February 27, 2025 • 53 mins
In part two of this portfolio management Q&A, Dave West, Yuval Yeret, and Darrell Fernandes tackle the complexities of funding products vs. teams, especially in nonprofits. They explore shifting from work-based to product-based funding, managing technical debt vs. product roadmap progress, and aligning business and technology goals. The discussion highlights the role of initiative owners, evidence-based management, and finance partnerships in driving effective portfolio decisions. They also explore the concept of working cross-product. Tune in for insights on creating a more sustainable and impact-driven portfolio strategy.
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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
is part two. Gosh, we liked itso much. We've come back for
more. So part one and now PartTwo was a podcast focused on
answering the questions thatcame out of a recent agile
(00:42):
product, operating model,product portfolio management
webinar. We got a lot ofquestions. We started answering
them, and we only got, actually,for the first two. So you know,
if you're looking at my Kanbanboard, we didn't get we didn't
move many across the board. Sowe've got some more to talk
(01:02):
about today, and just like inpart one, I've enlisted two
people to help me with answeringthese questions, Yuval, Yvette,
PST, an expert in the field whocan blend lean portfolio
management Kanban andprofessional Scrum, sometimes
while on a a treadmill, which isvery impressive to see. I'm not
(01:27):
going to lie there. Welcome tothe podcast. Your Val, thank
Yuval Yeret (01:31):
you, Dave, not on a trend. I'm standing on the
treadmill. I'm not walking on
Dave West (01:38):
there we go. Which is which is good, which is good.
I'm glad you, because you'remaking me feel really bad. And
then we've also very lucky tohave dar Fernandez, executive
advisor to scrum.org, ex CIO anddelivery lead for two very large
financial institutions, and he'sbeen applying product thinking
(01:58):
in their portfolios, Tia andFidelity Investments. So we're
going to share some of hisinsights there. Welcome to the
podcast, Darryl.
Darrell Fernandes (02:09):
Thank you, Dave. We're looking forward to a
conversation
Dave West (02:12):
part two, so we started. So maybe listeners, if
you've not listened to part one,you probably should, but that
doesn't mean that you can't getstuff out of part two, I'm going
to jump straight in to thequestion that we're that's on
next on my list, which is aroundbudgeting and funding. We've got
(02:35):
a couple of questions here, butreally the first one is, I'm
concerned that funding theproducts versus funding the
teams won't work for fornonprofits. And I think the
question was, one of the keyconcepts of the webinar, was,
fund the products, not the work,and that, that's a fundamental
(02:59):
sort of concept. And this, thisquestion really says, Hey, we're
already far too busy. We'vealready got like 87 initiatives.
How the heck can I fund theseproducts? Instead, what I'm
doing is I'm funding work andhoping that the products evolve
in parallel. So I know you'veall you must. You've, you're
(03:21):
doing this actually, at themoment with a large
organization, there's a lot ofthings moving. They've, you've
got people that are already too,too busy, and suddenly are
adding product on top. Whatwould be your words of wisdom on
that?
Yuval Yeret (03:36):
I don't know that it's wisdom, but more often than
not in the organizations that Iwork with, the funding model
already funds teams. I mean, wesay products, and you know,
there are differences in how wework in product oriented ways,
(03:57):
but funding teams is prettycommon now in situations where
you fund the teams, it doesn'tmean that the teams aren't busy
working on too many initiatives.
It means you have an issue ofjuggling too many initiatives
that you need to deal with. Andyou know, the way around that is
to start to see the flow andimprove the flow. We can talk
through that, but it's not afunding concern. It's not that
(04:19):
the funding model needs tochange. On the other end, in
organizations that do have afunding model for initiatives,
again, the key challenge thatyou need to face. There are two
challenges. One is, are wewilling to change our funding
model and fund stable teams andget decouple the funding and
(04:42):
budgeting conversations from theteam structure in what, what
work are we doing? Conversation?
Essentially in your annualoperating plan, say these are
the teams or groups, or if.
Portfolios that we have, andthis is their operating budget,
and it is what it is. And nowwe're empowering product owners,
(05:05):
portfolio owners, whateverlevel, to do the right thing.
The key challenge there issometimes political, because in
organizations where the work isfunded based on initiatives. You
often have finance people andPMO people that are managing,
(05:25):
you know, those investments andare managing to this funding
moving to a mode where you findteams, often, is a big change
for these people, and you knowthe feeling that they're losing
control, and you need to givethem an alternative. Evidence
based management is analternative that can, you know,
(05:48):
show them that there's value inthe work that is being done. But
it is a change. And again, thischange is very different than
you have lots of things inflight, and you need to focus on
fewer people. And that would bea concern regardless.
