February 13, 2025 • 44 mins
In this episode of the Scrum.org Community Podcast, Dave is joined by Yuval Yeret and Darrell Fernandes to answer key questions on Agile product portfolio management from a recent webinar. They explore how to visualize work, reduce work in progress, and prioritize investments using cost of delay. The conversation highlights the importance of quarterly business reviews, aligning initiatives with strategic goals, and leveraging Kanban and Evidence-Based Management. Tune in for practical insights on managing Agile portfolios effectively—and stay tuned for Part 2!
Here is the resource Yuval mentioned containing the Product Portfolio Agility Trail Map.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Lindsay Velecina (00:00):
Music. Welcome to the scrum.org community
(00:04):
podcast, a podcast from the homeof Scrum. In this podcast, we
feature professional scrumtrainers and other scrum
practitioners sharing theirstories and experiences to help
learn from the experience ofothers. We hope you enjoy this
episode.
Dave West (00:20):
Hello and welcome to the scrum.org community podcast.
I'm your host, Dave West, CEOhere@scrum.org today's podcast,
it's actually going to befocused on answering some
questions that came out of arecent webinar. The webinar was
around the Agile productoperating model and in
particular, product portfoliomanagement. How do you manage
(00:41):
your portfolio? Products? A bigtopic, so big, I've enlisted two
people to help me with answeringthese questions that came out
the webinar. I'm very lucky tohave Yuval you. PST, the reason
why I'm excited to have EvanYuval here. He's an expert in
(01:02):
the field. Obviously, we allknow Yuval, but he's really good
at blending that safe, leanportfolio management Kanban and
professional Scrum, whichultimately, I think is the
future of portfolio management,maybe of a little bit design
thinking and OKRs thrown in forgood measure. So I'm really
grateful for Yuval being here.
And then we have DarylFernandez, who's action
(01:26):
executive advisor to scrum.orgbut we're kind of leveraging his
old experience. He's the ex CIOand delivery lead for two
organizations applying productthinking to their portfolio, Tia
and fidelity. The reason whyit's great to have Daryl is he's
done this in large, complicated,successful organizations, so
(01:47):
he's got the battle scars toprove it. Darryl Yuval, welcome
to the podcast. Hey, Dave,great. Great to have you. And
we've got a load of questions. Idon't think we're going to have
time, so this might so thismight be a two parter.
Listeners. Gosh, controlyourself. That's really
exciting, but we've got somegreat questions. So let's, let's
(02:09):
jump in. Let's start withprinciples and get it started.
There was a lot of questions inthe chat and posted in the Q A
thing around principles andgetting started. Where do you
start? Really, was a questionthat came over and over again.
You know, we talked about thisprocess, and I don't, I didn't
(02:32):
mean to invent a process, butthis, this sort of, how do you
fund teams or products. So therewas that very distinct process,
looking at risk, looking atvalue, looking at where products
were, with their their lifecycle, so funding. And then
there was this managing crossproduct initiatives. And it they
(02:53):
were, they though they wererelated. They were distinctly
separate. And we got a lot ofpeople saying, My organization
is doing none of this. Where dowe start? Now, I know Yuval,
you're kind of involved in thiswith a client at the moment. So
where do you start? Where didyou start with flow?
Yuval Yeret (03:16):
And it relates to the fact that the principles
here are the same principlesthat we apply elsewhere. I think
you said turtles all the way.
It's it's flow, it's empiricism,it's evidence based, and it's
especially at the portfoliolevel, what I find is it's hard
to turn around. You know, thissort of aircraft carrier, you
(03:39):
need a dream tab. Flow is thatsort of dream tab, that thing
that is not that hard to set up,you know, a portfolio Kanban
board to look at. You know, whatare you managing? Could be too
many things could be the wayyou're currently funding them.
Could be things that just focuson specific areas. Could be
(04:00):
things that cut across whateverit is. Start to see the mess,
start to see the swamp, maybe itis a river already. And then
from there, you can start tothink about how to improve,
whether that's, you know,managing the amount of work in
process and hopefully reducingit, whether it's recognizing
(04:20):
that you're actually involved intoo many things, you're managing
too many things, and it mightmake sense to create, empower
teams that can actually runthose things, and you just want
to fund them, you know, givethem a mission, give them a
Goal, outcome oriented goal, andlet them run ideally, you know,
around products, that's whereproduct thinking can help
(04:45):
designing your product strategy,and over time, maybe bring in
evidence based management andempiricism. What I see in my
work with clients that's one ofthe hardest pieces. Uh, to bring
in to convince both leaders andteams to work on so we typically
don't, don't start with that,and we don't apply it all across
(05:07):
the board. It might make senseto choose a specific strategic
initiative that you identify ashigh risk, high uncertainty and
high opportunity, and play withevidence based management and
leading indicators over there.
Dave West (05:24):
So the most important thing is visualize it, make it
transparent. Understand how manyinitiatives are in play,
understand the impact thoseinitiatives are having on those
product teams. Hopefullyunderstand the flow of work
across that portfolio, and thensort of use that as an
(05:46):
opportunity to reduce WIP,increase value, focus on
outcomes, and sort ofincrementally move towards
something that's a little bitmore product centric, more
empowered, more outcomeoriented, would that sort of
summarize what you just said?
Yuval, awesome. Gosh, that wasthat was a mouthful, excellent.
(06:07):
Now, Darryl, sorry, I justwanted
Darrell Fernandes (06:11):
to key off one thing that Yuval said,
because I think a lot of thishas to do with scope of
influence. Has to do with wherethe organization is in their
readiness, who's taking on therisk of trying to drive some
change here, and those areimportant variables to consider.
And depending on where you arein that the point that you've
all made about a singleinitiative might be a good place
(06:34):
to start, whether that singleinitiative is has a couple
products and critical, but notvisible, if you will not
strategically visible, orwhether it's super important to
the organization has multipleproducts, picking one and really
testing how this can work, howthe approach can fit within the
(06:58):
ethos of the organization, andwhat changes have to happen.
Learning through that process, Ithink, is a really important
step. Doing portfolio managementon a product oriented
organization can getoverwhelming if you do too much,
too fast, just like anything, ifyou put too much whip out there,
you can get overwhelmed by it,and by starting with a single
(07:19):
initiative, by trying things, bylearning on a on a manageable
scale. I think there's a lot ofvalue in that. Because you want
this to be successful, you wantto drive this change. Because
all the reasons evolved and yousaid, Dave, it brings
transparency, it brings clarity,it brings focus, it brings
energy to the outcomes thatyou're driving. It's also
(07:42):
important, and being able to getreally good at it as you scale
it, I think, is tremendouslyvaluable.
Dave West (07:49):
So just another important point, though, that
sort of builds off what both ofyou were saying is the
importance of quarterly businessreviews, or quarterly reviews,
at least at the minimum, becauseif you are going to slowly adopt
this, and you are going toinspect and adapt, if you are
really going to be agile at theportfolio level, you need to
(08:11):
have a mechanism that reviewsand can potentially make changes
at that level. So putting thatin place can be incredibly
important. Do you Do you agreethat, and it's often missed.
It's kind of missing. It kind ofisn't. Obviously, all big
organizations have regularcadences where they where they
evaluate investments. However,what tends what I see is it
(08:34):
tends to after that initialridiculous planning exercise
happens, it then breaks downinto each functional area or
whatever, and they review and,you know, like the portfolio
managers or the project managersdo something, and then the
business does something, andthen the teams do something, and
then the technology people dosomething, and they don't bring
(08:55):
that all together holisticallyto get that enterprise flow, or
Kanban that you're that you'redescribing your Val Do you think
that's also important as you getstarted? Yes.
Yuval Yeret (09:05):
I also see another siloed behavior, but not, not
necessarily across functions.
One other pattern I see is theorganization has some sort of
phase Gate process, formerformal process for how they
manage initiatives, but theymanage each initiative in a
silo. So they have aconversation around, should we
(09:26):
do this initiative? Should weinvest in it? And they decide to
invest, but they don't look atthe big picture of how the teams
are currently flooded with otherstuff that they're working on,
and can we actually do this?
