Kanban - an alternative path to agility (Agile Adria)

dja@leankanban.com @lkuceo Copyright Lean Kanban Inc.
Presents
Presenter
David J. Anderson
Agile Adria
Croatia
April 2014
Release 1.0
Kanban
an alternative approach to agility

An Unconventional Approach
May Be Required

Bruce Lee rejected traditional teaching and styles
of Chinese martial arts
• There are some parallels in
the story of Bruce Lee and
the emergence of his
approach to Kung Fu
• Lee rejected the idea of
following a particular style
of Chinese Martial Arts

Snake
Monkey
Mantis
Tiger
Kung Fu Panda simplified the art to only four
styles

There are in fact very many styles…

“Dry land swimming” provides a false sense of
capability
• The only way to learn is to train with a live opponent
• Lee rejected the many styles of martial arts for various reasons,
mainly that they gave the practitioners a false sense of
capability, putting them at risk in real combat situations
• He was against Kata (learning patterns without an opponent)
and described them in derogatory terms such as "dry land
swimming.“

Jeet Kune Do
Using no
way as way
Having no
limitation as
limitation

Jeet Kune Do encourages development of a
uniquely personal style
• a framework from
which to pick &
develop a personal
style
• an evolutionary
approach where
adoption of
maneuvers is
learned &
reinforced by
training with an
opponent
• Nothing was sacred
"absorb that which is
useful“
discard the remainder

Training with an opponent provides the core
feedback loop to drive adaptation
Lee pursued ever
more elaborate
approaches to
protected real
combat training
to enable the
closed loop
learning that was
core to the
evolutionary
nature of JKD

Kata are not adaptive
In comparison with JKD, patterned styles of martial
arts taught with "kata" were open loop and not
adaptive. There is no learning from practicing kata

Lee’s genius was recognizing hand-to-hand
combat is an unordered problem
• Patterned styles are
perfectly good for
controlled circumstances
such as competition
• Sporting combat is an
ordered domain problem
• Street fighting is not orderly
and therefore emergent
practice is required
• Unordered problem
required a new philosophy

Motivation for the Kanban Method

Traditional Change is an A to B process
• A is where you are now. B is a destination.
• B is either defined (from a methodology definition)
• or designed (by tailoring a framework or using a model
based approach such as VSM* or TOC TP**)
• To get from A to B, a change agency*** will guide a
transition initiative to install B into the organization
***either an internal process group or external consultants
Current
Process
Future
Process
Defined
Designed
transition
* Value stream mapping, ** Theory of Constraints Thinking Processes

Daniel Kahneman has given us a simple model for
how we process information
Daniel Kahneman
System 1
Sensory Perception
Pattern Matching
System 2
Logical Inference
Engine
Learning by
Experience
Learning from
theory
FAST
But slow to learn
SLOW
But fast to learn

How we process change…
Daniel Kahneman
Silicon-based
life form
Carbon-based
life form
I logically evaluate
change using System 2
I adapt quickly
I feel change emotionally
using System 1
I adapt slowly

Adopting new processes challenges people
psychologically & sociologically
• New roles attack identity
• New responsibilities using new
techniques & practices threaten
self-esteem & social status
• Most people resist most change
because individually they have
more to lose than gain
• It is safer to be conservative and
stick to current practices and
avoid shaking up the current
social hierarchy
• Only the brave, the reckless
or the desperate will pursue
grand changes

The Kanban Method…
• Rejects the traditional
approach to change
• Believes, it is better to avoid
resistance than to push
harder against it
• Don’t install new processes
• Don’t reorganize
• Is designed for carbon-based
life forms
• Evolutionary change that is
humane

The Kanban Method…
• Catalyzes improvement
through use of kanban
systems and visual boards*
• Takes its name from the use
of kanban but it is just a name
• Anyone who thinks Kanban is
just about kanban (boards &
systems) is truly mistaken
*also known as "kanban" in Chinese and in Japanese when written with Chinese characters