Dave West (06:06):
Okay, so, gosh, there's two things there. I do
want to lean in a bit on this,you know, fund the work thing,
because I think that we have, Ihave some examples of where that
isn't the case, and it is a realchallenge. But the you sort of
dropped a bombshell about pMOSthere, Yuval, that I just need
(06:26):
to, well, I'm not sure we'llfinish it, but bring up. So what
you're saying is that pMOS, whohistorically have managed these
complicated I mean, we've allfilled in timesheets, you know,
which I remember that was myFriday afternoon after the pub,
which I'm not sure that was agood thing or a bad thing, but I
got through it. But the thesepeople that are in these
(06:49):
organizations, in the PMOproject offices, etc, are going
to have to basic, well, youwould encourage them to change
what they're focused on, toreally coaching and enabling
evidence to be the primarymechanism of progress and
building, dare I say, dashboardswith the teams to demonstrate
(07:11):
progress against that evidence.
Because that, that's, that's abig change to most pMOS,
Yuval Yeret (07:17):
rather than that.
Oh, a bit more than that. Okay,if you're moving to a product
oriented portfolio, one of thekey things that you're doing is
you're saying, If, until now,let's say 80% of my budget was
allocated to initiatives, and20% was business as usual,
(07:37):
change management that you trustand empower teams to work on.
It's typically what you want todo is not just manage the same
initiatives using productorientation. You actually want
to push a lot more of the budgetinto these product teams,
(07:58):
product groups, and tell them,here's your budget, here's 50%
of the overall budget, whateverthe number you need to come up
with. What makes sense, but yougo manage it. I'm not gonna
micromanage you. I'm not gonnatell you how to work on this
initiative. There will be fewerinitiatives that need
(08:19):
management. There would be fewerprogram managers, you know, that
will be busy, busy runninginitiatives in the organization.
There would be more productowners, product managers
throughout the organization,that make decisions around what,
what features, what you know,investments make sense, what
should be in those productbacklogs while the funding is
(08:41):
stable. That's a meaningfulchange that. And you know that
there's the conversation aroundmoving from program management
to value management and beingenablers and having a different
role in this organization.
That's a huge change for forpMOS,
Dave West (09:04):
Daryl, you've been a little quiet, and I apologize
for that, as we talked aboutthis, but tell me, you know, in
the organizations that you werepart of, and you don't have to
obviously, share any secrets,but that's the kind of change
that you were driving. I meanthis value management, rather
(09:26):
than portfolio management. This,you know, the ownership your
Darrell Fernandes (09:31):
outcome, yeah, outcome impact driven
right? And empower the teams toto get to that outcome. There's
balance, right? There's balancein the long term, sustainability
of the deliverable versus theshort term feature function of
the deliverable, but, but theoutcome of the impact is really
what you're trying to drivetowards. In this particular
question. It's interesting tome, so I'm going to do a little
(09:54):
bit of a pivot, because I seetwo things in this question that
intrigue me a little bit. Oneis. I see a notion that there's
these product teams of one, orthese product teams of one or
two, and those those individualsare overwhelmed. And I can look
back to the Phoenix Project as agreat example of flow and flow
constriction. And it's it's notin the app dev side, it's more
(10:16):
in the dev ops side, but itstill talks a lot about the same
challenges that you see herewhen you have app dev product
teams of one or two, where youjust you can't get all the work
through and take taking a stepback from that you generally
want to build broader. You mayonly have funding for one or two
people, or ability to invest inone or two people in a product,
(10:39):
but you need to then join otherother products together to
create some structure thatallows you when priorities drive
to go wider than one or twopersons of capacity to deliver
value, right? So you have toreally take a step back and
evaluate whether these productteams of one or two are the
(11:00):
right thing for yourorganization in most cases, when
we came across those, we took astep back and said, We need to
merge some things that ourproduct teams are one or two
that have like dev skills orlike business partners, etc, to
get more capacity and theaccountability then becomes a
little broader, because you haveto balance across multiple
(11:20):
outcomes. It's a little harder,but you have that capacity on
demand, quote, unquote, when youneed it to deliver true business
value for a specific reason. Sothat's one piece, the other
piece that's pretty interestingabout this question, less about
our topic at hand, maybe, butnuanced in the nonprofit piece
of this question, which inmission based organizations,
(11:41):
priorities are really hardbecause everything is so
important to the mission, and insolving the problems towards the
mission is such a almostemotional effort that it becomes
hard to prioritize. And so whatI read into this question a
little bit, and this is me kindof doing way more, way more
(12:04):
interrogation than is probablyappropriate. Is that this
particular organization probablyisn't prioritizing, well, right?
They want to do everything witha limited set of resources, and
there's not clear ways to tobalance the most important
things with the less importantthings. Everything's important
because it's a mission, right?