They, you know, they use pushmode to drive things into the
organization rather thancreating pool. And that's one of
(09:49):
the key things that, you know,starting to see the the big
picture, starting to manageusing a kanban system is
helpful. The other thing Iwanted to. To share is, I've
been working on providing someguidance to portfolio leadership
teams that are considering this.
To answer the question, how dowe get started? And it's
(10:10):
tempting to provide a roadmap,right? We have a conversation,
how do we provide a methodology?
And you'll probably appreciatethis. Daryl. The current
metaphor that I'm using is atrail map or plan the piste,
right? Because, depending onwhere you are in the journey and
(10:35):
what's the context, what's theproblem, what's your readiness,
how are your knees you mightwant to start with, you know, a
green slope of starting a Kanbanboard and seeing some stuff you
might want to try a blue oftrying a specific initiative. Or
you might, you know, go into thedouble black diamond of evidence
(10:58):
based management across theentire organization switching to
product oriented teams from dayone. Your mileage may vary,
depending on your context andreadiness.
Unknown (11:12):
I think it's a absolutely critical that you
have that conscious approachYuval that you just laid out. I
think it's really important thatyou go through that thoughtful
process of, what are we readyfor? Where are we on this
journey, and where can we besuccessful, and how big a risk
do we need to take? What is themarketplace conditions? What is
our business condition? Where dowe need to go? But to your
(11:35):
point, Dave, that regularcadence of reviews quarterly, I
think is a great place to start,because you're thinking about
these things holistically, notjust in a change mode, but also
in a run mode. All kinds ofthings happen in the industry on
a regular basis, and thosethings aren't planable, right? A
release may come out that youmay have to absorb from a
(11:55):
security batch perspective,different things happen. You've
got to understand how that isall affecting all of the
initiatives that may or may notbe hitting a product team,
because, because those things,if it's a security patch,
candidly, may be more importantthan some of the business
initiatives that you have from arisk management perspective, and
(12:16):
having those reviews, thetransparency is there to look
In, but to have those reviews,to give the platform for those
those teams, to to outlinewhat's happening at their level
and how it may impact theoverall portfolio and the cross,
cross product dependencies, Ithink, is absolutely, absolutely
critical for the organization.
Dave West (12:39):
It is interesting.
You bring that up becauseorganizations are very ill
equipped to deal with change atthis magnitude on a frequent
basis. You know, the we teach, Imean, you teach it actually,
Yuval Darrell and I just, youknow, sort of Potter around
mentioning it, but you actuallyteach this about you teach about
(13:01):
empiricism and the importance ofinspection and adaption through
transparency and the fact thatyou know some of best, best laid
plans, best laid assumptions,are actually, you know, missing.
You deliver something like, Oh,that wasn't quite what I
expected. Now you scale thatacross initiatives. So, you
(13:22):
know, you put, I don't know, 20%of all your money into, I don't
know, some personal bankinginitiative. You realize that
actually, you know, crypto isthe way to go, which you know
many of us might now be thinkingabout, and you're like, Oh,
that's not what I expected now,and having an organization that
(13:43):
can absorb that level of changein priority is the it's the Holy
Grail when it comes to thepursuit that we're on. I mean,
it's this that is businessagility, that is ultimately what
we would all love to be on. Butit's hard to build that
resilience into the organizationto facilitate that. What so how
(14:04):
do you balance that kind oflevel of need with the ultimate
sort of constraints that anorganization has? I know, Daryl,
you did this for a living, for awhile.
Darrell Fernandes (14:18):
Yeah. I think when you look at macro at that
level. Dave, there's so manyforces that are coming and to
evolve earlier. Point aboutstage gates and about processes,
there is some level ofinsulation that the organization
has built to to help adapt inthose ways. Because it's, it's
(14:41):
when you, when you're at scale,doing these kind of changes,
it's, it's overwhelminglydisruptive when one of those
things hits you, becauseeverybody wants to adapt,
everybody wants to adjust,everybody wants to take on the
new thing. But if you have awell constructed portfolio. You
understand your capabilities,your products, you can actually
(15:04):
be more precise about where thechange needs to happen. So I'll
just reflect We, obviously, wewent through COVID Like everyone
else did. A lot of regulationschanged real time COVID, and you
could spend a lot of energytrying to re orient the entire
organization to every one ofthose reg changes. But because
(15:26):
we had some semblance of aproduct model, because we
understood where we could mostefficiently and effectively
drive the change, we couldisolate the impact of pretty
macro changes in regulatoryenvironment to the places that
it needed to be and adapt andpivot where we needed to without
having to disrupt the entireportfolio. There's plenty of
(15:48):
that going on anyway, but, butyou can, you can use this as an
insulation from some of that andreally get focused. And I think
one of the things that the thecombination of portfolio
management and productmanagement does is it allows you
to be really clear about whoneeds to absorb what and who
(16:08):
doesn't, and then you can, withthat transparency, figure out
what the dependency implicationsare, figure out what the
workload implications are, etcetera. But I think this model
does allow you to be more nimblewhen it comes to those things.
That's my experience.
Yuval Yeret (16:24):
So there are two threads that I'm thinking of
pulling here. So one is that themodel allows you to be nimble,
but it's up to you toreconfigure your organization to
actually be nimble. The factthat you have a portfolio
(16:47):
management approach doesn't meanyou're nimble, because if your
teams, if your groups, aren'torganized around products, each
change is gonna hate. A lot ofthem, or a lot of the changes
are going to hit a lot of them.
One of the important things Ifind is to use the flow purpose
perspective to see that, and notjust add more and more
(17:14):
coordination mechanisms and morecomprehensive portfolio
management practices. But todescale to say, Okay, we've
noticed there's a type of thingthat constantly hits three
groups, four products. Are theyreally products? If that's
(17:35):
happening this, you know, cryptothing that keeps hitting these
four products in our world? Doesit make sense for us at this
point to organize a productaround crypto so that we can let
that area focus on it work on amission, on bringing us to the
age of crypto. That's aportfolio management decision to
(17:58):
reconfigure, to reorganizearound products. If you don't do
that, I think you're missing thepoint on being a product
oriented portfolio managementapproach. For me, that's the
essence of it. Another essenceis, if you talk about, what does
it mean to be an agile portfoliomanagement approach and that
resilience, it's both theability to change where you're
(18:21):
heading, and that's coming fromlimiting the amount of work in
process and providing moreintake opportunities. And not
just plan the entire year, planmore frequently, but an even
harder transformation ortransition for the organizations
I see is, once you startsomething, once you commit to
(18:45):
actually working on aninitiative, how often do you
look at whether it's trackingtowards outcomes? We talk about
evidence based management,applying evidence based
management for these strategicinitiatives. What does that look
like? How do we know that ourinvestments in crypto, let's say
or Gen AI for improving thedeveloper experience, or for
(19:09):
helping our tellers, you know,you know, achieve more in their
day. How do we know that it'sworking effectively, that it's
achieving. You know what weintended to achieve there? And
do we, are we even open? We talkabout the scrum values of
(19:30):
openness, it's very hard forportfolio leaders that I've seen
to be open to the possibilitythat we were missing the mark,
that we were wrong with ourassumption that we need to do
crypto. Go tell any sales personthat sold. You know, a big deal
based on if we have that featurethis customer will buy. Go tell
(19:54):
them, you know, that there's achance that the cost. Customer
won't buy even if we build thatfeature and it worked.
Dave West (20:05):
Yes, having been the product manager that was forced
to introduce stuff that actuallynever got product market fit,
even after we introduced it,I've definitely felt that that
and so you just to pull on thatthread for a second, the thing
that we tend to fund? Well, one,we need to fund outcomes. Yes,
(20:28):
totally. Initiative needs tohave a clearly identified
objective and a set of resultsassociated with it, whether
using OKRs, EBM, whatever. So weget that. And that resonated
really well from the webinar.
