Framework, Options and Process

The framework specifies the limits and constraints that a delivery organisation must operate within. If we consider one such section of the framework… Deliver Value within the Portfolio, the obvious constraint is that the Portfolio has a strictly ordered backlog. Note that the framework does not state how the backlog should be ordered.

The decision on how to order the backlog is the responsibility of the portfolio owners. However, given that the portfolio owners may not be experts in Agile Techniques, it is useful to present them with a set of options. giving the pros and cons of each option.

Options for strictly ordering the portfolio in order of preference:

  1. The backlog is ordered with a process that takes account of complexity, informed by a quantitative version of Cost of Delay.
  2. A quantitative version of Cost of Delay / Joshua Arnold’s CD3.
  3. Don Reinertsen’s Wisdom of Crowds version of Cost of Delay.
  4. Safe’s Fibonnacci based version of WSJF.
  5. A value based approach to prioritisation.
  6. HIPPO based prioritisation.

Option 1: Complexity Based Solution, informed by a quantitative version of Cost of Delay

Description: Calculate the cost of each backlog item of interest. Convert the cost to the value that should be delivered expressed in business value metrics. Wisdom of Crowds the idea to work out which is the best for items in the Complex and Chaos domain. Use a quantitative version of Cost of Delay for items in the Obvious and Complicated Domain. Common sense prevails hopefully to order the backlog properly. This is a social structure informed data rather than following a rigorous “equation”.

Strengths: This approach combines the power of Dave Snowden’s Wisdom of Crowds with Don Reinertsen’s Cost of Delay.

Weaknesses: Even Chris Matts cannot find the write up of his piece. Possibly because he forgot to post it. This is an hypothetical ideal solution that has not been tested for a real portfolio.

Further Reading: Links to Dave Snowden videos, and Don Reinertsen books and videos.

Option 2 – A quantitative version of Cost of Delay / Joshua Arnold’s CD3.

Description: A quantitative version of Cost of Delay / Joshua Arnold’s CD3.

Strengths: The approach creates a clear unambiguous ordering of the backlog. Ideal for portfolios in the “Obvious” and “Complicated” domain, such as efficiency innovation.

Weakness: Care must be taken for portfolios containing investments in the “Complex” and “Chaos” domain, such as sustaining and disruptive innovation. May lead to a bias toward efficiency innovation.

Further Reading: Links to Black Swan Farming and Don Reinertsen.

Blah…. Blah…

Option 6: HIPPO based prioritisation

Description: The most senior person in the room dictates the order of the backlog.

Strengths: The most senior person gets to grab all the constrained resources to make themselves successful, but once they do this, they have no excuse if they fail to deliver the value that they promised. This approach is simple to implement, especially in traditional cultures with a high power distance index. The strict order of the backlog makes success or failure transparent and so HIPPOs are likely to support successful ideas after an initial attempt to simple support their own.

Weaknesses: It fails to harness the wisdom of the crowd and limits the IQ and knowledge of the Portfolio decision process to the experience, education and intelligence of the highest paid person in the room. This approach limits the organisation’s ability to grow its a more agile and self organising culture that uses distributed cognition instead of command and control.

Further Reading: Snakes in Suits by Paul Bablak

Organisation can help those pulling together a method by explaining the context in which an option works, and contexts where care must be taken.

Some organisations might prepare “Strip Maps” to illustrate the process that act as the “Easiest to implement” set of methods and tools to satisfy the framework in an organisation. For example

Example Strip Map (Partial)

Executives ensure a balanced portfolio of investments: Cynefin



Portfolio Owners strictly order Portfolio backlog: Hippo


Teams lead time is less than a month: Lean Value Stream Mapping and Kanban



Team demonstrate reduction of technical debt: Extreme Programming


Process and Framework

What is the difference between a process and a framework?

Currently we are bombarded with stories about how an organisation has adopted Scrum or Kanban or Safe or DAD or something LESS. The main narrative about scaling agile is about implementing a process or method. Instead I will argue that organisations need a framework instead.

Lets use Feature Injection (Value Mapping) to explore this idea.

