book helps to get to the core of the problem. This fits well with a quote from “The Toyota Product Development System: Integrating People, Process and Technology“:

Classical product development reduces the number of solutions early.
Lean product development reduces the number of problems early and leaves as many solutions available as possible, for example by set-based development or by using tradeoff curves.

Is there someone who has the courage and skill to ask the right questions? Who has the tenacity to dig until they find the real business requirements?

Jul

Software Development Takt

Takt time

Takt time is the rate at which customers buy a product. Takt time determines the speed at which a Lean manufacturing runs. For example, say we sell 576 units of product A. If we have a 8 hour shift, we need to make 72 units per hour, or 1.2 units per minute. We have 50 seconds per unit.

Every step in the production process must now deliver their contribution to the product in 50 seconds.

What if there’s a step that can’t deliver in 50 seconds? Then we have a bottleneck. We’ll produce and sell less than we could. We apply the 5 focusing steps to increase the bottleneck’s capacity so that they can deliver in 50 seconds or less.

What if there’s a step that can deliver in less than 50 seconds? They still deliver every 50 seconds, even if they have to slow down. If they delivered more frequently, we’d build up lots of work in process as other steps can’t use its output faster than once every 50 seconds. Or we might build unsold goods.

Slowing down? Isn’t that inefficient? Yes, but we’re not optimising the efficiency of a single step. We’re optimising the whole value stream. If a step has a lot of spare capacity, this could be used to work on another product, but only if it doesn’t endanger the delivery of the first product.

Using Visual Management, the value stream tracks actual production rate regularly. The steps won’t run perfectly as clockwork, there will always be some variation. The production rate displays allow everybody to react (speed up, slow down a bit) to keep to the takt time. The takt time works as a metronome that synchronizes musicians.

Takt time isn’t (always) the drum beat

In Theory of Constraints, the Drum-Buffer-Rope system synchronizes the speed at which each step in production runs. The “Drum Beat” is the rhythm, the steady pace at which the slowest step (the bottleneck) runs. The rest of the system works to that beat. Again, no use producing faster than the bottleneck because we’ll only create more work in process.

The two concepts are quite similar and I sometimes confuse them. There’s one clear difference:

takt time is customer-focused, outward looking
drum beat is bottleneck focused, inward looking

If the customer is the constraint, a base (if not outspoken) premise of Lean, takt time equals the drum beat and drum-buffer-rope implements customer pull.

Takt time in software development

What is the equivalent of takt time in software development? If you’re Microsoft, you know approximately how many copies of Microsoft Office are bought every day. You could run your disk duplication and packaging plant at this takt time. But that’s not what I want to talk about.

Takt time = the rate at which you release a new product (version) to users

How often do you put new, valuable features in the hands of your users? Every day? Every week? Every month? Every quarter? Every year?

The logic of slow takt times or how to kill all your Agile teams with one simple decision

Most teams I work with, including Agile teams, have long release cycles. Long by my standards. Some of this is under control of the development team, but the release cycle is often dictated by other concerns. Often, operational teams (systems engineers, DBAs, support) reduce the number of releases.

Operational teams are often stressed, in fire-fighting mode and jerked around as projects miss deadlines and make last-minute changes. To reduce the load and ease the pressure, they reduce the number of releases. Fewer releases means more complex and error-prone releases, as more features are batched up in one release. These releases require more effort and have more issues. Fixing and patching those issues requires more work. Business people, under pressure to generate more value faster push harder to get features out of the door. Corners get cut, features get released under the guise of fixes. More work. The logical reaction is to reduce the number of releases again. Which makes the problem even worse. And so on.

Reducing the number of releases, increasing the overhead of releasing is the perfect way to demoralise and ultimately kill any Agile team. Why should we define short iterations and releases, if it takes so long to get something in production? Why should we collaborate tightly with customers if the software is outdated by the time it gets into the hands of users? Why should we focus on business value if potentially valuable features gather dust in an endless release process? We might as well switch to waterfall.

It doesn’t have to be this way. The first step is to regain the trust of the operational teams: release on time, deliver great quality code, involve operational teams in planning and retrospectives, treat members of operational teams (who are often involved in many projects) as members of your team: listen to them and optimise the whole value stream.

Once we’ve established trust and created one team, we can start to talk about improving and going faster.

Jun

Heijunka – Humane work

Operational Excellence AND Customer Intimacy, but not at once

In the previous blog entry, we saw how one company resolved the conflict between operational excellence and customer intimacy. They found a way to have both. But we didn’t implement both at the same time.

