Navigating Towards True Value
Traditionally, Agile organizations struggle with value. The right ingredients exist but we never seem to bake a very good cake. PI Objectives are ignored. Sprint objectives are rarely established or adhered to. We use a user story template that guides us towards addressing the who, the what and why but it is rare to see a story that articulates more than the what.
Defining value is subjective and requires guessing about the future. Nobody has a crystal ball, right?
Paradoxically there is an insatiable appetite for forecasting effort and tracking the rate of effort spent. Why can't we apply that mindset to value? When did you ever see a value velocity? Why is it we struggle so much with defining and tracking value? Not everybody does.
When I joined Rally in 2008 I experienced agility woven into the very fabric of a company. Rally appreciated the value of a shared understanding of value. Influenced by the work of Pascal Dennis, Rally would formulate a True North statement every year to guide all in the organization. Their True North comprised both a broad-brush goal and hard measures. The broad-brush goal or hoshin as Toyota calls it, speaks to the heart, the hard measures speak to the head. The True North was decomposed into mother strategies and later baby strategies as strategic planning descended down through the organization. Like its namesake, the True North was ever present throughout and constantly used to help make decisions. The name I associate with this approach is Hoshin Kanri which loosely translates to Strategy Deployment.
Those practicing Hoshin Kanri reflect their strategic decisions on an A3 Strategy or X-Matrix. Strategy is about story-telling so using a single piece of paper is a useful forcing to ensure brevity of communication.
OKR stands for objectives and key results. Nothing that mystical once you understand the acronym. John Doerr introduced Google to OKRs in 1999 after two decades of living and breathing OKRs at Intel. OKRs have become very popular in recent years. Due in part to the success of Doerr’s book Measure What Matters.
An objective is simply what is achieved, no more and no less. Objectives are significant,
concrete, action oriented, and (ideally) inspirational. When properly designed and deployed, they’re a vaccine against fuzzy thinking – and fuzzy execution.
Key Results benchmark and monitor how we get to the objective.
Effective KRs are specific and time-bound, aggressive yet realistic. Most of all they are measurable and verifiable.
As True North is decomposed, so too are OKRs. Key Results becoming objectives at a lower level although Doerr is quick to point out the dangers of doing this too rigidly and cautions against strict cascading.
The best approach for you is really the one that sticks and OKRs really seem to have built a lot of momentum.
Regardless of your chosen approach, at some stage you need to map objectives to backlog items. You might already appreciate that objectives and backlog items are not quite the same. An objective is a destination, a backlog item is an activity you complete to get there.
Agile tools do not map perfectly and we’re seeing a lot of OKR products flood the market. However, I can’t envisage any organization being successful managing both an objective hierarchy and a backlog hierarchy.
I think you need to choose one hierarchy and compromise. For me, that compromise is mapping your lowest level yearly objectives to epics in your backlog hierarchy. The key results for those epics may or may not map to features.
Lastly my favorite story about tracking value delivery. In 2010 I went to visit Menlo Innovations. CEO Rich Sheridan tells their story in Joy, Inc: How We Built a Workplace People Love. I asked Rich how Menlo defines and tracks value. “That’s easy Ken. We
have a demo every Wednesday. If the customer doesn’t show up, work stops. The customer has never failed to show up”.