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Confidential1
Agile: A peek into Philips Agile
transformation
Sriram Venkatasubramaniam
Sr. Director, IT Delivery
June 2015
Confidential2
Agenda
Philips Overview
 “Accelerate” transformation program
Agile: Philips’ journey
 The starting vision
 Our journey
 Agile Center of Excellence
 Agile Adoption and Measurement
 Agile Delivery Model
 Concept of Delivery Centers
 Case Studies
 Lessons Learnt
 The road ahead
Q&A
1
2
3
Confidential3
Agenda
Philips Overview
 “Accelerate” transformation program
Agile: Philips’ journey
 The starting vision
 Our journey
 Agile Center of Excellence
 Agile Adoption and Measurement
 Agile Delivery Model
 Concept of Delivery Centers
 Case Studies
 Lessons Learnt
 The road ahead
Q&A
1
2
3
Confidential4
Philips
 Royal Philips of the Netherlands is a diversified technology company, focused on improving
people’s lives through meaningful innovation in the areas of
 Healthcare
 Consumer Lifestyle
 Lighting
 The company is a leader in cardiac care, acute care and home healthcare, energy efficient
lighting solutions & new lighting applications, as well as male grooming and oral healthcare
 We believe in continuously reinventing ourselves through transformation programs like
Accelerate, PIL, Gemini, etc.
2016 Health-Tech
Lighting Solutions
More than 120 years of history

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When organizations move to agile for software delivery, there is often tension with traditional portfolio management. This talk will illustrate how an organization can move from traditional portfolio management approaches to one that embraces agile software delivery. Doing so enables organizations to become predictable, improve the flow of value delivered, and pivot more quickly if necessary. We will demonstrate the use of governance that allows a more adaptive portfolio management approach. We will cover topics that enable agile portfolio management including: Lean techniques for managing flow Effective prioritization techniques Long range road-mapping Demand management and planning Progressively elaborated business cases Validation of outcomes Support for audit and compliance needs These topics will be illustrated by real-world examples of portfolio management that have been proven over the last five years with a wide range of clients.

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Confidential5
Philips Accelerate Program
Accelerate! : Our worldwide business transformation program - is about
changing the way we do business and unlocking our full potential. To become
more agile, innovative and entrepreneurial as a company
Confidential6
Accelerate Program – Philips IT
ASP
ITGS
IT
Delivery
Confidential7
Agenda
Philips Overview
 “Accelerate” transformation program
Agile: Philips’ journey
 The starting vision
 Our journey
 Agile Center of Excellence
 Agile Adoption and Measurement
 Agile Delivery Model
 Concept of Delivery Centers
 Case Studies
 Lessons Learnt
 The road ahead
Q&A
1
2
3
Confidential8
Our starting vision
 Reduced time-to-market and increased
business relevance of technology solutions
 Agile is a mindset, not just a methodology
 Fixed Team, Fixed Budget, Fixed Release
 We adopted SCRUM methodology
 Small iteration cycles (2-4 weeks) in
collaboration with business
Network of technology partners to provide Philips access to scale, innovation and efficiency
Product Engineering approach - End-2-End Involvement via CVP from Agile development to catalogue
deployment
Agile/Output Based Delivery
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Confidential9
Our Journey
Doing:
2012
• Know the Scrum
method
• Know how to
perform the process
• Go through the
motions neatly
Becoming:
2013 – H1
• Start to make small
variations /
improvements
• Start to understand
why things work
this way
• Able to argue why
this is better
Being:
2014
• Unable to think
different
• Transform
opposite ideas to
current values &
mindset
• Deep knowledge
internalization
Consciously
Incompetent
Consciously
Competent
Unconsciously
Competent
Excelling:
2015 onwards
• Agile all the way
• Continuous
Improvement
across areas
• Build further on
existing
knowledge and
capability
Continuously
Improving
You got to be careful if you don't know where you're going, because you might not get there
Confidential10
Agile Center of Excellence (ACE)
IT
• Trainings
• Workshops
• Events
• Free books/materials
• Webcasts by senior
management
• Company-wide
program (Accelerate)
• Agile maturity
assessment
Partner
• KPIs to ensure agile
adoption
• Engagement in agile
framework
• High quality scrum
masters, agile coach
• Scrum ceremonies
• 100% use of Rally
• Agile maturity
assessment
Business
• Business involvement
through product
owner
• Communicating the
importance of agile
• Building product
backlog
• Product owner training
• Agile maturity
assessment
Knowledge is knowing tomato is a fruit, wisdom is not putting it in a fruit salad
Confidential11
What gets measured gets delivered….
