On-Demand Webinar: Five Things Successful Enterprises Do to Adopt LPM

Agile Rising’s Richard Knaster, SAFe Fellow and Marshall Guillory, SPCT discuss Five Things Successful Enterprises Do to Adopt LPM. Lean Portfolio Management (LPM) helps organizations achieve business agility and better outcomes by aligning strategy, execution, and value delivery. It has ultimate responsibility for decision-making and financial accountability for the solutions in a SAFe portfolio. However, adopting LPM can be challenging for many enterprises. Read Richard’s blog post detailing the 5 Things Successful Enterprises Do to Adopt LPM here.

0:00 welcome everyone today to our webinar on the five things that

0:05successful Enterprises do to adopt LPM and I’m presenting today with Marshall Guillory

0:11 Marshall why don’t you go ahead and introduce yourself and then I’ll introduce myself

0:17hello everyone Marshall Guillory I’m the vice president for the government practice for agile Rising also

0:24Consulting some fairly well-known government organizations like NASA the FAA and the Veterans Administration

0:30I’m super passionate about lean and agile practices of course and

0:36have long enjoyed my relationship with Richard and super excited to talk about LPM today

0:44excellent I’m Richard naster I’m a safe fellow I’m also a principal contributor to safe I’m

0:51also part of agile rising and a principal consultant and I’m also super

0:57passionate about lean portfolio management and strategy as well as you

1:03know the entire safe framework and really making the lives of people better you know I think today it could be very

1:11difficult in today’s work environment and I like to help organizations

1:16transform to become more engaging and fun because we spend too much time at work to not be enjoying what we do each

1:23day so with that we’ll uh begin our presentation

1:29and here is our agenda and we’re going to do this as more of a conversation

1:34than just a broadcast app View and Marshall and I will be kind of going back and forth with each other so it’s a

1:40more interactive type of presentation so we’ll provide some context for

1:46today’s presentation as to why LPM is so important we’ll briefly review the key

1:54LPM responsibilities briefly review what is what do we mean by a safe portfolio and then we’ll go

2:01into the meat of this discussion which is about the five things successful

2:06Enterprises do to adopt LPM and then we’ll also have a q a as well

2:15so the very first thing is why LPM and Marshall I’m sure you’ve run across

2:21a number of these challenges here uh one of my favorites is that agility

2:28is limited by annual planning the project model and in flexible budget

2:34process you know you spend like three months out of the Year doing detailed project planning in order to have the

2:41budget for the following year and as soon as the new year starts uh all the things that you said you want

2:47to do get thrown out the window and you you start with a completely different list

2:53uh and then the other thing about that one is that you know when you do traditional project

2:59portfolio management it’s more about picking amongst the the best project ideas and not really have a purposeful

3:06journey of how do you get from the current state to where you want to go in the future state

3:12yeah I wholeheartedly agree and we see that quite often with clients and it’s

3:17the nature of the history I guess of how organizations come to being if you will and what they’ve learned in their

3:23operating model and uh interestingly we spend a lot of time working with pmo

3:28organizations to help them to learn how to do this in a different way which we’re going to

3:34talk a lot about in this webinar all right great what’s one of your favorites here that your favorite

3:40challenge that you like to uh to address well um we’re going to talk later about

3:47um project to product and I think that’s a big mindset shift and I enjoy the conversations with

3:53clients about that and in many ways it’s challenging their ways of thinking

3:59directly um with regard to funding how do they fund uh their Solutions in their

4:05organization they by and large fund it through projects and love conversations about continuity

4:12um project outcomes versus what potential product outcomes we could have and it’s a real uh Game Changer I think

4:19for clients once they realize that there perhaps is a way to get better business outcomes even than the

4:25way their current system works yeah that’s one of my my favorites too and it’s a it’s a challenging one to

4:32overcome because organizations are so steeped in the project mindset and their

4:37budgeting processes are still annual and they’re reluctant to go

4:42from a project to product mindset but I think it’s one of the most important factors in being successful with a lean

4:50and natural transformation and being successful with with LPM another big thing that I see is quite a

4:58bit of a challenge out of this list here is that when you are in a project-led

5:04organization you often Place big bets on projects

5:09and you have you come up with a plan and you come up with what the expected benefits are

5:15but the problem is is that often those bets don’t pay off and you spend a lot

5:21of time and money and not know till the very end whether or not you were bet on

5:26that project is really gonna result in any benefits

5:32absolutely um I can recall over the past several decades many I.T projects for example

5:40Erp system upgrades they’re often associated with major upgrades with very

5:45high dollar numbers 20 million 30 40 50 million dollar upgrades

5:50and um we get varied results that we see with clients so one of the things that

5:56we can help organizations with is how do we decompose

6:01those large project batches uh into smaller experiments through the concepts

6:07that we teach in OPM absolutely absolutely um I think the the other big you know

6:14one of the biggest problems here too besides the ones that we mentioned is that we measure outputs versus

