Top 5 Ways Companies Hamstring their Development Process

Consulting with dozens of companies, I have come up with a list of the most common impediments that damage a company’s ability to generate maximal business value from development.

As profit goes down, companies are looking for ways to improve
- although the search is in vain unless root causes are dealt with!

“Business Value” is the positive business outcome of development (eg., Money earned, customer satisfaction, market share, conversion rate etc.), minus all costs of producing this outcome, including the delay incurred until gaining it, adverse side effects and opportunity cost of not doing something else instead. Or, in simpler terms, Business Value = success.

The following factors are commonplace, yet most companies are so oblivious to the damage these things cause that they might even be unwilling to deal with the issue:

#1 Communication

Regardless of whether it’s top/down, peer-to-peer, internal or customer facing - communication proves to be the #1 challenge in doing the most valuable thing.

Middle management filtering critical information, unsuitable use of media causes misunderstandings, waiting for responses causes unnecessary delay. Even then, not talking and acting upon assumptions often leads to the worst waste.

#2 Trust

Double-checking, approvals and permission processes as well as any other kind of control just keep people from doing that which helps the company most.

While something may always go wrong, a company built on the assumption that employees will purposely damage the business means you’ve lost already.

#3 Processes

Artificial process constraints lead to inefficiency in achieving results, oftentimes impose suboptimal solutions, are often associated with inherent waste, and might enforce unnecessary handovers.

Standardized processes are good for things where you don’t want to invest even a single minute into, yet development and its outcomes aren’t part of those.

#4 Structure

Inflexible organizational structures create indirection and dependencies, result in unavailability, reduce effectiveness, induce delays and limit the opportunities for value creation. Structural issues might reduce a developer's ability to deliver by a good 95%. As Deming said, "a bad system beats a good person 100% of the time".

#5 Saving money

Avoiding to spend money on that essential, "out of budget" component may result in a seemingly more inexpensive solution which may be a hundred times less efficient, potentially to the point where they might eat up the entire value proposal of the development effort.

Bottom line: money spent is irrelevant as long as that spending is below the value obtained. Keen spending goes a much longer way than vigilant budget maintenance.

Bonus: Consequences

#6 Artificial Dependencies

Closely related to communication, structure and trust, when people are forced to synchronize with others on topics they would have under control, the incurred communication overhead tranlates directly into reduced capacity, therefore a multiplicative factor in value reduction.
Such artificial dependencies might include non-value adding functions, such as reporting structures, centralized institutions such as "Enterprise Architecture", "Test Department" etc. As the proverb goes, "Make everything go over your desk and you are important."

#7 Lack of customer interaction

Low trust, bad communication or unsuitable processes, organizational distance etc result in an inability to deliver small increments. Every step taken without involving the customer directly is full risk of delivering zero value. This often produces a vicious circle where more and more risk is pushed downstream until all development happens without customer involvement, who is then usually disappointed to receive a worthless product.

Conclusion

Managers are continuously looking for better ways to get work done which allow them to keep the above things in place. Until we realize that the business relevant outcomes of the work are dependent on dealing with the above factors, all improvement initiatives will at best yield an efficiency increase without offering a better outcome.
Significant improvements in outcome fully depend on doing the right thing in the right way, and that means resolving the key issues around communication, trust, processes, structure and spending.