• Adherence to ART releases
• Offshore percentage
• Velocity increase for all active scrum
teams in rally
• Automation of test scenarios &
Regression Suites
• “Stairway To Heaven” star
The early bird might get the worm, but the second mouse gets the cheese
Some additional KPIs
Confidential12
The results speak for themselves….
Yesterday is history, tomorrow is mystery, focus on today, that is why it is called “The Present”
To leverage the benefits that Agile brings to Philips, the
Agile Center of Excellence supports teams, programs, and
management in adopting the Agile way of working.
Focusing on short-cycled value delivery,
we use internal expertise and experience,
combined with outside-in views of our coaching partners.
The Agile Center of Excellence provides effective trainings,
pragmatic coaching and organizes events to ignite,
sustain, and reinforce the Agile mindset.
Unveiling the value of the Agile Center of Excellence…

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Confidential13
Agile Delivery Model
Prioritize &
Group Epics
Epic backlog
Per team
Business IT demand
(vision)
E2E Solution
Development
and rollouts
Product
A
Feature/Process teams
All demand is grouped into
products and the overall
product roadmap is budget
approved
Breakdown
into capabilities
& epics
Release 1
Sprint A Sprint B
Release 2
Sprint C Sprint D
Release n
Sprint n
User story User story
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Team 1
Legacy & E2E
enhancements
Sprint / release planning
Product
B
Roadmap Product A
Q1 Q2 Q3 Q4
LPC LPC LPC LPC
High level demand
(Epic level) is
prioritized on a
roadmap
Team 1 Team 2 Team 3
AgileDeliveryAgilePortfolioManagement
Q2
1
2
3
4
5
6
The full process visualized from
vision to sprints
1 - Gather and review demand
2 – Cluster and approve demand
3 – Quarterly Budget Release (Fixed
Budget) and Team approval (Stable
Team) per product
4 – Demand Breakdown
5 – Demand Prioritization into team
backlogs
6 – Sprint and Release planning
Time is precious, spend (waste) it wisely
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Scaled Agile Framework Implementation
The best curve in your body is your smile, flaunt it !!!
Confidential15
Concept of Delivery Centers
Technical
Design
Functional
Design
Delivery
Management
Supporting
Functions
Partner
Development
RAMPS,
Transition,
Release
Delivery Center
A wise man can learn more from a foolish question than a fool from a wise answer
Confidential16
Salient Features of our Agile Delivery Model
High Offshore ratios
Continuous Improvements
Lean principles (Elimination of waste/redundancy)
Delivery Excellence
Test Factory Integration
Testing Automation
Build and Deployment/ Configuration Automation
Best Practices adoption
Follow your heart but do not forget to take your brain with you
D E VO P S

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Case-Study 2 (Foundation Platform)
How we operate
ART Planning
sessions
Hackathons
Continuous
Improvement
Testing
Automation
DevOpsPIL Cadence
• Scaled Agile Framework
• Release based cadence
• Well-defined processes
• Frameworks and Templates
• Tools and Checklists
• E-learning on-boarding course
• Work Instructions (Wow documents etc.)
Best Practices
Whenever I find the key to success, someone changes the lock
Confidential18
Case Study 2 - Value Delivered - Order to
fulfillment Program
Goals Actions Achievements Lessons learned
Have feature teams that
deliver E2E functionality
Advice & coach on restructuring the
teams to from silo’ ed component to
feature teams
8/10 Build & Test teams into virtual
end2end integrated teams
Don’t accept half
solutions
Improve quality of the Team
Backlogs
Create standardize hierarchy in
epics/features and user stories,
driven by the compliance teams.
