- Earlier, we introduced
the four out-of-box configurations of Safe.
We talked about the essential Safe
and we've really covered all the basic elements of that,
the basic patterns and activities that help each
agile release train deliver value.
We didn't talk at all yet about the portfolio, however
for most of us the portfolio level
is a substantial concern.
Even if we're operation largely at the program level,
where our concern is the delivery of value where the
agile release training focuses its effort
on releasing on demand, we need to know where new things
are coming from, and new initiatives, maybe
architectural initiatives, larger scale business epics,
they're gonna arrive in this visible combine area we're
gonna see those flow head our way.
They're gonna help us align to the enterprise through
strategic themes and make sure that the work we're doing
is consistent with the enterprise overall
vision and strategy.
So most of us operate in the context of the portfolio SAFe,
I know we certainly do even though we're relatively a
small enterprise in that regard.
If we take a closer look, there's not a lot of activities
here, there's not a lot of actions and not a lot of people
per se, so it's kind of thin compared to the art level,
and that's because there's high level strategic work,
less people are involved, and someway less activity
that's planning related, prioritization related,
and coordination related than it is tactical in terms
of delivering value.
We have the value streams here as you can see, that's
the fundamental construct every SAFe portfolio, is
a portfolio of value streams.
But the work of actually implementing happens down here,
so we don't think about the portfolio as executing
value or building systems, we think about it helping us
provide the budgets, and the support we need to successfully
build the systems that constitute these value streams.
So lets take a deeper look at the portfolio, We're gonna
start with looking at this icon over here,
lean portfolio management, because this is the function,
may not be a team that you can identify directly, this is
the function that every enterprise has that has the
ultimate responsibility for defining, supporting and
evolving a portfolio to meet the overalls enterprise
strategic objectives.
What is LPM?
It's a label, it's a placeholder for one of the most
strategic and important functions of the enterprise, but
one that as Geoffrey Moore notes, is not always obvious.
Ill take a minute to read this quote because I think
it's particularly powerful.
Most strategy dialogues end up with executives talking
at cross-purposes because nobody knows exactly what
is meant by vision and strategy.
Grand words but, who can decide that?
And no two people ever quite agree on which
topics belong where.
So even in a fairly robust or well structured portfolio,
or lets say, executive level structure of the enterprise,
lots of people, lots of opinions, but how does
strategy and vision get established.
And that is why when you ask members of an executive team
to describe and explain the corporate strategy,
you frequently get wildly different answers.
That's why Geoffrey concludes, We just don't have a
good business discipline for converging
on issues this abstract.
And yet if we don't converge on those issues, what good
is the rest of the work we do, if we're not aligned with
the proper vision and strategy.
So lets look at LPM as a function.
Think in your organization for a second about who
these people are, you probably know them, they probably
have different titles, they may be VP's and directors, or
people with a business owner responsibilities, maybe
business unit managers, VP of Development,
head of the data center, the people that are ultimately
responsible for portfolio performance.
So it's a function, it's an important function, and you can
see here that there are nine basic aspects, nine specific
responsibilities that we ascribe to this function, those
responsibilities are indeed the learning
objectives for this lesson.
As you saw in the overview, we're gonna go through
all nine of these now.
First of all, we need to connect the portfolio
to the enterprise strategy.
Now this is assuming the context of a
somewhat larger enterprise.
This is assuming that the portfolio itself is part of a
larger enterprise, many enterprises have multiple
instances of SAFe, and the enterprise strategy has to
drive business unit A, and business unit B,
and business unit C, Division A, the new company we
acquired over here in France or whatever, all has
to be driven from a kind of common enterprise view.
That's a level of centralization, only the enterprise
can decide if it wants to acquire a company or divest
a product line, or create a new product line.
And we do that with this very simple construct that we
call strategic themes.
And strategic themes are a simple bulleted list, that tend
to evolve very slowly, that describe how we want the future
state to be different than the current state.
Well we can't compete in this market effectively now
because of whatever, we sell to an aging demographic,
people like me, and we want to appeal to people that
are younger and have additional buying power.
They use different modes of operation, maybe they
shop online, maybe they buy their clothes
from a mobile device, I don't.
I do buy them online as well as in the mall.
I wonder what will happen with our kids and grandkids.
So if you're gonna appeal to a different demographic,
you're probably gonna have to have different
technologies to do that.
And this has to be a collaboration, it has to be a
collaboration between the people who are responsible,
the LPM folks here, and those that they work
with in the larger enterprise, maybe the CFO,
the chief product line officer, chief product manager,
whoever's responsible for the overall
complement of programs.
They're driven by their own initiatives.
Various things impact them, maybe declining market shares,
new market opportunities, those are the business drivers
that cause them to think about things like warehousing
costs are getting out of hand, or our mobile platform
is no longer competitive, or we don't have any kind
of corporate footprint on Facebook, and yet
everybody else does.
