Download the associated webinar: https://www.cprime.com/resource/webinars/lean-portfolio-strategy-part-2-shifting-from-imitation-to-real-lpm-the-move-to-true-value-streams/ Lean Portfolio Management (LPM) is touted as a world-changing paradigm. A shift that promises to boost productivity, time to market, quality, customer satisfaction, revenue, and a host of other vital business metrics. It promises to transform the organization to a leaner, more agile version of itself, primed to innovate effortlessly and outperform its competition at every turn. Most organizations who have tried to establish LPM find the reality to be more nuanced than that. These companies end up implementing “Imitation LPM” where actions and some process changes may be in place and functioning, but the real promise of LPM- the increased agility and reduced waste- is not occurring. Real LPM assumes that work is funded by value streams with teams organized around delivery of products and services that are valuable to customers. This is, perhaps, the hardest part of implementing LPM. In part 1 of this webinar we explored how signs of imitation LPM show up in an organization’s approach to strategy. In this second of our series, we join Michiko Quinones (Jira Align Consultant) and Jean Dahl (General Manager, Scaled Agility) to explore: - How to organize around value streams - Real world examples of organizations who have successfully shifted from imitation value streams to true value streams - The impact to funding and budgeting cycles

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Lean Portfolio Strategy Part 2:
Shifting from Imitation to Real LPM –
The Move to True Value Streams

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HOUSEKEEPING ITEMS
Audio is streamed through
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The recording and slides will
be sent to everyone via email
within 24-48 hours after the
webinar concludes.
Submit questions any time
during this presentation via
the Q&A box on the bottom
panel of your screen.

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OUR SPEAKERS
Michiko Quinones
Jira Align Consultant
Cprime
Jean Dahl
General Manager,
Scaled Agility

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AGENDA
01 A HISTORY OF VALUE STREAMS
02 BUDGET IMPACT OF REAL VALUE STREAMS
03 REAL COMPANIES WHO HAVE SHIFTED
04 KEEP THE CONVERSATION GOING/Q&A

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Value Streams
Key Points

7. A Value Stream
is a _______
PUT YOUR ANSWER IN THE CHAT

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POINT 1
It’s the Waste

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VALUE STREAM MAPPING
https://www.projectengineer.net/what-is-a-value-stream/
Customer need
Product

10. Movement Overproduction Time on hand (waiting)
Transportation Making Defective products Stock on hand (inventory)
MANUFACTURING MUDA - TAIICHI OHNO

11. Movement
Task Switching
Overproduction
Partially done Work
Time on hand (waiting)
Delays
Transportation
Handoffs
Lost Knowledge
Making Defective products
Defects
Stock on hand (inventory)
Extra Features
SOFTWARE MUDA - MARY POPPENDIECK

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RARELY OR NEVER USED
-Pendo: The 2019 Feature Adoption Report
https://www.pendo.io/resources/the-2019-feature-adoption-report/
80%

13. TRUE VALUE STREAMS
• Less delays
• Less dependencies
• Less task switching
• Less lost knowledge

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POINT 2
It’s the Product

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MCDONALDS
15
15
Happy Meal
Need for
Fun
Affordable
Family
Meals
Operational Value Stream
Development Value Stream
Food
Fulfillment
Customer need
Product

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SAFE’s ITERATION ON VALUE STREAMS
Internal Value
Customer need
Product
External Value

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POINT 3
It’s a Map to Optimize Value
Not An Organizational Construct

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• NOT ”Are we organized into value streams?”
but
• “Are our teams optimized for delivering value?”
THE QUESTION IS

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CURRENT STATE
From Waste/Product/Optimization
to Planning/Process/Organization

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MODELS FOCUS ON
PLANNING/PROCESS
Many organizations value stream
mapping as a way to determine who
needs to plan together in cadenced
planning cycles. Or they use value
stream mapping to understand
process steps. Or value steams have
become new organizational
constructs.

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• Similar to SAFe,
focus is on the
capabilities to
start and end
with customer
value.
PMI/DISCIPLINED AGILE’S ITERATION ON VALUE STREAMS

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• Creating Value
• Removing Waste
• Product Focus
lost as the goals
Task Switching
Partially Done
Work
Delays
Handoffs
Lost Knowledge
Defects
Extra Features

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Definitions
Real value streams
Built to deliver value on a product with the
least amount of waste
Looks like a network
Imitation value streams
Built to group similar functional agile
programs for aligned planning or internal
product delivery.
looks a lot like the functional hierarchy.

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Pre-Agile Transformation
Functional Units operating in Silos
Post-Transformation - Good
Functional Units Planning Together
Post-Transformation - Better
Networked Teams in Value Streams
Imitation Value Streams
Real Value Streams
Post-Transformation - Best
Full Stack Programs in Value Streams
Optimized Real Value Streams
D
C
B
A

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Budget Impact of Real Value Streams

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THE IMPACT ON BUDGETING

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THE REALITY
• The reality is that most organizations have imitation value streams.
• They are still functionally aligned and budgets are still provided to functions,
not value streams.

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BUDGETING IMPACT
Post Agile Transformation with Imitation Value Streams Post Agile Transformation with Real Value Streams
Financial Systems are set up to fund
Initiatives within Functional Units
With the move to Real Value Streams,
the Funding also has to shift

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Real Life Stories

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A Company that Tried and Failed
Reminding Us That We Need to Connect
Operational and Development Value Streams

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A Company that Succeeded
Reminding us to focus on stakeholders more
than shareholders and to let the Street know
Capex/Opex Impact

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IDEAS FOR SOP-98 STAGES TRANSLATION TO AGILITY
NOT TO BE CONSIDERED AS FINANCIAL ADVICE
20% of the PI 60% of the PI 20% of the PI
Analysis
Reviewing
Portfolio Backlog
In Progress
In Deployment
Done
Chart from: https://www.fasb.org/jsp/FASB/Document_C/DocumentPage?cid=1176156442651&acceptedDisclaimer=true
Kanban
States (Pat Reed)
PI % of Work

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• Identifying Value Streams
• Using the Value Streams to Organize Portfolios into Products/Product Lines
• Funding by PI by Value Stream
• Rewarding executives for stakeholder value more than shareholder value
• Translating into SOP-98 Categories for CapEx/Opex
• Informing the Street of the Impact to CapEx/Opex
WHAT WORKED

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KEEP THE CONVERSATION GOING…
• Connect with our speakers on LinkedIn
• Check out Cprime upcoming webinars, read our blog, download
whitepapers/case studies & more: www.cprime.com/resources
• Share with us what topics you are interested in, ask us questions or give us
feedback: learn@cprime.com

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QUESTIONS?

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