6:20outcomes so for example in traditional project portfolio management you know everyone is incentive to focus

6:26on their tasks and completing tasks and that’s the that’s how the project progress is being

6:33measured about how many tasks we complete and I think everyone knows that if you ask developers uh what percentage

6:40they’re done they’re usually done about 90 percent of the time ninety percent complete

6:46so it doesn’t really tell us whether there’s actually any progress being made it just says how many tasks we’ve

6:52completed yep and because of that focus on outputs and

6:59also the traditional nature of how organizations align themselves according

7:05to silos is is the way that we commonly discuss it it doesn’t incentivize uh

7:10teamwork an incentivize individual Behavior so in many ways the mindset

7:16shift for how we measure uh our system and our systems performance needs to

7:21change as well uh which of course LPM introduces some concepts for that as

7:26well right in fact let’s go into those Concepts I think people pretty much know

7:32these challenges and that everyone is uh is usually uh encountering these

7:37challenges and if people want to put in chat any other challenges that they’re encountering that would be great too

7:45so here we’re showing the three dimensions of LPM lean portfolio

7:50management and safe and the three dimensions are strategy and investment funding agile portfolio

7:57operations and lean governance and we’re not going to go too deep on this slide

8:02here because this kind of content would need to be covered in our two-day LPM

8:09course it’s just a lot of stuff there’s a lot of nuance to this but you can see some of the things that are really

8:16important to do when you’re implementing LPM and you know probably the most important

8:21dimension of these three dimensions is strategy investment funding

8:26because that’s where we’re making the investment decisions it’s also how we’re going to change our

8:33model going from going from projects to products and funding products instead

8:38becoming a product LED organization and instead of

8:45having a plan Drive the schedule and also the investment what we what we

8:52can do that’s better instead is to say how much are we willing to invest in

8:58this particular initiative whether it’s doing sustaining Innovation or creating a brand new product and then limiting

9:04the scope of our work to the investment that we’re willing to put out so it’s quite a different model and of course

9:10this is where we also come up with our strategy for the portfolio

9:16and uh in another talk we’ll go into what do we mean by strategy because I think everyone is confirmed by uh

9:24um confused by what strategy means you know a lot of times people think it’s just goals it’s just objectives it’s

9:31your mission your vision everyone’s confused about that so we’ll get into that another time but you can see the

9:37major parts here about creating a vision for the portfolio making sure people understand how the portfolio contributes

9:45to the Enterprise and that helps people within the organization understand their how they contribute to the overall

9:53Enterprise’s strategy we go from the current state to the Future State using portfolio epics

9:59and we promote decentralized decision making and decision making in safe so therefore

10:06we want to have the guard rails to make sure that the Agile Release trainings go don’t go off the track

10:12and of course having a fast flow of value is really important

10:17any any other dimension here uh that you like to speak about Marshall

10:22what’s your favorite next Dimension after strategy investing funding well I’m a fan of all of them of course

10:30um all really relevant and important to the function for LPM I think in this

10:36case I’ll comment on agile portfolio operations particularly as a way to look at large

10:44complex systems if you have an organization that has hundreds of teams large-scale organizations

10:51how do you actually uh coordinate and create alignment across thousands of

10:56people perhaps that’s a big question and it’s a complex area for solution I think

11:03LPM uh is a necessity uh in a safe implementation in that in that scenario

11:09of course for most organizations even though we have large Solutions safe but when we think about coordinating

11:15multiple development value streams our goal is to create alignment but also to create a system that flows as you’ve

11:22referred to and creating systems that flow requires coordination activities and your APO is creating and fostering

11:31and maintaining your operating model uh using the the guidance and the principles and the framework so uh APO

11:39of course in this case is my pick okay and that’s agile portfolio

11:44operations when we say Apo and the last thing we’ll just cover is lean governance and then we’ve got enough

11:51context to to continue our presentation so this is in link governance one of the

11:56things we do is we forecast and budget dynamically even though we’re kind of stuck with the annual budgeting model we

12:04can you know twice a year we can update the budget and we can also decide how we

12:09allocate the budget to different value streams of course we want to measure our portfolio performance using objective

12:17measures and when we look at how well we’re progressing towards our product goals is how we’re doing with the

12:25features that we’re developing what would the MVP that we might be developing we want to do lots of

12:31solution experiments before we make big bets on epics we want to do small

12:36solution experience and of course one of the things that we need to do is to have continuous compliance and not wait for

12:42at the very end otherwise we’re not going to be able to accomplish our goals if we do that

12:48so we just want to do one more context slide and that is on what is a safe

12:54portfolio so when we talk about a portfolio and safe here we’re talking about a set of

13:01related development value streams and that we organize those we organize

13:07arts and teams within those development value streams and we organized the

13:14people around the solutions that we are going to be selling to our customers so

13:21development value streams create solutions that the operational value streams sell to customers or that they

