Lean Portfolio Management (LPM) improves the way organizations make decisions about project and product development. This method requires a significant mindset change across the whole organization, including among business executives.
Stop managing costs, start managing value with Lean portfolio management
Do you recognize this? Centralized decision making, Outdated outcomes, lack of strategic alignment, approval of low-value initiatives, overly long evaluation cycles
This is what you want!?
- Planning, funding, and the assessment of processes become more frequent and dynamic.
- Decentralized deceision making and more engaged employees.
- Time to market (or time to value) improves because versions of your products can be delivered and tested earlier than under traditional predictive methodologies.
- Better Product fit. Working with Minimum Viable Product iterations to get a final outcome with a better match to the demand. Also, products or services can be killed before they consume too many resources only to deliver an end result that is already outdated
Then you should manage your portfolio in a Lean Agile approach
Lean Agile approach
- Teams participate in decision-making processes.
- Value is delivered incrementally.
- Plans are adaptive to provide customers with maximum value.
- Lean cases are used to fund and prioritize the work that matters most.
- Work is incrementally delivered.
- Customer feedback is gathered to determine what you should work on next.
- Value delivery is defined by the value stream leaders and team members.
- Adherence to outcome-driven value delivery.
- People are told what to work on.
- Specialists are moved from project to project. They can work on many projects at the same time.
- Requirements and detailed project plans are created before the work begins.
- Work looks very detailed even before it starts.
- Plans are usually followed by inflexible annual plans that are difficult to change.
- Funding and budgeting are tightly controlled by finance.
What is LPM: Lean Portfolio management in a onepager
Roles, events, artifacts
Equal to Scrum, Lean Portfolio Management has also roles, events, artifacts. This is what described in SAFe (© Scaled Inc)
Lean Portfolio Management (LPM) – This function represents the individuals with the highest level of decision-making and financial accountability for a SAFe portfolio
Epic Owners – Take responsibility for coordinating portfolio Epics through the portfolio Kanban system
Enterprise Architect – Enterprise architects work across value streams and ARTs to help provide the strategic technical direction that can optimize portfolio outcomes
Portfolio Sync – The Portfolio Sync provides visibility into how well the portfolio is progressing toward meeting its strategic objectives and may include reviewing value stream and program execution and governance of other portfolio investments
Participatory Budgeting – This event enables LPM to collaborate with Business Owners and other relevant stakeholders to right-size the investments in value streams and helps manage the approval process of epics in the portfolio Kanban Strategic
Portfolio Review – This event enables LPM to create alignment and investment guidance to inform rapid, high quality, decentralized decisions; adapt to meet changing needs; and provide governance necessary to effectively respond to new and changing opportunities
Strategic Themes – Provide specific, itemized business objectives that connect the portfolio to the evolving enterprise business strategy
Portfolio Vision – The portfolio Vision is a description of the future state of a portfolio’s Value Streams and solutions and describes how they will cooperate to achieve the portfolio’s objectives and the broader aim of the Investments by Horizon – Assists the portfolio in ensuring managing near and long-term solution investments
Guardrails – describe the portfolio’s policies and practices for budgeting, spending, and governance
Business Epics – Captures and reflect the new business capabilities that can only be provided through cooperation among value streams. Each Epic is supported by the Epic Hypothesis Statement, and Lean Business Case for those epics that make it to the analysis state
Enabler Epics – Reflect the architectural, technology, and business process initiatives that are necessary to enable new Features and Capabilities
Portfolio Kanban – Provides a system for visualizing the flow of epics
Portfolio Backlog – The highest-level backlog in SAFe, it holds approved business and enabler epics that are required to create a portfolio solution set. This provides the competitive differentiation and/or operational efficiencies necessary to address the strategic themes and facilitate business success
Portfolio Canvas – The portfolio canvas defines the value streams that are included in a SAFe portfolio, the value propositions and the solutions they deliver, the customers they serve, the budgets allocated to each value stream, and other key activities and events required to achieve the portfolio vision