Make your organisation leaner and more competitive by increasing velocity
How long does it take an idea to make its way from a whiteboard into production? In some organisations, this can take months or even years. In other organisations it can be weeks, or even days. Where on this spectrum would you place your organisation? All other things being equal, an organisation that can put a new feature live in two weeks will be far more efficient and effective than one that takes six months to do the same thing.
But organisations that operate with velocity are more high-performance in a number of ways. This article will look at how velocity can help;
- make you more competitive
- greatly reduce risk
- reduce TCO of IT in general
- improve customer-centricity
Let’s start with defining what we mean
Velocity — an organisation’s ability to move safely at speed, being able to quickly turn ideas into reality, to react to changes in the market (or regulation) and to seize opportunities in a timely manner.
Velocity makes you more competitive
In any industry, there will be those who innovate, lead from the front and set the pace. There will be others who follow and spend most of their time keeping up. For these latter companies, whenever there’s a change in the market or in regulation, they have to weigh up whether to continue with what they’re working on, or whether to start something new. They’re often having to sacrifice what they want to do for what they have to do.
For the companies in the lead, they have the initiative. They’re on top of what they need to have done, and can now choose where to go next. Who sets the pace and direction in your industry?
In one company I helped with an Agile transformation, we knew we’d arrived when the product owner came in one morning with a feature drawn up on a table cloth. Since it was the day of the sprint planning, we were able to create a story and add it to the upcoming sprint. Two weeks later, that feature was a reality; being used in production by real customers and generating value. It took a while to get to this point, especially as the processes, tech and approaches used were very traditional. But after a year of cultural change, they were able to innovate based on what their customers wanted, rather than what their competitors were doing.
They had gotten inside their competitor’s OODA loop.
John Boyd is described by some as the greatest military strategist in history that no one knows. He began his military…www.artofmanliness.com
Velocity reduces risk
When you’re operating at pace, you release small change often. Both the frequency and the size of change are important, and they both have a positive impact on reducing risk.
- The more things you change at once, the greater the complexity, and the greater the risk that something unexpected will happen. Complex issues are harder to reason about, and therefore harder to fix quickly. Small change will generally be simpler, carry less inherent risk and will be easier to fix if something does go wrong.
- You get better at stuff you do more frequently. Release to production several times per sprint (or per week, or per day!), and you’ll quickly get great at it. It’ll be boring and uneventful.
- Short lead times mean you’re not risking much investment if a business idea doesn’t impact the market in the way we expect. Velocity reduces the impact of building the wrong thing.
- Practically-speaking, in order to release often, you have to have a lot of automation in place. This in turn does a huge amount to reduce the risk of human error. It also makes processes easily repeatable, and easy to undo!
What a huge advantage it is to be able to quickly roll-back a change at the push of a button.
Velocity makes you leaner
Once you’ve made the investment to ramp up to cruising speed, then cost of change is much lower. You’re able to spend less time waiting, and more time doing. For example, some organisations have processes that try to estimate the cost of a project on a macro level that spans one or more years. This is not only incredibly difficult to do to with any accuracy, it also supposes that you know everything there is to know about a problem space before you begin. These practices will commonly spend tens of thousands, or even hundreds of thousands of pounds before the project is even given the green light to begin. With a sleek end to end delivery pipeline, for a fraction of that cost, you can create a working version of a product or feature and get it in front of real, paying customers to see if it really does give benefit or not. This practice of hypothesis testing is a way more accurate way of estimating project cost and market fit than anything you could do on paper, and actually brings gives you a better understanding of your customer.
A high velocity culture can promote a closer relationship with your customers
A zany-sounding claim, I agree.
But being able to watch what our customers do, and on the basis of that nudge the tiller a smidge, and then watch the result is a powerful thing.
Netflix used this to great effect in 2012 when they decided to bet $100M on two whole seasons of House of Cards.
When content owners threatened to put prices up or boycott Netflix altogether, CEO Reed Hastings acted on lessons learned from customer viewing habits (everyone loves Spacey, Fincher and the original HoC) and stumped up the buns to start creating their own content.
And — my word — the result is one of the best things ever to take place in the presence of my slippers.
The book The Mom Test (or how to talk to your customers) shows how it’s so much more effective to watch what customers do rather than just listen to what they say. People can give you the wrong impression for all sorts of reasons; they don’t want to hurt your feelings (thanks Mum!), they’re not sure what you’re saying so they nod politely, they don’t trust you, they don’t understand their own needs fully…
But being able to measure how customers interact with your products and propositions gives instant feedback on whether they like changes. Whether they understand them. And a high-velocity culture allows you to take advantage of those insights in a way that just wouldn’t be possible if it took months to years to react.
So, we’ve looked at four ways in which velocity makes an organisation more performant; more competitive through greater agility, less risky through use of automation and reduction in size and impact of change, lower TCO and enhanced customer-centricity.
In future articles I’ll talk about how Lean Startup, Agile, DevOps and other practices can help your company greatly increase its velocity.
In the meantime, if you’d like to chat about how this could work at your company get in touch at firstname.lastname@example.org, or check out our site at bestboyelectric.io