LPM provides an alignment and governance model for a specific SAFe Portfolio, which contains a set ofDevelopment Value Streams (DVS) for a business domain in an Enterprise. Although everyone in a SAFe portfolio plays a role in VSM, Lean Portfolio Management (LPM) is accountable for establishing the value streams and fostering operational excellence. When organizations face a high amount of uncertainty in the marketplace, they can apply a lean start-up mindset to think in bets. In doing so, they can explore the solution space in a cost-effective waythat funds small experiments, not large initiatives with substantial uncertainty. It does not store any personal data. He enjoys helping leadership teams create a compelling path from their current state to a new, leaner way of working. In other words, aligning investments with returns. We publish multiple blogs weekly and have tutorial videos, guides and free templates for Excel and Word that you can download to help manage your portfolio. I have read, understood and accepted Gartner Enterprise Architects promote adaptive design and engineering practices to drive the portfolios architectural initiatives. These cookies will be stored in your browser only with your consent. Energy flows where intention goes. When should a Lean portfolio be established? It includes six measures specific to flow: distribution, velocity, time, load, efficiency, and predictability. Theyll carry the day-to-day impact of lean thinking as theyre responsible for deploying lean techniques and using lean portfolio management tools. Value Stream Management (VSM) is a leadership and technical discipline that enables the maximum flow of business value through end-to-end solution delivery. Here youll plan from the top down your budget, estimating what funding youll need with cost-management planning. Surface positive feedback from retrospectives and make sure to celebratetheimproved flow of value through the organization. By clicking the "" button, you are agreeing to the Therefore, it is crucial to invest in developing a strong metrics capability. As a result, some enterprises have abandoned the PMO approach, distributing all the responsibilities to ARTs and Solution Trains. The challenge of connecting agile teams into an agile enterprise is that a gap emerges between the teams doing the work and the teams allocating the funding. The portfolio roadmap integrates lower-level roadmaps into a more comprehensive view. Neither images nor text can be copied from this site without the express written permission of the copyright holder. How can they be on this dedicated value stream? It unleashes all portfolio members creative and productive energy toward achieving its goals and further unlocks peoples intrinsic motivation. Also, although more frequent budget changes may seem to support increased agility, they may create too much uncertainty and an inability to commit to any near-term course of action. When should a Lean Portfolio be established? LPM uses the portfolio Kanban system to visualize and restrict work-in-process (WIP), reduce batch sizes, and control the length of longer-term development queues. A roadmap also acts as a communication channel for teams and stakeholders. The resulting data is used to finalize adjustments to the value stream budgets. 6. If this is your current state, then full-blown SAFe, especially Lean Portfolio Management (LPM), is probably too much at this point. Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features. ProjectManager is online portfolio management software that delivers real-time data to make better decisions when managing a portfolio. GE recognized the need to combine the speed and agility of a startup with the scale and resources of a large enterprise. Apply the SaFe Principles 4. Lean portfolio management does this by using the five principles of lean. The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional". Fill out the form to connect with a representative and learn more. Track your objectives with defined metrics and key performance indicators (KPIs) to determine variances in your plan and determine your options to address and execute adjustments to reduce disruptions thatll impact your value stream. In the context of strategy and investment funding, portfolio flow describes the process of managing portfolio epics through their lifecycle, including limiting the number of significant and typically cross-cutting initiatives in progress to match the portfolios capacity. Everyone working for you should be involved in this type of lean portfolio management. With the deeper discussion of the eight flow accelerators in Principle #6 and the new Portfolio Flow article introduced in SAFe 6.0, the ways to achieve a continuous flow of value through the portfolio are explicit and actionable. , whereby I agree (1) to provide Gartner with my personal information, and understand that information will be transferred outside of mainland China and processed by Gartner group companies and other legitimate processing parties and (2) to be contacted by Gartner group The LPM function can help cultivate and apply successful ART execution patterns across the portfolio with the assistance of the Lean-Agile Center of Excellence (LACE). Here is only some of our content thats related to portfolio management. A connected enterprise with full alignment is key to competing in the modern economy. FAQs on how to use SAFe content and trademarks, Create a Lean-Agile Center of Excellence (LACE), Watch and download SAFe videos and presentations. The Lean governance collaboration and responsibilities (Figure 6) require the active engagement of the VMO, LACE, Business Owners, and Enterprise Architects. Flow and cycle time. Of course, you have to find those inefficiencies first. They become a continuous energy source to power the enterprise through the necessary organizational