13:28use to do their jobs which is to serve the customer so each of these

13:34development value streams they build solutions they support them it’s both

13:39keeping the lights on as well as developing new features and the

13:44portfolio helps ensure that where all the value streams are aligned on building the things which are most

13:51important to the overall portfolio of our products or Solutions and when we

13:56say Solutions or products we kind of use that interchangeably also to include the

14:02meaning of of services so you know again if you want to learn

14:08more about these topics you know you can learn about that in our upcoming LPM course but now we want to go on to the

14:15heart of the presentation this discussion rather about the five things successful Enterprises do to adopt LPM

14:24and Marshall do you want to take the very first one sure I’d love to and you know what

14:29before we do that um just because otherwise we’ll end up

14:34repeating ourselves I’m just gonna put the five things that successful Enterprises do to adopt LPM and Marshall

14:42is going to start with the very first one about adopting and improving LPM practices early in the safe

14:48implementation thank you Richard so as you can see uh

14:53this graphic shows the skeleton adult framework implementation roadmap and in version six of the skeleton framework or

15:01safe uh we have now um pushed the LPM course and of course

15:07the implementation of LPM as a function uh to a much earlier stage in your your

15:14transformation if you will or leading change or your change management plan this has become really relevant as uh

15:22myself Richard other Consultants um we’ve through practice realized that

15:28in many systems implementing LPM early actually is a

15:34benefit to the overall implementation and the reason why is we can begin to

15:40involve Executives leaders managers in the process of change and also their

15:48Learning Journey because when we Implement lean and natural practices it’s not just for the quote people doing

15:54the work uh Executives do work too and managers and we want everybody to adopt

16:00the practices so introducing LPM and what we sometimes refer to as a parallel

16:06implementation to launching after release Trends which we discuss in other webinars and other videos

16:13is a function of Engagement with the right people the right stakeholder

16:19groups as part of your organizational design for this change management plan so when agile Rising Consultants engage

16:26with clients we of course do a lot of Discovery work and we follow the safe implementation roadmap

16:33and throughout that process we very often find that through our experience

16:38we can see that clients will probably need a lean portfolio

16:44management function in their endgame implementation so why not get started early

16:49this means beginning discussions with stakeholder groups Executives managers leaders Etc

16:56um Financial analysts and financial management the CFO if you will in your organization

17:02and begin the process of leading change just as you would with technical teams uh development teams and that invokes

17:10that that parallel implementation of LPM what this allows you to do is begin your

17:18change management practice along with launching other release trains so your

17:23entire design for your portfolios can follow the implementation roadmap pattern and you can adapt and make sure

17:30that we have alignment across those two implementations yeah one of the favorite things I like

17:37to do when when we Implement LPM early is that oftentimes leaders really don’t

17:43know what we mean to be lean or agile and how it applies in their context

17:50and what I find is when we start LPM at the same time that we are launching

17:55trains we now give them something to really understand in their own context and I

18:02find that this helps really accelerate the implementation of safe

18:08uh because they understand how lean and natural apply in their world so I think that’s a big important and

18:15when your implementation of safe has stalled implementing LPM can often

18:20reinvigorate it and Marshall perhaps you know you can talk about what are some of the things that we can do very early on

18:27when implementing uh LPM and then perhaps later in the transformation we

18:34might Implement other parts well the LPM implementation map which we

18:42shared here in part as you can see there’s a much more detailed version as well in the show logo framework materials but a couple of key things one

18:51as with any change we want to make sure that we have that guiding Coalition following John cotter’s change

18:58management process that’s built into the framework so that guiding Coalition is in part

19:05guiding the overall transformation but you’re going to need those same folks to guide your LPM implementation and

19:13they are the folks that are going to have the answers about how do we build the LPM team or establish the LPM

19:20function who will actually participate and attend the LPN course who will actually attend and facilitate

19:27and participate in the process of lean portfolio management so those are discussions that you should have early

19:33on with your stakeholders that are involved in your transformation secondly uh it’s really important just

19:40like when we’re launching an Agile Release Train to plant the flag if you will we want to launch the art we don’t

19:46want to endlessly prepare seeking Perfection rather than seeking Improvement so scheduling the LPM events

19:53in other words scheduling the class itself getting people the knowledge and

19:58education that they need to understand LPM functions but also scheduling your portfolio sync

20:04events your strategic portfolio review events and other events that you’re going to use to facilitate the process

20:10of portfolio management using lean thinking identifying strategic themes early in

20:17the game this most often in many of our implementations means identifying work that is already in flight

20:23what are the big initiatives that we have going on in our organization now perhaps they were organized and funded

20:28via a project what will be the discussions that you have as a safe practice consultant

20:34to help your client transition from Project thinking big bang big batch

20:40projects to lean thinking with hypotheses that will be testing as part

20:46of a lean business case in a safe Epic so identifying that strategy and those

