Lean Portfolio Management Operations: An Agile Approach (2023)

This blog is part of a series onLean portfolio management for the company. If you have not done so yet, we recommend reading:

• Part 1: What is lean portfolio management?
• Part 2: Lean Portfolio Management: Tight Budgets and Investment Financing

If you've read the first two parts of this series, you'll understand that traditional portfolio management approaches may no longer be able to keep up with the fast pace of the global economy or digital disruption. Traditional approaches, which are often longer and more linear, can inhibit the flow of innovation and value in your organization and as such make it difficult to Lean-Agile transformation without transforming your organization's approach to portfolio management. In the first two parts of this series, we talked about the key elements ofLean Portfolio Management(LPM) and how funding practices need to be adapted to better support LPM initiatives. Now let's dive into developing an agile approach to lean portfolio management operations.

Adopting agile portfolio operations practices is an equally important component to the success of your Lean-Agile transformation.

Traditionally, in an effort to maintain alignment and consistency across the portfolio, organizations have dedicated a centralized PMO (Program Management Office) to plan, manage programs, and define solutions. The problem with this structure begins and ends with the way projects are financed, as we learned in ourlast publication. To sum up:

• Organizing temporary teams around projects (moving people to work) results in inefficient and underperforming workgroups.
• Project-based financing requires detailed plans based on inaccurate projections, taking time and people away from delivering value
• Annual planning creates a state of perpetual overwhelm, which lowers productivity, morale, and performance.
• Progress is measured based on plan completion rather than actual business results or customer satisfaction.

A project-based funding structure creates a slower, more complicated budgeting process that requires estimates, plans, and details long before they are accurate. By the time a plan is approved and the team can get to work, it should probably already be up to date to account for new information and changing requirements. But reporting new information may require additional paperwork, so teams are encouraged toNoincorporate new learnings into the project for fear that doing so may result in time and/or budget changes that push the project(s) further away from the project.

By contrast, the agile approach to lean portfolio management operations fosters a decentralization of program management, shifting the power of planning and execution with agile release trains (ART) and empowered, self-sufficient solution trains.

But how do you maintain alignment with broader organizational goals when ARTs function relatively independently? By centralizing key elements of portfolio operations, leveraging new and different operational roles such as an Agile PMO and Lean-Agile Centers of Excellence (LACE).

Didn't we just say that a centralized PMO hurt LPM? Yes, but an Agile PMO and a Lean-Agile Center of Excellence play a completely different role than a traditional PMO. Rather than "owning" the day-to-day decision-making power around program strategy, funding, and execution, the role of an Agile PMO (APMO) or LACE group is to:

• Coordinate value streams
• Execution of the support program
• Drive operational excellence (fuente)

Before we delve into each of these responsibilities, let's take a closer look at what a LACE group really is.

Lean-Agile Center of Excellence (LACE)

A Lean-Agile Center of Excellence (LACE in SAFe terms) is another area where APMO involvement can help drive operational excellence. A Lean-Agile Center of Excellence describes a small group of people dedicated to promoting the Lean-Agile way of working. Typically, the presence of a healthy, high-performing LACE is the differentiator between organizations that achieve better business results through Lean-Agile implementations versus those that simply practice Agile in name.

LACE responsibilities typically include everything from communicating the need and urgency of change, facilitating Lean-Agile training, reporting progress on Lean-Agile initiatives, and evaluating progress on each of theFive Lean Company Competencies.

LACE can be part of the Agile PMO or it can exist as a stand-alone unit. In both cases, it can serve as a continuous source of energy to push the company through the necessary changes. Often, as the organization matures in its Lean-Agile development, LACE becomes a long-term center for continuous improvement.

Now let's discuss the responsibilities of an APMO or LACE group, starting with the coordination of value streams.

Coordinate value streams

The true value of offering a portfolio of solutions is the ability to leverage built-in capabilities to respond to the growing patterns and needs of end users. As such, while many value streams can operate independently in your portfolio, it is important to put effort into building cooperation and collaboration between different parts of the business and be able to deliver the benefits and alignment at the portfolio level that help the company to offer better offers. results.

