(4/9) Implementing Lean Portfolio Management - Fourth of Nine Principles

Quick POLL

Answer in Comments.  How frequently does your team deliver business value?

1. No idea of frequency or delivery 

2. We deliver infrequently, maybe a few months apart

3. We deliver regularly, like monthly

4. We deliver asap, every few days of less

5. We provide continuous delivery (CD), every change goes to customers

This is my fourth post in the series on the Nine Principles of Lean Portfolio Management (LPM) from ICAgile.  Here I delve into nuances behind these principles.  Please join us at the Kintsugi Training Institute (KTI) in our LPM course, where we use these principles in training on the whole Lean Portfolio Management system.

     This blog is based on the seven reporter questions: what, why, who, when, where, how, and which.  You can read more about this question strategy on my blog: Simpler Agile. 

     If you are interested in business agility, OCM, or LPM please contact me online. 

What is the topic? 

#4 - Define, prioritize, and deliver business value frequently

The ICAgile article defines the fourth principle as follows.  Business value must be articulated in clear language using agreed-upon metrics to make work prioritization clear and straightforward at all levels. Depending on the scope of control, work is delivered in the smallest increments possible, as frequently as possible, to enable rapid feedback, learning, and adaptation.  The entire organization is attuned to feedback, listening for both the loud messages and “weak signals”.  Feedback mechanisms are built into every aspect of delivery and are used to learn and adapt in iterative cycles.

Why is this important?

Frequent delivery!  This is the driving force in this principle.  Frequent deliveries enable rapid feedback about what has been delivered.  Primarily, that feedback can be used to determine if the delivered functionality and/or service has a positive impact on the customer, i.e. is it seen as valuable by the customer.   Secondly, the feedback can be used to learn about how the functionality/service performs in the marketplace as compared to similar competing functionality/services, allowing for insights, innovation, and future functionality/services. Thirdly, the feedback and learning enables the organization to adapt to changes in the marketplace; e.g. new products or features previously unforeseen. 

Who is involved?

This section can be parsed into three key subsections - the people who define business value, who prioritize it, and who deliver it.

      There are three main groups who define business value.  The obvious one is business stakeholders such as business managers, business owners, etc.  They have a deeply vested interest in the success of what is delivered to the marketplace.  A big part of that success is dependent on the delivered value.  Here is where the second group is critical - the end users.  They decide what is valuable to them and what they are willing to pay for it.  The third group are the customers who directly purchase the products and/or services which provide the business value.  These maybe the same people as the end users, or they could be intermediaries, such as resellers or repackagers.  

      The second key subsection is the people who prioritize business value.  By prioritize we think about who determines the relative business value of various initiatives, features and work items.  At the highest enterprise level organization-wide strategic initiatives get prioritized by C-suite executives and other top leaders, unfortunately, most times without enough input from others.   The features for a given initiative typically get prioritized by the business managers, business owners, and product managers involved in the products and/or services impacted by the features.  The work items for the feature typically get prioritized by product owners and other team level stakeholders.   Ideally, the team members get involved.

      The simple answer would be - the team working on the work items delivers the results to the marketplace.  However, in reality other people and sometimes even whole other teams get (unnecessarily) involved.  These could be project managers, program managers, configuration managers, release managers,  and others.  This occurs because many people are worried about maintaining "proper" business relations within the marketplace, with partners, competitors, customers and end users. 

How is this to be performed?

The methods and practices to "define, prioritize, and deliver business value frequently" encompass the entirety of agile methodologies.  It is the essence; the guiding start.  We will not regurgitate all of that here.  All good agile writings support this.

When is it best to do?

As with anything in agile methods, the answer is "it depends".  Timing is highly dependent on circumstances.  There are guidelines and suggestion, yet every team needs to defines its own way of working for optimal delivery.  The key here is "frequently".  

      "Frequently", is usually understood to fall between weekly and monthly.  However, some production support teams deliver daily.  While some future focused research teams may struggle with a brand new technology for a few months before they can deliver some minimal viable product (MVP).

      The ultimate goal for frequent delivery is - continuous delivery (CD), that is: every change goes directly to customers.  Of course this is much easier said than done.  Whole books are available on CD.

Where do we track progress?