20:52teams very early in the game creating those backlog items and getting some momentum behind them and connecting them

20:58to the people who do the work is another really important part of the early stages in your LPM establishing the

21:04budgets in the girl world guard Rose as well which Richard and I will continue to discuss moving forward and then

21:11finally we have to have an operational kanban systems that we can enable flow so you definitely want to have either a

21:17tool or a kanban on the wall if you will a system to manage flow early in the

21:23game but in other words you don’t need to implement all of LPM in the beginning

21:28you can just start with some of these items and then later on we can extend

21:36the practices that we do in LPM as we launch more trains

21:42the other thing that’s kind of new in in save six and Marshall you talked about

21:48the guiding coalition but along with that one of the things that we found is that we want to create

21:56an executive team which follows or organize an executive team which is

22:02following agile practices to help guide lean portfolio management

22:08so you’re seeing possible people that might be in this in this group

22:13CEOs CFOs Chief security officer Chief product

22:19officer mainly all the sea levels I also like to have an RTE or so in that mix as

22:27well and this group supports the lace and we’ll also be talking about on the

22:32next slide about the value management office instead of a agile program office

22:39or a you know a pmo traditional pmo and they’re helping decide this group

22:45here this executive team they’re at the highest levels of the Enterprise and they’re going to help determine how much

22:51budget each portfolio should get because in a large Enterprise typically it has

22:57more than one portfolio these Executives also need to

23:02collaborate with Executives within the LPM function to collaborate on the Strategic themes

23:10that that portfolio will work on because that’s how they connect the work that

23:16they’re doing in their portfolio to the Enterprise’s strategy to make sure that

23:21we have alignment with all of our portfolios to the Enterprise’s strategy

23:27and this will also help prevent duplicate work or you know sometimes

23:32what happens is when you have traditional project portfolio management is that one project May negate another

23:38project or it may cause us to get very delayed because it’s the same pool of

23:44people that’s that’s being used so along that lines we also want to

23:50start transforming the pmo to a value management office and perhaps uh

23:58Marshall you can share your thoughts on you know going from a PM traditional pmo to a VMO

24:04sure so this always begins with knowledge so we use safe courseware to

24:10educate people on the new ways of working if you will ways of thinking

24:15and there needs to be a facilitated Journey um which is why we use safe practice

24:22consultants and the VMO uh has to be uh created with intent so when

24:30you look at traditional pmos we often have people who have been operating in that model for many many years uh

24:37they’re often for example in the case of our government clients uh documents that

24:42Define exactly how that process works it’s often phase gated so the process

24:48begins with Gathering uh leaders who can help drive that a a a coalition if you

24:55will within the pmo perhaps the senior leader of that group uh

25:00uh that is willing to try something new and in many cases for example at Nasa uh

25:06with their office of the CIO operates the pmo for NASA and they were willing

25:12to do a branch and their 7120 process that’s called

25:18that’s the first step in transitioning to a True Value management organization uh what we’re ultimately gunning for is

25:25to actually change the way of working to migrate from project thinking to product thinking so

25:31the VMO uh gives people a new model a new operating model a new way to

25:39facilitate and manage risk at an Enterprise level for example using lean

25:44and agile governance it also allows an organization at an Enterprise level to interact

25:49in a lean and agile way with all the people doing the work so rich alluded to

25:56um projects competing for prioritization uh and budgets

26:02we can in many ways mitigate all those common problems that we see in project management or program management

26:09by actually applying lean budgeting Concepts and having the VMO Focus

26:14ultimately on outcomes and our hypotheses that are embedded in our epics

26:20so the becomes a central focus on accelerating value delivery to clients

26:25rather than in my experience and opinion a reactive organization that simply manages the latest project that has the

26:33most attention right and also it’s often the PML has traditionally been the place where

26:40project managers report into and so it’s it reinforces the project

26:45model and we really want to go to from Project to product so now let’s talk

26:50about that a little bit more what do we mean when we go from Project to product so that means that today in most

26:57organizations people are organized in the functional Silo and then temporary

27:03project teams are created where they will do work we’ll create a lean business case we’ll fund that project

27:11and often we are identifying every possible thing that we might want to

27:17implement in that project and then having the plan having the

27:22scope Drive the plan and basically when we do that we’re making big bets and we don’t even know

27:29if the benefits that we have in our very detailed business case are really we’re going to achieve those

27:36benefits and I always kid around and I say I’m one of the best fiction writers of all time because I wrote so many

27:42business cases in my past life and I didn’t realize at the time how much fiction was in those business cases

27:49because you know it was based my Roi was always on spot on I had a five-year cash

27:56analysis I had Net Present Value I had internal rate on return and basically

28:01any business case I wrote you know would get approved by the CFO but the problem

28:07was nobody really spent a lot of time looking at the assumptions that that Roi

28:13was based upon and you know what nobody ever even checked after the project was