Water flows around the rock
“be like water”
the rock represents resistance

Kanban should be like water*
In change
management,
resistance is from
the people involved
and it is always
emotional (system 1)
To flow around the
rock, we must learn
how to avoid
emotional resistance
* http://joecampbell.wordpress.com/2009/05/13/be-like-water/

The Kanban Method

Principles behind the Kanban Method
• Start with what you do now
• Agree to pursue evolutionary change
• Initially, respect roles, responsibilities and job
titles
• Encourage acts of leadership at all levels
The first 3 principles were specifically chosen to
address System 1 objections, to flow around the
rock of emotional resistance in humans

Learn to view what you do now as a set of services
(that can be improved):
• What to look for…
• Creative work is service-oriented
• Service delivery involves workflow
• Workflow involves a series of knowledge discovery
activities
• What to do…
• Map the knowledge discovery workflow
• Pay attention to how & why work arrives
• Track work flowing through the service
The Kanban Lens

STATIK
(systems thinking approach to introducing kanban)
1. Understand Sources of Dissatisfaction
 From viewpoint of internal & external
stakeholders
 Sources of variability that cause dissatisfaction
2. Demand and Capability Analysis
 (Ideally) By work item type & class of service
3. Model Workflow
 Understand the knowledge discovery process
by type
4. Discover classes of service
5. Design a Kanban System Visualization
6. Roll out Plan
This process tends to
be iterative
For each service…

Understanding
kanban systems

F
F
O
M
N
K
J
I
Kanban can be physical
Ideas
D
I
Dev
Ready
G
Development Testing
Test
Ready
F B
C
UAT
Release
Ready
In-progress
Legend
Done
Blocked - issue
Blocked - defect
Physical token such as a
magnet is a kanban
Colors are used to
denote state
Moving done items
down below a line is an
optional enhancement
seen in some
implementations
Override on kanban
limit introduces
additional “blocked –
issue” kanban
People working on
blocked item “A”
have been
redirected to
work on item “I”

F
F
FF
F
F J
I
Kanban are often virtual!
Ideas
D
I
Engin-
eering
Ready
G
5
Ongoing
Development Testing
Done
3 3
Test
Ready
5
F
B
CPull
Pull
These are the virtual kanban
*
These are the virtual kanbanThese are the virtual kanbanThese are the virtual kanban
The board is a visualization of the
service delivery workflow, work-in-
progress and the kanban system
UAT
Deploy-
ment
Ready
∞ ∞

F
F
O
M
N
K
J
I
Pull
Kanban systems are pull systems
Ideas
D
I
Dev
Ready
G
5
Ongoing
Development Testing
Done
3 3
Test
Ready
5
F
B
CPull
Pull
*
There is capacity here
UAT
Release
Ready
∞ ∞
Pulling work from
development will create
capacity here too –
the pull signals move
upstream!
Now we have capacity
to replenish our ready
buffer

Commitment is deferred
E
I
D
Commitment point
F
F
FF
F
F F
Pull
Wish to avoid aborting after commitment
Ideas
Dev
Ready
5
Ongoing
Development Testing
Done
3 3
Test
Ready
5
UAT
Release
Ready
∞ ∞
We are committing to getting
started. We are certain we want
to take delivery.
Ideas remain optional and
(ideally) unprioritized
G

Discard rates are often high
E
I
D
F
F
F F
G
I
Reject
Ideas
Dev
Ready
5
Ongoing
Development Testing
Done
3 3
Test
Ready
5
UAT
Release
Ready
∞ ∞
Discarded
The discard rate with Microsoft in
2004 was 48%. ~50% is
commonly observed
Options have value because the
future is uncertain
0% discard rate implies there is no
uncertainty about the future