The other thing that wasimportant is that that what's
you don't have to discovery isan explicit you need to have
discovery and then make adecision. Now that doesn't mean
(20:53):
that you can't align to it. Itdoesn't mean does it, and it
certainly doesn't mean that thatshould be done by a separate
team that isn't part of yourstandard delivery organization,
which is often the case in theselarge organizations, you go off
and do a POC proof of concept,separate group of people build
up something, prove someassumptions, which basically
(21:13):
means aligning to yourexecutive, say the things that
they want to hear, and then Theygive you the money. But you need
to basically drive that intothose teams in a discovery
fashion, and then build thatlearning outcome out to make the
decisions. And I think that thatthat's hard to do, but I think
(21:34):
it's crucial, because otherwiseyou invest in things that that
that ultimately don't give youthe value that you seek. I think
Yuval Yeret (21:46):
I want to be careful with how we talk about
funding. I think a key role ofthe I Agree, a key role of the
portfolio is to to managefunding, but we manage that
funding in two distinct ways. Inin my experience, one is we fund
products, and we empower teams,products, managers, owners that
(22:12):
own that product, to go, achievea mission. To go, achieve a
strategic goal. We fund anoutcome that we trust them to go
and deliver. And they'll dodiscovery, they'll do delivery,
whatever. There's a certaintransparency we want to that
from the portfolio level, but wewe're not going to manage that
hands on. Yeah, there are someinitiatives, typically those
(22:37):
that are cutting across that arethe most strategic, biggest
opportunity, biggest risk,biggest interest for the
portfolio, leadership team,whatever. Hopefully that's 20%
of our funding or or of thework, not more than that. But it
depends, and for those we wantto to to introduce and use that
(23:01):
discovery process that you'retalking about more explicitly,
those would be the initiativethat we will manage on the
portfolio Kanban board, forexample. And on that Kanban
board, yes, there should be somediscovery phase that gives us an
opportunity to after we decidedwe want to invest a little bit a
(23:24):
seed round, if you want to callit that, for that initiative,
see that we want to invest morethe whether that work is done by
the same teams or other teams,you know, is a Separate concern.
In my experience, I like thefact that the same teams do the
(23:45):
discovery for the work, but Idon't want to prescribe it
necessarily. There are very goodreasons to work that way. But,
you know, that's a prescriptionthat's not necessarily part of,
you know, educational principlesand practices.
Dave West (24:03):
Yeah, I don't know. I don't want to spend too much on
this, but my experience is whendiscovery is done outside of the
delivery organization, not onlydo you only consider you don't
have a big enough understandingof the risks and challenges to
delivering that capability intothe thing that we already have
in in market. But also there's acertain level of ownership that
(24:29):
is missed, which then requiressignificant amount of work to
gain that you know, engineers inparticular, and obviously my
experience is software products,right? Are very good at saying,
well, that's a really good idea,but it wouldn't work here that
and, yeah, but I don't want Iagree that I'm not sure it
should be prescribed howeverthere, if there is a cost, if
(24:50):
you don't, and I think that'swhat I meant, the one
Yuval Yeret (24:54):
thing I'll let's emphasize one thing, the
discovery should be. Focused onthe main risk with the
initiative that we'reconsidering. Yeah, main risk is
visibility. It should be, youknow, a technical discovery. It
should be a technical proof ofconcept. The engineers should be
(25:15):
involved. But a lot of the time,especially these days, the main
risks are desirability andviability will will the
customers come? Is it somethingpeople really want, really need?
Are we thinking about the rightuser experience? And there's
(25:35):
this anti pattern of we focustoo much on this solution, way
too early that we need to weneed to help organization around
we need to think about theproblem, market feed the before
we dive into the solution. And
Dave West (25:54):
perhaps I've just been badly burnt though my other
learning is that if we teachdelivery organizations how to
separate those concerns in amore effective way, teach them
how to do real discovery, thenyou get that. You get the
benefit, obviously, in allsituations, not just the ones
(26:15):
you think are discoverysituations, because then
suddenly they challenge everyassumption in a way that is a
lot more effective anyway. Ididn't, I don't want to get too
bogged down in that area. Ithink, I think there's a lot of
opportunity to improve how we dodiscovery across organizations,
and when it starts, and how muchit costs and you know, and how
(26:41):
you make it transparent, whichis that what I do, though, want
to a couple of things. There'sgone. There's so many things.
One thing is about you said,Let's not plan everything for a
year, for two years, for threeyears up front, and accept that
we're gonna I think that's whatyou said. Yuval Darryl,
obviously you worked for largeorganizations that wanted some
(27:06):
level of stability in terms ofthe time frame. So it's
impossible to be prescriptivehere, however intent wise, what
should the cadence be? Even fora large organization of their
portfolio planning. We talked Italked about QBRs quarterly
reviews. I talked about annualplanning cycles in the in the
(27:28):
webinar, was that too naive?
Should I have made that moreprecise what? There was a number
of questions about that.
Darrell Fernandes (27:36):
Yeah, I think it comes down to confidence
levels. Dave, so where we triedto get in multiple organizations
was a place where we weremanaging a rolling 18 month
calendar of investments, and thenext six month view was more
confident than the following sixmonths, which was more confident
(27:59):
than the following six months.
So do you need an annualplanning cycle so you can look
at your annual financials as anorganization, your annual
budgets? Yes, you do that,right? But, but that doesn't
have to be a ceremony, a one offceremony. If you have a rolling
18 month planning cycle, youjust take if, if your fiscal
year is January to December. Youtake your whether you're doing
(28:22):
it every six months or everyquarter, hopefully every
quarter, you take your Q for 18month planning cycle. You look
at the the next window of time.
You can, you can define and youcan, you can summarize your
basic annual plan based onwhat's already in motion, and if
(28:45):
something new comes up that youwant to do in that following
year, that's your opportunity toquestion what, what trade offs
are you willing to make in orderto make that happen, whether
it's discovery, whether it'sexecution, but if you have that
rolling 18 months, it no longerbecomes a a one off ceremony. It
becomes the way you run yourbusiness, which is the ideal
(29:08):
that we were always workingtoward, towards. I can't say
that in any instance, we got allthe way to that, but we did
reach levels of maturity wherewe were just continually looking
18 months out, understandingthat the fiscal year snapshot
was just a picture of the next12 month cycle and the 18 month
planning cycle, and we had adegree of confidence and a
(29:31):
degree of commitment to what wasgoing to happen in that 12 month
cycle.
Yuval Yeret (29:36):
I listened to Daryl, and what I'm hearing is a
product owner. I mean, we'retalking about portfolio
management here, butessentially, what we're talking
about is, you know what we'vebeen talking about in scrum all
along. We are planning everysprint. But that doesn't mean we
don't look into the productbacklog. That doesn't mean we
(29:59):
don't have. The roadmap. TheRoadmap should provide some
balance of predictability andflexibility, depending on how
important these two aspects areto us in general, I would say
when we're looking at a productoriented portfolio, we should
bring with us everything that weknow from team level Scrum, from
(30:25):
team level agility, it's a lotof the same practices apply.
Most of the same practicesapply. Flow applies. Of course,
we have two audiences. What Isee is two audiences that tackle
portfolio level agility. One ispeople that have been doing it
in the trenches and are dauntedby working with the portfolio
(30:50):
level. What they should be maybedaunted by is, you know, working
with like, you know, leaders atthat level with concerns at that
level, they shouldn't be dauntedby the practices that we use.
They should leverage thepractices that they've learned
and mastered over the years. Theother audience is portfolio
(31:13):
level leaders, whether it'spMOS, product people at the
portfolio level, productleaders, CIOs, that don't have
that expertise in agility, whatwe need is, you know, to use the
language. What I found useful isto use the language from team
(31:34):
level agility and work withthese people. And the advantage
is, once you manage to get thatlanguage across, the power of
actually enabling agilityelsewhere in the organization is
multiplied. You start to havepeople at the right level of the
organization talking about focusand flow and steering using
(32:00):
evidence and discovery, andsuddenly all of the practices
that the teams in the trenchesare using start to make more
sense, and you have people thatare actually on board for
helping these teams work in aproduct oriented fashion,
because they know the language.
