Tragedy of the PMO
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Game Theory says PMOs can't possibly work. But there's a way – via Throughput Accounting, Open Book Management, and Business Agility. Two quick games show how and why.
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Tragedy of the PMO
- 1. The Tragedy Of The PMO
- 2. Does it? The PMO should promote collaboration, minimize tech debt, and maximize portfolio throughput.
- 3. The Bonus Dilemma Two managers, One Minty each. If both collaborate, both win a Minty If both cheat, neither wins. If one cheats, they win the other’s Minty + a bonus 2.
- 4. The N-Party Iterated Bonus Dilemma Pairs take 6 turns each. Negative scores allowed. The remaining 50% play each other Each new round, Managers start with one Minty each. After 6 turns, cull the lowest 50% of all managers.
- 5. Many variations on this greasy pole! Try “The Evolution of Trust”: http://ncase.me/trust/
- 6. So much for collaboration. What about Throughput and Tech Debt? Let’s play PMO Poker …
- 8. 1919 1919 4 BonusTech Debt 4 Managers each with a 20 chip P&L Shuffle and deal 10 Features to start • Each feature has 2 cards: • a red card –> feature cost • a black card –> feature return Managers ante one chip each to form a release bonus. • Bonus paid to highest scoring manager at the end of the release Managers take turns delivering one feature each. • A Manager may R&D up to 3 new features a turn @ 1 chip each • A new feature they don’t deliver is available to all other Managers
- 9. 1919 1919 4 BonusTech Debt Tech Debt: • The red card for each feature you deliver is added to the tech debt • At the start of the next release every Manager must pay 10% interest on their PMO’s total tech debt • At any time, any Manager can pay off any tech debt card at a cost of 50% its face value. A Release ends when no Manager wishes to spend more P&L • Bonus is paid to the Manager with the highest return. They spend it on a new Ferrari – it doesn’t go to P&L. • Each Manager starts the next release with a 20 chip budget minus the tech interest. Tech debt endures ...
- 11. 19 4 11 1919 BonusTech Debt Manager one delivers a feature.
- 12. 18 4 11 610 BonusTech Debt The other managers deliver features.
- 13. 1 4 1 12 BonusTech Debt Play continues until the end of the release.
- 14. 14 4 14 1414 BonusTech Debt 60 4 Next release everyone has a new budget but all pay 10% interest on tech debt.
- 15. That didn’t work. Let’s try “Lean Startup”! (Same game but P&Ls start with the return from last release – their black card score)
- 16. That didn’t help either. Now what?
- 17. Throughput Accounting Open Book Management and Business Agility Throughput
- 18. 19 19 4 Bonus Tech Debt 76 P&L This time we’ll try Business Agility. We have no winners’ bonuses and just one P&L. We all get a one chip bonus if there’s positive return, and none of us get it if there’s negative return.
- 19. 19 19 4 Bonus Tech Debt 76 P&L Stream one eliminates features that can’t yield net profit after paying tech debt.
- 20. 19 19 4 Bonus Tech Debt 73 P&L … and then immediately analyzes three features ...
- 21. 19 19 4 Bonus Tech Debt 69 P&L … yielding three worth delivering.
- 22. 19 19 4 Bonus Tech Debt 63 P&L Stream 2 analyzes three new features …
- 23. 19 19 4 Bonus Tech Debt 63 P&L … but none are worth delivering after accounting for tech debt.
- 24. 19 19 4 Bonus Tech Debt 60 P&L Stream three has better luck …
- 25. 19 19 4 Bonus Tech Debt 54 P&L … and gets busy delivering two features.
- 26. 19 19 4 Bonus Tech Debt 51 P&L Stream 4 also discovers two features worth delivering …
- 27. 19 19 4 Bonus Tech Debt 41 P&L In real life they all do this in parallel.
- 28. 19 19 4 Bonus Tech Debt 29 P&L Everyone has done the R&D part of their next turn.
- 29. 19 19 4 Bonus Tech Debt 20 P&L And now there’s enough P&L available to eliminate the tech debt …
- 30. 19 19 4 Bonus Tech Debt 2 P&L 0 11 11 Before releasing all these features and starting the next release cycle ...
- 31. 〉eXponential return 〉 Simple design 〉 Continuous throughput 〉 Autonomous teams 〉 Learning: triple-loop 〉 Ecosystems thinking What’s the difference between Agile Organization and some other kind?
- 32. … if it uses Business Agility. A PMO can promote collaboration, minimize tech debt, and maximize portfolio throughput …
- 33. 〉Products are service ecosystems 〉Product return curves are sigmoids 〉Don’t chain the curves; stack them eXponential return
- 34. 〉Design means the elegance of minimum 〉Not look and feel; how the ecosystem works 〉Design, Delivery & Devops work hand-in-glove Simple design BUILDLEARN MEASURE TESTS DATA CODE REFACTOR
- 35. 〉At one time there’s one bottleneck constraint 〉Work on other constraints is premature 〉Because it won’t increase Throughput Continuous throughput Throughput
- 36. 〉Self-organising teams don’t have masters 〉Self-managing streams don’t have owners 〉Leadership as a Service + Chapters & Councils Autonomous Teams
- 37. 〉Value flow, work flow, and flow of learning 〉Self-organizing transformation: steel threads 〉Continuous Delivery x Continuous Adaptation triple loop Learning Learn Build Measure Simplify Portfolio Squad Stream
- 38. Ecosystems thinking 〉Ecosystems as networks of mutual benefit 〉Whole board: think globally, act locally 〉Avoiding hill-climbing: iterative and reductive
- 39. X S C A L E Xmas Watch out for the Special! Coming Soon! X S C A L E A l l i a n c e X S C A L E A l l i a n c e . o r g Learn Build Measure Simplify Learning Flow Work Flow Value Flow