New Recipe for Success

by David Anderson

In 2010, I published the Recipe for Success in Kanban – Successful  Evolutionary Change for Your Technology Business. Ten years later, I´ve  been rethinking my approach, and reacting to the poor advice I see from  the Agile movement, obsessed with reorganizations, and disruptive,  dramatic social change that only slows businesses down, a magical game  of musical chairs that gives the appearance of doing something about  organizational agility, and service-delivery capability. Rather than  reorganizing, you should lead with purpose, create customer-centric  metrics, implement feedback loops, and hold people accountable.

The Original Recipe for Success

My advice in 2010 was aimed at first and second-line managers who  were tasked with delivering professional services work such as software  development. Often, skilled practitioners, when promoted into a  management position, these people are given little training, and almost  no mentoring or guidance. They must learn new skills quickly or they  will struggle. Often someone who was highly competent feels suddenly  hugely incompetent and their self-esteem suffers as consequence. This  dents their confidence, which affects how people trust them. A lack of  trust adds constraints, and a vicious cycle ensues. To break out of  this, my advice to new managers was…

  • Focus on quality
  • Reduce work-in-progress
  • Deliver often
  • Balance demand against capability[1]
  • Prioritize
  • Attack sources of variability to improve predictability

This advice was intended to help new managers gain a sense of  achievement, boost their self-esteem, build confidence, and consequence  build trust. This turns a vicious cycle into a virtuous cycle and sets  them on a path to success and hopefully promotion and greater  responsibilities in future. Let´s look at these six elements briefly…

Focus on quality – improves customer satisfaction, reduces rework, improves predictability, improves trust with customers

Reduce work-in-progress – improves focus and reduces  multitasking, improves predictability, and improves quality, relieves  workers of overburdening, improves employee engagement, and improves  trust with customers

Deliver often – improves trust with customers,  delivers value more frequently, reduces opportunity cost of delay,  improves economics, improves customer satisfaction, improves trust

Balance demand against capability – relieves the  delivery workflow from overburdening, improves quality, reduces lead  time, improves predictability, improves trust

Prioritize – easier said than done (well), reduces anxiety over balancing demand against capability and reducing work-in-progress.

Attack sources of variability to improve predictability – builds trust, improves economics, enables greater efficiency

With my recent work on the Kanban Maturity Model, and the development  of the Organizational Maturity levels, I can now see that this list of  six is spread across several maturity levels ranging from the easier,  simpler, shallower maturity of reduce work-in-progress, and focus on  quality, through mid-levels of deliver often and balance demand against  capability, to deeper and more challenging capabilities of prioritizing  effectively and identifying and reducing sources of variability  (requires finding new ways of working, as well as a deeper understanding  of types and causes of variability).

Meanwhile, inexperienced managers in professional services  industries, under pressure to perform, are being advised to reorganize  into pods, squads, guilds, cross-functional teams, chapters, and release  trains. Rearranging the deck chairs on the Titanic! It gives the  impression of doing something in a crisis.

So, it´s time for some new advice and guidance, a new recipe for  success. Stop reorganizing and instead encourage cooperation in your  organization, create alignment, and deliver on customer needs. You don´t  need to reorganize, you need to create social capital so that people  work better together. Here is how to do it…

The New Recipe for Success

From our work developing the Kanban Maturity Model, we studied the  challenges of why and how organizations struggled to adopt practices  that lead to improvements. Culture is often cited as the top reason why  practices were resisted in organizations. Culture is the product of  behaviors and actions, and these are driven by values. To change the  culture, you need to lead with values. To drive adoption of new values,  you need leadership. A lack of leadership is at the core of why  organizations struggle to improve their capabilities and outcomes. While  leadership development is a deep and challenging topic and one that  most organizations ignore, you can go a long way to catalyzing acts of  leadership at all levels in an organization, by holding people  accountable. Accountability is the secret to unleashing the latent  leadership in your organization, driving cultural change, and ultimately  adoption of practices that improve agility, resilience, customer  experience, and your economic performance. The New Recipe for Success is  intended to drive accountability in your organization, improve trust  and social capital, increase cooperation across organizational units,  and produce the improvements in agility, customer satisfaction,  resilience, and innovation that you´ve been looking for.

