Kanban Overviewand

Wine (or tea) tasting sessionabout

KCP (Kanban Coaching Professional) Masterclass for kanban practitionerstaught by LKU (David Anderson), during 2014, Apr 28 – May 2

& LKNA 2014, May 5-8

Pertinent Slides & notes from KCP Day 1 to 5, with LKNA 2014 photos

Pre-requisite: “STOP Starting, START finishing” by Arne RoockRecommended reading: David Anderson’s kanban (blue book)

Topics- pick and choose for discussion• Kanban Overview

• Kanban Method– Kanban Method’s Four basic principles– Kanban Method’s Six core practices

• Wine (or tea) tasting session (KCP & LKNA14)– Advanced Topics from KCP Masterclass– LKNA 2014 Experience with photos

• References & External links

Kanban Method

• The Kanban method, as formulated by David J. Anderson, is an approach to incremental, evolutionary process and systems change for organizations.

• It uses a WIP (work-in-progress) limited pull system as the core mechanism to expose system operation (or process) problems and stimulate collaboration to continuously improve the system.

Kanban Method

Kanban Method’s basic principles

Kanban Method’s four basic principles

• Start with what you do now– Kanban method starts with the roles and processes you have – It stimulates continuous, incremental and evolutionary changes to your

system.

• Agree to pursue incremental, evolutionary change– Kanban method a change management method which encourages

continuous small incremental & evolutionary changes to your current system.

– Organization/team must agree that continuous, incremental & evolutionary change is the way to make system improvements and make them stick.

Kanban Method’s 4 basic principles contd…

• Start with what you do now• Agree to pursue incremental, evolutionary change• Initially, respect the current process, roles,

responsibilities & titles– Sweeping changes may seem more effective but have a higher failure rate

due to resistance and fear in the organization. – It is likely that there exist organizational designs that are worth preserving.– Kanban method does not prescribe specific roles or process steps. – We eliminate initial fears by respecting roles, responsibilities and job titles. – We must also seek to drive out fear in order to facilitate future change. – This should enable us to gain broader support for our Kanban initiative.

• Leadership at all levels– Encourage leadership at all levels- individual contributors to management.

If the intent is there, then the question should be….

How Deep is your Kanban?

Visualize Limit Work-in-progress Manage Flow Make Policies Explicit Implement Feedback Loops Improve Collaboratively, Evolve Experimentally (using models & the scientific method)

Shallow

Deep

Dep

th

Kanban Method 6 Core PracticesThe More Specific Version

Visualize work, workflow & business risksImplement Virtual Kanban Systems using large physical or electronic boards in collaborative workplaces

Limit WIPImplement WIP limits per person; avoid multi-tasking

Manage FlowMake Policies ExplicitImplement policies for work types, classes of service and/or value stream on your kanban board. In no particular order.

Implement Feedback loopsKanban Kata: Standup meeting, Delivery Review & Ops ReviewChoose frequencies for replenishment, delivery/release & reviews

Improve Collaboratively, Evolve ExperimentallyEducate your workforce to enable collaborative evolution of policies & ways of working based on models of workflow

Kanban Method’s six core practices• Visualize

– Workflow of knowledge work is inherently invisible.– Visualize the workflow and make it visible to understand how work proceeds. – Without understanding the workflow, making the right changes is harder. – A common way to visualize the workflow is to use a card wall with cards & columns.

Columns on the card wall representing the different states or steps in the workflow.

• Limit WIP (Work-In-Process)– Limiting WIP implies that a pull system is implemented on parts or all of workflow. – pull system will act as one of the main stimuli for continuous, incremental and

evolutionary changes to your system. – Pull system can be implemented as kanban system, CONWIP system or DBR system. – The critical elements are that work-in-process at each state in the workflow is limited

and that new work is “pulled” into the new information discovery activity when there is available capacity within the local WIP limit.

• Manage flow– The workflow through each state should be monitored, measured and reported. – This enables evaluation of continuous, incremental and evolutionary changes to have

positive or negative effects on the system.

