Post on 23-Apr-2020
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Lean Portfolio Management
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Lean Portfolio Management Is…
Clarity on strategic intent & themes and alignment to outcomes at every level. Quarterly
planning cadence focused on delivering outcomes over deliverables.
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Lean Portfolio Management Principles
Align to Outcomes
Shift to Strategy
Move Decision Making Down
Limit WIP
Plan with Visual
Artifacts
Quarterly Planning Cadence
Focus on Customer Value
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Lean Portfolio Management - Recommendations
1. Form the right Lean Portfolio Mgmt. Teams• Gain clarity on roles, decision rights and expectations
2. Move planning from Outputs to Outcome focus• Empower Teams to figure out the ‘HOW’, communicate the What/Why and
acceptance criteria
3. Shift to quarterly collaborative face to face planning • Move away from any automated intake process at the portfolio level
4. Make outcomes visible, align to them and check-in on progress at all levels
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Minimize Outputs & Maximize Outcomes
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Outcomes vs Output
Outcome: Create an Awesome Customer Experience Key Results: • Improve Net Promoter Score from X to Y. • Increase Repurchase Rate from X to Y. • Maintain Customer Acquisition Cost under Y.
Output (Epic/Capability): • Launch MVP2. • Redesign the customer journey. • Analyze existing UX experience gaps.
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Align Through the LevelsTe
am Outcomes & Goals
< 3 MonthsTeam
Capacity User Stories
< Iteration Iteration Outcomes & Performance
Team Growth Items
Team
of
Team
s
Quarterly/PI Outcomes
Team of Teams Capacity Capabilities &
Features
1 ‐ 3 Months Team of Teams Outcomes & Performance
Team of Teams Growth Items
Portfolio 1‐Year
Outcomes Investment Epics
3 – 12 Months Portfolio Outcomes & Performance
Portfolio Growth Items
Enterpris
e
3‐Year Outcomes
KPIs & Enterprise
PerformanceBudget Business
Plan
1 Yr.Enterprise
Growth Items
Strategy Funding Work Results
Roll‐up
and
Rem
ove Obstacles
Align an
d Ac
hieve Outcomes
GrowthToday we create 3 year strategy then focus all our effort on the
‘Work’ alignment column.
Tomorrow, we need to shift focus to ‘Strategy’ alignment
and outcome delivery over
output.
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Enterprise: 3-Year Outcomes (Strategic Intent)
• 3 to 5 high-level statements: the essence of winning
• Speaks to “The Why”
• Stable over time: 3 years out
• Drives focus and alignment to strategy
Stretch targets that move the organization to compete in innovative ways
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
3-Year Outcome: ExampleOutcome:
Hypothesis:
We Know we succeed when:• Increased Market Share• Higher return on investment• Increased customer sentiment that we are a product leader in the small business
market
Modernize and innovate on our Small Business Insurance Products
We believe that modernizing and innovating our small business insurance products will allow us to be more competitive and become an emerging leader in this market
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Portfolio: 1-Year Outcomes
• 3 to 5 most important differentiators
• Captures success measures as key results
• Key results can be attained within a year
• Drives effort and commitment to strategy
Portfolio’s Outcomes to achieve in the next year that align back to the 3 Year Outcomes
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
1-Year Outcome: ExampleTitle:
Hypothesis:
Key Results / Metrics:
Title Progress Metric Now Target Team of Teams
Increase SMB membership
Active Members
30K 60k SMB Sales
Maintain Conversion Rate
Activation 72% 72% SMB Delivery
Quote applications for new products
Quotes 0 45K SMB Marketing
Overall Progress:
Customer/org Impact metric
New & Compelling Non‐medical SMB products
We believe that by launching new SMB non‐medical benefits insurance products to the market we will increase our market share for small business members.