So, so everything becomesimportant and that becomes a big
(12:26):
challenge. I think the productmodel and the portfolio
management on top of the productmodel can actually expose that
risk and expose that challengein a different way, and if you
use it to your advantage, Ithink forcing those
conversations at the portfoliolevel, through this vehicle
becomes a value add, and I thinkit can, can drive the
prioritization to the rightlevel of the teams necessary to
(12:49):
help the people doing the workdo the most important work,
because it's all important. So II know that's a little bit of a
pivot from the from the programmanagement side of the question,
but, but that's kind of where Isaw this question going. So
Dave West (13:08):
I mean, running a mission based organization value
and impact against that missioncan sometimes annoyingly, I have
to be honest, brings that upwhen we have our regular
meetings about how I'm runninghis his business, and the, you
know, sort of impact, impact andvalue, everything that we do has
(13:32):
to have any has an economicelement, but it also has an
impact element, and we have tobalance those. But it's about
making choices. And choices arereally hard to make,
particularly as and this is theother thing about mission based
that you're not non profit. Youknow these sort of organizations
you you know your stakeholdersare in. You really want to
(13:54):
satisfy those stakeholders. Andchanging priorities is as a huge
impact, maybe a personal, humanimpact, which which we don't see
so much in a big financialorganization, maybe so
interesting. So I do want tolead us to another topic around
budgeting, though, that is, youknow, that sort of CapEx, these
(14:15):
timesheets, putting time intothe right buckets, you know,
making sure you capitalizeappropriate investments. I
remember when I was my firstjob, 92 I think it was
commercial union, which nolonger exists, not, not because
of me, just, just for therecord, they got merged with
(14:38):
another insurance company andthen brought into another one
and the huge Aviva, amazingorganization, actually, big
scrum shop anyway, but sorry,but the I remember having to
create time sheets on thatFriday afternoon, and I remember
one of the motivations for doingit, one of the reasons why my
boss, Geeta Shah, said that Ineed. To do it was because of
(15:02):
the way in which money was beingcapitalized, etc. So you had
projects, and you had workinside those projects and and
all this sort of stuff does.
Does that change with theproduct model? Now you, you
know, you, you obviously livethis. You worked a lot with
finance. Obviously, fidelity isa different perspective than
maybe Tia on this. But whathappened? How can you do it? You
(15:23):
can
Darrell Fernandes (15:26):
do it. It takes work, right? It's not
free. Capitalization can't beunwound if you have significant
capital portfolio,capitalization happening can't
be unwound in a single cycle. Ittakes. It takes, in cases,
years, if you even choose to tolessen your capitalization
(15:47):
approach. So you have to findtools that allow you to track
the work in a way that that canstill be capitalized and still
solve that business problem,which your P and L requires,
right? If you've got that builtinto your P and L, you can't
ignore it. You have to solve forit. So you've, you can, you can
(16:09):
use feature tagging, which is anapproach to that. And you can
automate feature tagging if, ifyou're still tracking hours, it
becomes easier. Manyorganizations have walked away
from tagging hours and kind ofgotten to a model where they do
associate allocation of theirFTEs, which is a estimation of
(16:32):
how much work is happeningagainst features, and those
features are then tagged and ina discretionary or a non
discretionary bucket. So thereare ways to do it, and there are
ways to automate a good portionof that and simplify it, but,
but it must be done. You can'tjust turn it off, at least in my
experience, because of thefinancial impacts to turning it
(16:54):
off, in a immediate sense,become too big to explain, and
so you have to find a way tomanage through it. And maybe you
choose to through a glide pathover years, wind out of your
capitalization. Maybe you don't.
That's a business decisionthat's market driven. There's,
there's a lot of things outsideof product delivery that go into
(17:16):
that.
Dave West (17:20):
Yeah, so I mean, and you worked through this with
finance, so basically, byinvolving your CFO, and you know
that part of the organization,who actually, from my
experience, and maybe you Val,you're going to say, I'm wrong
here when, when I asked, comesto you, but my experience is
those people really want tohelp, but they actually don't.
(17:43):
They don't want to be abottleneck, a hurdle, a burden.
They actually want to drive goodstuff into the processes.
Absolutely.
Darrell Fernandes (17:54):
I'm sorry, Yuval, just one thing, and then
I'll flip it to you when youtalk about this approach, and
the fact that it's evidencebased, and it brings more
transparency than maybe otherapproaches. They actually really
want to jump on board, becausethey're not used to having that
level of exposure and andclarity to what what's actually
happening. Yuval, I'll flip itto you. Sorry, yeah,
Yuval Yeret (18:16):
I would agree, in general, but it is you change
and finance. People are not thepeople you know that risk is
something that they would liketo avoid, even when they're in a
business of, you know, helpingpeople manage risk. So what I
found is the evolutionary pathworks like you don't have to
(18:43):
change how you do yourcapitalization and your time
sheets on day one of workingtowards a product oriented
portfolio management approach.
You, you know, like we do withvelocity based on story points
versus throughput, don'tnecessarily throw away your
(19:03):
story points on the first day. Imean, I, you know, I'm a content
trainer. A lot of PSDs aresaying, No, you know, don't do
story points, partially becauseyou know what we've brought into
the community. But you know, whynot use them in parallel for a
while and see that it makessense to, you know, to trust the
(19:27):
throughput, and there's noadditional value in what you get
with the story point. So here aswell, do Timesheets in parallel
to doing feature tagging orusing, you know, new tools that
can associate check ins to thecode base with JIRA tickets and
(19:49):
show you stuff. There's lots ofcool stuff that's available
these days, but run it inparallel and see that. Then.
Evidence that you get makessense, and over time, maybe you
can start to remove thosetimesheets. That's what I'm
seeing most of. To be honest,most of the clients I worked
(20:11):
with, it took them years, if atall, to stop doing timesheets as
part of this, because it wasn'tthe biggest fight worth fighting
at the time.
