The Value Flywheel Effect: Power the Future and Accelerate Your Organization to the Modern Cloud

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As AWS Hero Gillian McCann says, “ serverless isn’t easier, but it’s better”. It’s not easy to do this. It’s hard to do all this stuff. But it’s a better way of doing it. It’s sustainable, rewarding and a more impactful way of going about your day. Now that you’ve learned about what the Value Flywheel Effect is, let’s look at the 12 key tenets that support the Value Flywheel. (This post is adapted from The Value Flywheel Effect by David Anderson, with Mark McCann and Michael O’Reilly). Organizations that recognize this will create a space for innovation. Small successes will breed larger success and spread through the organization like wildfire. This power and momentum will increase, and the path forward will become smoother. 9. The Value Flywheel Effect

Wardley Mapping with the Value Flywheel - The Serverless Edge Wardley Mapping with the Value Flywheel - The Serverless Edge

Let’s work through our approach. First, your organization needs to have a clear business goal and single-threaded leadership committed to delivering (the first phase of the Value Flywheel). In our example map below, this is shown as a pipeline. The business goal is represented as a cascading value, with the most ambitious (difficult) goal to the far left (in Genesis) and the tamer achievable goal to the far right (Commodity). For example commoditize can affect your long term value. Towards the bottom of the map, the enabler for all of this is Wardley mapping. Or the idea of challenging to make sure there’s movement. And that is the concept of the Value Flywheel. There’s clarity of purpose first. You challenge through your map, you figure out your next best action, which is your leverage, and then you move things over into long term value. Which then creates space for further innovation up at the top of the map. Pushing with great effort, you get the flywheel to inch forward, moving almost imperceptibly at first. You keep pushing and, after two or three hours of persistent effort, you get the flywheel to complete one entire turn. In a group of more than three or four people, team dynamics start to take effect, and responsibilities require clarification (never mind teams with several hundred people). The software serves a market, which is usually represented abstractly too. Finally, there’s leadership, who need to understand all this context, shape a compelling purpose, and work it into a plan to reach an outcome.Find the things really moving the Flywheel the most, and focus efforts on those pieces of work. Find ways to eliminate work that doesn’t push on those core pieces (like Atlassian), or fold them into current efforts. Make Progress Visible The Value Flywheel Effect, enabled by cloud adoption, will accelerate your business. Each phase of the Value Flywheel is anchored by three key tenets (twelve in total). These tenets will help guide you through each of the four phases of the Value Flywheel.

The Value Flywheel Effect: Power the Future and Accelerate

The flywheel effect occurs in business, just as it does in machines, because of very deliberate building and linking together of capabilities to execute against articulated strategic objectives in such a way that a compounding return on effort is introduced, resulting in continued acceleration in business growth. Key Drivers Momentum Wardley Mapping is a sense-making device developed by Simon Wardley. The constraints and language that Wardley Mapping provides are compelling for aligning your teams or peers. (You can view our post on How to Wardley Map or visit LearnWardleyMapping.com for more.) Simon talks about Compute evolving to Cloud. And the propensity of DevOps to move to the right. Along with good architecture practice, operating systems and run time. He identifies that run time is an inertia point for moving to Serverless. And a second inertia point going to Cloud. Problem prevention culture is critical. But one of the significant challenges is that silent excellence can be recognized or unrewarded. So you must be careful that you have enough people who understand what good looks like, reward it, and realize it appropriately. You don’t want to fall into a superhero ‘save the day’ mindset! If you invested in problem prevention culture, superheroes do not need to come in and save the day! The Flywheel Effect is used to describe a handful of concepts at once, which are rarely split apart.Here is each component piece I could identify, and how it relates to the Flywheel illustration.

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Compounding Return on Effort—No “one push” makes it happen.Continuous small inputs add up into an impressive output, eventually.

Serverless architecture case study - The Serverless Edge

Another advantage of scale comes from psychology.The psychologists use the term social proof.We are all influenced — subconsciously and to some extent consciously — by what we see others do and approve.Therefore, if everybody’s buying something, we think it’s better.We don’t like to be the one guy who’s out of step. This is because Network Effects (past a certain tipping point, especially when combined with virality), can be auto-catalytic. Matt Coulter receiving the Now Go Build from Werner Vogel at AWS re:Invent Developer Community and CDK PatternsAs we said, The Flywheel Effect is the mechanism we are going to describe. It’s a phrase from Jim Collins’ book Good to Great, but it is a very accurate description of what we are observing. A conference for enterprise leaders transforming their organizations, implementing techniques such as DevOps, Team Topologies, Learning Cultures, and Platform Engineering. The commoditize box is interesting because I can’t think of a time when we didn’t have some mad idea of bringing in something like threat modelling, whole team testing or some cloud strategy, like sustainability. As a technical leader it is in your remit to do that. We talk about creating space for innovation. If you have a problem-prevention culture, you’re removing a lot of busy work. Your teams can focus on innovative things and help your business succeed because they’re not fixing disasters, managing outages, or chasing their tail trying to keep things alive.That’s quite hard to explain to senior people. If you want more innovation, you need to do more boring architecture. Because one feeds the other. Do you want all your best people firefighting? Or do you want them to help you grow in the marketplace? Or have your best people do architecture so everybody can innovate?

What is engineering excellence? - The Serverless Edge

Now suppose someone came along and asked, “What was the one big push that caused this thing to go so fast?” Coverage Density. As Uber grows in a city, the outer geographic range of supplier liquidity increases and increases. Once again, Uber started in San Francisco proper. Today there is coverage from South San Jose all the way up to Napa. The more people that use Uber, the greater the coverage. What do the right people want more than almost anything else? They want to be part of a winning team. They want to contribute to producing visible, tangible results. They want to feel excitement of being involved in something that just flat-out works . […]With a team-first environment, great things can happen, but we must also ensure that the technology strategy deployed will move the team forward, not impede their progress (phase three of the Value Flywheel: Next Best Action). The level of engineering in the team must be held to a high standard—not just technology from yesteryear shifted onto a different platform. A serverless-first approach helps here. Risk We anchored our map with a senior executive, like a CEO. This is pattern we have seen many times. There’s a layer across the top here, which is ‘clarity of purpose’. And we have things here, like operational efficiency, time to value and business growth And needs around cost management, digital modernization, customer need and even secure rapid experimentation. These are things that might be top of mind for the CEO. From a company perspective, the CEO is the individual we can use as the persona most concerned with the first three tenets. Though these tenets affect everyone in the organization, the CEO has the interest of the company at heart and can ensure these three tenets are met. As Uber grows in a city, the outer geographic range of supplier liquidity increases and increases. Once again, Uber started in San Francisco proper. Today there is coverage from South San Jose all the way up to Napa. The more people that use Uber, the greater the coverage. Every time they have a player drafted or win a championship, it becomes a more desirable school for the next round of players, and on it goes. Each win makes the next win slightly easier.