28:19was implemented whether or not we got those benefits so that’s a huge huge

28:24problem and you know as Marshall mentioned earlier you know face Gates

28:30are not the best thing to use certainly the way they’re defined today they cause waterfall execution to happen

28:39because we’ve got to get all the requirements done sign off on those get all design done

28:44signif sign off on all those and so on uh instead we want to organize people in

28:51value streams and arts so that people are organized around the products and

28:57services that our organization offers to customers we can also adjust how much money each

29:04value stream gets twice per year so even though we can change the overall annual

29:10budget we can turn we can decide which value streams are going to get more capacity and we can make those changes

29:17twice a year in very disruptive markets we might do that more often but it can

29:23be very difficult to have where your your budgets are changing on a quarterly

29:28basis of course the lean business cases we don’t want to spend I’ve seen business cases go on for 18 months

29:34before we got approval on that but want to have been made more more sense to use that time to actually do some solution

29:41experiments to see if the business outcomes that we want to achieve that

29:46we’re making progress towards them using some kind of leading indicators to know

29:51if we’re on the right track to making that progress foreign and of course

29:58um we want to be using objective measures and Milestones so we’ll talk a little bit later on about what some of

30:04those objective measures and Milestones might be and Marshall perhaps you can

30:09speak a little bit more about how we organize the portfolio around this this value

30:14sure thank you Richard uh safe has a concept of value streams that’s unique

30:20to the framework we think of value streams and uh really three different ways business value streams or

30:27operational value streams and development value streams development value streams are what many of us in the

30:33it and software business are already familiar with we think of the word development as producing a software

30:38product or an I.T product but because of business agility there are many other ways in which we can think about

30:44development value streams today by including all the rest of the organization

30:49uh so we organize the portfolio around value because we organize our people and

30:57our systems around development value streams and then the way in which we create value and those development value

31:04streams is through a social construct if you will called an Agile Release Train or a team of teams uh this is not a

31:13one-to-one relationship we can have really large development value streams for example uh if you worked at Boeing

31:19and you you built commercial uh passenger aircraft there are literally thousands upon thousands tens of

31:26thousands of even uh people vendors suppliers Etc involved in developing a

31:31functional and safe aircraft so therefore because of the uh social construct of an outdoor Release Train

31:38there would probably be many different types of that early strings that would need to execute and deliver value so we

31:45move away from uh organizing teams into completely independent uh disconnected

31:52units that are most often very large larger than what we would like an agile team to be to actually be in aligned

31:59around value by focusing on Solutions and products

32:04um additionally we have the benefit of creating alignment when we have large

32:10cyber physical systems with thousands of people so

32:15um we have clients for example at Nasa that have um 800 to 1200 people in a single

32:22portfolio uh prior to that they were organized around projects we have been trying to

32:28help them to come together and think about what are the solutions and products that they’re delivering to the

32:33administration to NASA which means in their business the missions it’s all about the mission it’s all about rockets

32:40and spaceships and going to Mars so even though it is an I.T function for example

32:45we would want folks to come together and think about how can we construct this

32:51this network organize around value that has multiple development value

32:57streams and multiple other release streams that is ultimately a portfolio if you will

33:03so organizing a portfolio around value becomes incredibly important for organizational design and ultimately for

33:09developing great business outcomes yeah speaking of that one of the things

33:15that we don’t want to do is we want to re-in we want to reintroduce the value

33:21stream network in other words when you first start an organization it looks like the diagram on the left

33:27where you see those nodes it’s more like a network in the middle might be the CEO

33:33and anyone can speak to anyone it’s very intramural we can operate at the speed

33:39of innovation but we don’t want to toss out the traditional hierarchy it still serves a

33:46purpose because it helps us improve our efficiency and improve our

33:51stability we still need managers when we Implement safe in fact they’re the ones

33:59who can change the systems that get in the way of operating as a team of agile

34:07teams and also a portfolio of value streams which contain multiple teams of

34:12teams so we don’t want to completely disrupt the organization and again there are

34:18benefits that come from both of these organizational models the value stream

34:24network as well as the traditional hierarchy

34:29the next topic we want to speak about is that in order to be successful going

34:34from Project to product is that we want to be in a continuous delivery model

34:42and we want to move away from projects so what is the replacement you know if

34:48you’re not doing projects and you have a very large initiatives features themselves are not enough

34:54you need you know you can have a very large program it might be some cyber physical systems like Mark Marshall

34:59works with NASA but you also may work in an insurance company or banking or any

35:05number of businesses that need to do large initiatives that might take multiple program increments

35:13and they may require multiple Agile Release trains and value streams to implement

35:18but we don’t want to get back to the project model so we will Implement epics

35:24they’re similar but they operate very differently and if you go into the scaled agile framework into the epics

35:30article it will show you a comparison between projects and epics

35:36and when we go to this continuously model and we organize are people around the value streams and

35:44arts which produce those products as Marshall was mentioning that allows us to have long-lived stable teams and that