We first went for Operational Excellence. First we standardised, made things reliable, made work repeatable, not only in production but also in IT. The existing product definitions were inconsistent and complex. This made our code complex because we had to treat every product as a special case. Over a period of about one year all the product definitions and the code were refactored to new standardised forms. All of this happened while the system was in production and new features were released every two months. We got very good at refactoring and migrating without disrupting because we did it so often, in small steps.

A similar ‘refactoring’ happened on the production floor. Product line by product line was tackled: work cells clearly labeled, clear flow lines from input to output established, work in process limited… When I first went to see the production floor I nearly got lost between the piles of work in process and it was hard to see what was going on. After the changes, the area looked a lot more spacious and it was clear at a glance what was going on.

Once we had the production and development system under control, we started to think about customisation and getting more intimate with our customers.

Effectiveness AND Alignment, but not at once

This reminded of Alan Kelly’s blog entry about the “Alignment Trap“. In summary: we want our IT organisations to be effective (do things right) and aligned with business objectives (do the right things). Unfortunately, most organisations do neither.

If we want an organisation that does the right things and does them right, what strategy should we follow? Based on a study, Alan conjectures that it’s best to focus on effectiveness first, alignment second. First learn to do things right, then do the right things.

Managed and Agile, but not at once

I encounter a similar situation in many coaching and consulting engagements. Organisations want IT teams that are reliable, predictable and can be trusted to deliver as promised. And they also want them to be agile, deliver faster and respond to change. Lean and Agile can get you there.

What’s the first step? Usually, we need to bring things under control, clear away the clutter, reduce chaos, limit task switching, limit work in process and make things visible. This often involves “anti-agile” or “anti-lean” measures such as batching support, analysis and design work to avoid task switching and installing strict change management and issue prioritising to keep focus. I always get lots of complaints and get accused of “not being agile” from people who are used to the chaos and suddenly find that the team no longer asks “How High?” when they yell “JUMP!” Those who stop jumping find that they get a lot more done and that the results are better. They are less stressed.

Once we have the process under control, we can start improving the flow.We know how to do things, we can start to go a bit faster, in smaller steps; we can disrupt the stability to improve a bit. And then we find a new stability and so on.

Heijunka

Heijunka is one of the often forgotten Toyota Way principles. It means “levelling the load”, working at a steady, regular, sustained and sustainable pace. It means planning the work so that there’s a good balance between flow and the load on people and machines.

Large companies who impose just-in-time deliveries to their suppliers without levelling their orders abuse their suppliers. Teams who randomly request clarifications for stories burn out their Product Owner. Teams who push out releases faster than their customers and users can accept them throw away value.

Heijunka means making and keeping work humane.

Which small step can you take to make your work more humane?

Jun

Nemawashi – Decisions by consensus without compromise

Decisions by consensus

One of the Toyota Way principles is « Nemawashi », take decisions by consensus.

Building consensus is a slow process, but it’s necessary to get everybody on board before taking a decision. Otherwise, the implementation will be delayed and (unconsciously) sabotaged by those who didn’t agree or weren’t involved.

It’s not just about building support for your ideas. The consensus-building process solicits ideas and review from everyone involved so that the final idea is usually a lot stronger than the original.

But there’s one big misunderstanding about consensus.

Consensus doesn’t require Compromise

It’s tempting to dilute our idea to reach consensus, ensure that everyone gets a bit of what they want, so that they’ll agree to go along.

It doesn’t have to be this way. In “Extreme Toyota” the authors show how Toyota embraces conflicts and doesn’t settle for compromises. They identify six contradictions that are central to Toyota’s way of working:

Moving gradually and taking big leaps
Cultivating frugality while spending huge sums
Operating efficiently as well as redundantly
Cultivating stability and a paranoid mindset
Respecting bureaucratic hierarchy and allowing freedom to dissent
Maintaining simplified and complex communication

“This AND that” sounds better than “This OVER that”… I want to have my cake and eat it too 😉

Enter the business consultants

A few years ago I worked on a project that automated the whole value stream of a business unit. The main challenge was that the different departments had conflicting needs. No surprise there.

One of the conflicts was between the production department that did the work on customer demand and the sales department that sold contracts for doing the work to the customer . The production department needed standardised products with little variation so that they could work efficiently, predictably and hit their Service Level Agreements; the sales team needed customised products so that they could tailor their offering precisely to what the customer needed.