Dave West (20:25):
They though I am, I'm afraid, reminded of so I had to
basically get 40 hours everyFriday afternoon. And I we used
to have a, this is England inthe 90s. You go to the pub of
Friday lunch, and I'd come backand I look at the projects, and
there was and I'm like, Oh,where are we against those
projects? How much have wespent? And then it doesn't
(20:47):
matter what I did that week, Iwas completely the opposite,
really. I mean, yeah, and thenyeah, and just tried to, then,
oh, and get it to balance. Andthen if it didn't balance, my
bosquito would be like, all overme, and I'm like, I've got,
well, I didn't work on that.
She's like, Well, can you makeit work? But it does take time,
and I think the transition andseeing and getting that
(21:11):
transparency of the change, Ithink it's a bit of a theme for
the change that we'redescribing. Try things, see what
they go that doesn't mean throwaway existing processes
overnight, but at least involvepeople in the change from
finance and and all good thingscan happen. Right? Apply
Yuval Yeret (21:32):
evidence based management. For words, evidence
based management. Dave,
Dave West (21:37):
oh my god, it's going to be turtles all the way down
now. Yuval, so I'm going to getconfused, but yes, it's like,
you need to adopt this in anagile way, using evidence to
drive change and and that'swhether we're talking about
portfolio management, whetherwe're talking about, I don't
know, how we manage features,whether we're talking about
(21:58):
stakeholder engagement, whetherwe're talking about
organizational constructs,governance, compliance. If you
don't use an incremental,evidence based approach to this
very complex socio technicalsystem, you're always going to
be in in trouble. I mean thatthat is, that is the reality.
(22:19):
And yes, this is just one otherthing, all right, so carrying
the theme about, um, let's talka bit, a little bit about the
this, this. I that thisportfolio strategy, you know, we
talked a little bit about, youknow, the choices. But
ultimately, this particularquestion is, how does product
(22:41):
portfolio, strategy change? Ifyou're in a fast startup Tech
with fluid teams, technical debtpiling up all over the place,
they're doing a lot of supporttype your teams are now having
to do a lot of support typeactivities. You know, would you
focus on stabilizing. Thequestion was, would you focus on
(23:03):
stabilizing the product,mitigating that, technical debt,
managing that? Would you focuson, you know, just keeping the
systems going? I actually had avery similar choice to make
when, when I came in as a CPO oftask we had, you know, we were
bootstraps, so we're having topay people, you know,
(23:24):
surprisingly, on the revenuesfrom the products. And I had a
bunch of customers that we'dsold a story to that maybe our
products didn't quite live up toand I but I also had a product
roadmap that that we were usingto drive investment, talking to
VCs, etc, and I wanted todemonstrate progress against
(23:45):
this roadmap. Whilst trying toit was really we were
transitioning from a servicebased company to a product based
company. And it was, it was onlybecause of the inspirational
leadership of Mick Kirsten andneelan and and some others that
provided me the air cover thatallowed me to to do that,
because we made the choice thatultimately the long term value
(24:08):
of the business was going to besearch, as a product company and
as a services company. Yeah, wemight be able to build up. So
this is business for a bit, butthat isn't the long term
strategic value of the business.
So, so I've lived through this,what would you say? You know, I
don't know who wants to youknow, you've allowed you when
(24:28):
you're in this situation whereyou've got a product, you've got
teams aligned, you've got a roadmap, you've got stakeholders,
and you you've got support theoperational element. What you
do.
Yuval Yeret (24:41):
So we need to remember that we're talking
about portfolio, productoriented portfolio management
here. But the answer to theproduct level is both, you know,
turtles all the way. It's whatwe use to make. Distinctions.
And the other piece of this iswe want, in the portfolio level
(25:05):
to create an environment whereproducts are empowered to make
decisions. So if I was in theposition of being a portfolio
leader, first of all, what Ineed to understand is, okay,
what is my situation and what doI want my strategy to be? And I
don't know what's the rightbalance between eliminating
(25:27):
technical debt and keepingcurrent customers happy and
working towards future horizons,but I need to come up with one.
I need to see transparentlywhat's the current level of
investment and set guardrailsfor where do I want to be now
those guardrails, I don't wantto be managing them on a day to
(25:48):
day basis. What I want is tocommunicate them to the
different products, so thatproduct managers, product
owners, owning those productswith their teams, can make
decisions day to day in a waythat is aligned to the strategy
around, how do we want toallocate our capacity around
(26:08):
these, these different concerns?
