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InfoQ Homepage Podcasts Chris Matts on BDD, Real Options, Risk Management and the Impact of Culture for Effective Outcomes

Chris Matts on BDD, Real Options, Risk Management and the Impact of Culture for Effective Outcomes

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This is the Engineering Culture Podcast, from the people behind InfoQ.com and the QCon conferences.

In this podcast recorded in London Shane Hastie, InfoQ Lead Editor for Culture & Methods, spoke to Chris Matts “The IT Risk Manager”, one of the original thinkers behind Real Options, Feature Injection and Behaviour Driven Development. 

Key Takeaways

  • Real Options is about translating the ideas from financial risk management into IT projects
  • Understanding that things go wrong and that what is thought of as the last responsible moment is often actually too late and is in fact an irresponsible moment
  • Most of the challenges to agile adoption are far above the level of the delivery team
  • Introducing a simple governance framework which supports an agile culture
  • The difference between the community of needs and the community of solutions, and the need for both

Show Notes

00m:30s Introductions

00m:55s Real Options is about translating the ideas from financial risk management into IT projects

01m:50s The intent behind Real Options is to manage risk rather than ignoring it. 

02m:10s Three simple rules of Real Options

  • Options have value
  • Options expire
  • Never commit early, unless you know why

02m:25s The fourth rule which is not often discussed – the value of options increases with uncertainty

02m:35s Explaining how real options can be used in decision making

03m:10s The mistaken perception that making a decision is making progress, even if the decision is a bad one

03m:50s Knowing the point at which options expire and the default action will happen regardless of the value

04m:20s Understanding that things go wrong and that what is thought of as the last responsible moment is often actually too late and is in fact an irresponsible moment

05m:25s Options give us choices

06m:00s Implementing cultural change using a risk management framework

06m:15s The importance of a governance framework

06m:50s Four elements of a lightweight governance framework for agile projects

  • Deliver measurable value
  • Reduce lead times
  • Ensure sustainable quality
  • Manage risk

08m:40s Using the culture to change the culture – the framework forces a change in focus from business to outcomes

09m:10s Cynefin – moving from complicated to complex solutions

09m:45s Embracing uncertainty and focusing on valuable outcomes

10m:20s Changing the metrics from features and effort to outcomes and customer value

11m:25s Most of the challenges to agile adoption are far above the level of the delivery team

12m:25s Changing the lead time measurement to reflect the entire value stream through to getting value from the features in the hands of real customers

13m:40s The need to break work into very small pieces

14m:05s Design metrics such that when people game the metric they exhibit the behaviour you want to see

14m:15s Example of how a lead time metric can influence the size of features

14m:40s Example of how a “concept to cash” metric can cause the wrong behaviours

16m:30s The backlog at the portfolio level needs to be ordered

17m:40s A mechanism to order the portfolio

18m:15s The real constraint in most organisations is capacity within teams rather than budget or time

18m:45s Prioritise the work at the constraint, capacity planning or delivery mapping

20m:00s Application of Theory of Constraints

20m:40s Culture in the agile community

21m:00s There are two broad communities that agile practitioners span–

  • Community of needs
  • Community of solutions

21m:15s Community of needs is identifying problems which don’t have well established solutions and create solutions through experimentation and learning, then sharing the ideas with others

21m:25s Community of solutions is able to apply solutions which have been identified through the community of needs

22m:35s Example of Scrum and Kanban crossing the chasm and becoming part of the community of solutions

22m:50s The two communities have very different behaviours. 

22m:55s Community of needs events tend to be peer to peer and collaborative

23m:25s Community of solutions events are more expert driven, classroom style

24m:15s Many of the agile events and commences are in the community of solutions now

24m:25s The need for a strong focus on the community of needs to conduct experiments, learn new things and develop new solutions, especially around scaling agile

24m:50s Example of how the risk framework didn’t work in a particular context and how that made the approach more robust through identifying the context for failure

25m:50s Agile at scale is still in the experimental and learning stage

26m:50s The risk of losing credibility through unrealistic expectations and not understanding the organisational context

27m:25s Questioning if some of the frameworks are in line with the agile manifesto

27m:35s Uncovering better ways of developing software by doing it and helping others do it

28m:00s Adopting practices because they are proven in many contexts, not because they sell well

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