August 28, 2021

Using VSM to Break Down Organizational Silos

In Agile circles, it’s been a truism that “user stories are placeholders for a conversation.” Today, I’d argue that saying applies to pretty much anything important that gets written down.

It used to be common for businesses to have a culture that accepts people issuing a written edict and assuming everyone will be able to understand exactly what’s intended. Those days are over. Leaders can’t create plans and throw them over the proverbial wall and expect desired results. Developers can’t create a product and toss it over to QA.

Everything we generate—emails, requirements, strategies, user stories, and more—should be written with the assumption that a conversation will be needed to ensure our intent is understood. This is especially true if someone else needs to take action based on what we write.

Use Value Stream Management to Eliminate Silos

The issuing of missives that get passed across teams is indicative of a bigger problem: The persistence of silos, and the reality that gaining alignment across these silos is difficult. As these stats amply illustrate, the impacts of this misalignment are huge:

$1 million is wasted every 20 seconds due to ineffective implementation of business strategy.¹
In the US, $102 million of every $1 billion in enterprise IT spending is wasted due to inefficiencies in project execution.²
61% of respondents indicate that technology selections are not linked to business objectives.³

These statistics show how costly systemic problems in the enterprise can be. Each of these problems can primarily be traced to silos, misalignment between teams, and poor project management. Here’s how these issues cost businesses:

Misalignment between teams, stakeholders, and disciplines causes tremendous friction and waste.
Business objectives aren’t aligned with project requirements, which leads to even more inefficiency.
Inefficiencies in execution—and, frequently, teams focusing on the wrong work entirely—result in poor ROI and business outcomes.

Ultimately, each of these problems can be solved by value stream management (VSM). One of the reasons I like VSM is that it requires you to visualize and recognize the walls in your organization that people are tossing work across.

Start With a Map

VSM starts with creating a value stream map. These maps detail how work flows through your organization. All steps in the process need to be considered to achieve transparency throughout the organization. It is extremely beneficial for everyone involved to understand what other parts of the organization do and how they do it.

For example, if development teams gain a better understanding of user experience and design processes and the steps those teams need to go through, they start to view those designs differently than they did before. Teams may find usability design can be moved ahead of development so bottlenecks are removed or mitigated. This helps all participants in the value stream to make better decisions because they understand the impact those decisions have.

Conclusion

Silos cost organizations millions of dollars each year. Those organizations that are harnessing VSM are well positioned to eliminate these silos and the penalties they exact. In fact, through a well-executed VSM initiative, businesses can dramatically improve alignment of their strategic planning and execution. In the process, these organizations can recoup anywhere from 10 to 50% of their teams’ potential capacity, and boost their ability to deliver more value to customers.

References

1. Project Management Institute, Pulse of the Profession, February 2018

2. Project Management Institute, Pulse of the Profession, February 2018

3. Dimensional Research, “Pandemic Accelerates BizOps Adoption,” April 2021

Tag(s): ValueOps

Laureen Knudsen

Laureen Knudsen is an award-winning senior business leader with 15+ year career that spans IT, financial and healthcare systems, and analytics. Co-Author of Modern Business Management: Creating a Built-to-Change Organization. Laureen leads a team of experts working to define the future of business to bring Lean...

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