B L U E H O L E PRESS B L U E H O L E PRESS Kanban from the Inside print cover FINAL OUTLINED 270 pages.indd 1 9/1/2014 10:43:40 PM Kanban from the Inside Understand the Kanban Method, connect it to what you already know, introduce it with impact Mike Burrows B L U E HOLE PRESS Sequim, Washington B L U E HOLE PRESS Blue Hole Press 72 Buckhorn Road Sequim, WA 98382 www.blueholepress.com Copyright © 2014 by Michael Burrows All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage or retrieval system, without permission in writing from the publisher. Printed in the United States of America. Library of Congress Cataloging-in-Publication Data applied for; available at www.loc.gov ISBN: 978-0-9853051-9-2 (paperback) Cover design by Jane Pruitt Interior design by Vicki L. Rowland 10 9 8 7 6 5 4 3 2 1 0 C ontents Foreword _______________________________________________ ix Preface ________________________________________________ xi Part I Kanban Through Its Values _________________________1 1 Transparency ________________________________________ 3 Core Practice 1: Visualize ____________________________________________4 Core Practice 4: Make Policies Explicit __________________________________7 Core Practice 5: Implement Feedback Loops _____________________________9 Transparency as a Value ____________________________________________13 2 Balance ____________________________________________15 Core Practice 2: Limit Work-in-Progress (WIP) _________________________15 Pull Systems for Knowledge Work ____________________________________15 Balance Workload versus Capacity ____________________________________17 Other Ways to Limit WIP ___________________________________________18 Balance Urgency-Driven versus Date-Driven Work _______________________19 Risk-Based Categorization and Classes of Service ________________________21 Balance Demand versus Capability ___________________________________22 Stakeholder Balance _______________________________________________22 Seeking Balance __________________________________________________23 3 Collaboration ________________________________________25 Core Practice 6: Improve Collaboratively, Evolve Experimentally _____________25 Collaboration Is a Thing ___________________________________________25 Improve Collaboratively ____________________________________________26 Encouraging Collaboration _________________________________________26 Focus on Collaboration ____________________________________________27 Evolve Experimentally _____________________________________________28 Them and Us ____________________________________________________29 Reflection: Transparency, Balance, and Collaboration ______________30 4 Customer Focus ______________________________________31 Core Practice 3: Manage Flow _______________________________________31 iii Kanban from the Inside — Mike Burrows iv ❖  Contents Why Customer Focus? _____________________________________________31 Satisfaction Assured _______________________________________________32 Right Across the Board _____________________________________________33 Upstream Kanban ________________________________________________34 Anticipating Needs _______________________________________________36 5 Flow _______________________________________________37 Core Practice 3: Manage Flow (Again) _________________________________37 Smoothness _____________________________________________________37 Right Across the Board (Again) ______________________________________39 There Is Always a Bigger Context _____________________________________40 Some Low-Level Examples __________________________________________41 Flow Across the Larger Organization __________________________________42 Managing Flow for Timeliness _______________________________________45 6 Leadership __________________________________________47 Foundational Principle 4: Leadership at Every Level ______________________48 Opportunity Everywhere ___________________________________________48 Leadership Begets Leadership _______________________________________49 Why Value Leadership? ____________________________________________50 What Does Leadership Look Like in Kanban? ___________________________51 Reflection: Customer Focus, Flow, and Leadership _________________52 7 Understanding _______________________________________53 Change without Understanding— Three Anti-Patterns ___________________________________________54 Introducing the J Curve ____________________________________________57 A Pattern for Purposeful Change _____________________________________59 8 Agreement __________________________________________61 Pursue Evolutionary Change ________________________________________61 Agree to Pursue __________________________________________________63 Change Management ______________________________________________64 9 Respect ____________________________________________69 Don’t Start with Roles _____________________________________________69 “Be Like Water” __________________________________________________70 Respect for People ________________________________________________71 The Humane, Start with What You Do Now Method ______________________74 10 Patterns and Agendas _________________________________75 “Noble Patterns” _________________________________________________75 Kanban from the Inside — Mike Burrows Contents ❖ v Agendas for Change _______________________________________________76 The Sustainability Agenda __________________________________________77 The Service Orientation Agenda _____________________________________78 The Survivability Agenda ___________________________________________79 Your Organization’s Agenda _________________________________________79 How Did We Do? _________________________________________________80 Five Years On ____________________________________________________81 Part II Models ______________________________________83 11 Systems Thinking, Complexity, and the Learning Organization ____85 Systems Thinking _________________________________________________85 Complexity _____________________________________________________88 Knowledge, Learning, and the Learning Organization _____________________91 Systems Thinking and Kanban _______________________________________95 Further Reading __________________________________________________97 12 Theory of Constraints (TOC) _____________________________99 The Five Focusing Steps and the Process of Ongoing Improvement (POOGI)__100 Drum-Buffer-Rope (DBR) _________________________________________101 The Thinking Processes ___________________________________________102 Critical Chain Project Management (CCPM) __________________________103 Throughput Accounting __________________________________________105 TOC’s Relationship to Kanban ______________________________________106 But Still . . . ____________________________________________________108 Further Reading _________________________________________________108 13 Agile _____________________________________________109 Three Agile Methods _____________________________________________110 Kanban and Agile ________________________________________________116 The Agile Model_________________________________________________118 Further Reading _________________________________________________119 14 TPS and Lean _______________________________________121 Three Lean Tools ________________________________________________122 TPS and Lean in Perspective _______________________________________124 Lean Improvement _______________________________________________125 Lean Product Development ________________________________________126 Lean Startup ___________________________________________________128 Lean/Agile Hybrids ______________________________________________129 Kanban and Lean ________________________________________________130 