  • Lead with purpose
  • Create customer-centric metrics
  • Implement feedback loops
  • Hold people accountable

Let´s look at these in turn…

Lead with purpose

Define goals that are meaningful to the success of your business.  What is the mission of your business, your business unit, your project?  Why do you exist as a business? What is your purpose? Why do your  customers come to you? What are their reasons for selecting you? What is  their purpose? What expectations do they have? And what outcomes do  they expect? You need an outcome-driven organization. Define the  outcomes you expect and measure your performance against those expected  outcomes.

Everyone should understand the purpose of their work, and the outcome  that they are contributing towards. Those outcomes should be meaning to  the mission of your business and meaningful to your customers – a  customer should recognize that outcome you are striving for, as  something that is valuable to them.

Create customer-centric metrics

Given your customer´s purpose and expectations, what is that they  care about? Timely delivery? Fast delivery? High quality? Affordability?  Convenience? Ease of use? Choice, optionality, adaptability, or  reconfigurability? These are the common things customers care about.  What do your customers care about? Define your anticipated outcomes  based on what your customers care about. Create metrics that reflect  these customer concerns. Aim to meet your customers´ expectations.

Together with Alexei Zheglov, I wrote a book about this, Fit for Purpose – how modern businesses find, satisfy, and keep customers. We teach classes on  how to create the right metrics to drive desirable evolutionary change  in your organization – metrics that align people across organizational  units and drive the cooperation you need to fulfill customer  expectations.

Implement feedback loops

Metrics are useless unless you take the time to reflect on them – to  compare your goals, your customer expectations, with your current  capability and performance. In the Kanban Method, we have several of  these reviews designed to hold people, at different levels in an  organization, accountable for achieving expectations. These are…

  • Flow Review / Service Delivery Review
  • Operations Review
  • Strategy Review

Some other feedback mechanisms exist in Kanban that have a secondary but still important role to play in accountability…

  • Replenishment Meeting
  • Delivery Planning Meeting
  • Risk Review

Much of the failings I see in organizations can be fixed by measuring  the right things, implementing a feedback loop to reflect on the  measurements and metrics, and holding people accountable. So often I  hear, ¨We´ve been doing Agile for years now but our customers continue  to complain that we are too slow and unpredictable. ¨ So I ask them:  ¨Are you tracking lead time from customer commitment to delivery? ¨ No,  we don´t do that!

¨Do you have a feedback loop, a review or retrospective where you  compare customer expectations with your delivery times? ¨ No, we don´t  have that either!

¨Are managers being held accountable for meeting customer expectations? ¨ What do you mean exactly?

This simple formula of measure and report things that customers care  about, implement a feedback mechanism to reflect upon your current  capability, and hold managers accountable, will fix most problems – you  don´t need to reorganize and you almost certainly don´t need an Agile  framework or methodology.

Hold people accountable

I recently blogged about the power of accountability to catalyze leadership.  My colleagues in our European office in Bilbao, tell me that  ¨accountability¨ cannot be translated into Spanish, as the translation  means ¨the person that is responsible for¨ and hence, responsibility and  accountability are the same thing in Spanish and Latin culture. This  requires just the briefest of thoughts to resolve. Someone who is  ¨responsible for¨ doing the work, responsible for the activity, even the  output, isn´t the same as someone who is ¨responsible for¨ the outcome.  This is the essence of accountability – accountability is  responsibility for an outcome.

Your organization needs to be outcome driven. Lead through the  definition of outcomes that are aligned with customer needs, and the  mission of your business. Define outcomes, measure and report metrics  that align with the outcome, implement feedback loops to reflect on  actual versus desired outcomes, and hold people, at all levels in your  organization, accountable for those outcomes.

Enabling the New Recipe for Success

We teach classes on how to define outcome-driven metrics using the  Fit For Purpose Framework, and how to implement the appropriate feedback  loops to drive evolutionary change in your organization in our Kanban  Systems Improvement (KSI) and Kanban Maturity Model (KMM) curricula.  Stop reorganizing. Stop disrupting people with dramatic social change  across your organization. Learn to lead with purpose, develop  outcome-driven, customer-centric metrics, implement the right feedback  loops, in order to catalyze leadership by holding people accountable –  evolve to a fitter-for-purpose organization that delights your  customers, fully engages your employees, changes your culture, and  delivers successfully on your mission and purpose.

Footnotes

¨Balance demand against capability¨ was originally published ¨Balance  demand against throughput¨ and changed soon afterwards (2010) in our  training material to use plainer, simpler, and more general language.

This article was inspired by Travis Birch, ¨You don´t need to reorg, you just need service-oriented managers¨. I felt it would be good to make this concept actionable.

[1] Originally published ¨Balance demand against throughput¨