Anchor new approaches in the culture.

—John Kotter



Extend to the Portfolio

This is article 11 in the SAFe® Implementation Roadmap series. Click here to view the entire roadmap.

In the previous articles in the SAFe Implementation Roadmap series, we described the first 10 ‘critical moves’ of the roadmap:

A lot has been accomplished.  SAFe has been implemented across several, if not all, of the Development Value Streams.  You’re seeing measurable benefits in time-to-market, quality, productivity, and employee engagement.  The new ways of working are becoming second nature for those operating within those Value Streams.  This is a telling point in the rollout.  The organization’s commitment to transforming the business at all levels and becoming a truly Lean-Agile enterprise will be tested.  Now is the time to expand the implementation to include maturing the enterprise’s Lean Portfolio Management competency, and anchoring the new approach in the culture.


In the last article, Launch More ARTs and Value Streams, we described how enterprise leaders drive and facilitate a wider implementation of SAFe. The success of these ARTs and value streams creates a buzz in the organization about the new and better way of working.  It also exposes the traditional, phase-gated processes at higher-levels that impede performance.  Inevitably, this puts pressure on the portfolio and triggers the need for the additional changes to further improve strategic flow.

These issues typically include:

  • Perpetual overload of demand versus capacity, which jeopardizes throughput and undermines the strategy
  • Project-based funding (bringing the people to the work), cost accounting friction, and overhead
  • No understanding of how to apply capitalization in Agile
  • Overly detailed business cases based on speculative, lagging ROI projections
  • Strangulation by the iron triangle (fixed scope, cost, and date projects)
  • Traditional Supplier management and coordination—focus on lowest cost, rather than the highest lifecycle value
  • Phase-gate approval processes that don’t mitigate risk and actually discourage incremental delivery

Nowhere is Lean-Agile Leadership more important than when addressing some of these remaining legacy challenges. If these approaches are not modernized, the enterprise will be unable to escape the inertia of traditional, legacy approaches, causing the organization to revert back to the old way of doing things. This inevitably leads to attempting Agile development with a non-Agile mindset, what is often referred to as ‘Agile in name only.’ The results can be seriously compromised. But help is at hand. Figure 1 illustrates how these mindsets evolve with training and engagement in the process of implementing SAFe.

Figure 1. Evolving traditional mindsets to Lean-Agile thinking

Leading the Transformation

Many of these traditional mindsets exist throughout the organization and, left unchanged, can sabotage a fully realized implementation. To help the SAFe workforce embrace the new way of working, we’ve described how SAFE Program Consultants (SPCs) and Lean-Agile Leaders lead the transformation by providing the new knowledge needed to inspire an attitude that will embrace the new mindset. But since it is better to lead than follow, increasingly we see an emerging Lean-Agile Program Management Office (PMO) taking an active, leadership role in the transformation. In so doing, they establish exemplary Lean-Agile Principles, behaviors, and practices, including:

  • Lead the change and foster relentless improvement
  • Align value streams to enterprise strategy
  • Establish enterprise value flow
  • Implement Lean financial management and budgeting
  • Align portfolio demand to implementation capacity and Agile forecasting
  • Evolve leaner and more objective governance practices
  • Foster a leaner approach to contracts and supplier relationships

Each is described in the following sections.

Lead the Change and Foster Relentless Improvement

For many enterprises, the need for change and the knowledge of the new way of working is led by Lean portfolio and Agile PMO personnel. In so doing, they sponsor and participate in the LACE, become SPCs, and support or encourage the development of specialty Communities of Practice (CoPs) that focus on and advance the new roles, responsibilities, and behaviors.

Align Value Streams with Enterprise Strategy

Development Value Streams (and the ARTs and Agile Teams that enable them) exist for one reason—to meet the strategic goals of the portfolio.  Empowering each Value Stream with the strategic clarity and resources to do so is a core responsibility of the Lean Portfolio Management function.  This is accomplished through a regular cycle of establishing, refining and continuously communicating the Portfolio’s Strategic Themes, as well as the portfolio’s structure, value proposition(s), resources and financial model through the Portfolio Canvas.