As mentioned in previous posts, there should be a single common repository (single source of truth) for maintaining and tracking all data, so that only the latest version and progress are viewable, not an old copy or derivative.  Also, as with any important document, proper configuration and change management needs to be established and maintained.  That includes: delivery content, information associated to the deliver (e.g. release notes), as well as customer feedback and data associated with usage.  Along with theses, it is critical that these practices be fully automated and easy to use.  For example, for change control use continuous integration.  

Which items are critical?

Delivering business value is essential.  To get this right, we must clearly define what does business value mean to us in our business?  However, there is much potential for misunderstanding.  Different people have different expectation of the business, which leads to differing definitions of what is business value.  For example, some business managers may want to focus on the 'bottom line' to maximize profit.  To do that, they define business value as 'whatever brings in the most money'.  Whereas some customer reps may want to focus on 'customer satisfaction' to maximize the customer's happiness with the business.  So the negotiation between the two groups needs to be, how do we define business value such that it is both profitable and customer-valuable.

     Once we have a clear, well-defined understanding of business value, which everyone accepts, we can focus on the rest of it; prioritizing and delivering it frequently.  Prioritization falls out of what is most important based on our business value definition.  Delivering it frequently depends how well we can decompose the business valued into small yet valuable chunks of functionality.  Then we focus on delivering the smallest chunks possible in the shortest amount of time.  Here WSJF (weighted shortest job first) can be a good way to prioritize.

     Remember … your process will vary.  So learn as you go.

      

References 

For further learning and training on the intricacies of LPM please follow these links.

Kintsugi Training Institute - LPM Classes - https://kintsugitraininginstitute.com/icp-lpm

ICAgile - LPM Principles - https://www.icagile.com/resources/the-principles-of-lean-portfolio-management-for-business-agility

Simpler Agile blog - https://simpleragile.blogspot.com/

If you are interested in OCM and LPM please contact me online. 

Business Agility - Understanding it in Seven Questions

Quick POLL

How strong is your business' agility?  Elaborate in comments.

1. No idea what it is 
2. Once heard of it
3. We are considering a transformation
4. We started our business agility transformation
5. We are going through a transformation
6. Most of our business is using lean-agile methods
7. We have fully embraced business agility in all its forms

This blog is based on the seven reporter questions: what, why, who, when, where, how, and which.  You can read more about this question strategy in other posts on my blog: Simpler Agile. 

If you are interested in Business Agility please contact me directly on LinkedIn - https://www.linkedin.com/in/paulpazderski/  

What is Business Agility?

Business Agility is the organizational capability to sense upcoming changes externally or internally and respond accordingly in order to deliver value to our customers and business interests.

Business agility is a comprehensive capability that encompass everything and everyone in the business system, including the organization, its vendors, suppliers,  partners, and even customers.  It is founded on a growth mindset (see Mindset by Carol S. Dweck), four agile values, and twelve agile principles (see https://agilemanifesto.org/).  It is instantiated in an innumerable, ever growing set of varied practices organized into frameworks.

Why is Business Agility important?

Since we work in a VUCA world: (Volatility, Uncertainty, Complexity, Ambiguity) we need the capability to respond to whatever changes are thrown at us.  Business Agility enables us to more quickly and easily innovate and quickly deliver iterative, incremental value to our customers.  Also, Business Agility provides better alignment within your business both vertically and horizontally. Lastly, when done correctly it improves work/life balance for all involved.

Who needs Business Agility?

Business Agility is a survival capability.  It is critical to all current and future business endeavors in our VUCA world.  Therefore, anyone desiring a successful business must understand and incorporate Business Agility into their business ventures.   Also, all people working in a modern business venture must get involved and support in Business Agility.

How does Business Agility work?

Business Agility requires a comprehensive all-encompassing transformation of the company.  Every person, every team, every group, every department, and every business unit must go through this transformation.  This Business Agility Transformation starts with all individuals cultivating a growth mindset.  Than understanding, accepting, and living by the four agile values, and twelve agile principles.   Such a foundation then enables to selection and enactment of the appropriate modern lean-agile practices and frameworks.  Yet, to select the appropriate practices and frameworks you need an expert guide.  In the lean-agile community such expert guides are usually called Coaches.  We inherently accept that all athletes and sports teams have coaches, sometimes more than one.  The same is true for Business Agility Transformation.  You must have expert Coaches guiding you.