Upstream Kanban Prepares Options
Ready
for
Engin-
eering
F
I
Comm-
itted
D
4 Ongoing
Development
Done
3
J
K
12
Testing
Verification
3
L
Commitment point
4 -
Requi-
rements
Analysis
2412 -
Biz
Case
Dev
4824 -
Pool
of
Ideas
∞
Min & Max limits
insure sufficient
options are always
available
Committed WorkOptions
Discarded
O
Reject
P Q
$$$ cost of acquiring options

Test
Ready
F
F
FF
F
F F
Commitment Frequency
E
I
G
D
Replenishment
Discarded
I
Pull
Ideas
Dev
Ready
5
Ongoing
Development Testing
Done
3 35
UAT
Release
Ready
∞ ∞
The frequency of system
replenishment should reflect
arrival rate of new information
and the transaction &
coordination costs of holding a
meeting
Frequent commitment is
more agile.
On-demand commitment is
most agile!

Test
Ready
F
F
FF
F
F F
Defining Kanban System Lead Time
E
I
G
D
Pull
System Lead Time
Discarded
I
Ideas
Dev
Ready
5
Ongoing
Development Testing
Done
3 35
UAT
Release
Ready
∞ ∞
The clock starts ticking when we
accept the customers order, not
when it is placed!
Until then customer orders are
merely available options
Kanban
system lead
time ends
when the
item reaches
the first ∞
queue

Test
Ready
F
F
FF
F
F F
Delivery Frequency
E
I
G
D
Delivery
Discarded
I
Pull
The frequency of delivery should
reflect the transaction &
coordination costs of
deployment plus costs &
tolerance of customer to take
delivery
Ideas
Dev
Ready
5
Ongoing
Development Testing
Done
3 35
UAT
Release
Ready
∞ ∞
UAT and Release buffer sizes can
reduce as frequency of delivery
increases
Frequent deployment is more
agile.
On-demand deployment is
most agile!

Service Delivery Agility
Service Agility
Commitment
frequency
Lead Time
Delivery
Frequency
LeadTime
Short
Long
Delivery
Service Agility
Commitment
Frequent
Seldom
Frequent
Seldom
More
Agile
Less
Agile
Kanban system dynamics

Understanding
the Kanban Method

Treat each service separately
Demand
Observed
Capability
Demand
Demand
Observed
Capability
Observed
Capability

Feedback Loops
Operations
Review
Service
Delivery
Review
Standup
Meeting
The Kanban Kata
daily
weekly
monthly

Standup Meeting
Daily Meeting
Disciplined conduct (kata)
& acts of leadership
identify problems
Improvement discussions
& process evolution
happen at after meetings

Service Delivery Review
Weekly Meeting
Usually (but not always) between a superior and a sub-ordinate
A focused discussion about demand, observed system capability, and
fitness for purpose
Comparison of capability against fitness criteria metrics and target
conditions, such as lead time SLA with 60 day, 85% on-time target
Discussion & agreement on actions to be taken to improve capability

Operations Review
Monthly meeting
Disciplined review of
demand and capability for
each kanban system
Provides system of
systems view and
understanding
Kanban system design
changes & process
evolution suggested by
attendees

Organizational Improvements Emerge

Visualize work, workflow & business risks
using large physical or electronic boards in communal spaces
Implement Virtual Kanban Systems
Manage Flow
Make Policies Explicit
Implement the Kanban Kata
Educate your workforce to enable collaborative evolution of
policies & ways of working
based on models of workflow from bodies of knowledge such as Theory of
Constraints, Deming’s Profound Knowledge, Lean, Risk Management ideas
such as Real Option Theory & Liquidity
Kanban’s 6 Specific Practices

Fitness Criteria

Start with what you do now
• The Kanban Method evolved with the principle
that it “should be like water” - enable change
while avoiding sources of resistance
• With Kanban you start with what you do now,
and "kanbanize" it, catalyzing the evolutionary
process into action. Changes to processes in
use will occur
• Evaluating whether a change is truly an
improvement is done using fitness criteria
that evaluate an external outcome

