10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

1

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

2

Digitec Galaxus AG owns two brands, each brand with its specific landing page.• Digitec.ch: offering electronic products in many different categories.• Galaxus.ch: An online warehouse with many categories like household, sports, do-it-yourself, garden, baby, books and movies.Digitec Galaxus AG is on company driving both brands. All the functional departments at Digitec Galaxus AG like product management or customer service serve both brands equally.• Total turnover of Digitec Galaxus AG in 2015 was about 700 million EUR (~800 million USD).• Total number of products offered in both brands comes to several hundred thousand.

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

3

Digitec Galaxus AG is serving the local market in Switzerland only.The success of Digitec Galaxus AG is based on an elaborated cross-channel concept:• Core is the online-shop with best of class shopping and service experience.• Eight showroom on strategic locations give Digitec Galaxus AG a personal face. These showrooms act as flagship store and pick-up and return locations.• Digitec Galaxus AG runs all logistics under its own control with a stock capacity of several hundred thousand storage places.• In collaboration with many partner like Swiss Post logistics, Digitec Galaxus AG offers a network of over 350 pick-up and return location all over Switzerland. • Customer services are cross-channel implemented

• Integrated self-service area in customer profile of the online-shop with history and details for every single order and service case• Direct communication in any showroom• Email and service desk by phone in three (out of four) local languages • Restricted service offerings on all pick-up and return locations

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

4

The organizational structure of Digitec Galaxus AG is oriented to efficient support the business processesFunctional departments with core business processes• Product management is responsible for purchasing and category management.• Logistics is responsible for the end2end supply chain, the delivery SLA´s on the customer side as well for stock orders as for supplier driven direct delivery including pick-up and return locations of logistic partners.• Retail drives the showrooms.• Return Management is responsible for the end2end return processes from customer to supplier with all dependent processes.• Customer Service is responsible to fulfil email and service desk by phone SLA´sService departments with supporting processes• Business Development is responsible to establish, manage and implement the strategic roadmap including all processes and tools required in organizational change. This includes competence areas as business analysis, requirements engineering, agile and lean processes, portfolio and innovation processes• Engineering is responsible for development of the operational systems including topics like user centered design, prototyping and business intelligence• Accounting is responsible for bookkeeping and financial accounting• HR is responsible for recruitment and personal development

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

5

The overall process model for any organizational change is aligned to the Scaled Agile Framework (SAFe) as recommended by the Scaled Agile Inc.The core SAFe process structures and mechanisms are:• Four RE abstraction levels:

• Portfolio: (strategic) theme, (business) epics• Program: (product) features• Team: user stories

• Continuous flow of work through the abstraction levels with dedicated feedback mechanisms• Pull system Digitec Galaxus AG implemented a SAFe alike process model without support of the Scaled Agile Inc. Responsible to define and implement the process model is the business development department of Digitec Galaxus.Opposite to many SAFe implementation, at Digitec Galaxus AG the SAFe alike process model is not restricted to changes related to IT-systems. All changes are managed in SAFe, including themes like expansion and automation of logistics, re-organizations of departments or development of new marketing approaches.

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

6

Important methods and techniques that influence the way requirements engineering is implemented at Digitec Galaxus are:• Scrum in IT-development for all teams implementing changes on IT-systems• User centered design and prototyping as important drivers to proactively act on the customer interface.• A set of Kanban systems covering different aspects in the organization:

• One Kanban board on portfolio level following the SAFe portfolio idea• Each department owns its innovation Kanban board• Business intelligence and Ux team use a Kanban board for planning of activities

• Story mapping as technique on different levels:• On top level to elicit, discover and manage the strategic roadmap including all company themes that drive change• On product level to mature and validate ideas and innovation• On product level to elicit, discover and validate product features for implementation

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

7

This section presents the requirements engineering related activities on the different abstraction levels within the SAFe process model including aspects as there are• Roles and responsibilities• Activities • Timely order of activities• Tools and Artifacts

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

8

This graphics presents the overall correlation of RE activities on different abstraction levels and the tools used to implement RE activities.Looking at the big picture of the RE process, very important to recognize are the feedback loops that establish the synchronization between abstraction levels. These feedback loops transport • Top-down: information about strategic alignment and prioritization• Bottom-up: Information about goal fulfillment, progress tracking, risks, and capacity consumptionInteresting to note are the tools that implement RE on the different levels• (Portfolio) Theme (corresponds to the term project in classical processes): a physical wall of sticky notes• (Portfolio) Initiative (corresponds to the term project phase in classical processes): a Jira Kanban board. The Digitec Galaxus AG term initiative in SAFe is named business epic.• (Program) Epic (corresponds to the term feature in classical processes): a Jira Kanban board. The Digitec Galaxus AG term epic in SAFe is named feature.• (Team) User Story: A Jira Team Backlog • (All levels): Signavio is used as BPMN tool to document business processes on level one to level four. Not all business processes are documented down to level three. The subsequent slides will discuss the abstraction levels in detail

