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Value Stream Management Is Now a Major Market Category

October 14, 2022

When I left Forrester in 2018, our research teams had conversations about Value Stream Management (VSM) but at that time many of our enterprise clients had started their DevOps and Agile journey and thought that VSM would distract them from their path. While publishing the first Upskilling IT in 2019 report with DevOps Institute, DevOps was somewhat leveraged by 60% of enterprise teams and 76% of the folks we surveyed relied on Agile as a framework. At that time, VSM was not yet on the horizon of enterprises. Fast forward, to 2022s during the research of Upskilling IT 2022, we found that VSM was leveraged at 20% (sorry but we did not probe for how deep and wide that leverage was) across global enterprises.

In 2020, as an independent Industry Analyst for Research In Action, I explored the top vendors offering VSM platforms and found a lot of differences among them. We published that research in July 2020 and I was disappointed as the study was not hugely popular as we got very few reads on our website. I updated the research again in November 2021 and finally, we saw an increase in readership. In that last study, we found that the challenges for VSM adoption such as executive buy-in, budget constraints and ‘not knowing where to start’ still existed, but had been reduced. Unfortunately, the biggest hurdles still were the lack of process maturity and skills to make progress around VSM and the VSM platforms.

At the same time, Helen Beal, chair of the Value Stream Consortium (also a great friend) and I developed and published the first inaugural State of Value Stream Management 2021. Our findings confirmed that usage of VSM platforms was low as only 17% of our survey respondents leveraged VSM platforms to automate the different phases within VSM. While this was disappointing, for me as an analyst it was a confirmation that the market category of Value Stream Management platforms had not yet evolved into a major market category even though VSM had been defined in 2018 by my former analyst fellow at Forrester, Chris Condo.  

So, this brings me to today. The category of VSM, while defined in 2018, and adopted in manufacturing for a long time, has finally transposed into a major market category. It finally has reached a state where IT and business teams are realizing that VSM provides “unique insight”. A significant number of enterprises had an “aha” moment solving major pain points during their Agile and/or DevOps journey adopting phases across the VSM lifecycle. But I am getting ahead of myself.

Markets and changes take time and that is exactly what is happening in this space. While VSM has been around for a long time in manufacturing, we are only at the beginning. In our second report The State of Value Stream Management 2022, we confirmed that. As Helen said in her recent blog, VSM is in the renaissance (or rebirthing) state. Both of us realized that even though we had been talking about VSM, researching, presenting, and discussing it… enterprises across the globe still have work to do. Helen’s epiphanies of: organizations not finding time to leverage VSM, the tough work to develop metrics which are then never used, and many organizations are stuck somewhere are valid, but the good news is:

  • More adoption across the VSM lifecycle is evident and organizations are using this to understand and optimize their organization and with it the outcomes.
  • New roles are defined who own the ongoing conversation, upskilling and these folks are part of the renaissance of VSM.
  • Key metrics are being populated and used to provide insights for improvements and changes around people, process, and technology.
  • Business and IT members are moving toward each other to work as partners across the different stages of product development.
  • Leaders are getting curious about VSM due to the success of others and are launching initiatives to learn and explore.
  • Value Stream Mapping is being used. It might not be yet to the point where they change the way they are working but it gives them insight into the current value streams, which is a first step.
  • DevOps and Agile alone are huge changes and require a significant effort but those who are in these journeys are willing to change how they work, and those will take the next steps into VSM.
  • Tools have always been the holy grail of IT teams but budget constraints, challenges to observe, continuously improve and accelerate speed and quality, and governance, risk and security requirements are forcing a Übertool approach. The time for VSM platforms is now as these tools are designed to provide contextual insights to different personas for business and IT collaboration and decision-making.

In my career, I have had many conversations with clients who are frustrated, feel stuck or overwhelmed and are asking me how they can continue to find the energy and enthusiasm to drive change. While there are other ideas, here is what I have continuously suggested repeatedly:

  • Break down the barriers. It is not easy to innovate and change and while your thoughts on change are noble, the way things happen is that it takes more than one to change how work gets done. Indeed, the more innovative or the more change, the more barriers the status quo will erect in your way. Change agents must understand this and should not get discouraged when acceptance of doing something new or different comes slowly. I’ve found that the best way to break barriers is to share the success of others, test or experiment while sharing the outcomes and learnings and continue to evangelize your ideas.
  • Don’t be afraid. Many teams have been adopting a variety of automation tools but none of them are really the holy grail that appeals to every function, or geographic location but these tools deliver the essentials. Stay on that path but seek to understand if there is a way to see things from an end-to-end (value stream) perspective and what that would do. Talk to others around you and understand if they are happy with what visibility they have. The worst case is to incite no reactions to your questions, but what might happen is that your peers might bond with you towards change.  
  • Be flexible about the path. There are many different paths towards VSM so be flexible and do not force your way. Listen to those who are willing to join forces and allow them to be part of the journey.
  • Don’t listen to those who say it cannot be done. Your organization might be saturated with change, frustrated with the amount of work caused by already introduced frameworks and best practice models which can lead to resistance by some. Don’t let these people stop you. Look at it from the perspective that these folks might feel successful during that previous curve of change and therefore cannot empathize with the next curve of change. Keep embracing change so that you can continue towards that next curve of innovating how work gets done.

In the week of October 17, 2022, the Value Stream Management Consortium is hosting an inaugural in-person event called Flowtopia. The team has an excellent agenda packed with experienced practitioners who are sharing stories about their VSM journeys. I cannot wait to hear about the event when Helen and the others come back. But I know there will be a bunch of networking and thought-provoking lean coffees and huddles.  

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Eveline Oerhlich

Eveline Oerhlich

Eveline Oerhlich is an Industry Analyst and Chief Research Officer at DevOps Institute.