Lean Management Principles for Information Technology

Gerhard J. Plenert

• Publisher: CRC Press
• Year: 2011
• Print ISBN: 9781420078602
• eBook ISBN: 9781000755770
• Topic: Business
• Subtopic: Information Management
• Index: Business

Whether it's because of a lack of understanding, poor planning, or a myriad of other things, 50 to 60 percent of the IT effort in most companies can be considered waste. Explaining how to introduce Lean principles to your IT functions to reduce and even eliminate this waste, Lean Management Principles for Information Technology provides t

Section II

Bringing Lean into Information Technology (IT)

5

How Can Lean Help IT?

The way forward is paradoxically to look not ahead, but to look around.

John Seely Brown and Paul Duguid

The Social Life of Information, HBS Press, 2000, p. 8.

When asked to define Lean, most experts would reply with a definition like, “A systematic approach to identifying and eliminating waste (non-value-added activities) through continuous improvement by flowing the product at the pull of the customer in pursuit of perfection.” Lean is a change management tool. It was developed by Toyota over 40 years ago to help them standardize on a methodology for continuous improvement. Since then Lean has evolved through numerous iterations, primarily in the United States where everything needs to be Americanized. The result is that the version of Lean being used in many organizations is vastly different from the original Toyota version.

Most adherents see their Lean implementations as something that is “only useful for manufacturing.” However, the author sees Lean as a company-wide tool. Across an enterprise, Lean practices can be used in engineering, in the front office, in the back office, in R&D, and even in IT to improve operations by driving waste from existing environments. Lean can be effectively applied within the IT organization.

Lean is both a management philosophy and a change methodology. Its management philosophy stresses the elimination of waste. Lean does not focus on making anyone work harder, or like its Six Sigma cousin, also derived from Toyota’s production system, reduce variation in vertical processes (see Technical Tool #16 in Chapter 6). Lean focuses horizontally across the value stream of an organization.

As mentioned previously in this book, Lean is a methodology that is focused on the elimination of non-value-added processes or “waste.” The author has found that nearly all organizations have a value-added content of less than 5%, and occasionally he has found a value-added content of less than 1%. As mentioned earlier in this book, his experience shows that by eliminating non-value-added wastes it is easy to double the capacity, throughput, and output of the organization while simultaneously reducing backlogs (the inventory of IT), regardless of whether it is for a single process or for an entire IT organization.

LEANING IT

In a recent study by Capers Jones, he identified the key factors for software and IT project success and failures. These are summarized in Table 5.1. From this table it seems obvious that poor project definition (Cause #1, 3, 4, and 5) and poor scheduling/planning (Cause #1, 2, 3) are primary factors in IT failures. We need to take a closer look at the overall IT organization and see where these failures may be occurring.

TABLE 5.1
Reasons for IT Failures

No.	Risk Factor	Root cause	% of MIS Projects Failing
1	“Creeping” requirements	Lack of well-defined user requirements and control	80%
2	Excessive “schedule pressure”	Inadequate scoping of the project and process	65%
3	Low quality	Poor design, inadequate testing, lack of processes	60%
4	Cost overruns	Lack of design, inadequate testing, low skill set	55%
5	Inadequate configuration management	Lack of version control and rigorous process for integration	50%

Source: Jones, T. C. Assessment and Control of Software Risks, Yourdon Press, 1994.

A typical IT organization can be broken down into a set of processes, all supporting a company’s business. These processes can be further broken down into Level 1 and Level 2 processes that can have the Lean methodology applied and can be seen in Table 5.2.¹

Each of these processes in the chart titled “Typical IT Organization Processes” can be subjected to a Value Stream Mapping (VSM) exercise that allows individuals to see what is actually happening in their organizations and what is possible (for a detailed discussion of VSM see Technical Tool #2 in Chapter 6). The objective of the VSM activity is to identify large non-value-added activities that can be eliminated. Often we find that what we thought was valuable to our process is in fact “wasteful” to our process.

Another area for reviewing IT effectiveness, which is primed for waste elimination, includes the three implementations that occur with all IT projects. These three areas tend to be very ad hoc with no standardization. They include:

TABLE 5.2
Typical IT Organization Processes

• Physical implementation—facilities, servers, workstations, mobile devices, etc.

• Technical implementation—software, data, applications, mobile devices, security, data warehousing, disaster recovery, etc.

• Business implementation—workflows/process mapping, training, support, documentation, etc.

Still another way to identify wastes in IT can be accomplished using workflow classification. The foundation of this tool is the Impact/Effort matrix (see Technical Tool #25 in Chapter 6), which focuses on work creativity and work repetitiveness. The purpose of this matrix is to classify two things:

1. Work to be performed

2. Workforce

Using Table 5.3, an IT manager would classify all the tasks that need to be completed. Additionally he or she would classify all the employees in the department and classify them into one or more of these quadrants. Then, as tasks arrive, the table will assist the manager in assigning the tasks. Additional Lean tools like prioritization of the tasks can also be useful.

It is the author’s experience that IT organizations are notorious for reinventing the wheel, with numerous redundant activities in development, maintenance, and documentation. Across all of the 7 Waste categories, typical IT organizations provide many examples, as illustrated in Table 5.4 (see also the detailed discussion of the 7 Wastes, which is Technical Tool #1 in Chapter 6).²

TABLE 5.3
Workflow Classification

	Unique Work	Repetitive Work
Creative Work	Quadrant #1: Creative and unique tasks	Quadrant #3: Creative but repetitive tasks
Routine Work	Quadrant #2: Mundane but one-of-a-kind tasks	Quadrant #4: Mundane and repetitive tasks

MEASURABLE BENEFITS OF APPLYING LEAN TO IT

When applying Lean to IT, there are four specific measures that should be used. These measures define the success or failure of the Lean activity. Specifically applied to IT they are:

1. Cycle time—Cycle time is the time it takes to run through the entire process. For example, in the Level 2: “Manage requirements” process, documentation activities can be reduced by applying documentation standardization techniques. The result would be an overall throughput increase and reduced cycle time.

2. Inventory—For IT, inventory means backlog. If the backlog of work for the IT department is measured in terms of months or even years, the IT department is out of control. The workload between employees or between departments should be balanced. One should not have a larger backlog than the other, or you cannot have smooth workflow through the organization.

3. Value-added content—A value-added activity is one that either (1) directly adds value to the final product, or (2) directly satisfies the customer (also see Acceptance Tool #1—Breakthrough Thinking/Concept Management/Purpose Expansion). Using this definition, some meetings or phone calls are value-added, and some are not. Code development is value-added, but discussing coding alternatives may not be, especially when the decision for these alternatives should already have been part of a standardized work set (see Technical Tool #18 in Chapter 6). A...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• Preface
• Acknowledgments
• Introduction
• SECTION I Why a Book on Lean Information Technology (IT)?
• SECTION II Bringing Lean into Information Technology (IT)
• SECTION III Lean Information Technology (IT) on into the Future
• Bibliography
• About the Author