That is a portfolio managementconstruct? How do we provide
strategic intent around types ofinvestments? And not just what
is the strategy, what are thegoals, but also types of
investments, but creatingautonomy that is aligned to
those investments and
Dave West (26:31):
supporting the challenge, you know, that my
team had, particularly as theyyou know, I initially, I had one
scrum team. Let's not, let's notbe grandiose here. And that
scrum team was very much. Theyhad very strong relationships
with those clients, becausethey'd sold the product back in
(26:53):
the day before I joined,actually, and it was really hard
to go and say, Look, you'regoing to have to say no. In
fact, you're not going to haveto say no, is what we ended up
I'm going to have to say no. Soyou give them to me as the
product owner of that product,and I'm going to have to talk to
them. And that took a bit oftime. Guard rails, we exactly
(27:17):
had those, and we put those invery quickly. We had a CEO with
Mick Kirsten, who lovedmeasuring things, so everything
was in this really comprehensiveSo, and when we slipped on those
guard rails, we hadconversations about it, and we
did slip, but we made choices.
You know, making payroll was onechoice we often had to make. And
(27:39):
the, you know, it was, it wasinteresting. So guardrails and
empowering make, you know,getting that product owner to
make those decisions was, wascrucial. Daryl, have you been in
a similar situation with some ofyour products?
Darrell Fernandes (27:54):
Absolutely.
And I think, you know, on theportfolio, we talked earlier
about impact, right? And what'sthe impact, what's the outcome?
And so when we talk aboutempowerment, well, empowerment
comes with an accountability,right? You have to You're
accountable for something, andyou're empowered to find the
best way to deliver that. Andwhat we see here is a little bit
of not being able to define theimpact of solving for some of
(28:18):
these technical legacychallenges, therefore, we can't
seem to find the time to go workon them, at least, that's how I
read the question. So, so Ithink you you have to really
look at what, what impact am Ias the leader or the portfolio
level, looking for, how can Imeasure that, and how can I then
(28:40):
value that as it relates tobecause paying, paying, you
know, payroll this month versuspayroll for the next six months
are two different questions,right? And you probably have to
solve for both, yes, how do youbalance the ability to hit
payroll this month but notcreate a situation where you've,
(29:00):
you've done so much debtdelivery that you can't pay
payroll in six months. You haveto really look at that. You have
to understand what's happening.
I, you know, I look at, andyou've all talked about turtling
up here, I look at flow, right?
What is your balance that'sdriving your flow? And if you
have too much technical debt,it's absolutely going to impact
(29:22):
your velocity. So how do youbalance the both at the product
and at the portfolio level, themanagement and, in some cases, a
little bit of extra debts? Okay,because the the revenue side of
the house isn't counting on thatparticular piece of the
portfolio to drive new over thenext three quarters, whatever
the case may be, and you canmanage that differently than the
(29:44):
place where getting to marketquickly is absolutely critical,
and you have to take a differentlook at your debt in that piece
of the portfolio. I'll give youpart for the example, account
opening, right account openingis fairly ubiquitous now it's
fairly. Absolutely standardized.
But if you want to launch a newproduct that's got nuance to it,
(30:04):
you may not use a centralcapability to drive account
opening. You may make a choicefrom a technical debt
perspective, to create a net newexperience to drive that account
opening, to get to marketfaster, to evolve faster, to
learn about what works and whatdoesn't work for a customer with
the intent over time, onceyou're in market, of reverting
(30:26):
back to the mean, of gettingback onto a standard capability
set for account opening, but youhave to make those choices and
create technical debt at timesin order to go as fast as the
market demands. I
Dave West (30:41):
think, from my experience, the most important
thing was to have thatconversation in a very
transparent way, absolutely andthat was now I was blessed,
because I was surrounded bypeople that got it really
quickly and just knew we weretalking the same language from
day one. That's the reason why Ijoined and that really helped,
(31:03):
but we had to make some hardchoices, and I'm reminded of
recently, there's a anorganization called Sonos in the
US that provides wirelessspeakers that ultimately hadn't
managed their portfoliocorrectly in terms of those
guardrails that Yuval describedand their technical debt had
gone out of control, and thenthey added a new product to the
(31:26):
platform. They're using aplatform model, and it broke and
it stopped working. And Ipersonally lost two speakers.
They fell off my system. I haveno idea why I was I was trying
to logicalize how, because Ibought many of them at the same
time, so there wasn't thatanyway, but they just fell off.
(31:46):
And actually still today, one ofthem I can't get back on because
of that, and it has stopped mefrom buying any future Sonos
products, which is, which isinteresting, and I'm sure
they're an amazing organization,and there are, they are on the
road to recovery, but it's thosechoices, having it transparent,
and it's, it's hard, and youhave to get everybody on the
(32:07):
same page. Really, reallyinteresting choices.
Yuval Yeret (32:13):
Yuval, yeah, you know, maybe last quick note
about this, I agree, the mostimportant thing and what the
power of portfolio levelmanagement is the conversations
are happening at the rightlevel. They're happening not
just at the one product level,but across products. But if
(32:33):
those conversations are notconversations that enable trade
offs, if what you're doing is,you heard we need to have goals.
And what you do is everybodygets goals. You Dave get goals,
and Daryl, you get goals, andyou get a goal, and you need a
goal, and everybody getsmultiple goals. Then goals are
(32:56):
not helping you. It doesn't helpto say we need to reduce
technical debt. While we, youknow, create this new
capability, while we do thatother thing, while we launch the
new platform, you need to do itin a way that forces
Dave West (33:10):
trade offs, that makes those conversation
something
Yuval Yeret (33:14):
over something else, like working software over
something. It doesn't mean wewon't do any of the other thing,
but it's a choice.