Organized Really sessions, PPTs,
movies
From 1000+ to 2 orphan user stories
in the backlogs
Start Integration early and
often
Initiated integration demo’s , coached
for continuous integration inside the
teams
Integration demo’s happen every 2
weeks
Teams need to be in the
driving seat, start small &
expand
Make teams self organize to
improve
Visualize flow of small pieces of work
going through the process
90% Velocity reliability. AVG release
velocity increase in 2014 from 21 to
41 over the teams
If only O2F was end2end
value oriented…
Engage product owners
from business in demo’s so
we have bi-weekly
interaction and feedback
Create transparency on PO
involvement, empower & coach team
decision making when PO is not
available
94% Product Owners joining demo
and prioritizing teams backlogs. On
average 85% acceptance of user
stories
Deploy early by including
NLATAM and compliance in
sprint rhythm
Simplification and increased agility
IDC process with the IDC teams
40%* decrease in throughput time in
the IDC process
Confidential19
Case-Study 3 - Idea-2-Market
Agile Software Playbook’
(ASP) has been created to:
• Share common practices
across teams
• Help teams in embracing
Agile and SAFe mindset,
• Provide ‘real time
knowledge’ with ‘practical
experiences’ (“artifacts” in
Agile terminology)
The Agile transformation is
expected to touch 50 Philips
locations across the globe,
projects in 28 Businesses and
4000+ engineers across various
roles
I2M Excellence focuses on
capability building in a number
of critical areas such as digital
and aims at :
• Developing better quality
software in a predictable,
fast and agile way
• Leveraging standardized
processes, tools and
development methodologies
in I2M
To support the transformation I2M has
identified Agile methodology as a key
enabler. SCRUM practices will form the
foundational core, on which we build
SAFe practices
The most successful people have plan A at the front of their mind and plan B at the back
Confidential20
Lessons Learnt
Agile should not be an IT driven initiative only. Take the business along.
Transformation agents – coaches and delivery managers play a vital role to agile
adoption and success. Gemba leadership is key.
Keep sharpening the axe. Build assets, implement incremental processes towards
Devops, pursue in-sprint testing and automation, encourage democracy and harmony
Systems Team is significant to keep enhancing the principles,
procedures, guidelines, assets and thereby keep the platform stable.
Scrum Ceremonies like ART Planning, SoS, Retro, stand-ups, etc. make a big impact in
identifying the impediments and their resolution
Experience is the name everyone gives to their mistakes

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Strategies for Large Scale Agile Transformation
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Confidential21
The road ahead
Make benefits of
agile secular
Get Scaled agile to
work seamlessly
Get all to dance
to the same tune
Enhance the
coverage of Agile
I won’t be impressed with technology unless I can download food
Live the spirit of
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Confidential22
Confidential23

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Agile Philips Journey

  • 1. Confidential1 Agile: A peek into Philips Agile transformation Sriram Venkatasubramaniam Sr. Director, IT Delivery June 2015
  • 2. Confidential2 Agenda Philips Overview  “Accelerate” transformation program Agile: Philips’ journey  The starting vision  Our journey  Agile Center of Excellence  Agile Adoption and Measurement  Agile Delivery Model  Concept of Delivery Centers  Case Studies  Lessons Learnt  The road ahead Q&A 1 2 3
  • 3. Confidential3 Agenda Philips Overview  “Accelerate” transformation program Agile: Philips’ journey  The starting vision  Our journey  Agile Center of Excellence  Agile Adoption and Measurement  Agile Delivery Model  Concept of Delivery Centers  Case Studies  Lessons Learnt  The road ahead Q&A 1 2 3
  • 4. Confidential4 Philips  Royal Philips of the Netherlands is a diversified technology company, focused on improving people’s lives through meaningful innovation in the areas of  Healthcare  Consumer Lifestyle  Lighting  The company is a leader in cardiac care, acute care and home healthcare, energy efficient lighting solutions & new lighting applications, as well as male grooming and oral healthcare  We believe in continuously reinventing ourselves through transformation programs like Accelerate, PIL, Gemini, etc. 2016 Health-Tech Lighting Solutions More than 120 years of history
  • 5. Confidential5 Philips Accelerate Program Accelerate! : Our worldwide business transformation program - is about changing the way we do business and unlocking our full potential. To become more agile, innovative and entrepreneurial as a company