35:52means that we will move with faster speed we will retain the knowledge and

35:58the relationships that you get when you have stable teams people know how each other works you start learning a

36:05business domain and so it’s a much different experience we also want to

36:11make all of the work visible in the portfolio kanban whether you’re doing

36:17epics or whether you’re doing traditional projects because we want to

36:23see how much capacity both the traditional projects and the epics are

36:28are using and of course our goal is to transition from projects

36:34to epics if we have really large things but a lot of things can be done on a much small scale just simply doing using

36:41features and delivering a steady stream of features to each Azure Release Train

36:47who then releases them into production there’s also a thing in safe called the

36:52business agility value stream and what that helps us do is what happens when we want to bring a brand

36:58new product to Rocket I think most of us are enhancing existing products existing

37:03services but the business agility value stream here is talking about creating a

37:10brand new product and perhaps it may result in a brand new development value stream and may as well bring a new

37:18operational value stream so the next topic that we want to

37:23discuss is something new and safe and that is principle number six and

37:30that’s make value flow without interruptions and Marshall can you can you articulate

37:36what do you what do we mean by flow and safe my flow so let’s take a step back and

37:44think about traditional project management at Enterprise scale if you will like a

37:50NASA for example or any commercial client you can think of

37:56um there’s no real Cadence or synchronization to projects

38:02um projects come along leaders want them or customers want them and they get funded and we go and we find the Matrix

38:09of people and resources and we we start the project we assign a project manager and it executes

38:15well what happens is that results in people being pulled to various projects

38:23and fractionally allocated we call it and fundamentally as a human

38:30when you ask people to work on many projects all simultaneously

38:35there’s a lot of distraction that comes along with that and waste that comes along with that so we don’t really see

38:41flow because the projects are always competing for the same resources because

38:46most organizations don’t have unlimited resources so in other words in other words the organization is more focusing on

38:53completing their tasks than having a fast flow of value yeah it is it is

38:58almost like that they’re task oriented rather than outcome or unit and so

39:04when we think about flow what we want to do is take our people and we want to

39:09create a system for them that actually enables flow and there’s a lot of things that need to

39:15change in that mindset values principles and the practices themselves and

39:21what we see is when we implement the practices are better than this code of a framework for example we can help people

39:29to organize their work and their teams in a way that actually enables flow to

39:35happen uh by no longer for example pulling people and putting them on projects but moving the work instead of

39:41the people as we say it right and the the that new principle six is all about how do we make flow occur

39:49without interruption and there’s an article at every level of of the framework including the portfolio which

39:56tells you how to apply the different flow accelerators at each level of safe

40:01and we’re going to get to those in a few minutes now the other thing that was introduced in save six was the concept

40:08of value stream management so exactly what is value stream management and how

40:14it can help well value stream management is a way that we can optimize people

40:20process and Technology to optimize the flow of business value for end-to-end

40:27solution delivery you know the real focus is on getting a

40:33faster flow of customer value identifying the bottlenecks that are in

40:39the organization what are the things that are really getting the way that inhibit flow uh the the what are the

40:47delays caused by and how can we eliminate delays because those will reduce the time to Market so value

40:55stream management is a very new discipline as it relates to software and

41:01uh systems development like those cyber physical systems Marshall mentioned but

41:06it’s been around manufacturing for a very long time but the nascent part of

41:12it is about applying it to software and systems development so Marshall perhaps you can talk about

41:20um some of the flow accelerators uh that we have in safe and and why they’re

41:26important sure so I’ll go back to the example earlier since we’re looking at portfolio flow in

41:31this in this example um when I talked about some of the key things you need to think about for

41:38implementing LPM early in your implementation uh one of those is visualize and in limiting work in

41:44process uh speaking personally you can’t underestimate the visualizing your work

41:51many agile teams are familiar with the concept of a scrum board which was a valuable way to make things transparent

41:57for a scrum team uh but we want when we think about visualizing and limiting working process

42:04we want to bring that to the next level and that means actually implementing a compound system

42:09and becoming one of the flow so accelerators and safe means that we also have to

42:15attach this to the backlogs at scale because safe is a scaling framework it’s

42:21not just about one or two teams working together or independently it’s about dozens of teams perhaps working together

42:27or hundreds so when we visualize and limit working process we actually enable the flow accelerators

42:35uh to happen because we can see the work moving through the system

42:40uh we can apply uh lean Concepts to that so it is a foundational element of many

42:47of the concepts that we apply in the framework for example addressing bottlenecks if we don’t map the value

42:54stream and map how we believe flow should flow or does flow through the

43:00system then we can’t really measure it we can’t create any system uh to for the

43:06accelerator number one so we first have to visualize a limit working process then we can see the

43:12system run we can see work flow through it and we will be aware of then of

43:18bottlenecks in the system which we can then address in flow accelerator number

