What is Value Stream Management (VSM) and Why is it Important?

There is often a disconnect between what customers say they want (gathered from sources like customer support or sales teams) and what is actually being delivered. Lack of effective communication between business teams and technology teams is part of the problem. While the C-Suite is focused on goals and overall strategies, technology leaders often speak in terms of delivery cadence and technical outputs. Leaders and their teams need to establish a common language and better communications channels to align around customer goals and experience. 

Value stream management facilitates cross-team communications to improve the flow of information and value creation. The customer requests a feature through sales or support teams, product teams design functionality, engineering teams build the software, and the product is shipped. Having a representative from each team on a cross-functional team makes delivering the right product more efficient and effective. 

Problems addressed by VSM include: 

• Customer frustration with current offerings
• Slow delivery of bug fixes and new features or products
• Losing market share to competitors that adapt quickly to market changes 
• Fewer resources due to layoffs and other cost-cutting measures
• Agile and/or digital transformations aren’t delivering as effectively as desired 
• Lack of visibility throughout the organization due to silos and disparate data 
• Organizational structure not designed for value creation
  
   

Once value streams are identified and mapped, enterprises can analyze them to create new products or features. They can use real-time, data-driven insights along the value stream to make better business decisions, such as what customers think about current products and what needs to change. Instead of investing in individual projects, the entire value stream can be funded, providing flexibility to adapt to changing customer needs without the need for new budget requests. 

The benefits of value stream management include: 

• Increased predictability. Understanding the entire value stream helps reduce uncertainty and surprises that lead to missed deadlines.  
• Higher customer satisfaction. Responding quickly to customer requests can improve their experience and the company’s reputation.
• Improved productivity. Streamlining operations and reducing roadblocks allows teams to ideate, test, and deliver faster. 
• Reduced costs. Identifying unnecessary work and wasted resources saves money and time. 
• Better software. Automating manual tasks frees up time for innovation and reduces opportunities for errors and defects. 
• Increased end-to-end visibility. Having real-time data available throughout the organization lets people track initiatives and adapt to changing corporate priorities.
• Boosted innovation and morale. Focusing on products that really matter to customers is more satisfying for developers. 

Value stream management solutions help leaders elevate value stream thinking across the organization to increase the effectiveness of their teams. Teams need real-time access to data and reporting to understand whether processes are running smoothly. They can use VSM tools to drive continuous improvement and correlate investments to customer value. 

VSM software solutions scale up collaboration without slowing teams down by:

• Offering an integrated view that breaks down company silos 
• Linking people, work, and time across every level of the company
• Combining data from disparate sources like heterogenous toolchains
• Creating a single source of truth without disrupting day-to-day operations
• Continuously reinforcing Agile best practices
• Working with the framework of your choice, such as SAFe, Scrum@Scale, LeSS, Disciplined agile, Spotify, or hybrids.
• Providing tools for teams at every level - from executives through release trains
• Proactively managing cross-team dependencies to improve predictability
• Creating an environment of continuous improvement with shortened feedback loops
• Measuring and analyzing the things that matter
   

VSM solutions allow teams to act autonomously to deliver customer-requested products, then analyze whether they resulted in tangible, measurable changes in customer experiences, and respond to what they learn.

Many enterprises suffer from lack of visibility and comprehensive reporting, especially those that are highly matrixed. Value stream management solutions cut through silos, pulling together disparate data to provide you with the metrics you need and actionable insights.