Value streams and value networks

Lean thinking is based on a model of delivery in which raw materials are progressively developed into a finished product that is consumed by a customer. This linear path is called a value stream. Many in the software community have criticized this model as too simplistic at best, and harmful at worst, as it risks ignoring key stakeholders by focusing on "the" customer.

In real life, a software product has many stakeholders. There may be multiple customers who have different needs and different usage patterns for the software. There may be people involved who are affected by the functionality or quality of the software product who are not, strictly speaking, customers. The process of building and delivering a software product is far more complicated than a simple, linear "stream" of activities. For those reasons and more, some people prefer the term value network to the term value stream. Jurgen Appelo wrote about this compellingly on his blog a couple of years ago, at http://www.noop.nl/2010/10/the-customer-value-problem.html.

I submit that it is necessary to be able to think on multiple levels in order to get anything done. If we try to work directly with the notion of a value network, with all its inherent complexities, we may well be unable to make progress because we cannot decide in which direction to step next. By trying to comprehend a complex universe all at once, all the time, we become paralyzed. It’s overwhelming.

Practical thinking requires the ability to compartmentalize when it is useful to do so, while keeping the big picture in mind. The value network idea has merit. It is big picture thinking. As such, however, it does not provide us with day-to-day tools to take concrete actions to meet goals. To do that, we must be able to simplify reality in practical ways.

The value stream is just such a practical simplification. As a project manager, you are not responsible for the complexity of the universe. You are not even responsible for the complexity of your own company. You are only responsible for one stream of delivery. You need tools that support that responsibility.

There is good reason for the popularity of the George Box quote, "all models are wrong, but some models are useful." The value stream is a model. It is useful when it is useful. Recognize when it is useful, and use it. Recognize when it is not useful, and use something else.

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