Dave West (32:19):
And the other thing that you end up doing is
removing all that translationthat reforming i I've worked
with a number of organizationswhere basically Scrum Masters
and product owners and deliveryleaders spend a lot of time
reframing the Work into adifferent context for the
(32:41):
purposes of red, green, orange,Amber, and these corporate
dashboards that that that make alot of sense if it's about out,
if it's about work, you know,sort of like outputs delivering
to plans, but make very littlesense when you're actually
trying to determine the valuethat each product's providing,
(33:05):
there is a question that I didsee over and over again, which
was really the We the idea ofvalue. So you've got a portfolio
of many different products init, and each of those products
potentially is valuable in adifferent way to the
organization. You know, Daryl, Iknow that used to manage things
(33:25):
in the data space. Now, let's behonest, selling, selling a
financial product much easier towork out value than providing a
data service to multiplefinancial products. So you don't
get sued by the by some sort ofgovernment entity because you're
misrepresenting the data indifferent contexts, or the
European Union comes in andgdprg to death, or whatever,
(33:49):
hard though to articulate valuein a consistent way to determine
investment. So how do you getthat consistent definition of
value across the portfolio. Isit even possible? I think,
Darrell Fernandes (34:03):
I think Dave, the way I would look at that is
your value is different, right?
A website or a web page has adifferent way to articulate
value to the business. It's inoperational cost, transaction
cost, customer engagement, thosekind of things ultimately
leading to business value,right? ROI of of the page is
(34:25):
there, but it's throughdifferent metrics that you get
there, right? Customer Data isabout operational efficiency. In
some cases. How can we maximizeand not have redundant storage,
not have redundant databases,not having redundant
capabilities. So there's anoperational efficiency, there's
a risk management piece of thatthat comes together. But again,
(34:49):
there's a there's a customersatisfaction that if the name,
if a customer corrects theirname, they do it once, and it
cascades to every place in theorganization. Because you manage
your data well, so there aresimilarities, but I wouldn't
want, I never was able to get toa place, and I'm not sure it
would be worth the effort to getto a consistent definition of
(35:10):
value across every product inthe portfolio. When you get to
the initiative level, the OKRsfor the initiative should be
able to cascade down into whateach of the product teams drive
through their value statements.
I've never had a challenge wherethat couldn't be aligned. But it
isn't a little bit of analignment exercise there that
(35:33):
you have to look at theportfolio, at the products, and
what drives value for thoseproducts, especially when you
get into new areas where you'reexperimenting with new products,
because you're still trying tofigure out and work out what the
what the market value is foryou've done the research, you've
done the discovery, but you'restill trying to figure out for
you, how do you scale to get tothat value? What does that look
(35:55):
like? Where are the barriers?
Dave West (35:58):
Yuval, what do you say you I mean, you're working
with a client that has manydifferent levels of value, some
of it very external, dollars andcents, some of it more internal,
operational efficiency, youknow, risk, etc.
Yuval Yeret (36:16):
Well, operational efficiency has dollars
associated to it, I mean,eventually allows you to start
trading in more countrieswithout growing your support
team, or some other things youcould do if you improve your
operational efficiencies. Butwhat I'm seeing work, work well
(36:37):
is similar to what Darrell isdescribing. You align on what
are your strategic goals? Whatare you focused on as an
enterprise, as a portfolio? Inthe case that we're talking
about, it's multiple portfolios,but they're aligned to one set
of enterprise strategies.
Hopefully that's a consistent,small set that allows you to
(37:01):
make value trade offs throughoutthe enterprise, not something
where everything you know couldmap into in which case
everything is valuable andthat's not valuable. Once you
have that, I agree with Daryl,you can start to ask yourself
for each one of those productgroups, what could it do to help
(37:22):
our strategy? How important isthis to supporting our strategy?
And that should help you decidehow to fund it for the next
year, or how to think about itand for each one of those cross
product initiatives, again, youshould be able to talk about,
how does this relate or align towhat's strategic for us? Another
(37:46):
technique is, you know, to usecost of delay. Reinerts talks
about, you know, whatever it isthat you're doing, if you're
working at the portfolio level,bring the finance people into
the room that they will help youfigure out, you know, the
numbers. They can turn a lot ofstuff into numbers if you talk
(38:07):
to them, we're afraid of talkingto them a lot of the time, but
bring them into theconversation, and there's a lot
that you can actually do, costof delay for and bring things to
the to the same playing field,and if you cannot, if you are, I
don't know, for example,Microsoft and you're trying to
(38:27):
compare the value of, you know,a new feature for Xbox Live
versus some new gen AIinitiative. First of all, you
know, you could probably get itto dollars, but another
(38:48):
indication is that they're notthe same portfolio. If the
conversation is so disparate, sodisjointed, maybe it doesn't
make sense for this to be aportfolio. A portfolio should
have a business model that makessense for it. There should be an
economic framework that'sdriving that portfolio, that the
different products in some wayfit into that model
Dave West (39:16):
that's kind of deep.
There was, I'm reminded of aUniversity I studied a something
called cybernetics, which had athis guy called Stafford beer,
who built economic models andthen used computers, and he
ended up running a small countryin or helping run a small
country in South America, whichthen had a revolution, and his
models were blown up. But, butwhat was interesting is trying
(39:38):
to define value, and Mars is areally interesting organization,
because what they're doing isthey're building something
called it's, it's, it'sbasically a balanced scorecard
for for investments that is muchbroader than just, you know,
immediate revenue. It's sort ofimpact, impact based. And it
really interesting. So, gosh, wecould talk about value for an
(40:02):
entire podcast, if not longer,but it is an interesting idea.
The point that you raised,though, I think, is have that
conversation, bring in thefinance people use techniques to
look at it from differentperspectives, and then try to
find something that balancesconsistently value across your
portfolio. And maybe you have toaccept that they're different
(40:24):
things and they need to bemanaged in separate portfolios.
You should you know yourcharitable contributions are
different to your capitalistcontributions as it were,
whatever, which is interesting,hey, oh gosh, we're coming to
time, and I need to bring thispodcast to a close, at least
(40:44):
this first version we I've putmy my Kanban board up, and I've
discovered, you know, that ourflow is quite slow. And out of
the seven topics, we managed toget two guns so we have we might
want to look at our work inprogress and move our flow a
(41:05):
little bit better for the nextpodcast. I really do think there
should be a next podcast.
Hopefully you two will sign upfor that. But I guess if we're
going to leave anything from ourlisteners with in terms of what
came out of today's discussion.
We talked about getting started,we talked a little bit about
value. We talked a little bitabout transparency and applying
(41:28):
these team level agile conceptsto the to the enterprise level,
to the portfolio level. Is thereanything else that our listeners
should take away from this firstdiscussion, I
Yuval Yeret (41:44):
hope they they took the concept of, this is a
fractal. The same principlesapply. And the concept that it
is a trail map we're not goingto provide, you know, a detailed
process. It's not necessarily, Imean, yeah, you could say it's a
framework, but there aremultiple things that you can try
(42:09):
doing depending on where youare. The most important thing is
to start thinking a differentway. Start thinking from a
product oriented perspectiveabout your portfolio.
Darrell Fernandes (42:22):
I think that's the key Yuval. If you
don't start thinking about it,contemplating it this way,
looking through the lens fromthis perspective, you'll never
appreciate the value you can getfrom it. So you have to take
that leap and start to explorein order to decide which path is
the right path for you.
Dave West (42:42):
And if you don't, this is digital enterprise, a
software centric organizationthat's going to be doing that
and building features andcapabilities in their products
that are going to basically beatyou. So if you don't start
thinking in this way, I thinkultimately, as successful as you
(43:03):
are today will ultimately beyour ruling in the future. So
thank you gentlemen for joiningus today. I really, really do
appreciate it. So we were heretoday. Listeners focused on
really the Agile productoperating model, the product
portfolio management element ofit, talking about a webinar that
(43:24):
was run recently and thequestions that came out of it.
We talked about getting started.
We talked about agility atscale. We talked about the
importance of getting leadershipto understand that at the
portfolio level, and really,then really talked about the
importance of value and how youcan effectively build that
balanced scorecard. Thank youfor joining us today. I really
(43:47):
appreciate you listening to thescrum.org community podcast. If
you liked what you heard, pleasesubscribe, share with friends,
and of course, come back alittle some more. Maybe this
topic will continue. I know wehave, gosh, almost five
questions still outstanding thatwe need to address. I'm I'm very
(44:07):
lucky that I get an opportunityto talk to a variety of guests.
Obviously, today we had YuvalYvette and Daryl Fernandez
talking about portfoliomanagement. But I'm lucky to
talk to a variety of gueststalking about anything in the
areas of professional Scrum,product thinking and, of course,
agility. So thanks for listeningand Scrum up. You.