We start with a tea bag. Some clueless consultant (i.e. Not you Martin) sells their client on the idea of Safe or Less. Safe and Less are the tea bag. They are part of a method or process that cover the program and team part of the organisation.

The client really needs a cup of tea which means they also need something to cover the portfolio, governance, executive and enabling functions (We decided enabling functions was a much more respectful name for Finance and HR than Supporting Functions).

Given the cup of tea, we can explore the needs of the different segments. The “Control” organisation consisting of leadership, management, executive, governance and risk functions have a need to demonstrate control to those they are accountable to (internal and external/market stakeholders). In a small organisation this is easy peasy. In large complicated and complex organisations, some structure is needed to make sure risks are properly managed.

The “delivery” organisation needs the freedom to choose whichever method or tool that suits their context. They need to be freed from the burden of oppressive SDLC deliverables.

The value for the organisation or business value is much faster and more effective innovation… Disruptive innovation, Sustaining Innovation and Efficiency Innovation. And that innovation should be demonstrated to hit the bottom line (as the organisation defines it).

When we look at the scaling methods, we find that they do not meet these needs. They do not provide effective control for the “controller” and they do not provide freedom for the “builders”

Now we understand the needs and the value to be delivered, we can see that a framework meets those needs. Rather than specify the process that the organisation needs to follow, the framework specifies the risks it needs to manage, and the limits for those risks that a delivery organisation can take on. e.g. We know that the longer the investment, the riskier it gets, so we limit the lead time to XX months. Truly Agile teams do not even perceive these limits. If you have a lead time of two weeks and your reporting infrastructure can demonstrate this to the “control” functions, then you are never going to be a worry to them. You get freedom to deliver as you choose.

So does that mean we do not need Safe and DAD and LESS? Quite the opposite. The framework provides the means for an organisation to implement these methods, processes and tools. It helps the organisation clearly identify those gaps in the process that need to be addressed. For example, Lets use Safe for Team and Program. The framework helps us see the gaps, so we add on Delivery Mapping for Portfolio, Real Options for Governance, Beyond Budgeting for Finance, Cynefin for HR, and Lean, TOC and Cynefin for Executives, with transparency provided by Jira/VersionOne/NameYourPoison. All the teams need to do is demonstrate they have the recipe for a cup of tea, and then just get on with it. The operations department of an organisation might adopted Safe as it fits better with its culture. A front office or customer facing organisation in the same organisation might choose LESS as it suits their culture. A small innovative lab might choose to have no process as long as it operates within the framework. The framework gives different departments in the same organisation the freedom to adopt a process and method that’s appropriate for its context, provided it stays within the limits of the framework.

By all means buy a tea bag, but make sure you buy the milk (or lemon), sugar, cup and hot water as well. The framework is your shopping list, to ensure you make a damn fine cup of tea. “Would someone please pass the honey?”

Next up, I will share how an organisation can implement a framework to free its departments in a controlled way.

Real Real Options – A European Passport

Brexit has shown up some fascinating behaviour. Like him or loath him, you have to admire David Cameron’s use of Real Options and the Strategy of Conflict (Game Theory) on Friday Morning. Real Options in the sense that he deferred the commitment to leave the EU until September. That gives the British People three months to scrabble around and find an alternate course of action. “Strategy of Conflict” states that you should never allow the opposition negotiator to speak to the decision maker. Cameron has removed the decision maker from the field. He declared himself a lame duck and that he wont be replaced until September. No one in Britain can negotiate with the EU because we effectively do not have a government.

The EU obviously want the commitment so that they can reduce uncertainty.

We are faced with a situation where we appear to have no options. However, we do. There is no legal commitment on the British Government to leave the EU. The British people have advised them that they would like to be out. At time of writing 2.8 million people have signed a petition asking for another referendum. The Leave campaign cannot oppose this as their defacto leader (Farage) said he would demand another referendum if the vote were as close as it is. By now the lies about the £350 million going to the NHS have been revealed.

What we need now is a proper realisation of where we are. Some of the British people might think they want to leave, but really they do not. Brexit was a protest vote and the message has been received loud and clear. We need to sort out our broken society and get proper jobs into those parts of the country impacted by global changes in the economy.