changes. There shouldnt be any interruptions, delays or bottlenecks. Portfolio business and enabler epics, capture, analyze, and approve new business and technology initiatives. In order to accomplish that goal, its ideal to follow these eight lean portfolio management steps. Here are the steps to get started. Shift the operations focus to delivering incremental value at shorter cadences for larger initiatives. Operating through LPM, the VMO leverages the specialized skills, knowledge, and relationships of the current PMO while transitioning themselves and the portfolio to a new Lean-Agile way of working. Leverage the cadences to achieve shorter feedback loops. Rhonda Byrne, Australian author, and TV producer Portfolio Flow The LPM competency aligns strategy and execution by applying Lean and systems thinking approaches to strategy and investment funding, Agile portfolio operations, and governance. The remainder of this article provides guidance on how enhancing the portfolio can help leaders seize these opportunities and unlock the full potential of the new ways of working. Lean Portfolio Management (LPM) has accepted the Epic All of the Epic's features are completed The customer accepts the Epic Portfolio governance is no longer required Portfolio governance is no longer required What is an example of using leading indicators in Lean Portfolio Management (LPM)? Lean-Agile Leaders should know that every long-term commitment decreases the organizations agility. This is my third . Operational excellence focuses on continually improving efficiency, practices, and results to optimize business performance. when should a lean portfolio be established? Thats why connecting the portfolio to the enterprise strategy is the primary responsibility of the strategy and investment funding collaboration. In the spirit of SAFes core value of relentless improvement, the next best action to enhance the portfolio is to begin a focused and deliberate journey to: The critical moves to relentlessly improve portfolios include: The central aim of SAFe is to facilitate the continuous flow of value to customers in the sustainably shortest lead time. Adopting LPM For those organizations that have not yet adopted LPM, the best way to enhance the portfolio is to start the LPM adoption process! Get started with ProjectManager today for free. companies via internet, mobile/telephone and email, for the purposes of sales, marketing and research. The LACE is often responsible for leading operational excellence with the help of an RTE and Scrum Master/Team Coach CoP. All reports can be filtered to see only the data you want and then easily shared in various formats with your stakeholders so they stay updated. devote the people and resources required to implement the most valuable enhancements. These obligations impose significant limits on solution development and operations. The portfolio needs to understand its role in achieving the enterprise strategy. When organizations improve their definition of customer value, communication improves and clears the path for the best ideas. This event focuses on achieving and advancing the portfolio vision. Privacy Policy. Theyre a valuable resource that should be tapped by teams. This typically includes: Many enterprises have discovered that centralized decision-making and traditional mindsets can undermine the move to Lean-Agile practices. This helps you avoid stockpiling materials and streamlines your equipment inventory. The information on this page is 2010-2023 Scaled Agile, Inc. and is protected by US and International copyright laws. 8 a.m. 5 p.m. GMT Find the owners - Portfolio leadership teams are high-performing, cross-functional teams of servant leaders. Sorry, No data match for your criteria. Thats why you want to make lean thinking part of your corporate culture. However, if: then, these interruptions to portfolio flow will negatively impact the teams and trains responsible for building the portfolios solutions. When there are at least 5 Agile Release Trains d . In order to do this, portfolio managers need real-time data to make more effective decisions about value realization and costs. Embrace a Lean-Agile mindset 3. This cookie is set by GDPR Cookie Consent plugin. This competency has proven to improve business outcomes for SAFe enterprises building the world's most important . This new approach to planning and budgeting includes understanding the historical and forecasted future costs associated with each Solution and forecasted epics costs. Plus, they lead by example. Please try again later. That is why, when you ask members of an executive team to describe and explain the corporate strategy, you frequently get wildly different answers. Analytical cookies are used to understand how visitors interact with the website. See the Measuring Competency section of the Measure and Grow article to download these assessments. Each responsibility is described in the sections that follow. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc. Early in the Implementation Roadmap, we recommended that the LACE train executives, managers, and leaders in basic SAFe concepts and specifically in how they can contribute to better value delivery by transitioning to Lean Portfolio Management (LPM). Use task, resource and risk management features to keep your project, portfolio or program on track. When the lack of communication between strategy and execution is hurting value delivery When there are a minimum of six Agile Release Trains that require coordination When it is part of training the executives Lean Portfolio Management: Frequently Asked Questions. There are many ways to do this and one of which is lean portfolio management. The senior leadership team will apply lean principles to manage the portfolio. when should a lean portfolio be established? Gartner Terms of Use Scaled Agile provides extensive training