  • 6. Confidential6 Accelerate Program – Philips IT ASP ITGS IT Delivery
  • 7. Confidential7 Agenda Philips Overview  “Accelerate” transformation program Agile: Philips’ journey  The starting vision  Our journey  Agile Center of Excellence  Agile Adoption and Measurement  Agile Delivery Model  Concept of Delivery Centers  Case Studies  Lessons Learnt  The road ahead Q&A 1 2 3
  • 8. Confidential8 Our starting vision  Reduced time-to-market and increased business relevance of technology solutions  Agile is a mindset, not just a methodology  Fixed Team, Fixed Budget, Fixed Release  We adopted SCRUM methodology  Small iteration cycles (2-4 weeks) in collaboration with business Network of technology partners to provide Philips access to scale, innovation and efficiency Product Engineering approach - End-2-End Involvement via CVP from Agile development to catalogue deployment Agile/Output Based Delivery If you do not succeed in the first attempt, skydiving is not for you
  • 9. Confidential9 Our Journey Doing: 2012 • Know the Scrum method • Know how to perform the process • Go through the motions neatly Becoming: 2013 – H1 • Start to make small variations / improvements • Start to understand why things work this way • Able to argue why this is better Being: 2014 • Unable to think different • Transform opposite ideas to current values & mindset • Deep knowledge internalization Consciously Incompetent Consciously Competent Unconsciously Competent Excelling: 2015 onwards • Agile all the way • Continuous Improvement across areas • Build further on existing knowledge and capability Continuously Improving You got to be careful if you don't know where you're going, because you might not get there
  • 10. Confidential10 Agile Center of Excellence (ACE) IT • Trainings • Workshops • Events • Free books/materials • Webcasts by senior management • Company-wide program (Accelerate) • Agile maturity assessment Partner • KPIs to ensure agile adoption • Engagement in agile framework • High quality scrum masters, agile coach • Scrum ceremonies • 100% use of Rally • Agile maturity assessment Business • Business involvement through product owner • Communicating the importance of agile • Building product backlog • Product owner training • Agile maturity assessment Knowledge is knowing tomato is a fruit, wisdom is not putting it in a fruit salad
  • 11. Confidential11 What gets measured gets delivered…. • Adherence to ART releases • Offshore percentage • Velocity increase for all active scrum teams in rally • Automation of test scenarios & Regression Suites • “Stairway To Heaven” star The early bird might get the worm, but the second mouse gets the cheese Some additional KPIs
  • 12. Confidential12 The results speak for themselves…. Yesterday is history, tomorrow is mystery, focus on today, that is why it is called “The Present” To leverage the benefits that Agile brings to Philips, the Agile Center of Excellence supports teams, programs, and management in adopting the Agile way of working. Focusing on short-cycled value delivery, we use internal expertise and experience, combined with outside-in views of our coaching partners. The Agile Center of Excellence provides effective trainings, pragmatic coaching and organizes events to ignite, sustain, and reinforce the Agile mindset. Unveiling the value of the Agile Center of Excellence…
  • 13. Confidential13 Agile Delivery Model Prioritize & Group Epics Epic backlog Per team Business IT demand (vision) E2E Solution Development and rollouts Product A Feature/Process teams All demand is grouped into products and the overall product roadmap is budget approved Breakdown into capabilities & epics Release 1 Sprint A Sprint B Release 2 Sprint C Sprint D Release n Sprint n User story User story User story User story User story User story User story User story User story User story User story User story Epic Epic Epic Team 1 Legacy & E2E enhancements Sprint / release planning Product B Roadmap Product A Q1 Q2 Q3 Q4 LPC LPC LPC LPC High level demand (Epic level) is prioritized on a roadmap Team 1 Team 2 Team 3 AgileDeliveryAgilePortfolioManagement Q2 1 2 3 4 5 6 The full process visualized from vision to sprints 1 - Gather and review demand 2 – Cluster and approve demand 3 – Quarterly Budget Release (Fixed Budget) and Team approval (Stable Team) per product 4 – Demand Breakdown 5 – Demand Prioritization into team backlogs 6 – Sprint and Release planning Time is precious, spend (waste) it wisely
  • 14. Confidential14 Scaled Agile Framework Implementation The best curve in your body is your smile, flaunt it !!!
