Serverless Craic Ep34 What is Value Engineering with BMK

Serverless Craic from The Serverless Edge

This week we look at 'What is Value Engineering?' with BMK Lakshminarayanan from DevOps New Zealand. BMK is based out of Wellington, New Zealand working as Transformation Architect and Independent Consultant for Section Six. He helps customers on containers and cloud with DevOps, modern engineering and architecture practices. He also worked for 15 years with Bank of New Zealand. As part of that work he connected and became a central part of the DevOps community.

BMK uses the term value engineering a lot. It's about making tech impactful for your business. When he says impactful for your business, it's about value for your customers. That includes making wise decisions about your technology investments. Value is what is your customer getting out of your service and product?

You need to look at three things for customer value.

1. What value is the customer getting from spending their time?

2. What value do they get for the money they spend on that product or service?

3. Are they really happy with the service or product that you're offering?

The other side of the coin is actually business value. What is the business getting out of the software you're running in production? Is it generating revenue for your business? What IT investments are the business making? Are they getting a good return of value? If the business saves money using technology, they do more with less. The investment will increase as they go forward. Studies in the last few years with Gartner, Forrester and other analysts say that technology investments keep going. When technology is providing the value they are after.

As an architect or developer your job is not just building and committing code. You look after the code that you're running in production. And how customers are using the system and the experience they have. The feedback you get goes back into your architecture, design, planning and development. You're not a programmer, you're an engineer because you are creating an outcome. And you're not creating code or a product. You have to understand what that outcome is. Your output is not the code. The outcome is the business deliverable.

There's a huge piece of engineering culture that needs to be put in place. We are talking about psychological safety. If you ask engineers to own an outcome and it's not happening. They need to be able to speak up and drive how that outcome is met. I use a term called engineering excellence. It's the mindset and culture within software units or the technology itself. An enterprise may have top talent and high density talent. But who can solve problems for customers? People need to feel comfortable sharing their experiences from an organisational point of view. In order to do that, you need a friendly environment where people can stand up and speak up.

I've seen the other side of things. When engineers don't feel they are in an organisation that's promoting, safeguarding or helping with psychological safety. They keep moving to a different organisation to look for different opportunities. Or sometimes developers put their heads down and they don't give their best. Because they feel they don't have options and they're stuck.

Are you seeing many failed cloud transformations? Or to phrase it in a different way. A lot of people have moved to the cloud. But they haven't realised the value they thought they would have. Have you seen that? I would not attribute that as failure. But I would say a lot of organisations are struggling in this space. Moving to the cloud is not just a business decision. You need technology experts to make this viable for your business to run.

A big challenge that I was talking about a couple of days ago with a client, is have you thought about Capex and Opex. It's a fundamental thing. Because in traditional IT, you have a datacenter and you have design and a lot of capitalizable work in that space. But when you move to a rental model, the Capex is very little and the Opex is more. The business previously never worried, cared or thought about how much data cost to run their business application. Because it's a shared infrastructure in your data centre.

There's a whole education required. We talk about that in our book. FinOps and Opex versus Capex. The organisation has to change the entire process, their thinking and the working culture, when you adopt the cloud. I hate when companies put a layer in front of the cloud. They take the old infrastructure team and put them in front the cloud. It's completely stupid. And it's missing the point. You need to let developers loose with guardrails and the correct governance. You can't build the same way in the cloud. You've got to build in a different way to take advantage of the newer services.

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