One of the problems with Leave is that there was never a real discussion about what Leave actually meant. What aspects of the EU were people voting to reject? It would seem that the Leave campaign voters were primarily concerned about immigration and the effects it has on them personally. So negotiation point point one should be that Britain gets a points based immigration system. Now they question should be… how much is that going to cost us. How about Britain funds two hundred thousand refugees (A couple of billion Euros a year) in one the European Countries seeking to increase its economy. In other words, Britain pay to have the points system. That would be a hell of a lot cheaper than the mess we have now. It would also show respect both to the Leave voters of Britain and the EU.

In times of uncertainty, options increase with value. Many people in Britain feel very uncertain. I have a European passport which means I consider myself a European first and British Second. Brexit will possibly result in my being forced to have a British Passport instead. The British Government and the EU are violating my human rights by taking away something from me without my say. In addition, myself and my family lose our human rights as Britain has no such human rights. We need options and I suggest we create the following option though crowd funding.

We need to take a case to the European Court of Human Rights to insist that every European Citizen in Britain is given the option of:

  1. Dual European / British Nationality, or
  2. European Nationality, or
  3. British Nationality.

This is not about the British Government, it is about the European Citizens in Britain. Obviously the Brexit supporters will choose the British Option. My children were born European. I was born British and became European. Should governments have the right to force a new nationality upon me, and take away my rights and options (Options have value)? I do not think so. Leave a comment if you support this idea and I will set up a just giving page to crowdfund it, and find a human rights lawyer to defend us Europeans and our children.

In the words of the Clash “The future is uncertain, know your right”. Human rights as it turns out.

Trying to understand “Leave”

Like many people I woke up yesterday to find myself in a different country. London appeared to be stunned. The tubes were eerily quiet and subdued. After all, less than 50% of Londoners were born British. My mood oscillated between despair and anger. It feels like we are in a bad science fiction movie. Last night I tweeted that if Scotland is allowed a referendum on independence, London deserves one too. Two people responded that London was elitist and needed to pay reparations for the damage done to the rest of England.

I was stunned. Almost physically rocked by these statements.

This morning I woke up with a desire to understand what had happened. This is my attempt to understand. I am a child asking for help. Not a patriarch forcing my opinion on others.

I grew up in Leicester. The school I went to was multicultural. A third of my school were Asian (Indian), many from families that had fled Idi Amin… refugees. I first started to observe cultural segregation at Sixth Form College. Asian girls were discouraged from mixing with white boys. There was no tension, just segregation. My first experience of racism was at University in Newcastle. It was a small thing but I had not noticed that my friendship group was multi-cultural compared to other mono-cultural groups, but someone else had noticed. I have been fortunate to work in IT in the “City” for over two decades. In 2000 my team consisted of Four brits (one of Asian descent, one gay), an American, A Canadian, A peruvian, A Hungarian, An East German (former member of the East German Army), A Frenchman… you get the idea. When I arrived in the City in 1993, it was a magnet for the best and brightest in the UK. By 2000 it was a magnet for the best and brightest in the World. These are not upper class privileged sorts, they are hard working individuals that applied themselves to be good at subjects that many find boring and tedious and damned hard work. They work hard, they play hard, and they pay a shed load of tax. Being part of Europe is big part of why we have jobs in London. Paying tax is a way of contributing back to the society that we grew up in.

Londoners appear to contribute about 1/4 of tax*. About an 1/8 of tax is spent on London. That means that London is a massive net contributor to the rest of the country. As a Londoner I’m happy to do my bit to help the rest of the country.

Less than 50% of London was born British. London is an international city built on immigration. London does not appear to have the same kind of problems with immigration that the rest of England has. One of the most stomach churning and revealing stories in Brexit was the story Farage told of a little old lady saying “Come and see what immigration has done to our community” How can we not have empathy and sympathy for this little old Lady. I met an old Lady like that in the local launderette when our washing machine died. I live in a white middle class street. At the end of the street is the main road that is as multi-cultural as you can get. There are white working class boozers with menacing smokers stood outside who eye you as you walk past. There are shops servicing clientele from the Middle East, North Africa and Poland… everything is Halal. There is a Mosque that is next door to the Music Venue that caters for up and coming bands, weddings and office parties. It is not always harmonious, especially when it comes to finding a parking space. Parking is a problem, compounded by the mini cab firm where all the drivers are from Somalia. Though when I need a taxi to the airport, they are reliable and normally listening to Radio 4 as a way to improve their English. Its an integrated multi-cultural community where different groups respectfully co-exist… apart from the parking. Touch wood, I’ve never felt that threatened, apart from the scary little old lady in the launderette. Within five minutes she had told me she wrote regularly to David Cameron… until the police visited and asked her not to. She then confided she still wrote, but used an alias.

