SAFe has updated the LPM Competency and LPM Configuration practices based on the continued maturity of LPM. I have reviewed the updates and have pulled the changes together as they align to the 3 LPM Collaborations which aligns to the organization of the SAFe course delivery. These are nice improvements and align with the real world which will remove some friction from adopting Lean Portfolio Mgmt practices.
Strategy and Investment Funding
- Definition of an MVP for a SAFe Epic
- Estimating Epic costs initially in T-shirt sizes
- Revised Lean Business case for new cost nuances
- Simplified Budget horizon treatment
- Strategic Portfolio Review
- Portfolio Sync
Lean Governance
- Expanded description of Participatory Budgeting to align with Epics
- Forecasting an Epic’s duration using ranged estimates
- Improved the treatment of KPIs
- Portfolio Roadmap update
Let’s dig into the details of the change at the next level. Starting with Strategy and Investment funding:
Definition of an MVP for a SAFe Epic – Defining the Epic MVP Analysis of an epic includes the definition of a Minimum Viable Product (MVP) for the epic. In the context of SAFe, an MVP is an early and minimal version of a new product or business solution that is used to prove or disprove the epic hypothesis. As opposed to story boards, prototypes, mockups, wire frames and other exploratory techniques, the MVP is an actual product that can be used by real customers to generate validated learning.
Estimating Epic Implementation costs initially in T-shirt sizes – This technique is used to more easily prepare for Participatory Budgeting, which uses real costs, not story point estimates, to establish the value stream budget. A cost range is established for each T-shirt size using historical data. The gaps in the cost ranges reflect the uncertainty of estimates. Each portfolio must determine the relevant cost range for the T-shirt sizes.
Revised Lean Business Case new cost nuances – The MVP cost ensures the portfolio is budgeting enough money to prove/disprove the Epic hypothesis and helps ensure that LPM is making investments in innovation in accordance with lean budget guardrails. The forecasted implementation cost factors into ROI analysis, help determine if the business case is sound, and helps the LPM team prepare for potential adjustments to value stream budgets
Simplified Budget Horizon treatment – Budget Horizon discussion is reduced to a single graphic with Horizons 3 – 0 from left to right including the solution investments. The discussion of the 3 investment horizons running from Horizon 1 to Horizon 3 is removed from the Lean Budget article.
Agile Portfolio Operations updates are focussed on the Portfolio Sync
Strategic Portfolio Review – The Strategic Portfolio Review is the key LPM event designed to foster continuous strategy, implementation and budget alignment. The focus is on assuring that investments are continually aligned with strategic themes and communicating any emerging guidance needed to inform rapid, quality, decentralized Value Streams decisions. The event is oriented primarily around reviewing MVPs and Epics as they work their way through the Kanban system and make their way to implementation. New epics are discussed as they arise. Epic Kanban state changes are discussed and approved. In order to enable value streams to prepare and respond to any changes, it is typically conducted approximately quarterly, at least one month before the next PI Planning meeting
Portfolio Sync – The Portfolio Sync is an LPM event designed to gain visibility into how well the portfolio is progressing toward meeting its objectives. This meeting has a more operational focus than the strategic portfolio review. Topics typically include reviewing epic implementation, status of KPIs, addressing dependencies, and removing impediments. The portfolio sync is typically held monthly and may be replaced on a given month with the strategic portfolio review.
Lean Governance updates touch four distinct areas of this competency
Participatory Budgeting – The change to this section consumes the updates on Epic Costing for a natural connection to Participatory Budgeting. In the previous here was significant friction with Epic estimating in story points and most budgeting mechanism in monetary terms (dollars, euros, etc.) This is a significant adjustment and aligns with the reality of most portfolios to understand their value stream funding and their biggest initiatives in currency.
Forecasting Epic’s – This removes one of the stumbling blocks to forecasting Epic implementation duration by providing a size range to acknowledge estimating is imperfect. The graphics reflect this adjustment in both the Portfolio article and the LPM 5.0.1 course material.
Improved KPI treatment – The organizational structure of proposed Portfolio Measures has been updated to Measure, Metric Used, Desired Result. The list of proposed KPIs starts with the measure of performance against the “Key Results” of the Portfolio OKRs. This is followed by a list of proven measures to begin a discussion on the right set of KPIs for the Portfolio.
Portfolio Roadmap – The new roadmap article and graphics provide better treatment of the connection between the multiple configurations of SAFe (Essential, Large Solution and Portfolio.) This will assist with implementation discussions to resolve some of the leaps of logic that were required and ofter resulted in significant disagreements within change agents.
Links and Action
Since this is intended to pull out the updates and not a discussion of these in the context of the larger LPM Competency and Portfolio Configuration I am providing these quick links to the articles that contain this information in context.
Enterprise Agility 