Kanban Method’s 6 core practices contd...• Visualize• Limit WIP• Manage Flow• Make policies explicit

– Until each process step is made explicit, it is hard to hold discussions about improving it. – Without an explicit understanding of how things work and how work is actually done,

any discussion of problems tends to be emotional, anecdotal and subjective. – With an explicit understanding, it is possible to move to a more rational, empirical,

objective discussion of issues, and have consensus around improvement suggestions.

• Implement feedback loops– First level of feedback is daily standups, where team collaborates to review flow of work

and demand versus capability measures, metrics and indicators. This is often coupled with anecdotal narrative explaining notable events, to enable evolutionary change.

– Second level of feedback is when demand is replenished at cadence based on lead time.– Third level of feedback - operations review – is where organizational process

improvements occur beyond a localized team level, to realize full benefits of Kanban.

Kanban Method’s 6 core practices contd...• Visualize• Limit WIP• Manage Flow• Make policies explicit• Implement feedback loops• Improve collaboratively, evolve experimentally

– Collaboration requires a shared understanding of theories about work, workflow, process, and risk. Teams collaborate to build a shared comprehension of problem and suggest improvement actions.

– Kanban method suggests that a scientific approach is used to implement continuous, incremental and evolutionary changes, using common models.

– Common models are- 1. Theory of constraints (the study of bottlenecks); 2. Deming System of Profound Knowledge (a study of variation and how it affects processes) and 3. Lean economic model based on “waste” (or muda, muri and mura).

Advanced Topics from KCP Masterclass

• Match “Cost of Delay” sketches with Classes of service• Cost of Delay has a 2nd Dimension• Intangible class items are still important• Matching Shelf-Life Risk to Capability• Understanding capability is critical to risk management strategy• When should we start something? • Kanban Depth Framework- A Model for Relative Assessment• Little’s Law- Possibilities• Kanban Coaching Tips• Optional Case Study: Capacity Allocation

Match CoD sketches with Classes of service to establish urgency

time

impa

ct

time

time

time

impa

ctim

pact

impa

ct

time

impa

ct

time

impa

ctim

pact

Expedite – critical and immediate cost of delay; can exceed kanban limits (bumps other work)

Fixed date – cost of delay goes up significantly after deadline; Start early enough & dynamically prioritize to insure on-time delivery

Standard - cost of delay is shallow but accelerates before leveling out; provide a reasonable lead-time expectation

Intangible – cost of delay may be significant but is not incurred until much later; important but not urgent

time

Cost of Delay has a 2nd Dimension

time

impa

ct

time

impa

ct

time

impa

ctim

pact

Extinction Level Event – a short delay will completely deplete the working capital of the business

Major Capital – the cost of delay is such that a major initiative or project will be lost from next year’s portfolio or additional capital will need to be raised to fund it

Discretionary Spending – departmental budgets may be cut as a result or our business misses its profit forecasts

Intangible – delay causes embarrassment, loss of political capital, affects brand equity, mindshare, customer confidence, etc

time

?

Working capital

Working capital

Cost of delay changes over long period of time

Intangible class items are still importantIm

pact

2005 20092006 2007 2008 2010

0

Intangible Item

Standard Item

Fixed Date Item

Expedite Item

This is the cost of delay function, typical ofPlatform replacementsLegacy code replacementsMajor green-field (v1.0) projects

Matching Shelf-Life Risk to Capability

Short(days, weeks,

months)

Medium(months,quarters,1-2 years)

Long(years,

decades)

Lead T

ime

Short

Long

Deliv

ery

Service Delivery Agility

Reple

nis

hm

en

t

Frequent

Seldom

Frequent

Seldom

Pre

dic

tabili

ty

High

Low

Where does our business currently

rank on these sliders?

Kanban system dynamics

Are our business strategy and expectations aligned with our currently observed capabilities?

If we plan to pursue short shelf-life opportunities, do we have the agility and predictability to pull it off?

Understanding capability is critical to risk management strategy

If you cannot assess your current delivery capability and align your

strategy and marketing plans accordingly, then …

You are doomed before you start!

When should we start something?

impa

ct

When we need it

85th percentile

Ideal StartHere

Commitment point

If we start too early, we forgo the option and opportunity to do something else that may

provide value.