When is Business Agility engaged?

The movement toward agile methods started over 20 years ago.  Many organizations across the globe are using them.  Therefore, if you and your business are not onboard yet, you are behind the curve.  The unfortunate circumstances are that many first time attempts at transformations fail for numerous reasons - lack of commitment, weak support/leadership, and/or poor coaching for example.

Where is Business Agility visible?

First and foremost, Business Agility shows through customer loyalty and promotion; i.e. the customers are so happy with the business, its products and services that they tell everyone how great those are.  Second, the business tends to outperform their competition.  Third, products and services tend to lead the market in innovation and disruption. Fourth, the employees, vendors and suppliers are very happy and promote the business.  Finally, the community are just as happy and supportive.

Which elements are critical to Business Agility?

Find and engage a well-rounded, experienced Business Agility Coach.  Cultivate that growth mindset.  Follow with the four agile values, and twelve agile principles.   Start learning modern lean and agile practices and frameworks.  Yet, avoid trying to become the agile coach yourself.  Get a professional.

References 

For further insights on Business Agility please follow these links.

• Agile Manifesto - https://agilemanifesto.org/ 
• Simpler Agile blog - https://simpleragile.blogspot.com/
• LinkedIn - https://www.linkedin.com/in/paulpazderski/  

If you are interested in Business Agility please contact me directly on LinkedIn.

(3/9) Implementing Lean Portfolio Management Nine Principles - Third Principle

Quick POLL

Reply in Comments - How aligned is your work to goals common to your group or enterprise?

1. No idea of common goals 
2. Some alignment
3. Mostly aligned
4. Completely aligned 

     This is my third post in the series on the Nine Principles of Lean Portfolio Management (LPM) from ICAgile.  Here I delve into nuances behind these principles.  Please join us at the Kintsugi Training Institute (KTI) in our LPM course, where we use these principles in training on the whole Lean Portfolio Management system.

     This blog is based on the seven reporter questions: what, why, who, when, where, how, and which.  You can read more about this question strategy on my blog: Simpler Agile. 

What is the topic? 

#3 - Align around common goals, and how they might change

The ICAgile article defines the third principle as follows.  Typically, the “true north” guiding organizational strategy is conveyed as a set of desired business outcomes across multiple time horizons. These outcomes, should be expressed and communicated as clear, measurable "goals", which would make the strategy implementable. Every area of the organization should understand where and how to contribute to the overall mosaic that delivers on these outcomes. Feedback loops need to be established to ensure these goals and outcomes can adapt to meet the evolving needs of the organization and these changes also should be communicated to the entire organization transparently and clearly.

Why is this important?

Alignment!  This is the driving force in this principle.  When people are aligned with their work towards a common goal both the progress on the work is smoother and the achievement of the goal is easier.  For a blatant example compare a group of people sitting in a raft randomly paddling, versus the same group synchronously paddling towards the shore.  No contest.  All it really takes is for someone to say: "Let's paddle to the shore!"  People will automatically take a spot on the raft and start paddling in the same direction.  Yes, it make take a few stroke to get into synchronization and smooth out the movements, yet with little coaching quick progress can be achieved.  If however some people are paddling towards one shore while others towards the other, little if any progress will be made.  Plus everyone will get frustrated.

     The second part is confirming everyone understands and buys-in to how these common goals may change.  This is critical to be arranged before the first change occurs, so that when it does everyone is already familiar with the change approach and can easily realign to the change goal.  Using our raft example, if we get everybody to agree how we turn, then when the need for a turn comes we can enact it smoothly.

Who is involved?

Setting goals and aligning to them could be performed at multiple levels in the organization.  For example, at the top enterprise level, along with the overall business, needs a set of goals which are derived from the overall strategy and lead to its fulfilment; each organization segment, such as business units or departments, should define their strategy and goals;  each product should have its strategy and goals;  and organization-wide strategic initiatives may have their strategies and goals.  All these strategies and goals must be aligned to each other to foster synergy and cohesion and to avoid friction among people and work.

