Software delivery is a risky business for large organizations. Over the last few years best practices are combining concepts from several disciplines such as Lean and Agile in an attempt to deliver more value to the marketplace while keeping costs in check.

As the saying goes - nothing new under the sun. All the buzzwords have been around for a long time and currently there appears to be a resurgence of key concepts such as Systems Thinking and basic Supply Chain math which are gaining traction in the IT Community. Evidence of this can be observed by reviewing the Lean / Agile Principles which can be found on the ScaledAgile website.

Lean Agile Principals

This article serves as a very simple introduction to a few key concepts. There is also a lot of overlap of terminology among several disciples such as Lean, Agile, Six Sigma, Operations Research, Management Science, etc, but ultimately every business is trying to solve the same common goals.

Maximize the good and Minimize the bad.

Right, it's that easy, so let's start shopping for our beach house.

The first concept to understand has to do with labeling your work. Is all of your work the same? Most businesses are far too complex to treat all the work the same way. If all the work is the same, then we can think of the work as a Commodity.

Actual file contains 100 units not just the 10 displayed in the image.

The image above provides an example of what work would look like if we treat all work like a commodity. Think of all work like a stack of paper - each piece of paper must get processed one by one. If we processed a single work item in a single day, then we would process one piece of White Paper per day. In 100 days we would earn $100 - this is the Economic Outcome. The image contains a column called Sequence Value which indicates that zero value is gained by treating the work item any different from other work items in the stack.

In other words, we could do job 1, 2 and skip 3 and replace it with job 7. We could go back to job 3 and then complete job 8, 9 and 10, etc. until we complete all 100 units. There would be zero economic impact on the business if this occurred.

The image states that our total capacity is 100 Units and we have the operational means to select all 100 Work Items.

This image will serve as our Baseline illustration so let's provide a summary from left to right.

  • Capacity - this is the max work units our operation or workflow can handle.

  • Economic Outcome - this is the net result of this scenario. We processed 100 sheets of White Paper and earned $1 per sheet. Over 100 days we earned $100.

  • Count - A simple index of each work item labeled 1-100

  • Value - Each job completed earns us $1. Since the Sequence Value is zero we know that the work is a Commodity.

  • Paper Color - all the work is the same; all of our paper is White.

  • Selected - This column indicates that this work unit or job is selected for this given scenario if there is a "1" in the cell.

This scenario illustrates that each work item is to be treated the same because there is nothing to distinguish one work item from the other.

The conclusion is that sequence (of work or job selection) does not matter or factor into the selection process.

Ok - now, that we have established a clear baseline scenario let's add a Business Rule.

When sequencing matters - what would happen if we got paid more for Green Paper?

Actual file contains 100 units not just the 10 displayed in the image.

This scenario demonstrates the relevance of order and sequence relative to overall economic value.

Suppose we had a special customer that would pay 3 times more for
Green paper. However, Green paper is rare and expensive. Therefore, our operation can only accommodate 1 Green item or job only after 3 White items.

We could also imagine some other operational limitation for retaining a White, White, White and Green pattern. Perhaps existing customer obligations under an Service Level Agreement (SLA) means that we have to reserve production capacity for the processing of White Paper even though we are getting paid more for processing Green Paper.

Look what happened to our overall Economic Outcome by introducing Green Paper with a different Sequence Value even though our Capacity is the same (100 Units or 100 Jobs):

  • Scenario 1 (Work is a commodity) - White only - total Economic Outcome of $100

  • Scenario 2 - (Work is not a commodity) - White and Green - total Economic Outcome of $175

Purple - getting closer to real world complexity.

Actual file contains 100 units not just the 10 displayed in the image.

It is clear that there is a lot going on now that a third work item type has been introduced to the workflow.

If Green was rare and expensive how about Purple?

Let's not forget about our customers that still desire plain old White Paper. Our people and equipment still need to honor a specific sequence in order to uphold Quality and scheduling standards.

We can see that our first business rule of 3 White per 1 Green was
overruled to open a slot for Purple, but in a real scenario there could be other considerations that would not make it so simple to exchange one work item type for the other.

What's more, we could analyze the operation to determine if it made
better economic sense to exchange Purple and Green instead of simply having Purple immediately follow Green in the sequence.

Notice in all three scenarios that our total capacity was fixed at 100 Units or Items. Now, we are on our way to understand why simple business rules and workflow sequencing does have a considerable Economic Impact to any Business Operation where work is not a commodity.

This introduces the concept of Theory of Constraints which paves the way for why frontline managers must be aware of their decisions and understand the overall impact of their decisions. Equally important is the understanding of Upper Management in same context. The entire culture must be aligned and knowledgeable of how work is sequenced or the firm risks making poor decisions in aggregate even though everyone is acting with the best of intentions.

Every organization must strike the right balance between well-intentioned executive autonomy and operational excellence. The solution will always be in the math that points to the best overall Economic Value.

Here is a link for the complete file. Subsequent posts will expand upon the core concepts introduced within this article and within the file.

Workflow Maximization - Order Matters by Nick Maravich

About Author

Nick Maravich

Nick Maravich

I am software enthusiast and I have worked in Start-Ups and in large organizations. I am currently an Enterprise Agile Coach with a Healthcare Organization.