Further Reading _________________________________________________131 Kanban from the Inside — Mike Burrows vi ❖  Contents 15 Economic Approaches to Flow __________________________133 ROI and the Pareto Diet ___________________________________________134 Cost of Delay ___________________________________________________138 Cost of Carry ___________________________________________________142 Options _______________________________________________________143 Putting It All Together ____________________________________________146 Further Reading _________________________________________________147 16 The Kanban Method __________________________________149 A Very Brief Timeline _____________________________________________149 Foundational Principles ___________________________________________151 Core Practices __________________________________________________151 Contextualized Kanban ___________________________________________152 Enabling Concepts and Tools _______________________________________155 Implementation Guidance: STATIK __________________________________156 Further Reading _________________________________________________157 17 Smaller Models _____________________________________159 Two That Got Away ______________________________________________159 Thinking Tools and Coaching Models ________________________________163 Group Facilitation and Games ______________________________________167 Models of Collaborative Leadership: Triads and T-Shapes _________________170 Further Reading _________________________________________________171 Part III Implementation ______________________________ 173 18 Understand Sources of Dissatisfaction ____________________175 Two Perspectives ________________________________________________176 Two Questions __________________________________________________176 Formats _______________________________________________________177 Organize and Explore ____________________________________________178 Follow Up _____________________________________________________179 19 Analyze Demand and Capability _________________________181 Know What You’re Delivering, to Whom, and Why ______________________182 Quantitative Analysis _____________________________________________185 How Work Arrives _______________________________________________188 Does It All Add Up? ______________________________________________189 20 Model Workflow _____________________________________191 Sketching It Out _________________________________________________191 Kanban from the Inside — Mike Burrows Contents ❖ vii Top-Down Decomposition ________________________________________193 Bottom-Up Organization __________________________________________194 Review ________________________________________________________195 21 Discover Classes of Service ____________________________197 Discover, Check _________________________________________________198 Examples ______________________________________________________199 Toward a Healthy Mix of Work _____________________________________199 22 Design Kanban Systems _______________________________203 Scope, Work Item Granularity, Work Item States ________________________203 Other Dimensions _______________________________________________207 Multi-Level Designs and the Expand/Collapse Pattern ______________________________________208 Limiting WIP ___________________________________________________210 Review ________________________________________________________212 23 Roll Out ___________________________________________215 Planning the Engagement _________________________________________215 Shaping the Agenda: The Three P’s __________________________________217 Pulling Change Through the System _________________________________219 Closing Thoughts________________________________________________228 Further Reading _________________________________________________229 Glossary ______________________________________________231 Appendix A ____________________________________________239 Deming’s 14 Points for Management _________________________________239 Acknowledgments _______________________________________241 About the Author ________________________________________243 Index _________________________________________________245 Kanban from the Inside — Mike Burrows C 4 haPter Customer Focus Core Practice 3: Manage Flow Is this a mistake? How do we get from Manage Flow to customer focus? Indulge me for a moment—let me cheat a little, expanding the wording of this core practice to express more fully what this practice really means: CP3 (expanded): Manage flow, seeking smoothness, timeliness, and good economic outcomes, anticipating customer needs. This chapter focuses on customer needs and how to anticipate them better. Smoothness and timeliness are covered in the next chapter, on flow. Keep in mind “good economic outcomes” as you read both chapters; eco- nomic decision-making is covered in Chapter 15. Why Customer Focus? Task focus, role focus, team focus, project focus, product focus, company focus, technology focus . . . the list goes on. So many ways to lose sight of what we’re in business for! In my classes I offer this advice: Know what you’re delivering, to whom, and why. You might think that this could go unsaid, but it really seems to hit home. Unsolicited, students tell me that they’d never really thought about it before. They mention it in feedback sheets as a key takeaway. It’s not that those other focuses are bad, but that customer focus helps to put them all into proper perspective. 31 Kanban from the Inside — Mike Burrows 32 Chapter 4 ❖ Customer Focus In this chapter, we explore some practical ways in which customer focus can improve the flow of work, sometimes profoundly. It’s not so surprising when you think about it: If you look at what you do from a someone else’s perspective, you are likely to learn something new about how it works. Satisfaction Assured Recall this policy from the scenario that opened Chapter 1: ◆ Developers retain responsibility for work items until they have obtained customer confirmation that the item is proving its worth. This policy was a relatively late addition. We had evolved a development process that seemed effective enough. We’d gather requirements, build new features, test them, and release them. After a while, we got a little more sophisticated: We added a column on our board that let us track features that were released but still required further implementation steps before they could be considered complete. Too often, though, when we checked, we found that we’d delivered fea- tures that would never be used. Features that had been asked for! How does that happen? Our new policy was added to address what we assumed at the time to be bad customer behavior. Why ask for stuff you don’t need? How about letting us know when you change your mind? However, it soon became ap- parent that this new policy was changing behavior on both sides. Closing a feedback loop was the catalyst for a level of customer collaboration (a value straight out of the Agile Manifesto10) not previously seen. Knowing that the process was going to end in what could turn out to be a difficult conversation, developers and our internal customers alike made sure to nail those final implementation steps (clarifying timetables, keeping people suitably informed and trained, getting static data cleaned up, and so on). When necessary, these steps would be tested beforehand, often collaboratively. That, in turn, influenced the way development and specification were done. All the way back at the start of the process, it changed even the way work got prioritized, now that it was apparent that success depended on shared commitment. 10. See Chapter 13 for more on the Agile Manifesto. Kanban from the Inside — Mike Burrows