Beyond Lean Software Development

We must look beyond software development to the application of Lean to the entire software ecosystem.

As exciting as the development of Lean Thinking in the realm of software development has been, I fear many people are not seeing the bigger picture.   What is afoot here is not just an improvement in the way we build software.  It is much, much more.  A whole industry has the potential to be transformed by these ideas.  More than an industry, in fact: the whole software ecosystem.

The software industry is now global both in terms of product development and its customer base.  It is increasingly adopting a just-in-time delivery and payment model - Software as a Service (SaaS).  Agile methods have helped facilitate this, and Lean is reasonably seen as the next step, though few realize that Lean is perhaps just as radical a departure from Agile as Agile was from waterfall.  

But let us look beyond software development.  If we look at the software industry as it now stands, much is lacking from a Lean perspective:

Organizations remain siloed, with wasteful walls between marketing, sales, support, and development. Hiring and staff development is haphazard. Product management, customer support, and sales remain largely untouched by Lean. 

Financial resource allocation is still done in big batches.  Financial processes may be better documented (and certainly much more costly and complex) as a result of SOX, but they are not Lean.  Push-based estimation and planning are still mainstream.

Short-term thinking prevails  over strategy.  Executives do not appear preoccupied with continuous improvement and organizational learning, focusing instead on short-term revenue. Investors have yet to discover what a difference Lean will make in financial performance; they remain largely unaware of Lean.

Software is a high-clockspeed industry, with tremendous pressure for young companies to perform in the short term, and then move towards an exit strategy.   There are few companies working towards a long-term vision.  Larger software companies remain focused on quarterly results.

IT organizations in mid-sized and large companies develop tremendous amounts of software as well, and are certainly part of the broader software ecosystem.  Unfortunately, they remain burdened by a bureaucratic mindset where people are punished for being wrong instead of rewarded for learning.   Innovation and creativity are not viewed as core values in most of these organizations.

Aerospace and Defense Companies, the Health Care Industry, and the Financial Services Industry, which also develop and depend on software as part of their products, suffer the same problems.  This is partially due to Government Regulation, but they also labor under a command-and-control managment culture. 

So before we get too excited about how the Agile Movement is beginning to discover Lean Thinking, let  us take a hard look at the big picture.  There is so much more that needs to be addressed.   It is not developers and other staff members who are most in need of education about Lean - they take to Lean because it feels like a more natural and less obstructed way of working.  The people who really need to discover Lean are the folks on executive row and in the boardroom.  At least that seems to be the case in the software industry.

In the seminar we held recently here in San Diego, a Chief Technology Officer of a mid-sized ($100M+) company made a salient comment.  She remarked that as the day progressed, the scope of the people she thought she needed to have involved in her company's Lean Transformation grew from a handful of key managers to dozens of people, including her entire management team.  Applying Lean to Software Development, or even Product Development, is not enough.  All business functions are ultimately related to all others, in spite of seemingly heroic efforts to manage businesses as largely disconnected silos.  "I want to get the whole company on board with this," she said.