Dave West (33:25):
But that initiative that in, yeah, so that imagine
there's an initiative associatedwith technical debt, because the
you know that from the flowmetrics, the company has seen
that it's getting harder andharder to add new capabilities.
They're having more defects,etc, becomes an initiative. It
you've got a choice. Then youeither stop, and I had this
(33:47):
actual choice, actually at tasktop. And I remember the the
conversation, this was later onin the journey, when we decided
to build what we called factory,because, you know, we're an
integration hub. And you canimagine that every time somebody
released a new API to theirproduct, JIRA or ServiceNow
everything broke, and so webuilt so I so I'd got this
(34:12):
evolved debt around theconnectors, we called them, that
I couldn't manage effectively.
And we had this conversation. Wehad to make a choice, you know,
to do we stop moving. It wasexactly right. It This wasn't
about status reporting. Thiswasn't about saying red, green,
blue. This was, this was oryellow, or whatever it is.
Sorry. This was about actuallysaying, Okay, we either bring in
(34:34):
some more people to help, whichwe didn't have the budget to do.
Or we do. We start, we slow downon our roadmap, delivery, and we
keep a couple of customers.
Luckily, one of them is dar orso he was fine, but we don't
(34:55):
necessarily service them quiteas well as. As we, as we
historically have, and we had tomake those choices and for six
months. And what was even worse,you that is we made that choice
and then sit, you know, with asix month sort of time frame,
and then, guess what, afterthree months, we realized it was
(35:15):
probably nine months and andthat was, that was, luckily, it
was luckily, it was over thesummer and everybody was on
vacation, so that we ignored,yeah, so we slipped it in there.
But it was, yeah, it was, itwas, it was exactly what you
said, making those trade offs.
It's not about status reporting,it's not about communication.
It's about decision making.
Yuval Yeret (35:37):
One of the things I find really powerful is taking
your goals and putting them on aKanban board. For me, that's
like the essence, what's thesmallest, lightest thing to do
at the portfolio level, takeyour goals, put them on a Kanban
board. Visualize. How many ofthose goals do we have? OKRs,
(36:02):
wildly important goals, rocks,whatever initiatives, epics,
call them, whatever you want tocall them. But how many of those
do we have? Is it realistic if anew goal comes up, don't say
immediately, yes, we have to goand do you know Gen AI,
everybody's doing Gen AI. Wehave to integrate Gen AI into
(36:23):
our organization. Okay, what'sgoing to be the impact of that
versus the other things that arecurrently in flight? Do we want
to switch over to that or tostop, starting, start,
finishing?
Dave West (36:38):
Yeah, and that means making choices. And choices are
hard, and organizations, from myexperience, the larger the
organization, the less willing,really, they are at making
choices. I hate to say that, butit seems to be what I see. They
fill up their boards and theyfill up their initiatives, and
(37:00):
they fill up this stuff. Andthen they, instead of saying,
Well, hang on a minute, we'vegot a business that we don't
know what's going to be in threemonths, so we should leave some
capacity, some slack in thesystem, and they don't do that.
And because everybody's, youknow, everybody's got a mission,
everybody's got a goal. I mean,who doesn't want to go. All
(37:20):
right, so we're coming up totime, but I do have one last
question that is around rolesand responsibilities. My gosh,
we've managed to fly throughthis Kanban board of questions
we're doing. This has been agood one. Today I see practice
second time is always a charm,right? It's well, one question
(37:41):
is, what does cross productmean? Very simple question, what
does it mean to you? I know whatI meant when I presented it. I
mean an initiative that has thatimpacts multiple products in
terms of their functionality orcapability. That's what I think
cross product means, or a veryannoyed product, which is a
different kind of cross I guessthe next question, sorry, Yuval,
(38:04):
I
Yuval Yeret (38:05):
have a caveat on that. Oh, it's an initiative
that significantly, meaningfullyimpacts multiple products. If
I'm working on something and Ineed Daryl to, you know, do a
day of work to help me finish mywork or deploy it. That's not
(38:25):
cross product in the portfoliosense. Yes, so we need to be
careful not to manage all of theorganization's work at the
portfolio level. That's why I'msaying that we need to minimize
the amount of things that wemanage as cross products and
maximize the amount of work weempower product teams to manage
(38:47):
exactly
Dave West (38:49):
and in in the case of Yuval asking Daryl to, you know,
do a small, minor thing so itmake his life so much more easy,
or delivery thing, then that hasjust been managed in the backlog
like any other stakeholder thatcomes and knocks at darryl's
door, cross product initiativesare ones where there's the Yuval
would have a wheelbarrow ofrequests to Daryl and vice
(39:14):
versa, maybe, which startsadding to the complexity of the
situation. Thank you for callingthat out. Yuval, I think that is
really, really, reallyimportant. And honestly, it
isn't a scientific sort ofmeasure, cross product or not.
