Part II: The Value Stream of the Effective Organization

One of the main tenets of Lean-Thinking is to attend to the work not the people. Some of the reasons for this are:

  • We trust our people so we want to provide them with the best environment we can. This requires improving the environment – we don’t need to improve our people.
  • Our goal is lowering the cost of delay of value being realized. Looking at the value stream provides an overall view that cannot be achieved from looking a single steps.
  • Focusing on people tends to have us think the people are the problem when almost all of the problems are due to the system people are in.
  • To lower cost of delay we must lower the delays at the critical steps in the value streams. Delays are caused by hand-offs, interruptions and rework.  The causes of these cannot be seen by looking at any one step.
  • Many delays are caused by dependencies between different parts of the value stream. A person may have a problem doing their job that’s been caused by someone else.
  • Focusing on people leads to local optimization both directly and by rewarding people for being locally optimized.

Since we trust and respect our people, micro-managing them shouldn’t be needed in the first place.

Understanding this means that we can understand what an effective organization must look like. That is, what does its workflow look like and how does its people collaborate with each other. A depiction of the value stream of the effective organization is shown in figure 1.

Figure 1: The Value Stream of an Effective Enterprise

Figure 1 depicts the steps work goes through from concept to realization. It does not intend to suggest that the work done is linear or in batches.  To simplify the main concepts, it has intentionally left out feedback loops as well as places where work is done in parallel and then re-converges. The replicated streams in the middle of the diagram illustrate how several value streams can exist in parallel.

Two new roles are also presented – the value stream network architect and the business architect. Both of these will be described in their context. Each of these parts of the value stream will be discussed in the rest of this part of the book.  It is important to see how each part is affected by parts upstream as well as affects downstream parts.

To learn more about value stream mapping, see Mapping Your Value Stream in Part VI.

Topics in this part of the book:

  1. Strategic Planning and Lean Portfolio Management. Strategy is critical. But it’s also an opportunity for alignment. Too many organizations only have clarity on their strategy at the business levels.
  2. Lean Product Management. Is a critical part of creating clarity on what value to have realized next while connecting the business needs to development. While there should not be a separation between business and development there is in most organizations. This separation can be reduced, even eliminated, with proper Lean Product Management.
  3. How Epics Are Used in FLEX. Epics are ubiquitous. They’ve been used for so long and in so many ways they’ve lost a lot of their usefulness. We prefer to use the concept of business increments that we will refine to minimum business increments. But since the notion of epics is so widespread, we usually just define them to mean ‘business increments.’
  4. The importance of Having an Intake Process. Having a quality intake process is essential for any level of effectiveness. It can also be used to educate product management and leadership as discussed in the following chapter.
  5. Planning, Collaboration, and Dependency Management . Large scale planning events are often over used. When used, it is important to realize they are more about collaboration and dependency management that the actual plan.
  6. Implementation and Integration. There are many ways to keep teams in sync with each other.  SAFe has popularized a method developed by us and others over a decade ago. There are other approaches as well.
  7. Release and Realization. The goal is not just release, but also realization. Many organizations plan for the development and release of value but forget the critical, non-development, parts required for realization of value.


The next FLEX course is currently being scheduled in August in southern Orange County, CA. If you want to learn more about FLEX you can take an online course at the Net Objectives University. If you want to learn about how to adopt FLEX in your organization please contact the author, Al Shalloway