Music. Welcome to the scrum.org community
(00:04):
podcast, a podcast from the homeof Scrum. In this podcast, we
feature professional scrumtrainers and other scrum
practitioners sharing theirstories and experiences to help
learn from the experience ofothers. We hope you enjoy this
episode.
Dave West (00:20):
Hello and welcome to the scrum.org community podcast.
I'm your host, Dave West, CEOhere@scrum.org today's podcast,
it's actually going to befocused on answering some
questions that came out of arecent webinar. The webinar was
around the Agile productoperating model and in
particular, product portfoliomanagement. How do you manage
(00:41):
your portfolio? Products? A bigtopic, so big, I've enlisted two
people to help me with answeringthese questions that came out
the webinar. I'm very lucky tohave Yuval you. PST, the reason
why I'm excited to have EvanYuval here. He's an expert in
(01:02):
the field. Obviously, we allknow Yuval, but he's really good
at blending that safe, leanportfolio management Kanban and
professional Scrum, whichultimately, I think is the
future of portfolio management,maybe of a little bit design
thinking and OKRs thrown in forgood measure. So I'm really
grateful for Yuval being here.
And then we have DarylFernandez, who's action
(01:26):
executive advisor to scrum.orgbut we're kind of leveraging his
old experience. He's the ex CIOand delivery lead for two
organizations applying productthinking to their portfolio, Tia
and fidelity. The reason whyit's great to have Daryl is he's
done this in large, complicated,successful organizations, so
(01:47):
he's got the battle scars toprove it. Darryl Yuval, welcome
to the podcast. Hey, Dave,great. Great to have you. And
we've got a load of questions. Idon't think we're going to have
time, so this might so thismight be a two parter.
Listeners. Gosh, controlyourself. That's really
exciting, but we've got somegreat questions. So let's, let's
(02:09):
jump in. Let's start withprinciples and get it started.
There was a lot of questions inthe chat and posted in the Q A
thing around principles andgetting started. Where do you
start? Really, was a questionthat came over and over again.
You know, we talked about thisprocess, and I don't, I didn't
(02:32):
mean to invent a process, butthis, this sort of, how do you
fund teams or products. So therewas that very distinct process,
looking at risk, looking atvalue, looking at where products
were, with their their lifecycle, so funding. And then
there was this managing crossproduct initiatives. And it they
(02:53):
were, they though they wererelated. They were distinctly
separate. And we got a lot ofpeople saying, My organization
is doing none of this. Where dowe start? Now, I know Yuval,
you're kind of involved in thiswith a client at the moment. So
where do you start? Where didyou start with flow?
Yuval Yeret (03:16):
And it relates to the fact that the principles
here are the same principlesthat we apply elsewhere. I think
you said turtles all the way.
It's it's flow, it's empiricism,it's evidence based, and it's
especially at the portfoliolevel, what I find is it's hard
to turn around. You know, thissort of aircraft carrier, you
(03:39):
need a dream tab. Flow is thatsort of dream tab, that thing
that is not that hard to set up,you know, a portfolio Kanban
board to look at. You know, whatare you managing? Could be too
many things could be the wayyou're currently funding them.
Could be things that just focuson specific areas. Could be
(04:00):
things that cut across whateverit is. Start to see the mess,
start to see the swamp, maybe itis a river already. And then
from there, you can start tothink about how to improve,
whether that's, you know,managing the amount of work in
process and hopefully reducingit, whether it's recognizing
(04:20):
that you're actually involved intoo many things, you're managing
too many things, and it mightmake sense to create, empower
teams that can actually runthose things, and you just want
to fund them, you know, givethem a mission, give them a
Goal, outcome oriented goal, andlet them run ideally, you know,
around products, that's whereproduct thinking can help
(04:45):
designing your product strategy,and over time, maybe bring in
evidence based management andempiricism. What I see in my
work with clients that's one ofthe hardest pieces. Uh, to bring
in to convince both leaders andteams to work on so we typically
don't, don't start with that,and we don't apply it all across
(05:07):
the board. It might make senseto choose a specific strategic
initiative that you identify ashigh risk, high uncertainty and
high opportunity, and play withevidence based management and
leading indicators over there.
Dave West (05:24):
So the most important thing is visualize it, make it
transparent. Understand how manyinitiatives are in play,
understand the impact thoseinitiatives are having on those
product teams. Hopefullyunderstand the flow of work
across that portfolio, and thensort of use that as an
(05:46):
opportunity to reduce WIP,increase value, focus on
outcomes, and sort ofincrementally move towards
something that's a little bitmore product centric, more
empowered, more outcomeoriented, would that sort of
summarize what you just said?
Yuval, awesome. Gosh, that wasthat was a mouthful, excellent.
(06:07):
Now, Darryl, sorry, I justwanted
Darrell Fernandes (06:11):
to key off one thing that Yuval said,
because I think a lot of thishas to do with scope of
influence. Has to do with wherethe organization is in their
readiness, who's taking on therisk of trying to drive some
change here, and those areimportant variables to consider.
And depending on where you arein that the point that you've
all made about a singleinitiative might be a good place
(06:34):
to start, whether that singleinitiative is has a couple
products and critical, but notvisible, if you will not
strategically visible, orwhether it's super important to
the organization has multipleproducts, picking one and really
testing how this can work, howthe approach can fit within the
(06:58):
ethos of the organization, andwhat changes have to happen.
Learning through that process, Ithink, is a really important
step. Doing portfolio managementon a product oriented
organization can getoverwhelming if you do too much,
too fast, just like anything, ifyou put too much whip out there,
you can get overwhelmed by it,and by starting with a single
(07:19):
initiative, by trying things, bylearning on a on a manageable
scale. I think there's a lot ofvalue in that. Because you want
this to be successful, you wantto drive this change. Because
all the reasons evolved and yousaid, Dave, it brings
transparency, it brings clarity,it brings focus, it brings
energy to the outcomes thatyou're driving. It's also
(07:42):
important, and being able to getreally good at it as you scale
it, I think, is tremendouslyvaluable.
Dave West (07:49):
So just another important point, though, that
sort of builds off what both ofyou were saying is the
importance of quarterly businessreviews, or quarterly reviews,
at least at the minimum, becauseif you are going to slowly adopt
this, and you are going toinspect and adapt, if you are
really going to be agile at theportfolio level, you need to
(08:11):
have a mechanism that reviewsand can potentially make changes
at that level. So putting thatin place can be incredibly
important. Do you Do you agreethat, and it's often missed.
It's kind of missing. It kind ofisn't. Obviously, all big
organizations have regularcadences where they where they
evaluate investments. However,what tends what I see is it
(08:34):
tends to after that initialridiculous planning exercise
happens, it then breaks downinto each functional area or
whatever, and they review and,you know, like the portfolio
managers or the project managersdo something, and then the
business does something, andthen the teams do something, and
then the technology people dosomething, and they don't bring
(08:55):
that all together holisticallyto get that enterprise flow, or
Kanban that you're that you'redescribing your Val Do you think
that's also important as you getstarted? Yes.
Yuval Yeret (09:05):
I also see another siloed behavior, but not, not
necessarily across functions.
One other pattern I see is theorganization has some sort of
phase Gate process, formerformal process for how they
manage initiatives, but theymanage each initiative in a
silo. So they have aconversation around, should we
(09:26):
do this initiative? Should weinvest in it? And they decide to
invest, but they don't look atthe big picture of how the teams
are currently flooded with otherstuff that they're working on,
and can we actually do this?
They, you know, they use pushmode to drive things into the
organization rather thancreating pool. And that's one of
(09:49):
the key things that, you know,starting to see the the big
picture, starting to manageusing a kanban system is
helpful. The other thing Iwanted to. To share is, I've
been working on providing someguidance to portfolio leadership
teams that are considering this.
To answer the question, how dowe get started? And it's
(10:10):
tempting to provide a roadmap,right? We have a conversation,
how do we provide a methodology?
And you'll probably appreciatethis. Daryl. The current
metaphor that I'm using is atrail map or plan the piste,
right? Because, depending onwhere you are in the journey and
(10:35):
what's the context, what's theproblem, what's your readiness,
how are your knees you mightwant to start with, you know, a
green slope of starting a Kanbanboard and seeing some stuff you
might want to try a blue oftrying a specific initiative. Or
you might, you know, go into thedouble black diamond of evidence
(10:58):
based management across theentire organization switching to
product oriented teams from dayone. Your mileage may vary,
depending on your context andreadiness.
