Anderson Kanbanbrieflyexplained

Kanban Briefly Explained
Options, Commitment, Probabilistic Forecasting, Adaptation, Scaling
dja@djaa.com, @djaa_dja
What is a kanban system?
A Kanban Systems consists of kanban signal cards in circulation
Kanban are (typically) virtual!

Backlog Engineering Ready Development
Ongoing
5
Pull
Change Requests
Test Ready
Done
Testing
UAT
Deployment Ready
B Pull E virtual kanban These are the F J G C F Pull F F Boards are not required to do Kanban! F I F A The boardD is a visualization of the F * The first system used database triggers workflow process, the work-in-progress to signal pull. There was no board! and the kanban PTCs I
Commitment is deferred
Backlog Pool of Ideas
Change Requests
Engineering Ready
Development
Ongoing
5
H
Test Ready
Done
Testing
UAT
Deployment Ready
Pull
Items in the backlog remain optional and unprioritized
FF F F F F F
D G
E
Wish to avoid discard after commitment We are committing to getting started. We are certain we want to take delivery.
PTCs
Commitment point
Discard rates are often high

Pool of Ideas
Change Requests
Engineering Ready
Development
Ongoing
5
H
Test Ready
Done
Testing
UAT
Deployment Ready
The discard rate with XIT was 48%. ~50% is commonly observed.
FF F F H
Reject
PTCs
Deferring commitment Options have the and avoiding interrupting C value because future is uncertain Dworkers for estimates E there makes sense when 0% discard rate implies is no uncertainty the future discard about rates are high!
Discarded
I I
Upstream Kanban Prepares Options

Pool of Ideas Biz Case Dev
24 -48 12 -24 4 -12

K L
Ready Requifor rements EnginAnalysis eering
Committed
Development
4
J I F
Testing
Ongoing
Done
Verification
Min & Max limits insure sufficient options are always available
Options $$$ cost of acquiring options Reject Discarded
Committed Work $$$ cost of converting options
Q
Commitment point
Replenishment Frequency
Pool of Ideas Engineering Ready
Replenishment Pull
Change Requests
3 5 3 Done replenishment Ongoing Frequent is more agile. On-demand C replenishment is most D agile!
E
The frequency of system replenishment should reflect arrival rate of new information and the transaction & coordination costs of holding a I meeting
Development
Test Ready
Testing
UAT
Deployment Ready
FF F F F F F
PTCs
Discarded
Delivery Frequency
Pool of Ideas
Change Requests
Engineering Ready
3 5 3 Done 5Frequent deployment is more agile.

Ongoing
Development
Test Ready
Testing
UAT
Deployment Ready
Delivery
Pull
FF F F F F F
Deployment buffer size can On-demand deployment reduce as frequency of delivery C D most increases agile!
is
E
The frequency of delivery should reflect the transaction & coordination costs of deployment plus costs & I of customer to take tolerance delivery
PTCs
Discarded
Specific delivery commitment may be deferred even later

Pool of Ideas
Change Requests
Engineering Ready
Development
Ongoing
5
H
Test Ready
Done
Testing
UAT
Deployment Ready
Pull
FF F F F F F
D G
ses it u an omm b n Ka se C ha P 2
E
We are now committing to a specific deployment and delivery date *This may happen earlier if I circumstances demand it 2nd
Commitment point*
PTCs
Discarded
Defining Kanban System Lead Time

Pool of Ideas
Change Requests
Engineering Ready
5
H
The clock starts Test ticking when we Testing accept the customers order,UAT not Ready Development 3 5 it is placed! 3 Done when Ongoing Until then customer orders are merely available options
Deployment Ready
Pull
FF F F F F F
D G
System Lead Time
Lead time ends when the item reaches the first queue.
PTCs
Discarded
I I
Littles Law & Cumulative Flow

Delivery Rate
WIP
Lead Time
Pool of Ideas
Avg. Lead Time WIP
Ready To Deploy
Avg. Delivery Rate
Infinite Queues Decouple Systems

Pool Enginof infinite eering The queueDevelopment decouples Ideas Ready
the systems. The deployment 3 Done Ongoing system uses 2 batches and is separate from the kanban system
Testing
VerificationAcceptance
Deployment Ready
Done
F The 2nd commitment is actually a commitment for the PB downstream deployment system
H
The Kanban System gives us confidence to make that I downstream commitment
GY DE
D G
M N
C
P1
E
AB
nt e itm ent m om loym C p d 2n r de o is f
A
2nd Commitment point
Identifying Buffers
Pool of Ideas Engineering Ready Development
Ongoing
Testing
verificationAcceptance
Done
Deployment Ready
Done
F
H
G
GY
D
PB DE
C I am a buffer!
P1
The clue is is in in my name The clue my name E Ready M Ready

