How a LEAN approach can help deliver IT that matters to business

Let me insist. We all knew this day was coming.  A day when nearly every company is a software-controlled business where Apps underpin its business processes: check a bank account; book a flight; stream a movie; manage a supply chain or communicate with business partners. A day when the success and performance of a modern business is built upon Apps.

If we take this vision one level up, we realize that actually the key to having a successful Apps portfolio depends on a company being able to transform its custom business requirements into working software features or, in other words, building custom Apps. And remember: the ultimate objective of a company is to make money, and the role played by Software is growing increasingly to this extent, either directly (by means of licensing or SaaS models), or indirectly (by enabling a business process that is aimed at making money). That is the reason why any company from any sector is facing the challenge of becoming a world-class software development firm.

So if they are so important, what is the most effective way to let business capitalize on Apps? In other words, how custom Apps can help business achieve the goal of making money? Let’s go step by step.

The Goal

  • On the business side, there are different routes that lead companies to make money: A better understanding of customer needs, improving product or service portfolio, boosting time to market, increasing sales pipeline or working towards customer retention. There might be others depending on the industry, but generally speaking, these represent the vast majority.
  • On the IT side, there are a few key drivers that will help companies achieve these goals. Concretely speaking, Gartner has identified 4 main objectives for CIOs that are aligned towards realizing them: improving delivery quality, expanding agility and innovation, reducing costs and increasing speed of delivery.

The Actions

So at this point it should be easy to get where I am going. Now we know the business goals and the IT drivers that will help achieving them, we need to shape concrete IT actions mapped to these drivers. And here is where the LEAN approach comes into scene (nothing different from the Agile principles all of us are used to, and nothing far from common sense). In one of my previous posts I talk about how automation, cloud and team collaboration are introducing the key techniques and technologies that IT is looking for to produce the relevant output that ultimately will help businesses achieve their goals.

The Measurements

One of the things that we have learned reading The Goal (E.M. Goldratt, 1984), is not only the importance of what to change and how to change it, but also how to put in place the right measurements so the changes are relevant in a process of continuous improvement. And let’s be clear about this: we should use metrics that focus on the final output coming from IT, metrics that highlight the entire end-to-end system and not the local work-centers (teams or steps in the SDLC). Only when we start setting up output-based measurements such as lead time for changes, release frequency, defect rate and on-time delivery we will be able to figure out whether IT is working towards achieving business goals or not

Additionally, we need to complete the picture with operational measurements that help us understand whether our work-centers and teams and working towards producing the expected IT output. But don’t be confused, we didn’t say they were not valid. The point is that these are not the key measurements that will tell us if we are working towards achieving business goals, because they are too local. Things like test coverage, team velocity, mean time to recover from an outage or environment provision time are operational indicators that we need to have under control, which combined to the output-based measurements will tell us how IT is helping the business to make money.

To finalize, for the sake of understanding, I have tried to represent this visually in the next table, where I have tracked down a sample business goal to the associated IT actions, including drivers and measurements.

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