Thinking about value by Isidro López

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What is value? “Value is not about the number of things we produce, but the outcomes we want to create for the business and customers.” 3 “Escaping the build trap (how effective product management creates real value)” by Melissa Perri

Thinking about value… Increase revenue Protect revenue Avoid costs Reduce costs 4

5 https://blackswanfarming.com/understanding-value/ (Joshua Arnold) Four possible outcomes from delivering an idea

We need to think about “value” from every perspective, not only direct and short-term “revenue” ● Users, customers and business ● Engineering and technology 6

Some examples of ideas related to “Increase…” ● Increase sales to new or existing customer ● Usual proxies (are they? 🤔) ○ Get more customers or users ○ Add new features ○ Add more options to an existing feature ○ Start using a new tool ○ Write more code ○ Add a new dependency 7

Some examples of ideas related to “Protect…” ● Improvements to at least keep up with competitors and maintain existing market share (defensive) ● Protect your data with back-ups ● Solving bugs (protect the value already delivered) ● Security analysis ● Update dependencies and frameworks ● Tooling to optimize the Support ● Continuous and opportunistic refactoring to keep the cost of change low (protect the future value) 8

Some examples of ideas related to “Reduce…” ● Remove features (unfortunately, it’s something extremely seldom done) ● Reduce the cost of maintainability and evolution ○ Remove code (Basal cost concept) ○ Paying back “technical debt” ○ Continuous and opportunistic refactoring ○ Scout rule (“leave your campsite better than you found it”) ● Reduce defects and rework with automated testing and TDD ● Automate recurring actions (especially if those more human error-prone) ● Improvements in performance/scalability/efficiency that lowers infrastructure costs 9

Some examples of ideas related to “Avoid…” ● Legal requirements, avoid fines, etc. ○ E.g. GDPR ● Lean principles and practices, e.g. Decide as late as possible, aka “defer commitment” ○ Keep options open unless there is a clear and obvious advantage on one of them. ○ Code: ports and adapters, decoupling from infrastructure, etc. ● Follow iterative and incremental development in order to minimize the output needed for getting the expected outcome. ● Real options ○ Timing of decision making is crucial: also see “Cost of Delay”, CD3, and “Opportunity Cost” ● YAGNI ("You Ain't Gonna Need It") ○ Only do things that answer to REAL and CURRENT needs backed up by something else than HiPPo or abstract guesses. Both from the business and from the technical perspectives. ○ Avoid premature optimizations ○ Code is a liability (it is output, not outcome) 10

Systems thinking for the win! ● Going beyond the traditional vision of value (only “adding value”) depends on the company and product engineering culture in place ○ You get more of what you reinforce or make easy or give public praise. ○ You get less of what you punish or make difficult or don’t recognize. ● Unfortunately, most companies mostly reinforce (explicitly or implicitly) a traditional vision of “increments of value”: ○ Aka “shipping massive quantities of features” 11

What about your company? Questions for self-reflection ● What do we explicitly reinforce/recognize/praise? ○ do we make explicit any work beyond “adding/increasing”? ○ do we recognize any work related with protecting, reducing or avoiding cost? ● In your specific team/area, ○ do you make explicit any work beyond “adding”? ○ do you value any work related with protecting, reducing or avoiding cost? ○ do you have explicit and visible work in your Kanban board for this? Can you think of ways for bringing value on the table besides “adding” things? 12

In summary ● Let’s stop thinking about “value” only or mainly in terms of ADDING things (features, tools, code, etc.) ○ On top of that, we wrongly associate “adding things” with “increasing the outcome”. ● We get from a system/organization/team/people what we reinforce. ● It’s always about trade-offs. ● How can you think about bringing value within the “protect”, “reduce” or “avoid” perspectives? 13

Resources https://blackswanfarming.com/understanding-value/ https://blackswanfarming.com/value-a-framework-for-thinking/ The Basal Cost of Software (Edu Ferro) What is Value? by Jez Humble (video, 50 min.) “Escaping the build trap” by Melissa Perri ● The book ● A talk (video, 38 min.) Book “Thinking in systems” by Donella H. Meadows 14

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