  • 15. Confidential15 Concept of Delivery Centers Technical Design Functional Design Delivery Management Supporting Functions Partner Development RAMPS, Transition, Release Delivery Center A wise man can learn more from a foolish question than a fool from a wise answer
  • 16. Confidential16 Salient Features of our Agile Delivery Model High Offshore ratios Continuous Improvements Lean principles (Elimination of waste/redundancy) Delivery Excellence Test Factory Integration Testing Automation Build and Deployment/ Configuration Automation Best Practices adoption Follow your heart but do not forget to take your brain with you D E VO P S
  • 17. Confidential17 Case-Study 2 (Foundation Platform) How we operate ART Planning sessions Hackathons Continuous Improvement Testing Automation DevOpsPIL Cadence • Scaled Agile Framework • Release based cadence • Well-defined processes • Frameworks and Templates • Tools and Checklists • E-learning on-boarding course • Work Instructions (Wow documents etc.) Best Practices Whenever I find the key to success, someone changes the lock
  • 18. Confidential18 Case Study 2 - Value Delivered - Order to fulfillment Program Goals Actions Achievements Lessons learned Have feature teams that deliver E2E functionality Advice & coach on restructuring the teams to from silo’ ed component to feature teams 8/10 Build & Test teams into virtual end2end integrated teams Don’t accept half solutions Improve quality of the Team Backlogs Create standardize hierarchy in epics/features and user stories, driven by the compliance teams. Organized Really sessions, PPTs, movies From 1000+ to 2 orphan user stories in the backlogs Start Integration early and often Initiated integration demo’s , coached for continuous integration inside the teams Integration demo’s happen every 2 weeks Teams need to be in the driving seat, start small & expand Make teams self organize to improve Visualize flow of small pieces of work going through the process 90% Velocity reliability. AVG release velocity increase in 2014 from 21 to 41 over the teams If only O2F was end2end value oriented… Engage product owners from business in demo’s so we have bi-weekly interaction and feedback Create transparency on PO involvement, empower & coach team decision making when PO is not available 94% Product Owners joining demo and prioritizing teams backlogs. On average 85% acceptance of user stories Deploy early by including NLATAM and compliance in sprint rhythm Simplification and increased agility IDC process with the IDC teams 40%* decrease in throughput time in the IDC process
  • 19. Confidential19 Case-Study 3 - Idea-2-Market Agile Software Playbook’ (ASP) has been created to: • Share common practices across teams • Help teams in embracing Agile and SAFe mindset, • Provide ‘real time knowledge’ with ‘practical experiences’ (“artifacts” in Agile terminology) The Agile transformation is expected to touch 50 Philips locations across the globe, projects in 28 Businesses and 4000+ engineers across various roles I2M Excellence focuses on capability building in a number of critical areas such as digital and aims at : • Developing better quality software in a predictable, fast and agile way • Leveraging standardized processes, tools and development methodologies in I2M To support the transformation I2M has identified Agile methodology as a key enabler. SCRUM practices will form the foundational core, on which we build SAFe practices The most successful people have plan A at the front of their mind and plan B at the back
  • 20. Confidential20 Lessons Learnt Agile should not be an IT driven initiative only. Take the business along. Transformation agents – coaches and delivery managers play a vital role to agile adoption and success. Gemba leadership is key. Keep sharpening the axe. Build assets, implement incremental processes towards Devops, pursue in-sprint testing and automation, encourage democracy and harmony Systems Team is significant to keep enhancing the principles, procedures, guidelines, assets and thereby keep the platform stable. Scrum Ceremonies like ART Planning, SoS, Retro, stand-ups, etc. make a big impact in identifying the impediments and their resolution Experience is the name everyone gives to their mistakes
  • 21. Confidential21 The road ahead Make benefits of agile secular Get Scaled agile to work seamlessly Get all to dance to the same tune Enhance the coverage of Agile I won’t be impressed with technology unless I can download food Live the spirit of agile Move to Devops