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

9

On strategic level the executive management plus the head of departments discuss and re-plan the strategic roadmap on a quarterly base.A theme is represented as a column on the physical wall. The timeline from top of the wall down to the floor covers a three years perspective.A sticky note on the wall represents an initiative (SAFe business epic).The board members in the strategic board (executive management plus the head of departments ) execute the following RE activities:• Story mapping: Decomposition of strategic themes into initiatives• Planning activities (related to RE)• Risk evaluation on base theme• Definition of business cases • Conflict management

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

10

The Kanban board of initiatives (SAFe: business epics) realizes the Digitec Galaxus AG (project) portfolio.On a monthly base the executive management plus the heads of engineering and business development (called “innovation board”) track, discuss an prioritize the initiatives based on feedback information on program level (progress report, velocity of teams, impediments, external influences and changes).The Kanban board of initiatives covers a time horizon of about six to nine months with a more detailed view on initiatives.The innovation board members execute the following RE activities:• Definition of goals per initiative.• Definition of scope per initiative based on high level features.• Definition of business value based on a weighted factor model to calculate the normalized business value of a single initiative.• Review of goal fulfilment (validation of initiatives)

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

11

On program level initiatives are decomposed to epics and user stories following a standard Scrum procedure.Additional to pure Scrum team dependencies and overall alignment is ensured by a monthly release planning meeting with attendees from business development and engineering departments. Optional members are executive manager.Business developer an SW-Engineers act in different roles that are required to execute all activities to realize the goals of an initiative. One team member typically acts in three or more different roles. A business developer for example acts as business analyst, requirements engineer and acceptance tester, a SW-engineer acts for example as requirements engineer, developer and SW-tester, another SW-engineer as Ux expert, in prototyping and as developerRE activities:• Elicitation of requirements with stakeholders • Communication and confirmation of requirements on levels product feature, epics, non-functional requirements • Decomposition into user stories• Acceptance testing (verification and validation)• Documentation: Business processes (Signavio PBMN), business object model, product features and non-functional requirements, user storiesRE activities are allocated, scheduled and synchronized self-organized by the teams.

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

12

The continuous character of development is realized by the portfolio of initiative that in parallel are in progress. Kanban assures that a maximal number of initiatives in parallel is in progress (minimizing average lead time).With this, and initiative undergoes a course of life from idea over development to review and closure. This course of life can be treated as a maturation process of from status idea to value creation.This slide presents the maturation process of a single initiative from the perspective of staff members involved into RE activities in the course o life:• In the ideation phase a function departments subject matter experts owns the idea (pre-initiative). Together with a coach (BD) and optional designer (Ux) or SW-developer (prototyping, requirements engineering) the SME drive the idea until it is moved to strategic level. Result is an new initiative. The Definition of Ready (DoR) for the idea is reached.• On the gate between innovation and portfolio the executive members take ownership of an initiative and are responsible for goal definition and business value definition• At this point in time a BD staff member in the role as “project lead” drives the initiative. The BD is responsible that all RE activities are executed together with the required staff members to cover all RE aspects. Depending on the character of the initiative, the BD staff member takes an active part in RE activities.• If an initiative reaches successfully the Definition of Done, the business epic owner (a CxO) is responsible to validate the outcome and initiate optional subsequent actions through subsequent ideas or initiatives.

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

13

The continuous character of our organization change process builds intensive on means of feedback and direct communication and collaboration.This requires • multi-disciplined job-profiles with overlapping roles • Processes that embrace cadence and synchronization • Self-organizing team with mean of cross-team synchronizationFrom the RE perspective the RE competence is distributed over more then on job profile. No explicit job profile “requirements engineer” exists. Instead nearly every job profile must cover a job profile specific set of requirements engineering methods and techniques as this table demonstrates.The development of the RE competence as such at Digitec Galaxus is under responsibility of the business development team. The job role of BD member includes as core competences• Business analysis• Requirements engineering • Process designNote very member of the BD team is an BA, RE or process design expert. As team BD owns the full competences to • design process and activities• Coach other teams in the core competences• Develop the competences to excellence

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

14

A core set of factors and values is prerequisite for establishing a consistent agile and lean organization.It is under the responsibility of executive management to enable, implement and govern these core factors and values.Digitec Galaxus invest continuous into government of these core factors and values.

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

15

Shared responsibility• The focus of shared responsibility is on outcome not on deliverables. Outcome represent business value, deliverables are results of activities.• The focus on outcome ensures organizational alignment• Multidisciplinary job profiles support to establish shared responsibility. Business epics owned by C-level management• C-level Management is involved instead of steering only• Prioritization is assigned to the responsibility for strategic decisionsMultidisciplinary job profiles• Foster efficiency in any activities because of less handover procedures, less communication gaps and workforce scaling options• Quality of deliverables increases as focus is validation of the business value and not on verification of deliverablesProcesses independent from organization • Development of excellence and organizational growth are orthogonal aspects• Collaboration is outcome oriented• Prevents blinkered thinking and acting Values & Mindset• shared responsibility and alignment are prerequisites for personal responsibility• personal responsibility is prerequisite for self-organization• personal responsibility and self-organization imply job-enrichment

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

16

10 June 2016

Rainer Grau, Digitec Galaxus AG

iRECON 2016

17