So those are the things that drive strategic themes.
Now our context at the portfolio level, pretend like
that's down here in the forward drawing, influences that,
because it's gonna be kinda silly to say, appeal to
a younger audience if our entire portfolio is aligned
differently.
We're gonna have to say okay, but we've got some issues
to express and also we see, again, imagine this
is our portfolio, new opportunities, maybe things that
you don't see because you're one step removed from
our market space, we see things all the time that
we'd like to report in on, and communicate to you and say
this could be of great value as well.
So this is a tight collaboration, it's not an
every day collaboration, because strategic themes and
strategy evolves fairly slowly compared to kind
of our tactical objectives but it is
an important collaboration.
And that's how we arrive at strategic themes.
Now they're very critical, they're also very short,
they're pithy and tight, so you might wanna take a minute
to stop and read the SAFe article
Strategic Themes and Enterprise, because that's where this
collaboration that I just described occurs.
Now, what do those do?
The influence what gets built, they're differentiating,
they differentiate the current state from the future state,
a strategic theme for us might be to make sure we
have appropriate content and coverage for dev ops,
and continuous delivery.
If you go back a few years ago, SAFe didn't talk a lot
about that, we were more in the state of organizing
teams, agile teams, and agile arts to deliver something
more frequently.
Well now we want to drive for continuous deliveries,
so an example for us a year ago was to substantially
enhance our dev ops content, and our product offerings
around dev ops and continuous delivery, and you can see
that in 4.5.
So that's an example of a strategic theme that drives
a lot of enterprise behavior.
It's a simple statement right, address dev ops, or however
we phrased that, but it can drive a lot of behavior.
And this gives us a lot of context because at
the implementation level, where we spend the rest
of our lives, these are gonna tell us things like,
yeah we budged for that, is this new initiative?
Do we have the right content for that?
Do we have the right subject matter experts on site?
Which value stream is gonna get that, well in our case
it's pretty easy, both.
We're gonna have to address both the knowledge base
value stream of SAFe, and the course ware value stream
those are our two value streams that we think about,
and that's gonna start to drive decisions
about what gets done.
Do we move to a different hosting environment, incorporate
a better learning management system to help those
that are online?
Or focus on dev ops, we have to decide, now lots of things
in life are not zero some games, but budgets are.
The budget is the budget, so all that work has to be done
in the context of the budget.
One value stream might want to grow a little bit,
and another might want to wane a little bit
to achieve that.
They also affect of course the program vision in road map.
Somebody needs to work on that content, somebody needs to
come up with this new form of guidance for that combine.
Or this new capability inside sales force for
learning management systems.
So the fact that we need to be able to do that different,
affects our vision in road maps, so our product managers
and others that are responsible and our PO's who are
responsible for these things, are influenced by that.
They also affect the the economic framework, gosh, can
we outsource?
Perhaps we're sales force and we're trying to figure out
are we gonna integrate learning management system, is
that a core competence, or does one of our partners do that?
Well that affects the economic framework of
what sales force is doing.
By the way I have no idea what sales force is doing,
but I just use that as an example.
Lets take a second now and pop back into your organization,
and think about your enterprise and ask yourself
the question, what needs to be different next?
Here we are, it's the middle of 2017, getting
on towards the end, in 2018, we've already defined our
strategic themes for next year, we have I think four or five
I don't remember exactly, the exact formulation of them.
What are yours?
Identify three strategic themes, that an help define
the strategy of your company and your customers portfolio
in the upcoming year.
Focus on the differentiators for your business, not
the typical business as usual items.
So think deep thoughts about what would be great, what the
future would look like if we could do this one thing better.
So did you come up with some?
Now think a little bit differently about them.
Will they influence the funding?
Is your current state of funding directly aligned to that,
or do you say wow, we've got substantial investment in
this area where our market share is waning,
and pretty unlikely to recover, but we don't have
the right investments here.
And Geoffrey Moore would say you know that inertia is
a residue of past innovation efforts, and you have to look
succinctly at your organization your portfolio and make
sure that the investments are matching where you want
to be, not where you are.
And I mentioned a couple of strategic themes already,
one was a retail company that was trying to reach
a younger demographic, people not like me.
They wanna sell to my kids.
My kids have the new buying power, that's great.
At the same time, that another one was just their
warehouse costs seem to be growing disproportionately
to revenue, so if they did two things, appeal to
a younger audience, and lowered their warehouse costs,
they'd be in pretty good shape.
You can see the revenue go up, and you'd see the cost
stabilize or start to go down, so that makes a lot
of sense for that retailer, and that's just a good example
of how you connect the portfolio to the
enterprise business strategy.