In a new forbes.com article, “Why Lean and Agile Go Together,” Dan Woods asserts that agile succeeding at large scale requires the application Lean manufacturing principles.

It is important to note that he is talking about principles, not practices. As Mary and Tom Poppendieck point out in Implementing Lean Software Development, manufacturing is fundamentally different from the product development that occurs in software development. The difficulty is often in determining how best to map Lean principles to software development, and there are differences of opinion among the Lean software development community on how best to do this.

The article states that:

In essence, as a practical matter, good ideas from Agile are being absorbed into a new approach to software development that is more Lean than anything else. Someone else can name this phenomenon, but Lean and Agile are merging.

I would add that they must merge, and that the marriage of these two will produce something new, exciting and innovative as we move into this new decade. In my agile coaching I do my best to emphasize the need for applying Lean principles, especially as they apply to portfolio and product management. One of the major Lean concepts that helps with this is that of the value stream or, as the Poppendiecks say, the activities that occur between driving a software product idea from concept to cash.

Dan Woods has an excellent description of how the concept of value streams fits into the larger picture of Lean manufactoring.

In a Lean manufacturing system, the work is broken into a set of value streams triggered by demand signals. The output of one value stream leads to others. Value streams may be executed sequentially or in parallel as needed. Eventually, everything is combined into the product. The suppliers for materials needed are alerted through a system of just-in-time replenishment of parts and components called Kanban.

I recommend the article, particularly for those at the executive level looking for a high-level introduction to the basic ideas of agile and Lean software development. The article mentions Ryan Martens from Rally, and he makes a few comments of his own here.