Why FinServ Software Delivery Is Ripe for Value Stream Management

(Contributed by Mr. Marco Morales who is the director of global solutions for digital transformation products at CollabNet.)    

As you’ve probably seen, CollabNet has been all around the globe in the last few months meeting with IT decision makers and managers to discuss Value Stream Management for software delivery.

We hosted a number of half-day seminars in cities like Paris, Los Angeles, Seattle and Berlin and were pleased to see this topic—improving software delivery through Value Stream Mapping (VSM)—really resonates with IT leaders at large organizations.  Many of them are familiar with VSM as a Lean Management method. Yet they hadn’t considered how to apply the same concepts to the software development lifecycle as a means of measuring value and making better business decisions.

After sharing this message and receiving feedback from the market, we realized there is a particularly pressing need for Value Stream Management for software delivery in the financial services industry. FinServ organizations have governance, audit and risk obligations that set them apart from other industries. While FinServ companies are spending a great deal attempting to improve the way they deliver value to customers through software, many of them don’t have a way of clearly showing the value of their efforts or an efficient way to show that they are meeting their regulatory requirements.

I had the pleasure of leading a FinServ-specific VSM seminar in New York recently. I discovered Financial Service organizations simply aren’t taking the measurements or collecting the data to show what is and isn’t working around the DevOps tools, teams and processes they have in place.  

Before you can understand the value of having those measurements though, the first step is to understand why they are important.

The best way I can communicate this is to get IT leaders to recognize that their company delivers value to customers when they deliver software.  Think of it this way. Whether you’re a bank, an automobile manufacturer, a healthcare organization or even a government agency your company has allocated people and resources to deliver software that may be a product, a service, or a component.  How do customers interact with your business? These days the majority of interactions are digital, right? So software is your connection to the customer, and software must deliver great experiences.

That’s why, as an IT leader in that organization, it’s your responsibility to make sure those digital interactions are smooth, positive experiences. You have to fully embrace the fact that what really makes or breaks customer service and business in general today is software.

With that in mind, financial services industries set goals to increase the speed of delivery, innovate faster, reduce operations costs and solve online scaling problems. To do that, organizations implement strategies to utilize contemporary software practices such as DevOps and new technologies such as CI/CD/ARA Toolsets, Cloud or Containers.

But still, how do you know you are you getting the most value possible from those investments? How do you know your changes are improving the organization?  Many teams invest heavily in toolsets and processes yet are still unable to state what 80 builds a day means or 10 deployments a week.  Yes, there are more and they are faster, but what does an increase in throughput or frequency mean to the business for escaped defects or being able to deliver features faster?  The “gut feel” is there but the data is missing to show your teams are operating more efficiently.

In manufacturing companies, many metrics are available because those companies are managing the costs down to the penny.  If an operation takes too much time, workers are idle, or materials are wrong, they show up as costs.  In software teams, a slipped feature translates to something like a new sprint or more story points, but it is not being tracked as a cost to the business.

And when we’ve asked IT leaders at FinServ organizations questions such as, “Are you able to provide adequate audit trails?” or “Are you able to demonstrate your processes are compliant, given multiple tools in your environment?” They usually give a hesitant yes. Traceability exists … kind of, but usually requires a good deal of heavy lifting to dig data up from a myriad of silos and tools through their logs and databases, only to be correlated through cut-and-paste operations in a spreadsheet. Even with these results, many teams are not capable of carrying the information forward to make the next iteration better because the metrics are inconclusive and not able to help business leaders make data-driven decisions.

Rarely are metrics gathered such as:

  • MTBF – Mean Time Between Failures, average time between when a problem is found in the prod environment and when it is fixed
  • Defect rate – number of defects that are found per unit of time
  • CLT – Change Lead Time
  • RWR (Rework Rate) – % of tickets mapped to releases
  • UWR (Unplanned Work Rate) – % of unplanned issues

It has been exciting to see the light bulb turn on for folks who realize they are missing crucial measurement and metrics. You can’t have continuous improvement without knowing what has improved and exactly how much. And you can’t truly know the cost or benefit to the business without good metrics.

And this is where Value Stream Mapping comes in to save the day.  Once your team maps over their tools in their process to a Value Stream, they can start tracking the metrics that are important to them.  The result is a system that is gathering data as the team creates and delivers software.  This data can be presented in different charts, used to raise alerts, or used to trigger events elsewhere.  By gaining a deeper understanding of the value and impact as information flows through a designated value stream, you can better identify where to focus future time and investments.  Your team is starting to enable data-driven decisions.

When the data doesn’t look right, you are free to adjust the model to collect or present the data differently.  If your team discovers a new metric to track, you add it to the model.  All the while, your system continues to build up a data model showing times, success rates, and other metrics important to your team.  This “receipt” of your operations can come in quite handy when you need to demonstrate an audit trail across multiple, disparate tools.

Value Stream Management enables you to show the value of your efforts and makes it easier to show how you’re meeting regulatory requirements.

CollabNet provides a unique way for enterprises to integrate, measure, monitor, predict and improve the value of tools used within the software development lifecycle. The CollabNet DevOps Lifecycle Manager (DLM) makes value stream monitoring and measuring simple. Through capabilities like tool chain orchestration and integration as well as monitoring and automation, companies can make informed decisions regarding software delivery and achieve their goals.

To learn more about how Value Stream Management can help your organization, whether FinServ or any other industry where software is key to customer satisfaction, please get in touch and set up a demo.

To read more about the DevOps Lifecycle Manager (DLM), take a look at this solution brief or watch our recent webinar with Forrester analyst Diego Lo Giudice.

Author: This blog was contributed by Mr. Marco Morales who is the director of global solutions for digital transformation products at CollabNet and technical expert on the subject of value stream management. Team CollabNet thanks him for his contribution.

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