Unknown (11:12):
I think it's a absolutely critical that you
have that conscious approachYuval that you just laid out. I
think it's really important thatyou go through that thoughtful
process of, what are we readyfor? Where are we on this
journey, and where can we besuccessful, and how big a risk
do we need to take? What is themarketplace conditions? What is
our business condition? Where dowe need to go? But to your
(11:35):
point, Dave, that regularcadence of reviews quarterly, I
think is a great place to start,because you're thinking about
these things holistically, notjust in a change mode, but also
in a run mode. All kinds ofthings happen in the industry on
a regular basis, and thosethings aren't planable, right? A
release may come out that youmay have to absorb from a
(11:55):
security batch perspective,different things happen. You've
got to understand how that isall affecting all of the
initiatives that may or may notbe hitting a product team,
because, because those things,if it's a security patch,
candidly, may be more importantthan some of the business
initiatives that you have from arisk management perspective, and
(12:16):
having those reviews, thetransparency is there to look
In, but to have those reviews,to give the platform for those
those teams, to to outlinewhat's happening at their level
and how it may impact theoverall portfolio and the cross,
cross product dependencies, Ithink, is absolutely, absolutely
critical for the organization.
Dave West (12:39):
It is interesting.
You bring that up becauseorganizations are very ill
equipped to deal with change atthis magnitude on a frequent
basis. You know, the we teach, Imean, you teach it actually,
Yuval Darrell and I just, youknow, sort of Potter around
mentioning it, but you actuallyteach this about you teach about
(13:01):
empiricism and the importance ofinspection and adaption through
transparency and the fact thatyou know some of best, best laid
plans, best laid assumptions,are actually, you know, missing.
You deliver something like, Oh,that wasn't quite what I
expected. Now you scale thatacross initiatives. So, you
(13:22):
know, you put, I don't know, 20%of all your money into, I don't
know, some personal bankinginitiative. You realize that
actually, you know, crypto isthe way to go, which you know
many of us might now be thinkingabout, and you're like, Oh,
that's not what I expected now,and having an organization that
(13:43):
can absorb that level of changein priority is the it's the Holy
Grail when it comes to thepursuit that we're on. I mean,
it's this that is businessagility, that is ultimately what
we would all love to be on. Butit's hard to build that
resilience into the organizationto facilitate that. What so how
(14:04):
do you balance that kind oflevel of need with the ultimate
sort of constraints that anorganization has? I know, Daryl,
you did this for a living, for awhile.
Darrell Fernandes (14:18):
Yeah. I think when you look at macro at that
level. Dave, there's so manyforces that are coming and to
evolve earlier. Point aboutstage gates and about processes,
there is some level ofinsulation that the organization
has built to to help adapt inthose ways. Because it's, it's
(14:41):
when you, when you're at scale,doing these kind of changes,
it's, it's overwhelminglydisruptive when one of those
things hits you, becauseeverybody wants to adapt,
everybody wants to adjust,everybody wants to take on the
new thing. But if you have awell constructed portfolio. You
understand your capabilities,your products, you can actually
(15:04):
be more precise about where thechange needs to happen. So I'll
just reflect We, obviously, wewent through COVID Like everyone
else did. A lot of regulationschanged real time COVID, and you
could spend a lot of energytrying to re orient the entire
organization to every one ofthose reg changes. But because
(15:26):
we had some semblance of aproduct model, because we
understood where we could mostefficiently and effectively
drive the change, we couldisolate the impact of pretty
macro changes in regulatoryenvironment to the places that
it needed to be and adapt andpivot where we needed to without
having to disrupt the entireportfolio. There's plenty of
(15:48):
that going on anyway, but, butyou can, you can use this as an
insulation from some of that andreally get focused. And I think
one of the things that the thecombination of portfolio
management and productmanagement does is it allows you
to be really clear about whoneeds to absorb what and who
(16:08):
doesn't, and then you can, withthat transparency, figure out
what the dependency implicationsare, figure out what the
workload implications are, etcetera. But I think this model
does allow you to be more nimblewhen it comes to those things.
That's my experience.
Yuval Yeret (16:24):
So there are two threads that I'm thinking of
pulling here. So one is that themodel allows you to be nimble,
but it's up to you toreconfigure your organization to
actually be nimble. The factthat you have a portfolio
(16:47):
management approach doesn't meanyou're nimble, because if your
teams, if your groups, aren'torganized around products, each
change is gonna hate. A lot ofthem, or a lot of the changes
are going to hit a lot of them.
One of the important things Ifind is to use the flow purpose
perspective to see that, and notjust add more and more
(17:14):
coordination mechanisms and morecomprehensive portfolio
management practices. But todescale to say, Okay, we've
noticed there's a type of thingthat constantly hits three
groups, four products. Are theyreally products? If that's
(17:35):
happening this, you know, cryptothing that keeps hitting these
four products in our world? Doesit make sense for us at this
point to organize a productaround crypto so that we can let
that area focus on it work on amission, on bringing us to the
age of crypto. That's aportfolio management decision to
(17:58):
reconfigure, to reorganizearound products. If you don't do
that, I think you're missing thepoint on being a product
oriented portfolio managementapproach. For me, that's the
essence of it. Another essenceis, if you talk about, what does
it mean to be an agile portfoliomanagement approach and that
resilience, it's both theability to change where you're
(18:21):
heading, and that's coming fromlimiting the amount of work in
process and providing moreintake opportunities. And not
just plan the entire year, planmore frequently, but an even
harder transformation ortransition for the organizations
I see is, once you startsomething, once you commit to
(18:45):
actually working on aninitiative, how often do you
look at whether it's trackingtowards outcomes? We talk about
evidence based management,applying evidence based
management for these strategicinitiatives. What does that look
like? How do we know that ourinvestments in crypto, let's say
or Gen AI for improving thedeveloper experience, or for
(19:09):
helping our tellers, you know,you know, achieve more in their
day. How do we know that it'sworking effectively, that it's
achieving. You know what weintended to achieve there? And
do we, are we even open? We talkabout the scrum values of
(19:30):
openness, it's very hard forportfolio leaders that I've seen
to be open to the possibilitythat we were missing the mark,
that we were wrong with ourassumption that we need to do
crypto. Go tell any sales personthat sold. You know, a big deal
based on if we have that featurethis customer will buy. Go tell
(19:54):
them, you know, that there's achance that the cost. Customer
won't buy even if we build thatfeature and it worked.
Dave West (20:05):
Yes, having been the product manager that was forced
to introduce stuff that actuallynever got product market fit,
even after we introduced it,I've definitely felt that that
and so you just to pull on thatthread for a second, the thing
that we tend to fund? Well, one,we need to fund outcomes. Yes,
(20:28):
totally. Initiative needs tohave a clearly identified
objective and a set of resultsassociated with it, whether
using OKRs, EBM, whatever. So weget that. And that resonated
really well from the webinar.
The other thing that wasimportant is that that what's
you don't have to discovery isan explicit you need to have
discovery and then make adecision. Now that doesn't mean
(20:53):
that you can't align to it. Itdoesn't mean does it, and it
certainly doesn't mean that thatshould be done by a separate
team that isn't part of yourstandard delivery organization,
which is often the case in theselarge organizations, you go off
and do a POC proof of concept,separate group of people build
up something, prove someassumptions, which basically
(21:13):
means aligning to yourexecutive, say the things that
they want to hear, and then Theygive you the money. But you need
to basically drive that intothose teams in a discovery
fashion, and then build thatlearning outcome out to make the
decisions. And I think that thatthat's hard to do, but I think
(21:34):
it's crucial, because otherwiseyou invest in things that that
that ultimately don't give youthe value that you seek. I think
Yuval Yeret (21:46):
I want to be careful with how we talk about
funding. I think a key role ofthe I Agree, a key role of the
portfolio is to to managefunding, but we manage that
funding in two distinct ways. Inin my experience, one is we fund
products, and we empower teams,products, managers, owners that
(22:12):
own that product, to go, achievea mission. To go, achieve a
strategic goal. We fund anoutcome that we trust them to go
and deliver. And they'll dodiscovery, they'll do delivery,
whatever. There's a certaintransparency we want to that
from the portfolio level, but wewe're not going to manage that
hands on. Yeah, there are someinitiatives, typically those
(22:37):
that are cutting across that arethe most strategic, biggest
opportunity, biggest risk,biggest interest for the
portfolio, leadership team,whatever. Hopefully that's 20%
of our funding or or of thework, not more than that. But it
depends, and for those we wantto to to introduce and use that
(23:01):
discovery process that you'retalking about more explicitly,
those would be the initiativethat we will manage on the
portfolio Kanban board, forexample. And on that Kanban
board, yes, there should be somediscovery phase that gives us an
opportunity to after we decidedwe want to invest a little bit a
(23:24):
seed round, if you want to callit that, for that initiative,
see that we want to invest morethe whether that work is done by
the same teams or other teams,you know, is a Separate concern.