I am one of the 1%. My earnings are in the top 1% of the country. In London, that means I can just about afford a mezzanine or one bedroom flat in one of the “up and coming” parts of the City. At 1% I cannot afford to hop between countries to avoid paying any tax. I’m proud to pay my tax and consider people like Philip Green to be an enemy of the state for avoiding paying tax on a level that would pay for a hospital or a school.

I do not feel elite, especially when standing in a packed tube seating my  way to work and back.

Then Brexit, and the accusation that London is the elite and needs to pay reparation. What has London done wrong that the rest of the country has decided to destroy our jobs and our future? We are already paying in twice as much as we take out. Don’t blame us for parliament, we only voted a dozen or so politicians in. The rest of the country voted the rest in. Londoners hate the politicians and their Old Etonian shady deals with Philip Green as much as anyone. So what is going on?

I think Brexit is just another manifestion of a global phenomena. The world economy is changing. Engineering jobs are either moving to the most highly skilled areas of the world (e.g. Germany) or the cheapest areas of the World (e.g. Asia). There are fewer engineering jobs to go round. America is suffering the same problem which is giving rise to Trump. The best explanation I’ve read is that the blue collar engineering class does not want hand outs, they want jobs. According to Dan Pink, motivation requires Autonomy, Mastery and Purpose. Our engineering class is given nothing… just social handouts and jobs that will never let them achieve satisfaction. London’s sin has been to assume that paying for the NHS and Welfare for big parts of England was enough. Clearly it is not enough, message received. We need jobs, not McJobs, but real jobs.

The elderly in this country have been lied to and deceived during the Brexit campaign, by both sides. Pensions account for the largest part of the UK budget. Leaving the EU will result in inflation which erodes the value of pensions. Clearly the elderly in the UK are scared of immigrants. Even in my street, the elderly are scared. This is where we need to act. We need to create programs to integrate the elderly into modern communities so that they can live richer more fulfilling lives, lives with less fear.

So lets understand the relationship between London and the rest of England. A few years ago I encountered the Benjamin Franklin Effect. Its a cognitive dissonance that I think helps to explain the relationships between Parents and Teenagers. In effect, we like someone because we do something for them, rather than we like someone because they do something for us. I suspect that the rest of England is resentful of London whereas London likes the rest of England (because that’s where we come from after all). This also explains why Wales and Cornwall voted to leave the EU despite receiving massive support from the EU. They don’t want your money (they need it and resent you for giving it), they want their dignity (and the EUs money takes it away).

So here is a thought. We need to create jobs that have meaning for the rest of England. Lets identify a deprived area of England, and relocate the Government to that area generating jobs to revive the community. How do we pay for this? We simply sell the buildings that the government occupies. The British Government is housed in some of the most expensive real estate in the world, and there is absolutely no reason in the modern age for that to be the case. The houses of parliament can be redeveloped as a museum/leisure centre/theme park for tourists. Once the area is revitalised and if necessary, we move the government again. Perhaps every ten years or so.

I get the feeling I’m reading this completely wrong. Would love to know what I’m missing.

I am proud to be British and European, however Britain is about my past and who I am, and Europe is about my future and the future of my children.I choose to be European for the sake of my children and over the next two years I intend to fight (in the courts if necessary) to remain my European status. If that means London needs to leave Britain, so be it.

*It would be great if the government would make it easier to see how tax is collected and spent.


IIRMFW : Program and Reduce Lead Time.

One of the key risk management controls for an Agile Risk Management Framework is to limit the amount and time between investment and return.