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Team of Teams: Quarterly Outcomes
• Each outcome should:
• Be clearly stated
• Have measurable results
• Be able to be completed in a quarter
Team of Teams’ Outcomes to achieve in the next quarter that align back to the Annual Outcomes
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Quarterly Outcome: ExampleTitle:
Hypothesis:
Key Results / Metrics:
Title Progress Metric Now Target Team of Teams
Increase SMB membership
Active Members
30K 37k SMB Sales
Maintain Conversion Rate
Activation 72% 72% SMB Delivery
Quote applications for vision insurance
Quotes 0 12K SMB Marketing
Overall Progress:
Customer/org Impact metric
“Got to Have it” Small Business Vision Insurance Product
We believe that by launching a modern and innovative SMB vision insurance product to the market we will increase our market share for small business members.
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Guidance for Writing Effective Outcomes
Created by Intel’s Andy Grove, made popular by ‘John Doerr at Google
Objectives & Key Results (OKRs)Hypothesis Statements
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Types of Key Results IMPACT/LAGGINGMeasure the Business or
Customer results you aim to achieve, make take more than a
quarter to measure.
LEADINGMetrics we have control over that we can measure within the quarter/PI to validate we’re on track.
BALANCINGGuardrail metrics defined to protect against unintended
consequences
IMPACT/LAGGINGAcquisition, Activation,
Revenue, Retention, Referral, Cost Reduction, Market share
LEADINGSuccessful experiments, confidence of pilot users,
page performance improvement, search results
matching new offering,
BALANCINGEnsure quality doesn’t decrease if you have a ‘go faster’ metric.
Examples
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Types of Quarterly Goals TEST IT (EXPERIMENTS)
Your idea is new and hasn’t been proven so you should focus this quarter on running experiments
and validating your assumptions. This goal is usually owned by your Discovery team members.
NAIL IT (MVP)You’ve validated the idea and are now ready to build an MVP so you should pick metrics that prove the MVP is valuable, usable, feasible. Also consider
performance and quality metrics.
SCALE IT (MMP)You’re ready to hit the market so now you can measure Pirate like metrics and market share
expansion, revenue and customer success metrics. Consider balancing metrics.
For your quarterly outcomes, identify the right key results based on the goal
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Workshop: Writing Outcomes
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Lean Portfolio Management Team• Aligns 3‐Year and 1‐Year Outcomes
• Aligns outcomes & initiatives (epics)
• Reviews, approves & prioritizes portfolio work
• Manages the Portfolio Kanban & backlog
• Performs quarterly planning
• Reports progress toward outcomes, investment & performance targets
• Remove portfolio‐level obstacles
Enterprise Architect Or Lean
Governance
Portfolio Manager(s)
Portfolio Owner(s)
Portfolio Mgt. Team
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Planning Cadence: EnterpriseTe
am Outcomes & Goals
< 3 Months
Team
of
Team
s
Quarterly Outcomes
3 Months
Portfolio
Strategic Themes & Outcomes
< 1 Yr.
Enterpris
e
Strategic Intent
1 – 3 Yrs.
Strategy
Align & Elabo
rate
Part 1‐Enterprise
Level
Part 1‐Enterprise
Level
Day 1: Vision & Strategy‐ Clarity on 3 year Vision & Strategic Intent‐ Define market strategy and how to win (by market
segment or product)‐ SWOT and market analysis data‐ Define Strategic Themes (1 year outcomes)‐ Define investment pool
Day 2: Portfolio Alignment.‐ Portfolio investment allocation‐ Review/modify current portfolio org design‐ Align portfolios to strategic themes‐ Identify risks, gaps and mitigation plan‐ Seed initial enterprise risks/obstacle board‐ Consensus and next steps
Day 1: Vision & Strategy‐ Clarity on 3 year Vision & Strategic Intent‐ Define market strategy and how to win (by market
segment or product)‐ SWOT and market analysis data‐ Define Strategic Themes (1 year outcomes)‐ Define investment pool
Day 2: Portfolio Alignment.‐ Portfolio investment allocation‐ Review/modify current portfolio org design‐ Align portfolios to strategic themes‐ Identify risks, gaps and mitigation plan‐ Seed initial enterprise risks/obstacle board‐ Consensus and next steps
Annual Planning with Quarterly Check‐Ins
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Planning Cadence: PortfolioTe
am Outcomes & Goals
< 3 Months
Team
of
Team
s
Quarterly Outcomes
3 Months
Portfolio
Strategic Themes & Outcomes
< 1 Yr.
