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AgileZen acquisition shows lean development's gains in Agile ALM

AgileZen is a startup that has caught the eyes of many agile and ALM customers as well as the vendor Rally Software which recently acquired the Web-based AgileZen.

AgileZen, a startup that's created a Web-based Kanban project management tool, was started in July, 2009, and has seen month after month of double-digit customer growth. Another indicator that AgileZen's lean development approach is a winner: Last week application lifecycle management (ALM) vendor Rally Software announced its acquisition of the company.

Kanban comes from the word "sign board" and is a concept that is considered "lean" – aimed at eliminating waste. The AgileZen tool is a simple application, drawing on ideas from lean manufacturing, allowing users to visualize work and progress through the system by using a Kanban board.

AgileZen's founders are Nate and Niki Kohari . Nate Kohari is a long-time software developer who wanted to apply lean ideas to software development. Niki is an industrial organizational psychologist who has had an interest in entrepreneurship and had studied lean methodologies from a theoretical standpoint.

Rally's project management tool has primarily focused on Scrum, the most popular of agile methodologies; but Kanban veers off from Scrum in software development in a few key ways. Kanban works particularly well for small teams, Nate Kohari said, adding that Scrum also works great for a lot of software development work.

The difference? "Scrum asks you to set up a synthetic timebox," said Nate Kohari. "That works really well for larger teams. Lean says rather than estimate, you just start working and measure [cycle time] as you go along." Niki added: "That was very appealing, because I'm very measurement focused and spent a lot of time doing statistics and measuring psychological variables. So it made perfect sense to me to skip the estimation and focus on measurements. "

Rally CEO, Ryan Martens, said there are different schools of thought about Kanban's relationship to the agile methodology.

"From my perspective the agile methods and lean methods both originated from Deming's work. Most of the roots go back into the 90's. Getting a smooth flow of work through the system using cadence and synchronization to increase the throughput and collaboration and prevent the defects. I would call it agile."

However, Martens said, agile is typically used to describe software development and lean is more a way of doing business. Martens feels that customers would use Kanban in their upstream and downstream processes and still manage their development lifecycle using a Scrum methodology.

Forrester analyst Tom Grant sees interest in lean methodologies growing, partly due to the recession. "Coming out of the recession, a lot of decision-makers are now aware of how much waste there was. The recession provided incentive for companies to trim back on waste in the organization. Organizations are transforming the way they do business and looking at adopting lean practices. It's the next logical step for organizations to look at lean."

Grant thinks the AgileZen acquisition is a positive move for Rally. " It's a good idea for a vendor who's been making their name in the agile space to start expanding outward into the lean space but to do it in an incremental fashion." This will be a stepping stone for Rally customers, Grant said. "This is a good entry point for those in agile to get to know what lean looks like in practice. There's a lot of talk but a lot of people don't know where to get started."

Editor's Note:
The complete conversation with Rally CEO Ryan Martens is available as an audiocast.

Asked if Kanban would be replacing Scrum in popularity, Martens answered that he saw value in both approaches. Both are important for creating regular, repeatable processes. He said that there were "numerous people experimenting with blends" and mentioned Corey Ladas' book, ScrumBan: Essays on Kanban Systems for Lean Software Development.

What are the users saying about the acquisition? All the comments left on the AgileZen blog with the announcement are congratulatory notes from customers. The Koharis say they've only received positive feedback.

On Twitter, comments were largely positive; but one user did suggest a concern about cost. "We used to use Rally, but business nixed it due to cost. I love how lightweight and tactile @agilezen is"

Martens noted that the AgileZen product would still be offered at the same price point it was before. Those customers that are only interested in the simple Kanban user interface will still have that option.

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What's on the road map? Martens answered: "We want to move their platform onto ours. We'll be leveraging their concepts into the core Rally product. We're mostly in 'inquiry mode' talking to our customers."

All sources for this story agree that lean methodologies are gaining a presence in the Agile ALM market. Though some users would prefer to keep their tools simple, others are looking at ways to integrate tools and methodologies into a total business solution. Whether organizations are big or small, the industry is continuing to explore ways at becoming more efficient with higher quality. Combining agile with lean just might be the answer.

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