In my experience, I like thefact that the same teams do the
(23:45):
discovery for the work, but Idon't want to prescribe it
necessarily. There are very goodreasons to work that way. But,
you know, that's a prescriptionthat's not necessarily part of,
you know, educational principlesand practices.
Dave West (24:03):
Yeah, I don't know. I don't want to spend too much on
this, but my experience is whendiscovery is done outside of the
delivery organization, not onlydo you only consider you don't
have a big enough understandingof the risks and challenges to
delivering that capability intothe thing that we already have
in in market. But also there's acertain level of ownership that
(24:29):
is missed, which then requiressignificant amount of work to
gain that you know, engineers inparticular, and obviously my
experience is software products,right? Are very good at saying,
well, that's a really good idea,but it wouldn't work here that
and, yeah, but I don't want Iagree that I'm not sure it
should be prescribed howeverthere, if there is a cost, if
(24:50):
you don't, and I think that'swhat I meant, the one
Yuval Yeret (24:54):
thing I'll let's emphasize one thing, the
discovery should be. Focused onthe main risk with the
initiative that we'reconsidering. Yeah, main risk is
visibility. It should be, youknow, a technical discovery. It
should be a technical proof ofconcept. The engineers should be
(25:15):
involved. But a lot of the time,especially these days, the main
risks are desirability andviability will will the
customers come? Is it somethingpeople really want, really need?
Are we thinking about the rightuser experience? And there's
(25:35):
this anti pattern of we focustoo much on this solution, way
too early that we need to weneed to help organization around
we need to think about theproblem, market feed the before
we dive into the solution. And
Dave West (25:54):
perhaps I've just been badly burnt though my other
learning is that if we teachdelivery organizations how to
separate those concerns in amore effective way, teach them
how to do real discovery, thenyou get that. You get the
benefit, obviously, in allsituations, not just the ones
(26:15):
you think are discoverysituations, because then
suddenly they challenge everyassumption in a way that is a
lot more effective anyway. Ididn't, I don't want to get too
bogged down in that area. Ithink, I think there's a lot of
opportunity to improve how we dodiscovery across organizations,
and when it starts, and how muchit costs and you know, and how
(26:41):
you make it transparent, whichis that what I do, though, want
to a couple of things. There'sgone. There's so many things.
One thing is about you said,Let's not plan everything for a
year, for two years, for threeyears up front, and accept that
we're gonna I think that's whatyou said. Yuval Darryl,
obviously you worked for largeorganizations that wanted some
(27:06):
level of stability in terms ofthe time frame. So it's
impossible to be prescriptivehere, however intent wise, what
should the cadence be? Even fora large organization of their
portfolio planning. We talked Italked about QBRs quarterly
reviews. I talked about annualplanning cycles in the in the
(27:28):
webinar, was that too naive?
Should I have made that moreprecise what? There was a number
of questions about that.
Darrell Fernandes (27:36):
Yeah, I think it comes down to confidence
levels. Dave, so where we triedto get in multiple organizations
was a place where we weremanaging a rolling 18 month
calendar of investments, and thenext six month view was more
confident than the following sixmonths, which was more confident
(27:59):
than the following six months.
So do you need an annualplanning cycle so you can look
at your annual financials as anorganization, your annual
budgets? Yes, you do that,right? But, but that doesn't
have to be a ceremony, a one offceremony. If you have a rolling
18 month planning cycle, youjust take if, if your fiscal
year is January to December. Youtake your whether you're doing
(28:22):
it every six months or everyquarter, hopefully every
quarter, you take your Q for 18month planning cycle. You look
at the the next window of time.
You can, you can define and youcan, you can summarize your
basic annual plan based onwhat's already in motion, and if
(28:45):
something new comes up that youwant to do in that following
year, that's your opportunity toquestion what, what trade offs
are you willing to make in orderto make that happen, whether
it's discovery, whether it'sexecution, but if you have that
rolling 18 months, it no longerbecomes a a one off ceremony. It
becomes the way you run yourbusiness, which is the ideal
(29:08):
that we were always workingtoward, towards. I can't say
that in any instance, we got allthe way to that, but we did
reach levels of maturity wherewe were just continually looking
18 months out, understandingthat the fiscal year snapshot
was just a picture of the next12 month cycle and the 18 month
planning cycle, and we had adegree of confidence and a
(29:31):
degree of commitment to what wasgoing to happen in that 12 month
cycle.
Yuval Yeret (29:36):
I listened to Daryl, and what I'm hearing is a
product owner. I mean, we'retalking about portfolio
management here, butessentially, what we're talking
about is, you know what we'vebeen talking about in scrum all
along. We are planning everysprint. But that doesn't mean we
don't look into the productbacklog. That doesn't mean we
(29:59):
don't have. The roadmap. TheRoadmap should provide some
balance of predictability andflexibility, depending on how
important these two aspects areto us in general, I would say
when we're looking at a productoriented portfolio, we should
bring with us everything that weknow from team level Scrum, from
(30:25):
team level agility, it's a lotof the same practices apply.
Most of the same practicesapply. Flow applies. Of course,
we have two audiences. What Isee is two audiences that tackle
portfolio level agility. One ispeople that have been doing it
in the trenches and are dauntedby working with the portfolio
(30:50):
level. What they should be maybedaunted by is, you know, working
with like, you know, leaders atthat level with concerns at that
level, they shouldn't be dauntedby the practices that we use.
They should leverage thepractices that they've learned
and mastered over the years. Theother audience is portfolio
(31:13):
level leaders, whether it'spMOS, product people at the
portfolio level, productleaders, CIOs, that don't have
that expertise in agility, whatwe need is, you know, to use the
language. What I found useful isto use the language from team
(31:34):
level agility and work withthese people. And the advantage
is, once you manage to get thatlanguage across, the power of
actually enabling agilityelsewhere in the organization is
multiplied. You start to havepeople at the right level of the
organization talking about focusand flow and steering using
(32:00):
evidence and discovery, andsuddenly all of the practices
that the teams in the trenchesare using start to make more
sense, and you have people thatare actually on board for
helping these teams work in aproduct oriented fashion,
because they know the language.
Dave West (32:19):
And the other thing that you end up doing is
removing all that translationthat reforming i I've worked
with a number of organizationswhere basically Scrum Masters
and product owners and deliveryleaders spend a lot of time
reframing the Work into adifferent context for the
(32:41):
purposes of red, green, orange,Amber, and these corporate
dashboards that that that make alot of sense if it's about out,
if it's about work, you know,sort of like outputs delivering
to plans, but make very littlesense when you're actually
trying to determine the valuethat each product's providing,
(33:05):
there is a question that I didsee over and over again, which
was really the We the idea ofvalue. So you've got a portfolio
of many different products init, and each of those products
potentially is valuable in adifferent way to the
organization. You know, Daryl, Iknow that used to manage things
(33:25):
in the data space. Now, let's behonest, selling, selling a
financial product much easier towork out value than providing a
data service to multiplefinancial products. So you don't
get sued by the by some sort ofgovernment entity because you're
misrepresenting the data indifferent contexts, or the
European Union comes in andgdprg to death, or whatever,
(33:49):
hard though to articulate valuein a consistent way to determine
investment. So how do you getthat consistent definition of
value across the portfolio. Isit even possible? I think,
Darrell Fernandes (34:03):
I think Dave, the way I would look at that is
your value is different, right?