N
AB I am buffering non-instant availability or activity with aa availability or an activity with cyclical cadence
Defining Customer Lead Time

Pool of Ideas
Change Requests
Engineering Ready
Development
Ongoing
5
H
Test Ready
Done
The clock still starts ticking when we accept the customers order, not when it is placed!
Testing
UAT
Deployment Done Ready
Pull
FF F F F F F
PTCs
D G
Customer Lead Time

The frequency of delivery cadence will affect customer lead I in addition to system time capability
Discarded
Flow efficiency measures the Pool Enginpercentage of total lead time is of eering spent actually adding value (or Development Ideas Ready knowledge) versus waiting 3
Flow Efficiency
Testing
VerificationAcceptance Done
Until then customer orders are merely available options Flow efficiency = Work Time Flow efficiencies of 2% have C Fbeen reported*. 5% -> 15% isP1 D normal, > 40% is good! G Lead Time
Ongoing
Deployment Ready
Done
x 100%
GY
PB DE
Multitasking means time spent in Eworking columns is often waiting M time

N AB
Waiting
Working
Waiting
Working
Waiting
Lead Time
* Zsolt Fabok, Lean Agile Scotland, Sep 2012, Lean Kanban France, Oct 2012
Observe Lead Time Distribution as an enabler of a Probabilistic Approach to Management

Lead Time Distribution
3.5 3 CRs & Bugs 2.5 2 1.5 1 0.5 0
6 3 0 4 7 1 1 4 1 5 2 2 2 9 3 6 4 3 5 0 5 7 6 4 7 1 7 8 8 5 9 2 9 9 1 8 1 0 1 1 1 2 1 2 1 3 1 4 8
Days
Thisis ismulti-modal multi-modal data! This data!
Mean of 31 days
TheSLA work is of two types: expectation of Change Requests (new 105 and days with 98 % features); Production Defects
on-ti
SLA expectation of 44 days with 85% on-time
Filter Lead Time data by Type of Work (and Class of Service) to get Single Mode Distributions
Production Defects
Change Requests
Mean 5 days
85% at 10 days
98% at 25 days
Mean 50 days
85% at 60 days
98% at 150 days
Allocate Capacity to Types of Work

Pool of Ideas Engineering Ready Development
Ongoing
2
Change Request s
Done
3 VerificationAcceptance
Testing
Deployment Ready
Done
F
H
Productio n Defects
E allocation Consistent capacity M should should bring bring some more consistency to N D AB of each type delivery rate of work
PB DE
Lead Time
C
P1
3
G
GY
Separate understanding of Separate understanding of Lead Lead Time each type of work Time forfor each type of work
Lead Time
The Optimal Time to Start

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 Ideal Start
Here
impact
When we need it
With a 6 in 7 chance of on-time delivery, we can always expedite to insure on-time delivery
85th percentile Commitment point
Metrics for Kanban Systems

Cumulative flow integrates demand, WIP, approx. avg. lead time and delivery rate capabilities Lead time histograms show us actual lead time capability Flow efficiency, value versus failure demand (rework), initial quality, and impact of blocking issues are also useful
Psychology of Probabilistic versus Deterministic Approaches
The psychology of a probabilistic approach can be challenging

Change Requests
I dont want to take the risk of being longer than 60 days. Mean I need 50 a precise estimate of when it will days be delivered!
85% at 60 days
98% at 150 days
Classes of Service Help Improve Trust

Engineering Ready Development
Ongoing
2
Expedit e classes
Done
3 VerificationAcceptance
Testing
Deployment Ready
Done
Different distributions for different 1 of service increases the level of trust that an item will be C delivered in a timely manner AB P1
Fixed Date
2 3 1
D
PB
M N
Standard
H G
DE
F
GY
Intangibl e
A lack of organizational social capital
A lack of organizational social capital may prevent trust in the kanban system from emerging. The There is a trust in individual people rather than the result is a degeneration to a deterministic system. system. Individuals are held accountable via their commitments. Everything must have an estimate. Plans are drawn deterministically. Overhead and rework Deterministic planning means a high likelihood of (of plans) is incurred as things change. Early and broken promises. specific commitments are requested People take the blame!
replace trust with comfort & reassurance
Deterministic planning provides a level of comfort. When people take the blame, replacing the people Deterministic seem accurate and plausible. provides a level ofplans comfort that remedial action has been taken. When promises are broken it further undermines the social capital in in a the organization. The organization is caught vicious cycle of distrust, individual commitment, disappointment, blame and repercussions!
What is the Kanban Method?
Kanban Method
A management & cultural approach to improvement View creative knowledge work as a set of services Encourages a management focus on demand, business risks and capability of each service to supply against that demand
Kanban Method
Uses visualization of invisible work and virtual kanban systems Installs evolutionary DNA in your organization Enables organizational adaptability to respond successfully to changes in your business environment
6 Practices for Evolutionary DNA