43:23two um next one I want to talk about let me kind of move on is working in smaller

43:29batches uh batch size optimization is something that I think all teams uh

43:35struggle with uh even not using a scaling framework like safe

43:40uh we have to again be able to see the the work in the system and have it to be

43:46transparent before we really know whether our batches are optimized or not uh we call this running the system

43:52we have to have also language and a model to use and safe introduces that

43:59safe requirements model or the safe Enterprise backlog model and as Richard as you’ve been talking about uh epics

44:05and features and so we have to have those Concepts in that language uh

44:12operating effectively as a communication Tool uh within the teams along with visualizing and limiting all

44:19the other flow accelerators so that over time teams can look at that holding cost transaction costs

44:25and really decide well we said we’re going to do for example 10 features this

44:31this increment but we only did two or perhaps that’s an indicator that the batch size was too big well there were

44:38other extreme dependencies that we weren’t made aware of so uh these accelerators can be very helpful to

44:44ultimately achieving Better Business outcomes great speaking of business outcomes what

44:50we want to do is we want to measure those business outcomes over outputs the

44:56thing is it’s much easier to measure out outputs you know how many stories

45:02did we complete how many features did we complete uh how many defects did we

45:08squash and all sorts of things like that but it doesn’t really show us whether or

45:15not we’re delivering value to our customers and that resulting in a value

45:22exchange to our business where our business can make more Revenue uh the

45:28like customers grow the business and so on so it’s really important that we are

45:33measuring outcomes over outputs now that doesn’t mean that measuring outputs is not

45:39important it still is because it gives us some context to our our business

45:46outcomes because perhaps we’re only you know doing one or two things in API

45:52which has a lot of people on the actual release chain and perhaps we’re not achieving

45:58a lot of outcomes and my thinking is it’s more important to focus on our

46:04business outcomes than focus on how many features did we deliver the nspi you

46:09know we delivered 20 features in this Pi but out of those features which one of

46:14them’s actually moved a needle in the business and most of the time the answer is we just don’t know but the good news

46:22is that we can instrument those things today to find out what the outcome of

46:28implementing those outputs are and so there’s a measurement model

46:33that’s in safe it was introduced in say five and it continues to be refined in

46:39safe6 and Beyond because the framework is also continuous flow model we’re

46:44always updating the framework so this measurement Model includes three

46:50aspects outcomes that we just discussed to our portfolio Solutions do they meet

46:55the needs of the customers and our business how are we flowing you know how

47:01efficient is the portfolio at delivering value to the customer and competency how

47:08well are we adopting the principles and practices in safe that enable a business

47:15agility at all levels of the framework so let’s continue with the theme on

47:21business outcomes so here are some of the things that we want to measure when it comes to

47:27business outcomes for example the pirate metrics which I like a lot

47:33and it’s called pirate metrics Dave McClure created them because the initial of each of those different metrics

47:39spells are so it’s kind of like the sound that a pirate makes

47:45uh fulfillment you know if we’re if we’re failing a consumer loan uh how many people that apply for a loan

47:51actually uh went ahead and finished the loan how long did the time time did it

47:57take to make a decision what is the approval late customer lifetime value and so on and we

48:03also need to look at our support because customer support tells you how well are we being

48:09successful with our customers and of course safe is used for manufacturing as

48:15well as as designing those new products that we’re going to manufacture so we

48:21have some example apis for those as well

48:26but we also need to measure flow and uh which of these metrics uh

48:33have you had the most success with Marshall maybe all of them I’m not sure

48:40well um of the six uh metrics here uh for measuring flow and safe

48:45a few of them that are easier let’s say to implement and to get value for

48:50decision making out of uh than others um so for example when we Implement safe

48:57one of the things that we’re doing is we’re designing a new system a new operating model that is probably very

49:06much so different than the one in which your organization maybe was using before and a a key uh flow metric in there is

49:15flow predictability uh otherwise known as planning predictability measure if you

49:21will and what that is a statistical process control that shows whether the system is

49:27in control or out of control and that becomes really important because customers the people who

49:34actually pay the bills really want organizations to be predictable and we

49:40can use a number of different common industry products to understand that for example if you have a smartphone

49:47and you’ve ever purchased an upgrade for a smartphone you probably didn’t do as much research if you’ve already owned

49:54every iPhone like I have since the very first one about the new iPhone you just

49:59said well I know they got some cool new features and I trust Apple produces a very high class product so I’m just

50:06going to go and you know go to my favorite mobile provider and get my new phone or whatever it is I do so in much the same way flow

50:13predictability allows internal and external customers depending on your context

50:19um to utilize that metric to understand whether the system is Flowing or not uh

50:24followed the number of work items that are currently in progress or waiting it’s a view into uh your your kanban

50:33system if you will your visualization of work and other things here uh are really used

50:40proportionately um I like to approach this uh by the way as a consultant uh not with a big bang

