During this webinar guest speaker, Forrester VP, Principal Analyst, Diego Lo Giudice, and Tasktop CEO, Dr. Mik Kersten, present their research on why transformations are failing at scale and how a product value stream approach enables organizations to survive and thrive in the age of digital disruption.
Visit the PowerPoint resources page Backstage for quick tips and slide layout solutions for your presentations.
rob Compare 2 years from now 2016 to “now” 2018… caution and realism
First, let’s start with the sorry state of digital transformation. These findings from a custom survey Ted Schadler conducted early this year, I think, echo Max’s remarks yesterday. Digital transformation is hard, in part because we still have a lot to learn about what it is, never mind how to accomplish it.
The core supports 100s of your business processes that run your business operations: Your CRM is part of Core Your systems to manage Employees – HR, Rectruiting Finance systems for accunt planning ERP
And depending which industry you are in, for example Retail will be inventory management and shipping, Airline crew management, maintenance and operations… 1 Min
So one of the key reasons is Digital experiences that break down for the customer, destroying the journey, create digital illusion!! we think we ‘ve got cool apps running and they might look cool, perhaps no so differentiating as Pascal showed earlier, but unfortunately there is still something that’s not giving great full experience to clients, or partners, because something in the invisible is not working….
Even Unicorns can have problems with the core !, It took my friend Rob (analyst) 5 days of tweeting this image you can see to Ellon Musk directly, once he found out through the insurance and the repair shop close to his house that Tesla’s management of glass inventory management was broken or inexistent. Now Tesla has a wonderful applications for customers to customize their cars and update with new sw to get new functionalities, but it looks like a broken glass replacement inventory management process.
Tesla was forced to send a manager to the factory in Fremont California (my friend lives close to san Francisco), pick up a glass and manually drive it to the closest repair shop to get this fixed. 1.5 min
Other examples? Bank Mobile app,super functional, but when I tried buying on the wen a train ticket, payment was not going through because my two step identifanction on the cool mobile app was not gettting through….
You get the point….Your cx relies on those backends !
Amazon has connected, biz, architecture, org
How much amazon is affecting retail. This community is starting to change things: Target (all time high), Walmart, Nordstrom, BestBuy. Retailers got hit early.
Consider the retail market from 2006-2016. Amazon, a software product innovator, is decimating other retailers. Last week Sears declared bankruptcy. And it has used it’s growth in retail to fund a software product delivery platform that it can now use to move into almost any market of it’s choosing.
Signs of hope with some like Target have taken a software product-oriented approach. Their stock price has improved in the past couple of years. But this is a big change.
Or if we “zoom out” of our current careers, have we seen something like this before?
Jim: playing a different game, vs. others which is what the revenue they are giving back / dividends. Retail is a small component. Last 3 years, HomeDepot higher, Nordstorm, target, Costco, positive growth. Ones who have embraced digital showing some signs. Embraced omni channel.
Sears went into bankruptcy protection this week
Some companies have mastered digital, others haven’t If this happens in every segment, in every industry, not a good thing
Target has recently gone up, so glimmers of hope
Realized at my first DOES that this community is part of the answer
So what are some of the problems our cores have ? Static and inflexible: But a lot of processes rely on them Unreacheable Indispensable data: Data in core systems is needed to support new customer experiences Growing technical debt drains technology budgets: Core is expensive to maintain – despite digital, we are still spending over 60% of budgets to maintain the systems. It’s like having a financial debt, the more the debt stays there, the more interest rates you pay, why? Because it impacts every change you need to make which takes longer to make every time !
Siloed teams with limited collaboration, large batch release forced by siloed core architectures – and still a total misunderstanding by doing the bare minimum of what true Agile would require – or even worse defining Agile as bunch of prescribed process rather than creating a new DNA of values and principles gets Agile stuck too.
And while on the systems of engagement we are breaking teams up in smaller teams that iteratively work in sprints that can deliver faster and smaller batches and MvPs, the core delivery process for Core is still waterfall, with complex and large batch releases – and multi-year projects.
You’ve been badly advised by analysts (the wrong analysts) to split your IT in two worlds: one that innovates goes fast, and one which doesnt and goes slow – and if you are unlucky and end up in the slow non innovation world, you definitively are not going to have a great EX which in turn is proven to provide a bad CX too
We are going to start with some stories …
Overall time it took to deliver a feature from an idea to a customer using it was 120 days. Immediate reaction was “we need more developers” … but when they dug into the details – only 2.5% of that time was development time. Finished features were sitting waiting to be deployed for sometimes up to 90 days.
“This is evidenced by this flow metric…”
Ability to deliver anything – features, defects, tech debt work, security risk work has been slowing at a steady (and rapid) rate. Why? We started digging into why this was and discovered that a reorg that was implemented last year and was great in theory turned out to have a critical missing piece …. The reorg would have been fine as long as the Spotify model of being able to commit on any area of the code (with constraints) had been rolled out at the same time. But it wasn’t and so now the teams have dependencies that they cannot resolve themselves … and so the ability to deliver anything is much slowed
This is Barclays analysis of their 18 month cycle for an idea, and how optimizing Agile alone is inefficient, if that’s not their bottleneck.
So what do we mean by core?
So we said that the core problems slow us down in building new features of making changes, well here are some numbers that show that despite the focus on Agile and in the last few years on DevOps, 20% of orgs can release apps monthly, and only 9% more frequently than monthly…
And what is worse…. Is there since 2014 – so in 4.5 years of DevOps speaking, not much has a improved.
But what else is impeding…
So what do we mean by core?
They introduce value streams, people process and technology to implement complete customer journeys: 1. Connecting dots between back and front through an API layer 2. That might mean some re-write, buy new packages, move to cloud 3. Brining more agility in the front and in the back.
Moving to cloud is a big enabling factor for gaining more flexibility and realizing the decoupling and decomposition needed on the backend.
Agile has made strides to improve things… but it is not enough DevOps has made strides to improve things … but it is not enough In particular for this audience I want to re point out the story I already told – lots of focus on CI/CD – and of course that is critical … but ….it’s not enough
The flow framework is dedicated to no longer having to rely on anecdotes and gut feel – a prescriptive approach that can address all areas of where and how software is created, built and delivered.
So what do we mean by core?
Create new business models with technology at the foundation.
Make digital business platforms the core architecture of business.
Treat technology as a business asset.
Let new technology guide your business strategy.
Truth be told … I wish I could stop here and everyone could go home and start getting their flow metrics tomorrow … but sadly I can’t – and that is why the rest of the flow framework is so important.
S3: Everything slowing down because of the reorg
S1: Speed to Joy was 120 days – too long!
LONG LEAD TIMES
So what do we mean by core?
But for Agile at scale to work, you really need to also align team, work and architecture structure – to enable autonomy and decrease dependency that lock flexibility and autonomy. And what makes this possible is focuss on small: small teams (squads, scrums), work structure (small batches), API-Microservices arachitectures…
This is the secret sauce to scaling Agile and enabling fluiditity and flexibility.
VSM Can helps teams better realize the value of agile processes Can better visualize the cost of antiquated processes Visibility into processes can help build trust
Another way of thinking of it … Live in the house while you’re remodeling it.