What is Value Creation Planning?
Value Creation Planning is a critical exercise for Private Equity firms looking to increase value in newly acquired portfolio companies.
Effective Value Creation planning considers all elements of the newly acquired business, but among the most critical areas is the assessment of the technology delivery capability – how effectively can the business deliver new technology to market in order to drive its growth?
Plandek is the leading technology delivery analytics platform – its end-to-end software delivery metrics (KPIs) are ideal for a robust audit and Value Creation Planning exercise.
How can you use Value Creation Planning in your delivery?
Post-acquisition Value Creation Planning is extremely important, but it can be time-consuming and rely on many different (often manually collected) data sources.
Foremost among the data collection challenges is an effective review of the newly acquired organisation’s technology delivery capability. Very often PE acquired businesses are technology-enabled and depend on the effective delivery of new technology in order to maintain their competitive edge. So, the effectiveness of their technology delivery capability is a vital part of the broader value creation story.
Plandek is an analytics platform to track and drive improvement across software delivery teams/organisations. It works by mining data from delivery teams’ toolsets (such as issue tracking, code repos and CI/CD tools), to provide actionable and intelligent insight across the end-to-end software delivery process.
Plandek, therefore, provides a ‘balanced scorecard’ of metrics to assess the effectiveness of the software delivery capability and related ‘Agile DevOps maturity’. Plandek is also used by the technology teams themselves to track and drive improvement over time (and so becomes a valuable tool in Value Creation delivery as well as Value Creation Planning).
Plandek’s technology delivery capability metrics/KPIs
Plandek integrates directly with the toolsets used by software delivery teams, to surface a broad set of Agile, delivery, DevOps, Value Stream and engineering metrics. It provides these highly configurable metrics in customisable dashboards for review by key personas in the technology delivery team (from CIO to Team Leaders).
As such, it is well-suited to the Value Creation Planning exercise to assess technology delivery effectiveness. You can choose the metrics that are most relevant (or use the pre-configured metrics templates) and get an immediate and objective view of the effectiveness of the technology delivery capability.
The example ‘North Star’ metrics dashboard below, shows a typical set of ‘North Star’ delivery capability metrics that objectively assess overall Agile DevOps maturity and delivery capability. As such, they represent KPIs that are ideally suited for Value Creation Planning technology audits.
Value Delivered (by Value point). This is a core measure of value output for those organisations using value points. If value points are not used, story points give a key measure of throughput (which is a proxy measure for value delivery). Both are therefore basic measures of an organisation’s ability to deliver software and how that is changing over time, which is fundamental for any Value Creation Planning exercise.
Lead Time to Value
Lead Time is a core agile software delivery metric which tracks an organisation’s ability to deliver software early and often. The concept of Lead Time is borrowed from lean manufacturing.
Lead Time refers to the overall time to deliver an increment of software from initial idea through to deployment to live – i.e. the complete end-to-end software delivery life cycle (SDLC). As such it is probably the first metric that the C-Suite should ask for to better understand how effectively a technology team is delivering.
The shorter the Lead Time, the higher the ‘velocity’ of the delivery team and hence the quicker the organisation is going to receive new features. Again, this is therefore a vital KPI when assessing technology delivery capability as part of a broader Value Creation planning exercise.
Deployment Frequency is another fundamental measure of Agile software delivery (or Agile DevOps maturity). A core objective of Agile delivery is the ability to develop and deploy to live small software increments rapidly. Deployment Frequency tracks that base competence and is a powerful metric around which to focus effort at all levels in the delivery organisation. Hence it is another key KPI for a ‘balanced scorecard’ via of technology delivery capability.
Escaped Defects is a simple but effective measure of overall software delivery quality. It can be tracked in a number of ways, but most involve tracking defects by criticality/priority.
When these simple Agile delivery metrics are viewed together, you can get a well-balanced view of how effectively the technology team is delivering over time.
Sprint Target Completion
‘Scrum Teams’ (also known as squads) and ‘Sprints’ are the basic building blocks of Scrum Agile software delivery. If Scrum Teams consistently deliver their Sprint goals (a ‘Sprint’ typically involving a two-week increment of work), Agile software delivery becomes relatively predictable.
On the other hand, if Scrum teams fail to deliver their planned sprint goals, then it becomes impossible to predict delivery outcomes across multiple teams and longer time periods. Scrum team predictability (often referred to as ‘dependability’) is therefore a critical success criterion in Agile software delivery and should be assessed as part of a technology Value Creation Planning exercise.
High-performing Scrum teams will consistently have Sprint Target Completion rates in excess of 85%.
The above are some examples of relevant metrics to consider in a Value Creation Planning exercise. There are many others that are commonly used (and can be surfaced through Plandek) to assess a technology delivery capability, including the DORA metrics and Flow metrics.
Using Plandek in ongoing Value Creation delivery
Plandek is designed to empower users from Team Leads to the CIO with insight to track and self-improve software delivery performance over time.
It is therefore ideally suited for the initial technology audit during a Value Creation Planning initiative, but also to underpin ongoing value creation delivery (via a metrics-led continuous improvement process) after the planning process has been completed.
Plandek’s Customer Success team help clients select the metrics appropriate for the Value Creation Planning exercise – and then when the exercise is complete the team engages with key personas within the software delivery team (typically Team Leads, Scrum Masters, Delivery Managers, Engineering Managers and Product owners and technology leadership) to roll-out customised metrics dashboards – so the entire delivery organisation is optimising around the metrics selected as critical at the initial Value Creation Planning stage.
Plandek also offers pre-configured ‘Xcelerator’ dashboards to help teams/managers improve particular aspects of software delivery (see graphic below).
Setting up Plandek within a Value Creation Planning initiative
Plandek is a SaaS-based analytics solution that is very easy to set up. It integrates seamlessly via the APIs of the underlying DevOps toolsets used by delivery teams. It is stack-agnostic and is most commonly integrated with Atlassian and Azure DevOps toolsets.
The three tool types that are most important to connect, in order to surface the metrics suited for a Value Creation Planning exercise are:
- Workflow management tools (like Jira or the Azure DevOps equivalent)
- Code repositories (such as Git, and Bitbucket)
- CI/CD tools (such as Jenkins, CircleCI etc)
Users are able to connect their toolsets via the Plandek website (www.plandek.com) which offers a simple self-sign-up journey.
Plandek (www.plandek.com) was co-founded in the UK in 2017 by Dan Lee (founder of Globrix) and Charlie Ponsonby (founder of Simplifydigital).
Plandek is an analytics platform to help software delivery teams deliver valuable software, faster and more predictably – across and within value streams.
Plandek works by mining data from delivery teams’ toolsets (such as issue tracking, code repos and CI/CD tools), to provide actionable and intelligent insight across the end-to-end software delivery process.