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Hello everyone. Welcome to the Five Minutes podcast. Today I'd like to talk about Little's law and its applications in project management, specifically in Kanban, Scrum, and Agile methods and the Little's law. It's a very, very simple law that is based on the production line. And the best way to explain it is to imagine the number of customers in a queue, and this number of customers in a queue is equal to the long-term arrival rate. It means how many new customers arrive per hour per day, per week, times the time it's taken to process them. For example, a very ultra simple example. Imagine that you sell sandwiches, and every hour, ten new customers arrive to order the sandwich, and it takes you 12 minutes to process each client between, for example, taking the order, making the sandwich, delivering, receiving the money, and the customer leaving. So it's 12 minutes. 12 minutes means 20% of an hour. So if ten clients arrive per hour, ten times 20% means at any time you have two people permanently in the line, it means you have an endless line with infinity. The time of two people means two people will always be in the line at any given time in this situation. So how do you do? How do you improve your process to avoid this from happening? What you can do, you Can one receive fewer clients, right? Fewer clients. So you avoid clients being in the line or second; you increase your throughput means your productivity. Instead of spending 12 minutes, you spend six minutes. If you do that, it will be 10% of an hour. It means your permanent queue, based on Little's law, decreases from two people to one person in the line.
Right. And this applies exactly to our work in project management. Let's imagine work in progress. This, for me, is one of the most important concepts that we need to understand in projects' work in progress. It's something that it's in the processing, waiting for the process, but it's not ready. It does not deliver any value. And I need to speed up the delivery of value, and the formula using the same Little's law formula is the work in progress of the whip. It's equal to the rate of production times, the lead time, and the waiting time of that. So if I whip the rate of production times, the lead time is whip work in progress divided by the rate of production. So what happens if you increase your work in progress? You are increasing your lead time. And this is the conceptual challenge we face. Many people see being productive as doing many things at the same time. So what do you do? You start doing everything you can. What happens when you do that? You are just reducing your productivity because you are increasing your lead time because you are increasing the whip. And this is why I am paranoid, and probably every single project manager aims to deliver value faster by limiting the work in progress and reducing multitasking because multitasking is a fallacy. Because when you think that you can do 3 or 4 things at the same time, this is not true. Every time you switch from one task to another, you lose time.
And this lead time is precious. When you have something that you need to deliver value that is time sensitive and everything today is time sensitive. You can even calculate that. And this is why, for example, in Kanban boards, you can calculate, using Little's law, the number of items on each column of the Kanban board because it's based exactly to make sure that your flow is steady and constant that you don't have. I would say items that are just waiting because other people could not take them. So you have this steady flow of work, and this is the challenge because most of the time, with this volatile environment, you don't have a very steady stage. So it's very hard for you to calculate. Exactly which rate of production do you have every single moment? And this will allow you to calculate exactly how many items can come and how many items should leave at a given time. And this is such an important concept. Most of the concepts that we use in Lean and Lean Six Sigma, that we use in Kanban that we use in many techniques in Scrum are based on Little's law, and it's a super simple formula that proves that doing many things at the same time is not a good idea. Maybe psychologically, for you, it shows you a false perception that you are moving, but instead of doing things and delivering results at the time you want, you are just creating more leading time and more waiting time. Think about that, and see you next week in another 5 Minutes Podcast.