and guidance for launching LPM, built from success patterns emerging from the field. Perfection is a goal thats impossible to meet, but the pursuit of it reduces waste and offers greater value to customers. The road to a better future state should be paved with architectural principles and practices that enable the ongoing evolution of the portfolios solution set. Examples include developing an e-commerce website, medical device, or satellite and developing and deploying a software application within an enterprise for internal customers. Lean governance closes the loop by measuring portfolio performance and supporting dynamic budget adjustments to maximize value. When organizations evaluate those outputs in short feedback loops, they can quickly recalibrate short-term plans, based on what they see. The Lean Portfolio Management (LPM) competency aligns strategy and execution by applying Lean and systems thinking approaches to strategy and investment funding, Agile portfolio operations, and governance. The senior leadership team will apply lean principles to manage the portfolio. This is an AR pistol stabilizing brace, and it is designed for any platform which accepts mil-spec carbine receiver . As illustrated in Figure 2, LPM provides guidance for: For those organizations that have not yet adopted LPM, the best way to enhance the portfolio is to start the LPM adoption process! Value stream configurations need to be evaluated and, if required, reconfigured using the process described in Organize Around Value to better enable smooth and continuous portfolio flow. Lean-Agile Leaders should know that every long-term commitment decreases the organization's agility. LPM adjusts budgets on a cadence, typically every six months or when significant events warrant, as part of the strategic portfolio review or Participatory Budgeting events (see below). Your California Consumer Rights. Get started with ProjectManager today for free. This cookie is set by GDPR Cookie Consent plugin. In order to eliminate waste and drive value to customers, you must maximize your workforce without over-allocating and burning them out. As described earlier, SAFe provides a Lean approach to budgetinga lightweight, more fluid, Agile process that replaces the fixed, long-range budget cycles, financial commitments, and fixed-scope expectations of a traditional planning process. Leaders responsible for vision, strategy, funding, budgets, prioritization, and financial performance may be asking how they can apply the new ways of working to their roles. Join your peers for the unveiling of the latest insights at Gartner conferences. As new information is learned about the solution set, including customer feedback and Key Performance Indicators (KPIs), the LPM function periodically reviews the portfolio canvas (e.g., quarterly). These assets include: While training and field-tested guidance are essential, the most critical success factor for adopting LPM is for leaders with portfolio responsibilities to fully engage in the change process and incorporate LPM practices into their individual roles. Together, they can optimize, address, and debug issues from Agile Teams, ARTs, and value streams. Boulder, CO 80301 USA, Privacy Policy An additional one-day workshop is available to help enterprise teams get started with LPM in their organization. Team and Technical Agility 3. Pain point #1: Long cycle times on large initiatives. Each has the ability to allocate funding, translate enterprise strategy into a local context, and govern execution and spending. Take investors in PepsiCo ( PEP 0.22%), for example. An enterprise can only accomplish its ultimate business objectives by allocating the right investments to building the right things.. Each Epic goes through different Portfolio Kanban states, and a designated owner defines the Epic's minimum viable product and oversees its progress from concept to completion. 1. Figure 5. illustrates each of these responsibilities, followed by a description of each. Exemplify the core values 2. Analytical cookies are used to understand how visitors interact with the website. Implementing SAFe Lean Portfolio Management for Executives 9,938 views Feb 26, 2020 95 Dislike Share Save LitheSpeed 1.07K subscribers Connect your portfolio to enterprise strategy, establish. When organizations fund team-of-teams through agile budgeting, then empower them to build plans that align to strategic goals, the new distributed accountability model speeds up the overall delivery of value. Overall, the lean approach drives reliable value delivery, reduces time to customer value, and ensures that teams can pivot as the marketplace changes or customer demands shift. This cookie is set by GDPR Cookie Consent plugin. LPM was inspired by the lean methodology, which started small but quickly spread to the masses. LPM plays a leadership role in operational excellence, helping the organization achieve its business goals. And yet, organizations aren't typically structured in a way that allows them to do so. Overseeing spending, audit and compliance, and forecasting expenses. Recent research by Gartner Senior Director Analyst Lorri Callahan and Distinguished VP Analyst Robert Handler guides an enterprise program management office (EPMO) or PMO operating in an organization that is adopting SAFe lean portfolio management (LPM) competency. Lean Portfolio Management 1.2) What are 4 things a Lean-Agile Leader must do? Early in the Implementation Roadmap, work was done to identify value streams and organize ARTs around the flow of value. Another aspect of portfolio flow concerns operational excellence, which is the subject of the next section, Agile Portfolio Operations. The more alignment you have, the more autonomy you can grantStephen Bungay, author and strategy consultant. We have lean portfolio management tools such as a live portfolio dashboard that captures six metrics across the portfolio to get a high-level view of performance and progress. Gaining portfolio alignment requires people to work toward a shared goal and purpose beyond any individual, team, ART, or value stream. Effective resource management is essential and should be part of the lean portfolio management tools you use to optimize your resource utilization. Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features. evaluate the health of existing portfolios, identify the areas of greatest opportunity for improvement, then. X When the lack of communication between strategy and execution is hurting value Since the portfolio roadmap may span multiple years, estimating longer-term initiatives requires Agile methods. The leadership team makes decisions at a set cadence, and both the operations (activities they perform) and the governance (reviews that they hold) follow that cadence to synchronize and align the planning and feedback loops. We also use third-party cookies that help us analyze and understand how you use this website. When the lack of communication between strategy and execution is hurting value delivery When there are a minimum of six Agile Release Trains that require coordination When it is part of training the executives Business Owners should frequently communicate the vision and the strategic themes, for example, during PI planning, all-hands company meetings, and throughout the PI. The first step is to find and form the group that will connect strategy to execution for a specific part of the organization. You can re-allocate right from the chart view to balance workload and keep your team productive. Lean budgets provide funding for value streams aligned with the business strategy and current strategic themes. Our portfolio roadmap view shows every project in your portfolio in a Gantt chart timeline. These shifts expand the benefits of SAFe by extending the new ways of working to the highest levels of decision-making and financial accountability for the solutions and value streams in the portfolio. Portfolio Kanban for PPM leaders visualizes and manages the flow of Epics in an end-to-end fashion. Necessary cookies are absolutely essential for the website to function properly. No setup is requiredwere ready when you are. Error submitting the form. Use your existing resource capacity to its full extent and remain flexible so you can reallocate as you adapt plans. The following sections describe these dimensions. Therefore, SAFe recommends a more continuous approach to coordinate ongoing compliance with relevant standards. The LACE can coach RTEs, and Scrum Masters/Team Coaches to address, optimize, and debug issues with achieving continuous flow. This one portfolio mindset is critical to achieving success toward the strategic themes and having the agility to make mid-course corrections fluently. The portfolio connects to the enterprise business strategy through Strategic Themesand the portfolio budget. Lead the transformation This compliance may address internal or external financial auditing constraints and industry legal or regulatory guidelines. They establish a framework for creating an efficient organization of all projects in a portfolio. Project roadmaps are valuable tools in this process as they help portfolio managers by giving them an overview in which they can strategically reallocate resources to maintain value while eliminating waste. As a last resort, make changes to the composition of individual teams only if absolutely necessary to preserve the cohesiveness of high-performing teams. Portfolio Events Value Stream coordination defines how to manage dependencies to exploit the opportunities that exist only in the interconnections between value streams. Scaled Agile Framework and SAFe are registered trademarks of Scaled Agile, Inc. This cookie is set by GDPR Cookie Consent plugin. Recommended resources for Gartner clients*: 6 Practices for Effective Portfolio Management, 3 Steps for Starting SAFe Lean Portfolio Management, How PPM Leaders Can Use Zero-Based Prioritization to Refocus Portfolios on Strategic Initiatives. In the past 12 months, PepsiCo's stock price is up around 5.8%, yet investors have a total return of 8.8%, including dividend payouts. When should a Lean Portfolio be established a. Use this free Roadmap Template for Excel to manage your projects better. By clicking the "Subscribe" button, you are agreeing to the That is the portfolio leadership team. It saves money for both the manufacturer and the customer. Read more:Fuel Digital Business With Product Management. Successfully defining and executing a strategy in a world of increasing uncertainty is challenging. Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. As noted earlier, SAFes Measure and Grow guidance offers portfolios a way to assess and improve their ability to deliver innovative business solutions quickly. To continuously connect strategy to execution, the leadership team continuously assesses these targets: To achieve enterprise agility, the leadership team facilitates periodic reviews: Adopting lean practices into existing portfolio leadership teams is a significant change and requires strong organizational change management practices. Unleashing the power of a leadership team is no less important than empowering a development team. These budgets are typically adjusted twice annually using PB. How many different, independently funded strategies will be driving the portfolio? Enterprise Architects help improve results by offering architectural governance and fostering the right balance between intentional and emergent design. 