A development organisation needs to deliver investments where the Lead Time and Weighted Lead Time are within agreed thresholds. Limiting the lead time also limits the financial value of inventory in the development organisation that is not delivering value to customers. An organisation may limit both the lead time (or weighted lead time) and/or the financial value of inventory (See CFD below).

Financial Value of Inventory

This leads to a new way of looking at the RAG status:

  • RED – The investment is over the lead time (weighted lead time) limit.
  • RED (Trending) – The investment is expected to breach the lead time (weighted lead time) limit.
  • AMBER (Trending) – The investment might* breach the lead time (weighted lead time) limit.
  • GREEN (Trending) – The investment is not expected to breach the lead time (weighted lead time) limit.

Organisations in transition often struggle to make lead time targets. It is possible that the organisation might allow longer lead times provided software is delivered into a pseudo production environment, and that there is a commitment from executives across the entire value stream to achieve the target lead time within an agreed time period.

* As indicated by a tool such as Troy Magennis’s Monte Carlo Simulation.

IIRMFW : Governance and Manage Risk (Part1)

The IT Investment Risk Management Framework for Agile development would be very different to that for Traditional approach. By its very nature, Traditional operates in the Obvious and Complicated domains of the Cynefin framework. Traditional assumes the correct answer which means it is not well suited to manage risks in the Complex and Chaos domains. The entire approach to risk management between Agile and Traditional is different. Traditional funds a list of features (Scope) to be delivered whereas Agile iterates towards a business value goal.

A traditional approach mandates a list of deliverables that need to be created to satisfy the SDLC. Agile mandates a list of risks that need to be managed in the context of the investment. This difference in approach means that two projects doing different things could both be satisfying the Agile Risk Management framework. Even stranger, there may be two projects following the exact same process but one of them satisfies the risk management framework BUT THE OTHER DOES NOT! For this reason, the policing service within the governance framework is critical and very different to traditional SDLC policing.

Traditional SDLCs are typically practice and deliverable based. There is a simple yes/no checkbox approach to policing the IT investment. e.g. Do you have a functional specification? And a project plan? And a test plan? Do you have 100% automated test coverage?

Agile Risk Management Frameworks are much more principle based. The policing service needs to be able to identify where there is risks because the approach is not quite right. e.g. On one team, the scrum master does all of the updates to Jira. On another team, everyone on the project updates Jira. Both projects are transparent but one might have a key man dependency. The policing service might ask to see a Skills Matrix or ask other team members if they know how to use Jira. Simply put, its not black and white.

The key role of the policing service is to challenge claims of “transparency”. To ensure that the perceived transparency is genuine. Having shed some transparency on risks, the policing service can suggest resources for the team to learn to improve. As they have a responsibility to the organisation, the policing service are responsible for the making the risk visible and recording it so that it does not become forgotten. Most teams do not intend to obscure information, often the problem is a lack of understanding and experience.

The diagnostic skills required of the policing service that allow them to identify risks that should be managed are similar to those of an Agile Coach. Even though the skills overlap, the Agile Coaches should never be used to implement the Policing Service. They can coach the policing service and help them acquire analysis skills. They should not act as the policing service, otherwise it will destroy trust between the team and the coach.

It is the responsibility of the policing service to ensure transparency on all risks. As such they should not report to a delivery organisation where there might be a conflict of interest between their responsibility to their management and the organisation. e.g. Consider private security guards versus independent police force.

It is the responsibility of the policing service to identify where the IT Investment Risk Management Framework is flawed. Either too constrained which limits the ability of the organisation to deliver, or not not constrained enough so that the organisation is exposed to risks that are not managed.

IIRMFW : Exec’s & Business Value

The IT Investment Risk Management Framework is the set of constraints that development organisations need to operate within in order for the associated risks to be managed appropriately.

The executives in an organisation have a responsibility to rhe investors when managing the risk surrounding the delivery of Business Value.

Executives responsibility for Business Value Metrics

The key metric that an executive is responsible for is:

  • The percentage of the IT Investment Portfolio that can demonstrate whether an investment generated a return.

There are two sub-metrics beneath this metric for the executive.