50:47like let’s do all these and let’s do all of them instantly let’s start simple like it says in the

50:53agile Manifesto I’ll start with one thing uh implement it make it an

50:58effective and accurate measurement of the system and then add on to it later so for example flow predictability is an

51:05easy one to start with um the other things come with discipline and Tool utilization perhaps But

51:12ultimately we want to determine whether or not the outcomes of the system

51:18are actually supporting what we actually say we’re going to do and we use these flow metrics to do that

51:25oh great speaking of flow we need to move on to the next successful thing number five

51:31and Marshall you talked about some of the things that we can do to get LPM

51:37started at the very beginning of the safe journey and this is basically

51:42showing you the different steps that you need to do to adopt LPM and we called

51:47adopting LPM instead of implementing LPM because it’s more something that you adopt over time we also wanted to

51:55distinguish the difference between the LPM adoption versus implementing safe

52:02overall and these steps are not necessarily linear so you might do some

52:08work for strategizing you might do some work for aligning and organizing and

52:13kind of going back and forth between the different steps within this journey and

52:18we’ll talk about in a moment all the things that are available in safe Studio that you can use because LPM is probably

52:26the most widely covered um uh discipline in in safe in safe studio

52:33so it’s it it’s pretty cool the stuff that we that we have of that

52:38um so Marshall which of these ones are you the most familiar with or that you like

52:44to speak to that you know that are your favorite kinds of assets or the different steps that you like the most

52:51sure so I think I’ll just speak generally to everything um in this case a lot of folks

52:57um have worked very hard over the past several years to create some really really great

53:03content the practice guides particularly that you see that follow the adoption

53:09roadmap uh have a great amount of detail for those of you new to LPM you can

53:16follow the videos and follow the practice guides to create your own knowledge and your own understanding and

53:21learning of lpms as a function and how you can use it in your organization there are a lot of successful patterns

53:27that we provided that come directly from field uh work uh from our actual

53:32implementations and there’s also some great tools that are available for example

53:40um uh participatory budgeting is is part of LPM and there’s a really great

53:46software tool in fact one of the only ones that are in the world uh that can enable you actually facilitate uh

53:52participatory budgeting uh using a digital tool rather than a manual spreadsheet or or paper for example so

54:00we strongly recommend you utilize the Community Resources here uh because it can help jump start your

54:07LPM practice right and Marshall I really thank you

54:12for being involved in the very first LPM Alpha class that I taught out in Silicon

54:19Valley it was really cool having you there and getting all the feedback you have definitely made a difference in

54:24the the quality of the other materials that we’ve developed over time thank you Richard

54:30uh we are going to be having some courses coming up uh LPM course will be

54:35coming up in September September 26 and September 27th and I’ll also be doing an

54:41implementing safe class on September 12th and September 15th uh if you don’t

54:49know a lot about value stream management and you would like to learn more besides

54:54the knowledge that you can get in the safe framework we also have an e-book that we can share that I authored and

55:01just put your name in chat or send us an email to Agile rising and we can we can

55:08send you a copy of that ebook at no charge anything that you wish to promote uh

55:15Marshall you know it’s like being on the uh on a Tonight Show or something like that and what things do you have coming up

55:24um well I actually have a presentation that I’m giving at the safe Summit uh in

55:29August uh coming up very soon I’m super excited about that and a little bit nervous I’ll be up on stage presenting

55:36um on the topic uh that’s near and dear in my heart which is connecting strategy

55:42and execution which in many ways is involved in the things that we talked about today it’ll be very specific about

55:49a systems model and some guidance uh that that we have created and utilize

55:55with various clients so I strongly encourage everybody if you can attend the safe Summit love to see you there uh

56:01if not um check us out in the safe Community after uh on the recorded videos

56:08okay it looks like we have uh one minute left or a few minutes left uh does

56:14anyone have any other questions than what’s been answered already in our q a

56:23okay it looks like we’ve answered most of the questions that that are in there so we’d like to thank you very much for

56:29attending today’s webinar we we hope you enjoyed it and remember if you want to learn more you know we practically hold

56:36a LPM class and implementing safe classes where we also speak about that

56:41and you’re going to find that in our LPM class it’s kind of a bit different some some of the other partners who teach LPM

56:48uh is that we not only go into the content from the framework but also go

56:54into things like you know how do you create a business strategy for the portfolio because my saying is if you

57:02have strategic themes but you don’t have a strategy then they’re just dreams what

57:08are you actually going to achieve if you achieve those those strategic themes what did it result in did it move the

57:15needle in the business did it help you go from the current state to a future state chances are it has not so to me uh it’s

57:22very important that we also understand strategy in a very deep way and we’ll also cover that in the LPM course

57:29well thanks everyone happy Friday any last words Marshall

57:38thank you for uh for the opportunity Richard always loved working with you thanks everyone for for joining on

57:44Friday of all days so you would you like to wrap us up

57:54 thanks everyone for joining