Effective Queue Management Can Drive Software Business Value

Sticky Notes

Proper prioritization is essential to driving the business value of software. Those working in the trenches need to have a clear understanding of the end goal in order to prioritize their projects appropriately.  With all team members focusing on the same mission to maximize business value from software by optimizing the flow of business value through software development, better decisions can be made throughout the software development lifecycle.

The key element to properly prioritizing projects is effective queue management. On a daily basis, tactical decisions are made at the team level about the prioritization of tasks.  In Donald Reinertsen’s book “The Principles of Product Development Flow: Second Generation Lean Product Development,” he offers six principles for creating a value management capability for queue management at the team level:

1. Software development inventory is physically and financially invisible
2. Queues are the root cause of the majority of economic waste in software development
3. Increasing resource utilization increases queues exponentially (but variability only increases queues linearly)
4. Optimum queue size is an economic trade-off
5. Don’t control capacity utilization, control queue size
6. Use cumulative flow diagrams to monitor queues

Often decisions made by IT are not based on delivering business value, but on the difficulty of the project, the resources required or who is shouting the loudest to push their project to the top of the queue. This needs to change. IT departments need to prioritize their projects based on the business value they will deliver to the organization. Effective queue management is an essential component to making the right tactical decisions that will lead to maximizing the flow of business value in software development efforts.

What drives your decision-making process when determining what project to put in the queue next?


Mike Harris
CEO

Written by Michael D. Harris at 05:00
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Application Issues Cost Companies

There is little more frustrating than when you’re trying to accomplish something at work and you’re held up by technology. You sit, waiting for the technology to work, all the while your stress level is raising as you watch the minutes tick by – minutes when you could be checking things off of your to-do list. Sound familiar? I’d be surprised if it didn’t.

According to a recent article from Baseline, app delays are a major problem for businesses. The reality is that most business users experience frequent delays while attempting to use software apps at work. While this is certainly frustrating for the users, it’s a financial nightmare for companies, who are losing millions of dollars a year as a result of such delays.

When employees waste valuable time troubleshooting the issue or stop using these often-expensive applications altogether, that’s a problem. Unfortunately, few IT decision-makers recognize this issue – or do anything about it. Needless to say, this is a problem.

I often talk about making the value of software more obvious to the business, and the situation above is a clear path to disaster. The lesson here is to make sure that the tools your team is relying on are as useful to them as you think, so that you can truly capitalize on their value, and, most importantly, deliver the required work.

Read, “App Delays Frustrate Users, Cost Business Billions,” here.

Mike Harris
CEO

Written by Michael D. Harris at 05:00
Categories :

Software Value Needs to Start at the Top

McKinsey

I read an article recently, written by Hugo Sarrazin and Paul Willmott at McKinsey & Company, that I thought would be of interest to the readers of this blog. It resonates with my past posts about getting the software value message right to the top of the organization. The article was titled “Adapting your board to the digital age."

Who can argue with recommendations to make board members more informed about the development of technology solutions? I particularly like, “Board members need better knowledge about the technology environment, its potential impact on different parts of the company, and its value chain.”

I would have liked to have seen more stress on the importance of the board being focused on the value delivered by digital transformation. Some of the recommendations (such as having technology committees) could be seen as sufficient in themselves, which they are not. I’m sure that if the board has a “balloons” committee then the company will end up spending more on balloons, even if that is not going to increase the value of the company.

My recommendation to boards? Follow most of the good ideas in this paper, but beware of “digitization” for its own sake. Start and end with business value!

Read, “Adapting Your Board to the Digital Age,” here.


Mike Harris
CEO

Written by Michael D. Harris at 05:00
Categories :

Simple Metrics to Measure Value – CoD and WSJF

Cost of DelayWhen discussing value, determining how to measure that value is critical. As I write my second book on “The Business Value of Software," I find myself frequently coming back to two simple techniques that help organizations measure the business value of their software development projects: Cost of Delay (CoD) and Weighted Shortest Job First (WSJF).

CoD is the hourly, daily, or monthly cost associated with NOT starting a project. When a project is delayed, there is waste (i.e. wait times, inventory costs, opportunity costs) and this waste can negatively impact the bottom line. 

Cost of Delay =
User or Business Value + Time Criticality + Risk Reduction or Opportunity Enablement Value

WSJF is another metric that prioritizes those projects by putting the project with the highest WSJF at the top of the list. It is calculated by dividing the CoD by the duration of the project. 

These two techniques are extremely helpful in prioritizing software development initiatives based on economics. They enable an organization to prevent the frequent starting and stopping of projects that are extremely common in the software development world and allow for a continuous flow of product development based on metrics that drive business value. 

Donald Reinertsen, the author of “The Principles of Product Development Flow: Second Generation Lean Product Development” has said “If you only quantify one thing, quantify cost of delay." I whole-heartedly agree with Reinertsen, and I also encourage organizations to quantify WSJF. By measuring CoD, software development organizations will eliminate overhead associated with delays, streamline operations, and ultimately, produce more business value. By adding WSJF into the equation, they’ll be able to prioritize their projects such that they’re continuously delivering the greatest value to their business units.

I’m always interested in how software development organizations are using these two techniques. Please share the successes you’ve realized when utilizing CoD and/or WSJF.


Mike Harris
CEO

Written by Michael D. Harris at 05:00
Categories :

IT Digitization

Michael D. HarrisAs you all know, I like to share interesting bits and pieces from the reading that I do. Like many of you out there, I subscribe to a number of industry publications, which help me get a sense of current trends, new tools, etc. in the software industry.

Today I wanted to share some takeaways from “Raising Your Digital IQ,” an article from the February 2016 issue of Strategy+Business. The article was written based on a global survey of business leaders, which showcased how the smartest companies are using technology.

The fact is – and this should not be news to anyone – that digital technology is becoming a key part of any IT strategy. The gap between traditional and digital IT is widening, and companies who are not adapting to the change will be left behind.

I suggest checking out the article for the findings, but I’d like to focus on some key points here.

This article quotes GE CEO Jeffrey Immelt, who has had this position since 2001. One particular thing I found interesting was Immelt’s comment that every industrial company will soon be a software and analytics company. Of course I find this interesting, given that our mission here at DCG is all about making software value visible.  I’m hoping that all these new software and analytics companies will take a hard-headed view towards their software investments and go for software value instead of “me too.”

For GE, a focus on analytics means a single, technology-enabled platform that supports innovation, operations, and customer support. What this looks like at any given organization will vary, but the future is using data to improve business.

Next? The effect of this transformation on budgeting. Traditional IT costs are now transforming too; for instance, cloud-based services are often cheaper to run and support. But, digitization also likely means an increased use of tools to manage the work – and not just in IT. This democratization of technology means that IT spending is now widespread in organizations – in fact, the article notes that in 2015 68 percent of technology spending was outside of IT. But, this too brings new considerations; when other departments are making their own IT choices, it can lead to incompatible systems, security risks, and off-strategy investments.

How is your organization planning its digital strategy?

Read, “Raising Your Digital IQ,” here.


Mike Harris
CEO

Written by Michael D. Harris at 05:00
Categories :

"It's frustrating that there are so many failed software projects when I know from personal experience that it's possible to do so much better - and we can help." 
- Mike Harris, DCG Owner

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