If we start too late we risk incurring the cost of delay

With a 6 in 7 chance of on-time delivery, we can always

expedite to insure on-time delivery

time

Delivery Rate

Lead Time

WIP=

Avg. Lead Time

Avg. Delivery Rate

WIP

Backlog ReadyTo

Deploy

Little’s Law

Backlog

Little’s Law- Possibilities

Thinking Fast and Slow

One can notice tremendous influence of this book from the cognitive science domain on the lean kanban community at Lean Kanban North America (LKNA) events David Anderson started 6 years back.

The basis thesis of the book is simple. In judging the world around us, we use two mental systems: Fast and Slow. The Fast system (System 1) is mostly unconscious and makes snap judgments based on our past experiences and emotions. When we use this system we are as likely to be wrong as right. The Slow system (System 2) is rational, conscious and slow. They work together to provide us a view of the world around us.

So when anytime you read about system 1 or system 2 in a lean kanban workshop, you will know what s/he is talking about.

How does “Thinking Fast and Slow” apply to kanban coaching?

Daniel Kahneman has given us a simple model for how we process information

Daniel Kahneman

System 1Sensory PerceptionPattern Matching

System 2Logical Inference

Engine

Learning byExperience

Learning from theory

FASTBut slow to learn

SLOWBut fast to learn

Kanban Coaching

Kanban Coaching

Kanban Coaching

Optional Case Study: Allocate Capacity

Background• Our business is under attack from an insurgent player who is gaining

market share. Our go-to-market strategy for this year is to defend market share by reducing subscriber churn

• Subscribers are leaving because our competitor’s service is seen as more reliable

• If we stop new feature delivery altogether we will also lose customers as marketing will have nothing new with which to promote our service

• Demand for new functionality runs at 12/month. Change requests take 30 days on average with 98% complete in 100 days

• Production Defects are reported at a rate of 100/month. They take on average 2 days to fix with 98% complete in 10 days

• Maintenance work is designed to reduce production defect demand by up to 10% for each item completed. They take on average 10 days to complete with the 98% taking 50 days

• We have an established working norm of only 2 items of WIP per person and 12 people on our team

Exercise• Using Little’s Law, design a capacity allocation to shape demand and

deliver on your strategic goals. How long will it take before you can switch strategy & fight with the competitor with significant new features?

LKNA 2014 Experience with photos

• Amdocs report- Delivery Sustainable Pace Manifesto• Amdocs “Pull for Change” initiative- Scaling Kanban• Lean Portfolio Management Workshop

Amdocs LKNA 2014 report- Delivery Sustainable Pace Manifesto

Pull Thinking at work- “Pull for Change” initiative for large-scale kanban adoption at Amdocs

LKNA2014 Pawel's workshop on lean portfolio management

References & External LinksThere is more continuous improvement happening in the Lean Kanban community with contributors like Arne Roock (known for “Stop Starting Start Finishing!”), Russell Healy (getkanban.com game creator), Christophe Achouizntz (known for Kanban team kaizen survey) or Hakan Forss (known to popularize flow efficiency metric as the primary Kanban metric).

References• Pre-requisite #1: “STOP Starting, START finishing” by Arne Roock• Pre-requisite #2: Anderson, David (April 2010). Kanban - Successful Evolutionary Change for your Technology Business. Blue Hole Press.• Pre-requisite #3: Anderson, David (April 2012). Lessons in Agile Management- On the road to Kanban. Blue Hole Press.• Pre-requisite #4: Scrumban - Essays on Kanban Systems for Lean Software Development by Corey Ladas• David Anderson’s blog posts & Henrik Kniberg’s blog posts• InfoQ eBooks by Henrik Kniberg & others [e.g. Jasper Boeg (2012-02). "Priming Kanban" (in English). InfoQ]

LKNA conferences & related links• https://plus.google.com/113439681622341364754/videos• http://leankanban.com/case-studies• http://blackswanfarming.com/cost-of-delay/

General References• From lean.org, the Lean Lexicon: http://www.lean.org/Common/LexiconTerm.aspx?termid=242• From Wikipedia, the free encyclopedia: http://en.wikipedia.org/wiki/Kanban_%28development%29