For many organizations, that's the ultimate goal: operating with a kind of Swiss Army knife versatility, with the agility to anticipate and respond to user needs with the right tools for the job. The APMO (and other Lean-Agile leaders/groups within the organization) help coordinate efforts across the entire value stream to manage dependencies and seize opportunities within the portfolio.

An article by Scaled Agile, Inc, creators of the Scaled Agile Framework (SAFe®) explains this responsibility (and opportunity) this way:

“…careful coordination can create a differentiated and unmatched solution offering. To that end, Lean-Agile leaders understand the challenge and the opportunity that their value streams offer. They make them as independent as possible, while interconnecting and coordinating with the larger purpose of the company.” (fuente)

(Video) Lean Portfolio Management in SAFe: Connecting Strategy to Execution

Execution of the Support Program

While it can be tempting to forego the role of a PMO entirely, it's important to understand that the agile approach to lean portfolio management operations includes a type of centralized program management capability. distributedallThe responsibilities of ART and Solution Trains will result in an organization that will inevitably face the same tensions around the allocation of funds and resources as a traditional bureaucracy.

While it requires a drastic culture change within the PMO, many organizations do better by redesigning their traditional PMO to become an agile PMO. Ultimately, the people within your PMO have the skills, knowledge, and relationships with managers, executives, and other key stakeholders that can be extremely helpful in not only managing change, but getting things done. Rejecting them would not only be a monumental waste of resources and time, but would also be very damaging to the culture.

Accepting the PMO as a change agent and encouraging it to adopt Lean-Agile practices (and the role of an APMO) is the most productive and beneficial way to approach this transition.

Typically, as the APMO matures, it can provide additional support for program execution. They can:

• Sponsor and communicate the vision of change
• Attend the launch (some members may even provide training)
• Lead change towards Lean-Agile goals and budget
• Promote more agile contracts and more efficient alliances with suppliers and customers (fuente)

To maximize the impact and effectiveness of the APMO, many organizations include Release Training Engineers and Solution Training Engineers in their APMO so they can share information on best practices, common program metrics, and standard reports.

Drive operational excellence

APMO plays a leadership role in helping the organization improve operational efficiency (and therefore achieve its business goals). There are two main ways the APMO can drive operational excellence in LPM: by sponsoring communities of practice (CoPs) and a Lean-Agile center of excellence.

Communities of Practice (CoP)

Communities of Practice (CoP) are organized groups of people who typically share a specific common business or technical domain. They meet regularly to share information, improve their skills, and actively work to advance general domain knowledge within the organization.

An example of a CoP is a group of product managers from across your portfolio who would not normally work together on an ART, but who would benefit from sharing best practices and knowledge. CoPs not only help drive operational excellence, but also provide employees with valuable mentoring and career development opportunities they might not otherwise receive.

An Agile PMO can sponsor and support role-based CoPs for Release Train Engineers and Scrum Masters to provide a forum to share effective practices for executing the Agile program. CoPs can also be theme-based, but this often happens later in LPM maturity.

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We hope this article has given you a comprehensive view of how business operations need to evolve to meet the needs of your LPM strategy. In the last part of this series, we'll look at Lean governance in LPM and how it influences future spend, forecasts and milestones, and governance of the development effort.

Be sure to download the full whitepaper,Lean Portfolio Management for the Company, for more information and greater detail of the commentedhere.

Written by Arroyo Appelbaum Product Marketing Director

Brook Appelbaum is the Director of Product Marketing for Planview's Agile and Efficient Delivery Solution. With nearly 20 years of marketing experience, Brook has led many different product and digital marketing teams. However, his favorite leadership role is Product Owner. As part of an agile marketing team within Planview, Brook drives the product marketing campaign and strategy for the agile and efficient delivery solution. And she thinks LeanKit is the best.