This is a classical conflict. The business consultants on the project called this “Operational Excellence” versus “Customer Intimacy“. And the consultants said we had to choose. It’s one or the other, you can’t have both. It’s like Henry Ford’s saying: “You can have any color car, as long as that color is black.”

Examining the conflict

It’s clear, you can’t have both standardised and customised at the same time. There’s a clear conflict. But we have a tool to deal with conflicts: the Conflict Resolution Diagram. Let’s apply the tool:

The diagram says:

To have a growing, profitable business unit (A) we need to sell what the customer needs (C) and deliver it reliably and cheaply (B).
To produce reliably, predictably at low cost and to hit the Service Level Agreements (B) we need products with little variety (D).
To create an offer that responds to the customer’s need and to grow our market (C) we need to vary our products per customer (D’).
Conflict: we can’t have little variation (D) and a lot of variation (D’) at the same time, but we need both.

Questioning assumptions

We deal with the conflict by questioning the underlying assumptions. Can we find fault with our logic? Bill Dettmer recommends to restate the relationships in “extreme wording”. For example:

There’s absolutely no way to have both low and high variability at the same time! Well, duh!
The only way to be profitable and reliable is to have low variability! Well, it was hard to fault this reasoning as this company operated on large volumes with low margins and tight competition.
Customers always need special cases! Not always, but customers were no longer satisfied with one-size-fits-all offers. If this company couldn’t offer customised products, the competitors would be more than willing to get a new customer.
We could have low variability and yet vary per customer if only we didn’t have so many customers! Going niche wasn’t an option for economical and legal reasons.

We looked at it every way possible and couldn’t find a fault with the reasoning until…

Finally, some clarity

The Logical Thinking Processes have a set of “Legitimate Reservations”, a set of critical questions we should ask. The first one is simply called “Clarity“: is the meaning of every word and sentence clear to everybody?

Now, we had already noticed that the different departments seemed to have different definitions for the same word. There were even differences in the way they described the different products to us. Were we talking about the same thing?

The breakthrough came when we asked “What do you mean by ‘Product’?” A product for the Production department wasn’t the same thing as a product for the Sales department. And the accounting & finance department had another definition of product. But… That’s not a bug; it’s a feature: if a Production-Product is different from a Sales-Product, can we have Production-Products with low variation and Sales-Products with high variation?

After a lot more work we came up with a way to standardise Production-Products on a small set of “building blocks” and let Sales create Sales-Products by mixing and matching the building blocks according to customer need. Then we mapped Production-Products onto Accounting-Products. And everybody got what they wanted: Operational Excellence AND Customer Intimacy.

Embrace conflict

We didn’t settle for a compromise, but spent the time to really think through our conflicts and come up with a solution that satisfied all needs. A conflict can be an opportunity to come up with an innovative solution.

You don’t have to settle for compromises if you think about it.

Picture of Bonsai by A. Marques. Thank you.

Jun

Integrating the Toyota Way with Agile

Integrating Agile

I’m looking forward to next week’s Integrating Agile conference in Amsterdam. On the program, a nice mix of local and international speakers. A keynote by Henrik Kniberg is bound to be interesting. I heard Rob Thomsett at the London Agile Business Conference, so I expect to be challenged and entertained. Some other sessions look interesting too, but it’s hard to tell without further session descriptions on the site. Recommendation to the organisers: TO decide if I want to go to the conference and which sessions I’ll attend I NEED to know what each session will be about.

Toyota Way

The program also features a new version of the Toyota Way session, most recently presented in Paris. I’ve presented about this topic since 2005 and the presentation keeps changing as I learn more. This time it will change more than usual, as I’m co-presenting it for the first time with Portia. As usual when working with Portia, we have more new ideas than can fit in one session.

So, what is the session about?

We present the principles and practices of the Toyota Way and Lean Management. We explain how we apply them by giving examples from our experience. We show how each of the principles does not stand alone but forms a system that brings enduring improvements.

What’s in it for you?

See how the Lean Management principles of the Toyota Way have made Toyota a learning and improving organisation.
Understand how Lean and Agile relate to each other.
Learn how to apply this in your own organisation to make Agile and Lean transformations endure.

Lots of material

To give you an idea of what we talk about in 45 minutes.

All of the wisdom in those books! Plus several years of experience applying these ideas in the real world.

It’s a bit harder to take a picture of experience. Although there are some wrinkles and gray hairs I could trace…

Thinking for a Change

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