  • The percentage of IT Investments that are linked to a metric. i.e. Has the product owner stated the metric that will improve as a result of an investment (e.g. Story, Epic, Initiative).
  • The percentage of metrics that can be displayed. i.e. Is the metric available in a format that the improvement in the metric can be demonstrated. Note that the metric might be manually captured.

In effect the executive should be able to observe a graph for each metric that is similar to the one below:

Screen Shot 2016-05-30 at 10.30.53

as well as a summary of investments that looks like the following:


In the event that a metric is not available to be displayed, the executive should be committed to delivery of that metric within an appropriate time frame.

Risks Being Managed

These key metrics demonstrate that the executive is managing key business value risks. The risks managed are as follows:

The percentage of the IT Investment Portfolio that can demonstrate whether an investment generated a return. – This metric ensures that the executive has transparency into whether a return is being delivered by their portfolio of investments. The exact return delivered by a particular investment may be difficult to assess however the impact of the portfolio investment is transparent. It is not necessary to specify that the executive checks the return regularly as the metrics graph provide transparency that is not enhanced by taking minutes of metric review meetings. However, it is to the executives benefit to be on top of their metrics by reviewing them regularly so that they can intervene in a timely manner. A failure to intervene would be evidence that the executive is not performing their role properly.

The percentage of IT Investments that are linked to a metric. – This metric ensures that everyone in the executives organisation is focused on delivering value rather than functionality. It provides transparency on those that cannot prove they intend to deliver value (no metric assigned). This transparency also allows the executive to take a portfolio view and rebalance the portfolio if appropriate.

The percentage of metrics that can be displayed. – This metric indicates where a return can and cannot be demonstrated. If the return cannot be demonstrated, there is a massive risk that an investment might deliver no return ir even worse destroy value.

The Business Value Metrics Framework

All metrics should be part of an organisation wide standardised metrics framework. This has two benefits:

  • The standard framework makes it easier for product owners to identify the value they are delivering because they do not have to work it out for themselves.
  • The standard framework makes it easier to compare the value of disparate investments.

The business value metrics framework should be “open sourced” within the organisation with a product owner facilitating the addition and modification of metrics, and the decisions regarding the additions and modifications being made by the Business Value Metrics Steering Committee. The Business Value Metrics Steering Committee should be appointed by the board as the definition of business value in an organisation is key to its success.

A business value metrics framework is vital when an organisation relies on third party consultants to write business cases as there is a substantial conflict of interest. For example, there is a tendency to suggest attributes of a product as business value (e.g. Lead time) rather than business value (Conversion Rate). Product attributes are easy to deliver compared to those that depend on the needs of the customer and the market.

The Business Value Metrics Framework can be constructed using “Break the Model”. Identify an example (Tea Bag), Reflect if it is in-scope, Create an Example (Tea Bag -> Cup of Tea -> User Need -> Business Value) and then Model (Add it to the Hierarchy). The product owner performs this process based on the examples that are presented to them as not fitting in the model.

The Business Value Metrics Framework will probably map to your organisations Business Model. e.g. Freemium = Get users, Increase Activity, Get Revenue. Traditional = Get Revenue, Increase Activity, Prevent Churn.

Risk Adjusted Return on Capital is a good starting point.

  • Risk
    • Investment Lead Time (Weighted Lead Time)
      • Key Man Dependencies
    • Quality
      • ITIL measures
      • Failure Demand
    • Employee Happiness
      • Turnover
  • Revenue
    • ARPU (Average Revenue Per User)
    • Activity (Average Visits per Month)
    • Number of Customers
      • New Customers
        • Conversion Rate
        • Customers into the Funnel
      • Churn
  • Costs
    • ACPU (Average Cost Per User)
      • People Costs
      • Overheads

Disruptive Innovation versus Efficiency Innovation

The executive should ensure that the portfolio has the appropriate levels of Disruptive, Sustaining and Efficiency Innovation. Otherwise the organisation might discover its market being disrupted. Check out Clayton Christensen’s lecture for more details.

* The concept of the Business Value Cascade was created by Mark Gillett, Senior Vice President at Microsoft, responsible for Skype & Lync products. The first analysis and implementation was performed by Keith Beatie, now a partner at McKinsey.