     At each goal setting event, there are two main groups involved with the setting goals.  The people who define and maintain the goals, and the people who work to achieve the goals.  Ideally, these should be the same people.  The people working to achieve a goal, should also be the people defining and maintaining that goal.   That personal connection strengthens the alignment, because the workers feel more connected to those goals.  If having all involved people attend a goal setting session, at least representatives should be present from each involved area; e.g. sales, marketing, devops, etc.

How is this to be performed?

In enacting this principle, there are at least 5 elements to expand with some common guidelines.  

• The goals need to be defined
• How the goals might change (flexibility) needs to be outlined
• The goals need to be maintained, i.e. changed when the need arises
• The people working towards those goals need to be aligned to them
• Progress to those goals needs to be tracked 

     Here are some typical suggestions for well-defined goals.  First, desired business outcomes need to be the precursors to the goals.  The resulting goals need to be stepwise approximations to the outcomes.  Second, make the goals S.M.A.R.T.  That means: Specific, Measurable, Attainable, Relevant, and Timeboxed; although some use other expansions for this acronym.   SMART, is just one of those rules-of-thumb that helps us remember the elements of good goals.  You can also use the OKR system - Objectives and Key Results; or any other structure that leads to well-defined goals.  Third, it is highly valuable to involve the workers (people who will work on the goals) in their definition so that they feel a sense of ownership and accountability for them.  

     Build in flexibility into the goals.  This may seem counterintuitive to the SMART criteria.  However, in this context all we need is an outline of the approach for how we will change the goals and under what circumstances.  For a short example: we set a goal to increase mobile app customer base by 5% in next quarter.  We agree to track that at weekly checkpoints with the Sales & Marketing team who collaborated with us on defining this goal.  We also agree on only changing the goal if a drastic change in the market or in the company takes place; e.g. drastic meaning: destroying our goal's SMART-ness. We will change the goal with all the original participants involved.

     The goal needs to be recorded in a commonly accessible location, e.g. internal Mobile Products Page.  It needs to be tracked, e.g. in the Kanban system we all use for work.  The goal needs to be reviewed; e.g. at weekly checkpoint, or at least at sprint reviews.  Progress to goal needs to be visible; e.g. our Product Dashboard will include delivered BVP (Business Value Points) and actual current to baseline mobile app customer growth.

     The people working to achieve a goal from all departments (sales, marketing, devops, etc.) need to be involved in the definition, maintenance, and revision when needed.  To avoid unneeded overhead, goal setting and maintenance should be part of normal business flow, e.g. part of PI Planning.  This direct involvement will lead to work alignment and accountability.

     At the end of a cycle, e.g. PI, the goals need to be reconciled and considered done, changed, or terminated, depending on progress and criteria.  They also need to be included in the retrospective.

When is it best to do?

The timing for goalsetting is dependent at which level of the organization it is performed, and for what purpose.  If the goals are associated with a specific event or deliverable, then goalsetting should be started during the earliest conceptualizations for that event/deliverable and evolved as the other elements evolve, e.g. vision, strategy, etc.  If the goalsetting is for a group (team, department, etc.) the goalsetting should fallow the pre-establish cadence for that group, e.g. maybe monthly or quarterly for the team, and quarterly or yearly for the department.  The most important factor is to fit the goalsetting and maintenance into normal business activities.

Where do we track progress?

As mentioned previously, there should be a single common repository (single source of truth) for maintaining and tracking the goals, so that only the latest version and progress are viewable, not a copy or derivative.  Also, as with any important document, proper configuration and change management needs to be established and maintained for the goals and progress information.  That includes: change tracking, versioning, editor access controls, etc.  Along with theses, it is critical that these practices be fully automated and easy to use.  For example, for change control use continuous integration.  

Which items are critical?

The key reminders are: set the goals with the workers; outline the goal parameters at the outset (how they can change, what the triggers are, etc.); update goal progress frequently, and review with all stakeholders; confirm everyone's alignment to the goals at every opportunity; celebrate goal achievements!

     And remember … you processes will vary.

References 

For further learning and training on the intricacies of LPM please follow these links.

• Kintsugi Training Institute - LPM Classes 
• ICAgile - LPM Principles 
• Simpler Agile blog