The Generalized Version Visualize Limit Work-in-progress Manage Flow Make Policies Explicit Implement Feedback Loops
Improve Collaboratively, Evolve Experimentally
(using models & the scientific method)
Kanban Kata
Feedback Loops
The Kanban Kata
Operations Review
Improvement Kata
Standup Meeting
Standup Meeting
Disciplined conduct and acts of leadership lead to improvement opportunities Kaizen events happen at after meetings
Improvement Kata
A mentor-mentee relationship Usually (but not always) between a superior and a sub-ordinate A focused discussion about system capability Definition of target conditions Discussion of counter-measures actions taken to improve capability
Operations Review
Meet monthly Disciplined review of demand and capability for each kanban system Provides system of systems view and understanding Kaizen events suggested by attendees
Scaling out across an organization
Treat each service separately

Demand
Observed Capability
Observed Capability
Demand
Observed Capability
Demand
Some systems have dependencies on others

Demand
Observed Capability
Observed Capability
Demand
Observed Capability
Demand
Organizational Improvements Emerge
Scaling Kanban
Each Kanban System is designed from first principles around a service provided Scale out in a service-oriented fashion Do not attempt to design a grand solution at enterprise scale The Kanban Kata are essential! Allow a better system of systems to emerge over time
Summary of Benefits
Collaboration Benefits
Shared language for improved collaboration Shared understanding of dynamics of flow Emotional engagement through visualization and tactile nature of boards Greater empowerment (without loss of control)
Tangible Business Benefits

Improved predictability of lead time and delivery rate Reduced rework Improved risk management Improved agility Improved governance
Organizational Benefits
Improved trust and organizational social capital Improved organizational maturity Emergence of systems thinking Management focused on system capability through policy definition Adaptability
(to shifts in demand and risks under management)
Trustworthy Kanban Training

Global standards & trade association Certificate issuing body Standardized curriculum High Quality accredited trainers Train-the-trainer program
Thank you!
About
David Anderson is a thought leader in managing effective software teams. He leads a consulting, training and publishing and event planning business dedicated to developing, promoting and implementing sustainable evolutionary approaches for management of knowledge workers. He has 30 years experience in the high technology industry starting with computer games in the early 1980s. 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 University Inc., a business dedicated to assuring quality of training in Lean and Kanban for knowledge workers throughout the world.
Acknowledgements
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 & the optimal exercise point as an improvement over last responsible moment emerged from discussions with Chris Matts, Olav Maassen and Julian Everett around 2009. The inherent need for evolutionary capability that enables organizational adaptation was inspired by the work of Dave Snowden.
David J Anderson & Associates, Inc.
Appendix
Example Distributions
Expedite
Intangible
Fixed Date
Standard

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Kanban Briefly Explained

Options, Commitment, Probabilistic Forecasting, Adaptation, Scaling

What is a kanban system?

A Kanban Systems consists of kanban signal cards in circulation

Kanban are (typically) virtual!

Items in the backlog remain optional and unprioritized

Discard rates are often high

Upstream Kanban Prepares Options

24 -48 12 -24 4 -12

Ready Requifor rements EnginAnalysis eering

Options $$$ cost of acquiring options Reject Discarded

Committed Work $$$ cost of converting options

3 5 3 Done 5Frequent deployment is more agile.

Specific delivery commitment may be deferred even later

Defining Kanban System Lead Time

System Lead Time

Littles Law & Cumulative Flow

Avg. Lead Time WIP

Avg. Delivery Rate

Infinite Queues Decouple Systems

nt e itm ent m om loym C p d 2n r de o is f

The clue is is in in my name The clue my name E Ready M Ready

Defining Customer Lead Time

Deployment Done Ready

Customer Lead Time

Multitasking means time spent in Eworking columns is often waiting M time

Observe Lead Time Distribution as an enabler of a Probabilistic Approach to Management

Thisis ismulti-modal multi-modal data! This data!

SLA expectation of 44 days with 85% on-time

98% at 150 days

Allocate Capacity to Types of Work

The Optimal Time to Start

Metrics for Kanban Systems

Psychology of Probabilistic versus Deterministic Approaches

The psychology of a probabilistic approach can be challenging

98% at 150 days

Classes of Service Help Improve Trust

A lack of organizational social capital

replace trust with comfort & reassurance

What is the Kanban Method?

6 Practices for Evolutionary DNA

Scaling out across an organization

Treat each service separately

Some systems have dependencies on others

Organizational Improvements Emerge

Tangible Business Benefits

Trustworthy Kanban Training

David J Anderson & Associates, Inc.

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