Fitness criteria are metrics that measure
observable external outcomes
• Fitness criteria are metrics
that measure things
customers or other external
stakeholders value
• Delivery time
• Quality
• Predictability
• Safety (conformance to
regulatory requirements)
• or metrics that value actual
outcomes such as
• customer satisfaction
• employee satisfaction

Which system is fitter?
We don’t know!
System B is faster but without understanding
customer expectations, both may be fit enough
0
2
4
6
8
10
12
14
Lead Time (Days)
System A
Frequency
0
5
10
15
20
25
30
5 10 15 20 25 30 More
Lead Time in Days
System B
Frequency
Mean 17 days Mean 12 days

Measuring delivery against expectation
0
2
4
6
8
10
12
14
Lead Time (Days)
System A
Frequency
0
2
4
6
8
10
12
Lead Time Expectation Spread (Days)
System A
Frequency
0
5
10
15
20
25
30
5 10 15 20 25 30 More
Lead Time in Days
System B
Frequency
0
5
10
15
20
25
30
35
40
45
-15 -10 -5 0 5 10 15 20 More
Lead Time Expectation Spread (Days)
System B
Frequency
Mean 17 days Mean 12 days
System B is clearly fitter!
System B delivers 5/7 within expectations
System A only delivers 3/7 within expectations

Evolutionary change has no defined end point
Evolving
Process
Roll
forward
Roll
back
Initial
Process
Future process is
emergent
Evaluate
Fitness
Evaluate
Fitness
Evaluate
Fitness
Evaluate
Fitness
Evalua
Fitnes
We don’t know the
end-point but we do
know our emergent
process is fitter!

Business Agility
ServiceDeliveryTime
Short
Long
Evolutionarychanges
Respond
Frequent
Seldom
More
Agile
Less
Agile
DefineFitnessCriteria
Often
Seldom
KanbanKata
Sense
Strong
Weak
Business Agility
Sense
Fitness criteria by
market segment
Capability against
demand
Repond
Service Delivery Time
Evolutionary Changes

Kanban Coming to Southern Europe…
Bologna May 30
Venue to be announced. Watch…
http://lkse.leankanban.com

Upcoming Training in Europe
Leading Change & Managing Risk Masterclasses
Berlin May 24-28
http://www.djaa.com/kcpm-05201401
London June 31 – April 4
http://djaa.com/kcpm-june2014

Learn More
http://www.limitedwipsociety.org
http://edu.leankanban.com
@leankanbanu

Thank you!

About
David Anderson is a thought
leader in managing effective
software teams. He leads a
training, consulting, publishing
and event planning business
dedicated to developing,
promoting and implementing
sustainable evolutionary…
He has 30 years experience in the high technology industry
starting with computer games in the early 1980’s. He has
led software teams delivering superior productivity and
quality using innovative agile methods at large companies
such as Sprint and Motorola.
David is the pioneer of the Kanban Method an agile and
evolutionary approach to change. His latest book, published in
June 2012, is, Lessons in Agile Management – On the Road
to Kanban.
David is a founder of the Lean Kanban Inc., a business
dedicated to assuring quality of training in Lean and Kanban
for knowledge workers throughout the world.

Joe Campbell first blogged about the similarity in philosophy between the
Kanban Method and the teachings of Bruce Lee. He coined the phrase “Kanban
should be like water”.
The data on slides 47 & 48 was provided by Raymond Keating of CME Group.
Hakan Forss of Avega Group in Stockholm has been instrumental in defining the
Kanban Kata and evangelizing its importance as part of a Kaizen culture.
Real options thinking inspired by the work of Chris Matts, Olav Maassen &
Upstream Kanban pioneered by Patrick Steyaert.
References to Sense & Respond are inspired by the work of Stephen Parry.
Don Reinertsen first suggested using virtual kanban systems for service delivery.
Acknowledgements

Kanban - an alternative path to agility (Agile Adria)

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