Cross product, you know, is it700 requests? Is it four? 300 is
(39:35):
it 12? You know, I don't know. Ithink you know when you know,
though, and and I think it, youknow, I think it's sort of
clear. So thanks for for makingthat clearer for our listeners.
The other thing was interestingis, in the presentation, I
introduced a bit like the way inwhich lean portfolio management,
they do this idea of ainitiative owner or an epic
(39:58):
owner, or whatever, somebodythat owns. These cross product
initiatives. And the words ofadvice for want to a better term
I provided for that was, youknow, that they need to have a
regular cadence. They need tohave, you know, transparent
artifacts, maybe a backlog,maybe a Kanban board, maybe
blah, blah, blah, and they havean initiative owner. And there
(40:19):
was a question about, what's theconflict between product owners,
initiative owners. So I knowDarryl you, you were in
financial services, where therewere these big initiatives, you
know, whether it's moved tocloud, whether it's GDPR,
whether it's some new sockscompliance, that is, isn't about
socks, it's about somethingelse. But anyway, everyone's got
(40:41):
to wear green socks from now onthat, you know, how did you
balance ownership andempowerment at the team level
with these very powerful seniorpeople that came around and
goes, I need to have this. Thecompany will fail without it. I
think
Darrell Fernandes (40:58):
there's different types of initiative
owners, and you, you hit on acouple there. Dave, right? So
let's, let's talk about cloudmigrations. So, so the first
conversation is, why are youdoing a cloud migration? You're
doing a cloud migration for thecapacity that it can provide
you. From an elasticityperspective. Are you doing? You
know? Why? Why are you doing?
Are you doing it for costcontainment, because it's it's
(41:18):
off prem, and you can manage itbetter all those questions,
right? And if it's those kind ofrisks that you're managing or
impacts that you're managing,you can take something like
Cloud migrations. It's still aninitiative, but empower the
product teams differently thanif you're launching a new
financial product which requiresan account opening and account
(41:40):
reconciliation, tradingcapabilities, which are all
separate products to cometogether to offer a new
financial product. Right? Sothere's different kinds of
initiatives, and I think youhave to be clear, when you ask
somebody to own an initiative,what are the what's their role
in driving the impact, and whattools do they have to drive that
impact? And then the productteams need to understand what
(42:04):
their role is in the in theinitiative. So if I'm an account
opening product owner, and I'mbeing asked to contribute, to
participate with, collaboratewith a new financial product,
then I then I need to understandhow that objective is going to
be fulfilled through myorganization, and how we're
(42:26):
going to measure it, and howit's going to fit with my other
priorities, and have thoseconversations, because I think
that those are the realchallenging initiatives. Is more
the business initiatives thanthe pure tech initiatives in my
in my mind, because theprioritization at the product
level becomes the challenge,right? Because if a product has
multiple priorities coming frommultiple initiatives, and this
(42:48):
is what Yuval, I think, wastrying to avoid, which is only
use the initiative constructwhen you absolutely have to big
enough to to use it, theprioritization becomes, becomes
where the rubber meets the road,and having that portfolio level
conversation about the thechoices that have to be made at
(43:10):
each product level in order tomake the initiative happen, and
make sure the initiative owneris kind of aware of that,
because sometimes the initiativeowner may be taking direction
from one side of the house andthe product owner direction from
another side of the house. Youreally need to reconcile that.
You need to have a vehicle toreconcile that. Go ahead, Yuval,
(43:31):
I see
Dave West (43:35):
Yuval.
Yuval Yeret (43:38):
I think you're making an important assumption
there all that the productowners are product owners. A lot
of organizations that I see atthe point that they're starting
their portfolio journey, youknow, their product owners are
not really the Empowered productowners that we talk about, and
(43:58):
it's a slippery slope. To thepoint where we think the
initiative owners, you know,tell product owners what they
need, and it happens. I thinkyou described the right dream
scenario, that the rightenvironment which we need to
(44:19):
work towards. That's exactlywhat a product oriented
portfolio looks like, where wecarved out products that have
real owners, real empowerment,and those initiative owners
learn to act like productowners. We talk about product
owners as influencers, as youknow, experimenters, they do
(44:43):
need to make some decisions, butthey make decisions about their
initiative. They cannot makedecisions about other products.
They need to influence thepeople in the products. That is
a dynamic that is alien, foreignand. Lot of the people though to
a lot of the portfolios, but Ithink it starts with at least
(45:06):
acknowledging that theinitiative owner comes from the
product owner family. Aninitiative owner in your
portfolio should be one of yourbest product owners or product
managers. They should be anexpert in product ownership. Be
very careful with, you know,because it's at that scale
(45:31):
thinking about it's not somebodyfrom the product world, it's
somebody from the project world.
That's an anti pattern that thatI often see,
Dave West (45:41):
yeah, I mean, and then that makes sense, because,
oh, you got this big initiative.
It's cross product. It's a, youknow, business, it's high
profile. You got your productteams running. And of course,
the natural assumption would beto get a really good project
manager that to get it, becausethere's, you know, it's, it's
ultimately about coordination,isn't it? Well, actually, it's
not. It's about influencing.
