Thursday, March 17, 2016

Kanban's Survivability Agenda and Antifragility

A conversation on the kanbandev online forum has triggered this post. The discussion concerns how evolutionary change is applied, particularly when the fitness landscape is changing to such a degree that large rather than small steps are needed to survive in the new competitive environment. It got me thinking that we must consider evolutionary change on more than one level if we want to address what the Kanban Method calls its Survivability Agenda.

The first mystery to consider is how evolution jumps across valleys in the fitness landscape. Seems to me there are 3 possibilities. You could make large leaps in what you think are promising directions. Doesn't sound a great idea because you're doing reasonably well as you are (different if you know you face an imminent existential threat, but it has the same likely outcome). You could wait for the peak you're climbing to decline in the fitness landscape, to the stage when small steps will move you off it. That's probably going to be too late. Or you rely on diversity. Your peak may be declining and you may - if trends continue - be doomed, but others are in better spaces and they will grow.

The final option sounds like disaster. But I think it is the way evolution works. Processes and technologies evolve much faster than biological organisms (see Eric Beinhocker's Origin of Wealth for more discussion of this) because the cycles of copying with differences, selection, amplification/damping are much shorter. Not only that, they are accelerating, which is what is now so threatening to large organisations. Does this mean large organizations must sit back and let the inevitable happen? Of course not. The key is to have multiple fragile parts, so the organization itself is more antifragile.

In Antifragility N N Taleb discusses how hierarchies can gain antifragility by allowing fragility within them. And also how natural antifragility can be irresponsibly eroded, if higher structures in the hierarchies (like governments) absorb the fragility of structures within them (like banks). Back to the Dinosaurs - they were antifragile as a species (genus? - I don't know; biologists please excuse) to most changes in the fitness landscape less than massive climate change. But since that was the limit of their antifragility they died out. But the higher level in the hierarchy (life on earth) survived (just) because there were some funny rat-like creatures running around scratching a living beneath the dinosaurs feet. They found themselves in the foothills of some pretty small peaks of the fitness landscape, and made the most of it.

So the levels in the hierarchy of Kanban (e.g. Personal, Team, Product, Portfolio) and its stress on the exploitation of real options, are keys to its "Survivability Agenda".* Portfolio management is key. It is where antifragility of the organisation can be built or lost. Portfolio Management must decide what level of investment different products and product ideas receive, and for how long before the return must be tangible. In a stable fitness landscape they might consider that the one successful product they have, should receive all the investment. This builds a monoculture which is vulnerable to shifts in the landscape. Keeping options has a cost but preserves the antifragility at the higher scale. Diversity within the organization and a culture which encourages innovation, learning and experimenting will build greater survivability. Note that in part this is because it tolerates and encourages more fragile technologies and processes within it. They are limited in their ability to survive - indeed they need to maintain the differences from more successful instances, precisely so that diversity is preserved. Eric Bienhocker has an excellent account of Microsoft's use of options when developing Windows. They also had teams investing in OS/2, Apple and Unix. Clearly it would not have been helpful if the Unix team say, thought the OS/2 option was better and started working on that instead of Unix.

In summary, I don't think Kanban provides any magic bullets here. Hopefully it exposes the issues in building resilient or antifragile organisations but it is down to the strategists, managers and leaders within these organisations as to how the tools and insights might be applied. Different groups make different choices. There is no recipe. That in my opinion why it remains one of the most interesting and important methods around.