Enterpris
e
Strategic Intent
1 – 3 Yrs.
Strategy
Align & Elabo
rate Part 2‐
Portfolio / Value Stream Level
Part 2‐Portfolio / Value Stream Level
Day 1: Demand Mgmt.‐ Review Vision & Strategic Intent‐ Review and align on Strategic Themes (Annual
Outcomes)‐ Create quarterly outcomes‐ Outcome readout and refinement‐ Build/Update Visibility Room /Outcome Dashboard
Day 2: Capacity Mgmt.‐ Review/modify allocation & investments‐ Review/modify current team of teams design‐ Align team of teams to outcomes‐ Update obstacle board‐ Retro on meeting planning, ceremonies, roles, etc.‐ Agree on next steps
Day 1: Demand Mgmt.‐ Review Vision & Strategic Intent‐ Review and align on Strategic Themes (Annual
Outcomes)‐ Create quarterly outcomes‐ Outcome readout and refinement‐ Build/Update Visibility Room /Outcome Dashboard
Day 2: Capacity Mgmt.‐ Review/modify allocation & investments‐ Review/modify current team of teams design‐ Align team of teams to outcomes‐ Update obstacle board‐ Retro on meeting planning, ceremonies, roles, etc.‐ Agree on next steps
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Planning Cadence: Team of TeamsTe
am Outcomes & Goals
< 3 Months
Team
of
Team
s
Quarterly Outcomes
3 Months
Portfolio
Strategic Themes & Outcomes
< 1 Yr.
Enterpris
e
Strategic Intent
1 – 3 Yrs.
Strategy
Align & Elabo
rate
Part 3 ‐Team of
Team Level(PI/Big Room Planning)
Part 3 ‐Team of
Team Level(PI/Big Room Planning)
Day 1:‐ Vision & strategic themes‐ Present quarterly outcomes and top
deliverables/features‐ Architecture vision and practices‐ Team breakouts & planning‐ Draft plan review
Day 2:‐ Team breakouts & planning‐ Final plan review and alignment ‐ Team capacity, roles and allocation adjustments‐ Review dependencies, risks, skill gaps‐ Confidence vote‐ Planning retrospective
Day 1:‐ Vision & strategic themes‐ Present quarterly outcomes and top
deliverables/features‐ Architecture vision and practices‐ Team breakouts & planning‐ Draft plan review
Day 2:‐ Team breakouts & planning‐ Final plan review and alignment ‐ Team capacity, roles and allocation adjustments‐ Review dependencies, risks, skill gaps‐ Confidence vote‐ Planning retrospective
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Enterprise Visibility Room (EVR)
Where Quarterly Portfolio Planning Occurs
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Workshop: Walkthrough the EVRHealth & Maturity
Customer Segments & Personas
Performance KPIs
Strategic Intent & Themes
Quarterly Outcomes
Budget & Theme
Allocation
impe
dimen
ts / Obstacles
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
The blue columns represent ‘Demand’ the purple are
‘Capacity / Delivery’. You can click on any level of the org to gain visibility and alignment
on outcomes.
AgilityHealth Outcome Dashboard
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
AgilityHealth Outcome Dashboard
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Lean Portfolio Management Implementation Path
Form the Portfolio Management Team
Create 1‐Year Outcomes
Prepare for Quarterly Planning
Conduct Quarterly Planning
Align the Epics/Capabilities to
the Outcomes
Establish the priorities for the
quarter
Align demand to capacity
Organize the Portfolio Backlog
Portfolio Work
Portfolio Outcomes
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Summary
• Limit organizational Work-In-Progress (WIP)
• Make all work visual• Ensure cross functional team
alignment around customer value creation activities
• Connect Work to the Strategy and Vision
• Use Visibility Rooms at each level to Align Demand and Capacity
Copyright© 2018 Agile Transformation Inc. | Confidential & Proprietary
Workshop: Color the Radar