A website or a web page has adifferent way to articulate
value to the business. It's inoperational cost, transaction
cost, customer engagement, thosekind of things ultimately
leading to business value,right? ROI of of the page is
(34:25):
there, but it's throughdifferent metrics that you get
there, right? Customer Data isabout operational efficiency. In
some cases. How can we maximizeand not have redundant storage,
not have redundant databases,not having redundant
capabilities. So there's anoperational efficiency, there's
a risk management piece of thatthat comes together. But again,
(34:49):
there's a there's a customersatisfaction that if the name,
if a customer corrects theirname, they do it once, and it
cascades to every place in theorganization. Because you manage
your data well, so there aresimilarities, but I wouldn't
want, I never was able to get toa place, and I'm not sure it
would be worth the effort to getto a consistent definition of
(35:10):
value across every product inthe portfolio. When you get to
the initiative level, the OKRsfor the initiative should be
able to cascade down into whateach of the product teams drive
through their value statements.
I've never had a challenge wherethat couldn't be aligned. But it
isn't a little bit of analignment exercise there that
(35:33):
you have to look at theportfolio, at the products, and
what drives value for thoseproducts, especially when you
get into new areas where you'reexperimenting with new products,
because you're still trying tofigure out and work out what the
what the market value is foryou've done the research, you've
done the discovery, but you'restill trying to figure out for
you, how do you scale to get tothat value? What does that look
(35:55):
like? Where are the barriers?
Dave West (35:58):
Yuval, what do you say you I mean, you're working
with a client that has manydifferent levels of value, some
of it very external, dollars andcents, some of it more internal,
operational efficiency, youknow, risk, etc.
Yuval Yeret (36:16):
Well, operational efficiency has dollars
associated to it, I mean,eventually allows you to start
trading in more countrieswithout growing your support
team, or some other things youcould do if you improve your
operational efficiencies. Butwhat I'm seeing work, work well
(36:37):
is similar to what Darrell isdescribing. You align on what
are your strategic goals? Whatare you focused on as an
enterprise, as a portfolio? Inthe case that we're talking
about, it's multiple portfolios,but they're aligned to one set
of enterprise strategies.
Hopefully that's a consistent,small set that allows you to
(37:01):
make value trade offs throughoutthe enterprise, not something
where everything you know couldmap into in which case
everything is valuable andthat's not valuable. Once you
have that, I agree with Daryl,you can start to ask yourself
for each one of those productgroups, what could it do to help
(37:22):
our strategy? How important isthis to supporting our strategy?
And that should help you decidehow to fund it for the next
year, or how to think about itand for each one of those cross
product initiatives, again, youshould be able to talk about,
how does this relate or align towhat's strategic for us? Another
(37:46):
technique is, you know, to usecost of delay. Reinerts talks
about, you know, whatever it isthat you're doing, if you're
working at the portfolio level,bring the finance people into
the room that they will help youfigure out, you know, the
numbers. They can turn a lot ofstuff into numbers if you talk
(38:07):
to them, we're afraid of talkingto them a lot of the time, but
bring them into theconversation, and there's a lot
that you can actually do, costof delay for and bring things to
the to the same playing field,and if you cannot, if you are, I
don't know, for example,Microsoft and you're trying to
(38:27):
compare the value of, you know,a new feature for Xbox Live
versus some new gen AIinitiative. First of all, you
know, you could probably get itto dollars, but another
(38:48):
indication is that they're notthe same portfolio. If the
conversation is so disparate, sodisjointed, maybe it doesn't
make sense for this to be aportfolio. A portfolio should
have a business model that makessense for it. There should be an
economic framework that'sdriving that portfolio, that the
different products in some wayfit into that model
Dave West (39:16):
that's kind of deep.
There was, I'm reminded of aUniversity I studied a something
called cybernetics, which had athis guy called Stafford beer,
who built economic models andthen used computers, and he
ended up running a small countryin or helping run a small
country in South America, whichthen had a revolution, and his
models were blown up. But, butwhat was interesting is trying
(39:38):
to define value, and Mars is areally interesting organization,
because what they're doing isthey're building something
called it's, it's, it'sbasically a balanced scorecard
for for investments that is muchbroader than just, you know,
immediate revenue. It's sort ofimpact, impact based. And it
really interesting. So, gosh, wecould talk about value for an
(40:02):
entire podcast, if not longer,but it is an interesting idea.
The point that you raised,though, I think, is have that
conversation, bring in thefinance people use techniques to
look at it from differentperspectives, and then try to
find something that balancesconsistently value across your
portfolio. And maybe you have toaccept that they're different
(40:24):
things and they need to bemanaged in separate portfolios.
You should you know yourcharitable contributions are
different to your capitalistcontributions as it were,
whatever, which is interesting,hey, oh gosh, we're coming to
time, and I need to bring thispodcast to a close, at least
(40:44):
this first version we I've putmy my Kanban board up, and I've
discovered, you know, that ourflow is quite slow. And out of
the seven topics, we managed toget two guns so we have we might
want to look at our work inprogress and move our flow a
(41:05):
little bit better for the nextpodcast. I really do think there
should be a next podcast.
Hopefully you two will sign upfor that. But I guess if we're
going to leave anything from ourlisteners with in terms of what
came out of today's discussion.
We talked about getting started,we talked a little bit about
value. We talked a little bitabout transparency and applying
(41:28):
these team level agile conceptsto the to the enterprise level,
to the portfolio level. Is thereanything else that our listeners
should take away from this firstdiscussion, I
Yuval Yeret (41:44):
hope they they took the concept of, this is a
fractal. The same principlesapply. And the concept that it
is a trail map we're not goingto provide, you know, a detailed
process. It's not necessarily, Imean, yeah, you could say it's a
framework, but there aremultiple things that you can try
(42:09):
doing depending on where youare. The most important thing is
to start thinking a differentway. Start thinking from a
product oriented perspectiveabout your portfolio.
Darrell Fernandes (42:22):
I think that's the key Yuval. If you
don't start thinking about it,contemplating it this way,
looking through the lens fromthis perspective, you'll never
appreciate the value you can getfrom it. So you have to take
that leap and start to explorein order to decide which path is
the right path for you.
Dave West (42:42):
And if you don't, this is digital enterprise, a
software centric organizationthat's going to be doing that
and building features andcapabilities in their products
that are going to basically beatyou. So if you don't start
thinking in this way, I thinkultimately, as successful as you
(43:03):
are today will ultimately beyour ruling in the future. So
thank you gentlemen for joiningus today. I really, really do
appreciate it. So we were heretoday. Listeners focused on
really the Agile productoperating model, the product
portfolio management element ofit, talking about a webinar that
(43:24):
was run recently and thequestions that came out of it.
We talked about getting started.
We talked about agility atscale. We talked about the
importance of getting leadershipto understand that at the
portfolio level, and really,then really talked about the
importance of value and how youcan effectively build that
balanced scorecard. Thank youfor joining us today. I really
(43:47):
appreciate you listening to thescrum.org community podcast. If
you liked what you heard, pleasesubscribe, share with friends,
and of course, come back alittle some more. Maybe this
topic will continue. I know wehave, gosh, almost five
questions still outstanding thatwe need to address. I'm I'm very
(44:07):
lucky that I get an opportunityto talk to a variety of guests.
Obviously, today we had YuvalYvette and Daryl Fernandez
talking about portfoliomanagement. But I'm lucky to
talk to a variety of gueststalking about anything in the
areas of professional Scrum,product thinking and, of course,
agility. So thanks for listeningand Scrum up. You.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
On Purpose with Jay Shetty
I’m Jay Shetty host of On Purpose the worlds #1 Mental Health podcast and I’m so grateful you found us. I started this podcast 5 years ago to invite you into conversations and workshops that are designed to help make you happier, healthier and more healed. I believe that when you (yes you) feel seen, heard and understood you’re able to deal with relationship struggles, work challenges and life’s ups and downs with more ease and grace. I interview experts, celebrities, thought leaders and athletes so that we can grow our mindset, build better habits and uncover a side of them we’ve never seen before. New episodes every Monday and Friday. Your support means the world to me and I don’t take it for granted — click the follow button and leave a review to help us spread the love with On Purpose. I can’t wait for you to listen to your first or 500th episode!