Establish Enterprise Value Flow

Managing the flow of work from portfolio level initiatives is an important step in the maturity cycle. This requires implementing the Portfolio Backlog and Kanban system, filling the role of Epic Owners by adopting the Epics construct, and the Lean business case. In addition, Enterprise Architects establish enabler epics that provide common technological underpinnings, which support the broader use cases across the full portfolio.

Implement Lean Financial Management

Historically, enterprises were built by carefully controlling the definition and cost of development via the ‘project’ construct. In a sense, however, the project model provided temporary work for temporary people, and the inevitable cost and schedule overruns caused personnel upheaval and financial churning.

But as we improve our methods and discover the long-lived nature of most of what we do, we must move to a more persistent flow-based model. The new approach must minimize overhead, give people a stronger sense of purpose, and facilitate the growth of institutional knowledge. This is the larger purpose of the portfolio’s value streams, funded in accordance with SAFe Lean-Budget practices. Lean Budgets, informed by Strategic Themes and appropriate Guardrails, enables Value Streams and ARTs to move fast and make decentralized decisions, while staying aligned to Portfolio-level objectives.  In addition, to ensure that development costs are appropriately recorded without excessive overhead, a leaner approach to managing capital and expense costs is described in the CapEx and OpEx guidance article.

Align Portfolio Demand to Implementation Capacity, Agile Forecasting

Lean thinking teaches us that any system operating in a constant state of overload will deliver far less than its actual capacity. This is certainly true for any development process in which excess Work in Process (WIP) drives multiplexing (lowering productivity), unpredictability (lowering trust and engagement), and burnout (lowering everything).

By consistently applying the concept of velocity at the team, ART, and Solution Train, the emerging SAFe enterprise uses this invaluable knowledge to limit portfolio WIP until demand matches capacity. This increases the throughput and value delivered to the customer. And in place of detailed long-range commitments, the SAFe enterprise applies Agile forecasting to create a portfolio Roadmap, a baseline of expectations that are communicated to internal and external stakeholders.

Evolve Leaner and More Objective Governance Practices

As we noted in Figure 1, traditional governance practices were often implemented based on traditional, waterfall lifecycle development. This typically included passing various phase-gate milestones, along with proxy, paper-based measures of completion. The Lean-Agile model, however, works differently. As explained in SAFe Lean-Agile Principle #5 – Base milestones on objective evidence of working systems, the focus of governance moves to establishing and measuring the appropriate objective measures at each Program Increment (PI) boundary.

Foster a Leaner Approach to Supplier and Customer Relationships

The Lean-Agile Mindset informs another in the group of business practices—how the enterprise treats its suppliers and customers.

The Lean enterprise takes the long view and enters into long-term partnerships with suppliers, which produces the lowest overall cost of ownership, instead of a series of near-term maneuvers that lower only the cost of a current deliverable. Indeed, the enterprise will engage directly in helping their suppliers adopt Lean-Agile thinking and may even participate in developing a supplier’s capabilities in that area.

The SAFe enterprise also recognizes the critical importance of customers to the value stream. That realization means they are included in such key events as PI Planning, System and Solution Demos, and Inspect and Adapt (I&A).

They take on the responsibility’s incumbent on a customer in a Lean-Agile ecosystem. These relationships are fostered by adopting a leaner approach to Agile Contracts.

Moving Forward

By now, substantial business benefits are growing daily. Improvements in quality, productivity, time-to-market, and employee engagement are meeting or exceeding expectations. So how do you sustain this over the long term? This is the subject of the next critical move: Sustain and Improve.


Additional Resources

SAFe Lean Portfolio Management (LPM) Toolkit – To implement the full SAFe portfolio, Scaled Agile, Inc. provides SPCs with an LPM toolkit that can be used as a workshop for stakeholders to learn how to execute the Lean-Agile LPM practices described in this article. They learn how to implement the Portfolio Kanban system to limit WIP and accelerate value flow. Attendees leave with additional steps that can be taken to support Lean-Agile portfolio management, budgeting, software capitalization, contracts, and lifecycle governance. For more on the workshop, check out this link.


Last update: 5 October 2018