1 / 55. Lean project management is part of an agile methodology that aims to increase customer value by removing project waste. Adopting LPM helps organizations shift from traditional practices to a Lean-Agile approach, as shown in Figure 1. Flow time, load, and distribution are particularly relevant to the portfolio and are briefly described below. For example, they can map the work requests in the demand-intake process and under initial review to Reviewing. When should a Lean Portfolio be established? When is an Epic considered done? SAFe addresses big data concerns at the portfolio level as it requires vision, investment, and governance within and across the value streams within the portfolio. In lean portfolio management, one must continuously review and adapt to the changing environment to maintain value and eliminate waste. The people who fulfill the LPM function have various roles and titles and often reside in different parts of the organizations hierarchy. This is article twelvein the SAFe Implementation Roadmap series. For more information, see the advanced topic article and whitepaper:Achieving Regulatory and Industry Standards Compliance with SAFe. Market rhythms. The use of a lean portfolio management tool such as ProjectManager is essential for the successful implementation and execution of your lean portfolio management. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. These principles are defining value, mapping the value stream, creating flow, establishing pull and pursuing perfection. Who is providing the funding to the portfolio? This requires accurate estimates of resources. Lean thinking is the foundation of Value Stream Management. Fortunately, many enterprises have already traveled this path, and the change patterns are apparent, as shown in Figure 1. Portfolio management teams learn about enterprise strategy and how to execute that strategy by allocating the budget. This will give you an idea if its the right strategy to execute your portfolio management. Lean portfolio management is a process by which strategy is aligned with execution using a lean approach and agile portfolio operations and governance. These cookies will be stored in your browser only with your consent. Strategy and investment funding ensures the right work is happening at the right time. Continuous and early feedback on current initiatives, coupled with a Lean approach to funding, allows the portfolio to make the necessary adjustments to meet its business targets. Sign up for more agile articles and tutorials. Ensuring the entire portfolio is aligned and funded to meet business targets. Build an operating structure that embodies the key pieces of LPM, with a customized feel. The LACE and CoPs provide a forum for sharing effective Agile ART execution, flow practices, and other knowledge. The portfolio and solution roadmaps are bi-directional; each roadmap influences the other. Lean audit and compliance provide continuous adherence while minimizing overhead and supporting the ongoing flow of value. Portfolio Flow, 3. This optimization extends to business practices such as Lean Portfolio Management (LPM), which ensures that the enterprise invests in experimentation and learning to drive the system forward. Only if mandated from the top because it is better to operate in a completelydecentralized environmentb. Please refine your filters to display data. This article recaps the key points, edited for clarity and length. Additional conversations could focus on applying Lean thinking to funding and governance practices to eliminate bottlenecks in the flow of value generated within the development value streams. Privacy Policy. [1] https://www.techtarget.com/searchdatamanagement/definition/data-governance, 5400 Airport Blvd., Suite 300 We just dont have a good business discipline for converging on issues this abstract. Like traditional portfolio management, LPM requires a set of events to establish a cadence for reviewing and prioritizing the proposed work. In other words, they capture the large-scale or significant investments occurring within a portfolio. Organizations that focus on defining projects that span more than a year often get stuck in situations where teams are incentivized to meet out-of-date project goals, instead of delivering value early or seeking early feedback on market-fit. Instead, many adopt Lean Portfolio Management practices to drive alignment across the entire organization. Once you get to this step, youll be back at the beginning as lean never stops. Privacy Policy. Operating under the auspices of LPM, the LACE also plays a significant role in fostering operational excellence. The cookies is used to store the user consent for the cookies in the category "Necessary". In 2012, GE created FastWorks, a branded internal approach to translate lean startup principles and other disruptive strategies across its ecosystem. Principle #6- Make value flow without interruptions, 2. You can also customize reports and get a portfolio status generated with only a few keystrokes. The teams of Portfolio Management collect a budget towards the execution of that particular strategy by learning about the strategy of the company. They are accountable for the overall business outcomes and addressing the challenge of defining, communicating, and aligning strategy with execution. SAFe LPM Course This is a two-day, interactive course that teaches the practical tools and techniques necessary to implement Strategy and Investment Funding, Agile Portfolio Operations, and Lean Governance. Click here to view the entire roadmap. ET One example might describe how continuous communication and visibility of strategic initiatives can create better alignment between product development priorities and the businesss goals. Please visit. However, portfolio strategy is much more than prioritization and selecting the best investments. Collectively, these competencies work together to create superior economic outcomes. The flow will get value to customers faster, which means customers can pull the product in less time than it had been taking.
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