Anchor new approaches in the culture.
—John Kotter
It’s quite an accomplishment for an organization to have implemented SAFe across a set of Value Streams. At this point, the new way of working is well on its way to becoming second nature to everyone who has a role in the implementation. Most importantly, the measurable benefits of time-to-market, quality, productivity, and employee engagement are now tangible and demonstrating real progress. As a result, the effectiveness of the entire enterprise starts to improve, and the larger goal is coming into sharper focus: a truly Lean-Agile enterprise with a fully implemented set of SAFe value streams. This is a telling phase in the rollout, as it tests the authenticity of the organization’s commitment to transforming the business at all levels. Now is the time to expand the implementation across the entire Portfolio and anchor the new approach in the culture.
In the last chapter, Launching More ARTs and Value Streams, we described how enterprise leaders drive and facilitate a wider implementation of SAFe. The success of these Agile Release Trains (ARTs) and value streams creates a buzz in the organization about the new and better way of working. This tends to stimulate greater scrutiny of some of the higher-level practices in the business, which often reveals legacy, phase-gated processes and procedures that impede performance. Inevitably, such discoveries put pressure on the portfolio and trigger the need for the additional changes that will be necessary to further improve the strategic flow across the portfolio. These issues typically include:
Perpetual overload of demand versus capacity, which jeopardizes throughput and undermines 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 return on investment (ROI) projections
Strangulation by the iron triangle (fixed scope, cost, and date projects)
Traditional Supplier management and coordination—focus on lowest cost, rather than on highest life-cycle 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.
Many of these traditional mindsets exist throughout the organization and, if allowed to persist, 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. Since it is better to lead than follow, increasingly we have observed an emerging Lean-Agile Program Management Office (PMO) taking an active, leadership role in the transformation. In so doing, these personnel establish exemplary Lean-Agile principles, behaviors, and practices:
Lead the change and foster relentless improvement
Align value streams with enterprise strategy
Establish enterprise value flow
Implement Lean financial management and budgeting
Align portfolio demand with implementation capacity and Agile forecasting
Evolve leaner and more objective governance practices
Foster a leaner approach to contracts and supplier relationships
Each of these roles is described in the following sections.
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. These team members sponsor and participate in the Lean-Agile Center of Excellence (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.
Value streams exist for one reason: to meet the strategic goals of the portfolio. This can be ensured by implementing a process of establishing and communicating the Strategic Themes. Such an effort helps organize the portfolio into an integrated and unified solution offering. Strategic themes also inform value stream budgeting decisions, as described later.
Managing the flow of work from portfolio-level initiatives is an important step in the maturity cycle. It requires implementing the Portfolio Backlog and Kanban system, including filling the role of Epic Owners by adopting the Epics construct and 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.
Historically, enterprises were built by carefully controlling the definition and cost of development via the ‘project’ construct. In a sense, the project model provided ‘temporary work for temporary people,’ and the inevitable cost and schedule overruns caused personnel upheaval and financial churning.
As we improve our methods, and discover the long-lived nature of most of what we do, it becomes clear that we must move to a more persistent flow-based model. The new approach must minimize overhead, give people a stronger sense of purpose, and support the growth of institutional knowledge. This is the larger purpose of the portfolio’s value streams, which are funded in accordance with SAFe Lean-Budget practices. 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 chapter.
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 levels, 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. Instead of attempting to establish detailed long-range commitments, the SAFe enterprise applies Agile forecasting to create a portfolio roadmap, a baseline of expectations that is communicated to internal and external stakeholders.
As shown in Figure 1, traditional governance practices were often implemented based on traditional, waterfall life-cycle development. This typically included passing various phase-gate milestones, along with proxy, paper-based measures of completion. The Lean-Agile model 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.
The Lean-Agile Mindset informs another 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 engages directly in helping its 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 customers are included in such key events as PI Planning, System and Solution Demos, and Inspect and Adapt (I&A) workshops. Customers, in turn, take on the responsibilities expected of them in a Lean-Agile ecosystem. These relationships are fostered by adopting a leaner approach to Agile Contracts.
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 pattern over the long term? This is the subject of the next critical move: Sustain and Improve.
