Imagine you are in an organisation with a one-year release cycle and you miss your annual deadline by one minute. The cost? A one-year delay.
Now, try to invent a control system to ensure that we avoid this kind of delay.
You would probably add some middle management to manage the dependencies between the various parts that need to be integrated for the release. You would need more management capacity for expediting work when interdependencies juggle the plans and you would need to spend time on replanning.
You would do detailed analysis to identify risks and try to mitigate the risk, no matter how little the probability that the event would occur. You need more people to sit and worry about possible future events.
Then, you would probably also make sure that leading up to the deadline nobody was on vacation, and you might order a code-freeze for the last months to avoid adding risk late in the project.
You see where we are headed. Step by step, we are building the standard, enterprise IT-organisation.
Since the cost of missing the deadline is so high, we have created a big bureaucracy and complicated our everyday work to deliver on time. Productivity is sacrificed to reduce the variation.
The elegant solution is different. What if we tried to make missing the deadline a no-stress event, where a little variation in the development process would not cause a full-year delay? What if we designed our system to be robust with limited variation so that small things have small impact?
This is the lean approach. We try to drive down the variation and create a simple management system rather than accepting it and building a complex system on top to tame it.
Imagine we reduced the release-cycle to one week, shipping roughly two percent of our annual work at a time. The variation is smaller. Miss a deadline by a minute and you release the following week. The cost of slipping is much smaller. There are no more critical weeks or month-long code freezes. You need less bureacracy. There is less replanning. People can go on vacation when they want.
Releasing becomes a no-stress event, something we do every week. It becomes just another day at the office.
On top we get some business benefits. Since we ship every week we can deliver incremental value faster. The cash-flow position is better since we get an earlier return. We become more responsive. If the market suddenly fancies red buttons rather than grey buttons we can ship that next week. Our annual-release competitors will have to wait until their next release - or even more if we make the change during their code-freeze.
The net result is an organisation that is sound from a business perspective, flexible, simple to control, less stressful and more fun to work for.
That's why we call reducing variation an elegant solution.