The Role Of Value Stream Owner

ByColin O'Neill Reading Time: 5 minutes

A New Role

For many organizations embarking on a value-based journey, value stream management (VSM) represents a preferred way of operating a business on multiple levels. Along with this emerging approach comes fresh ways of thinking and a new role that reflects a value-focused distinctive perspective. A major new role is that of the value stream owner (VSO). We call it “owner” and not “manager” because the term “owner” connotes direct, tangible, and ultimate responsibility and accountability. Creation of this role enables an organization to optimize the entire product development flow, as opposed to the more common method of rewarding managers for optimizing their particular function or sub-flow, which diminishes the overall business goal.

The American idiom “the buck stops here” is quite appropriate for this role because the success or failure of a value stream to produce the desired outcomes (greater value = higher quality, lower costs, less waste, reduced delays, higher employee morale, and improved customer satisfaction) all rests with one person—the “single neck to wring,” so to speak. As may be expected, the VSO role is pivotal to value-centered organizations. Without understanding and championing this role, the chances of successfully becoming a value-based entity are largely diminished.

Definition

A value stream owner is an experienced, senior adaptive leader who is accountable to executive management for improving the value to non-value ratio of a product or service family within an organization.

VSOs typically report to a senior executive who has oversight of many, if not all, functional areas of a business unit. This reporting association is necessary because as issues arise over resource allocations and management goals, they can be effectively arbitrated and settled by the person who has direct control over those areas, namely the senior executive.

Responsibilities

A VSO is ultimately charged with identifying and eliminating non-value-added activities and events in terms of waste or delays. Delivered products and services must meet or exceed customer expectations and levels of satisfaction. This charge leads to an uptick in product quality, faster time-to-market, and improved profitability of the product line. Specific responsibilities of the VSO include:

  • Ensure that their value stream itself is correctly identified, defined, mapped, optimized, managed, and improved upon over time. This includes specific definition of the product/service family and related components.
  • Coordinate with myriad business functional areas that contribute manpower, product/service components, information, and domain knowledge to the creation of value in the flow.
  • Demonstrate to senior management that the outputs of their particular value stream are competitive in the marketplace and meet current customer needs. The VSO’s value stream must be able to quickly adapt to changing market conditions.
  • Continually expand their knowledge of value thinking and behavior and ensure appropriate value principles and practices are adopted by all members of their value stream in an atmosphere of cooperation, trust, and empowerment.
  • Ensure that improvement of their value stream is ongoing and that employees are always on the lookout for new and better ways of creating value within the organization.

Skills, Qualities, and Experience

The level of skills, knowledge, experience, and leadership presence needed by a VSO should not be underestimated. Selecting a VSO to lead a value stream is an important step in succeeding as a organization. Senior management must be thorough in its search to find the right fit. A person having the following qualities could be considered a good candidate.

  • Be an adaptive leader who creates an environment within which members of the value stream can grow and flourish so that they might make their greatest contributions to the product/service line. VSOs should lead with humility and strength, knowing that the finest results come from empowering and incentivizing employees to bring their best game to work every day.
  • Possess the management gravitas and moral integrity necessary to effectively engage senior management, other business unit leaders, and executives from other companies. VSOs must exude confidence and believe that what they are doing is for the benefit of their customers, their employees, and the company. They should not shy away from confrontation when they know the right thing to do.
  • Be savvy enough to surround themselves with people who know the business, market, corporate culture, and product line well.
  • Be transparent at each level of the value stream so that information flows freely up and down the chain.
  • Possess a thorough knowledge of the production and delivery flows of the value stream.
  • Be able to adapt to ever-changing markets and customer needs quickly and effectively. This implies that the value stream is organized and managed in such a way as to facilitate changes with minimal impact to the flow.
  • Maintain a holistic view of the organization and understand where in the large scheme of things their value stream fits. This includes not sacrificing one area for the sake of optimizing another, but to optimize for the whole instead. VSOs must be able to rise above the daily chaos and see far enough ahead to keep the product/service line flow on track.
  • Not be shy to elicit and expect support from executive management so as to operate from a position of strength, not weakness.
  • Put people first, knowing that it’s people that ultimately drive the success or failure of their value stream.

Enterprise VSO

Because each VSO manages a value stream that extends beyond one’s own organization, it may be prudent to have an uber VSO called the Enterprise VSO. This role may involve close coordination with business units or completely separate firms, perhaps those who are part of that company’s supply chain. The issues typically facing an Enterprise VSO are often daunting, and require skills, experience, and knowledge in excess of a standard VSO. An Enterprise VSO should have an extensive background in global commerce and should be an effective negotiator.

While the number of persons in this role today is significantly less than the population of standard VSOs, Enterprise VSOs are apt to become more commonplace as the global market continues to become more organization-interdependent.

Summary

Value stream owners assume responsibility and accountability beyond that of a traditional manager. Their qualities and skills must be deep and come from years of experience. In a value-centered organization, adaptive leadership is prized; in that regard, VSOs ought to be knowledgeable, effective adaptive leaders. Senior management should be careful to select the right VSO given that so much of the success of an entity rests on the effectiveness of its value streams. Executives should demonstrate support for and provide guidance to their VSOs.

Founder, The EVER System

Colin O'Neill is a seasoned entrepreneur, thought leader, and business executive with a passion for transforming how organizations and people work. A graduate of the U.S. Naval Academy at Annapolis, Colin served for 11 years as a Marine Corps officer, where he developed a strong foundation in leadership and commitment to service. For over four decades, Colin has been a trusted advisor to both government and industry, helping leaders adopt innovative business and technology practices that benefit their employees, their organizations, and society at large.

In 2011, Colin co-founded Scaled Agile, working closely with Dean Leffingwell and others to create the Scaled Agile Framework (SAFe). As CEO and President of Asia Pacific Operations, he played a key role in spreading the framework worldwide to where it is now the global standard for scaling agile practices in large organizations.

Since stepping away from Scaled Agile, Colin has helped companies align their strategy with execution through value streams and simplified portfolio management. This work led to the creation of the Entity Value Realization (EVER) system, which gives organizations the tools to unlock greater value at every level through distributed authority, empowered employees, adaptive leaders, and advanced technologies. Colin authored the book "Take Control By Giving Up Control: The Value-Centered Fast Track to Organizational Growth" available on Amazon.