Business Value Engineering

January 5, 2009

Business Value Engineering? What is that?

Well, we mean all the practices and work-methods around assuring that more and more Business Value is being delivered to the customer, and the firm satisfies all its constraints (e.g., good return to shareholders).

This is based on a key Lean idea. We are trying to optimize the end-to-end flow of Business Value. In the simple case, from the team to the customers. We are not trying to optimize one part of that, but the whole. (Lean notes that often, bordering on usually, by optimizing one part, we reduce the productivity of the whole, ironically and contrary to what we think we are doing.)

And we are not trying to improve a part that is not our biggest problem, even though that may help. We are trying to make the biggest improvement possible, given time, money and people constraints.

We think it is better to view this flow as an engineering process, that, like other engineering processes, is open and visible, and we are continuously learning and improving.

BV Engineering encompasses all the processes of giving the team the business information they need: The high level Business Value and the low-level requirements so they can build it properly the first time (or have a better chance to).  And all the processes of delivering that product and finding out, “Gee, did we really build the right thing?”

We, of course, view this is an Agile context, where so many things involved are subject to constant change and learning.

So, you see that part of the effort is to identify and test all the assumptions we are making. Part of the effort is to organize things in such a way that we can quickly identify which parts of the flow are weakest (and some part is the weakest). Part of the effort is to set up small ‘scientific’ tests (in a business context).

  • Part of the effort is to learn faster.
  • Part of the effort is to enhance just-in-time knowledge creation.
  • Part of the effort is to harness change for our firm’s competitive advantage (similar to an Agile principle).

Our bias is that most teams could benefit more by improving Business Value Engineering than by doing anything else. To the tune of improving BV delivery by 3 times within one year. (This, of course, does not keep you from also making other improvements.)

I will be talking about this topic more in a meeting in Atlanta on Jan. 8. See the Agile Atlanta Yahoo group for more details, or contact me if you have interest.

 

 

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One thought on “Business Value Engineering”

  1. control valves

    I believe construction of such projects requires knowledge of engineering and management principles and business procedures, economics, and human behavior.

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