(46:04):
It's about building a roadmap.
It's about making trade offs.
It's about compromise. It'sabout, you know, and yes, there
is some element of schedulingand the like, but it's not that
isn't the focus, and I thinkthat that is a key skill set
that's often missing in theseinitiatives. The other thing, I
think is really important isthere isn't many of them. I
(46:26):
think that the, you know, themajority of the work needs to be
being done by the product teamsbased on their product roadmaps.
And the not everything is aninitiative just because it
affects multiple products, whichis the point I think you raised
earlier, and I think that'scrucial and and ultimately, we
want to empower the productowners. So give them the guard
(46:47):
rails, give them the the thethis is what we believe at this
point, you know, and then allowthem to be transparently
communicating that to the peoplethat ultimately own the
products. And you know, onething that I've seen a lot is
that you've got differentreporting structures for
different products, meaning thatthe and that can cause a lot of
(47:10):
conflict as well. So, you know,the technology product teams,
or, you know, their productowners report into the CIO, CTO,
whatever, and then you've gotthe business product people
reporting into the businesslines, which ultimately means,
makes it very hard when you'vegot, you know, escalation
issues, because that you've gottwo because the technology
(47:33):
leader has a different set ofgoals than the business leader.
And then then there's this gameof, you know, and is it going to
go away up to, you know, theCEO, and if it's a big financial
company that I'm not sure thatmakes sense. So it just goes
around in circles. Let me justjump
Darrell Fernandes (47:51):
in real quick, Yuval, and then I'll
jump, throw it to you. But Ithink that opens a whole nother
conversation. Dave, aboutaligned incentives, and
regardless of organizationstructure, are people working
towards the same outcomes,right? And if they're not, what
steps can you take to to makethat happen more? Because as
(48:12):
long as people are working todifferent incentives, you're
you're going to have thatchallenge. And the more aligned
you can make, regardless oforganization structure, the
outcomes driving the incentivemodel, the better off you are in
this product centric portfolio,product portfolio centric model.
So I think that's a whole notherconversation. We didn't have a
(48:32):
question about it, but I thinkit's an important one to note.
Yvon,
Yuval Yeret (48:37):
yeah, another rabbit hole that relates to
that. You know, this is justcoming off the of the back end
of a conversation I'm havingwith a real client right now.
What's the scope of theirportfolio? Is it developing
technology products, or is it abusiness portfolio? And I'll
(49:02):
just quickly raise the questionand the impact of it, and maybe
we can discuss it in part three,if we ever do it is, if your
portfolio, as it often is, is anIT technology portfolio, what
might happen is, or what has agood chance of happening, is
(49:24):
that when initiatives come atyour doorstep, it looks like the
classic demand intake processwhere you're told this is what
we need to do to achieve abusiness goal that we've already
decided we need To achieve. Andyou don't have optionality. If
you really want to be a productoriented portfolio and have
(49:46):
optionality and focus on impactand outcomes, it actually leads
you to the fact that you neededto be a business and technology
partnership, not an us and them,where. Where you know,
technology and business areinvolved from day one of
thinking about something in thefunnel and deciding, do we want
(50:09):
to invest now in going to cloud,or in reducing technical debt,
or in Gen AI, or in going intothis weird crypto thing, or
whatever it is, all of those arebusiness decisions that need
(50:29):
product support, and you need tomake these decisions as a
portfolio. That's a much harderchange for some organizations.
You don't necessarily need tostart with that, but you need to
acknowledge it until you're atthat level, it would be hard for
you to be really productoriented and impact oriented.
Dave West (50:50):
I think that you know the reality is that most
organizations are still on theirlegacy. Organizations are on
their journey from Business andTechnology, separate to business
technology, and I think thatproductization can be a really
good tool as a catalyst fordriving that transition.
(51:15):
However, if, if productizationis thought of as something the
IT organization does on its own,then, yeah, you can build some
great technical products, andthat can be, you know, and, but
then it's a very different setof goals, and ultimately leads
you to these challenges, ofthese, you know, ownership
(51:35):
battles, which, which makes notgood for anybody, right? We've
come up to our time, gentlemen,thank you so much for spending I
could. I just learned so muchwhen I have these conversations.
I really do appreciate youtaking the time and listeners.
Thank you for listening. Today,I was with your value at PST,
(51:57):
expert in the field on leanportfolio management, Kanban and
professional Scrum, talkingabout portfolio management.
Portfolio Management. And DarylFernandez, executive advisor to
scrum.org, and ex CIO anddelivery lead. We've been
talking about portfoliomanagement today. We've been
talking about the questions thatcame out of the webinar. We
walked through budgeting andfunding, operational, strategic
(52:19):
investments, you know, capex,OPEX, we talked about strategy
and the challenges of that. Wetalked about roles,
accountabilities andempowerment, all of them, you
know, come to a head at thatportfolio level. Thank you for
listening today to thescrum.org, community podcast. If
you liked what you heard, pleasesubscribe, share with friends,
(52:41):
and, of course, come back andlisten to some more. I'm lucky
enough to have a variety ofguests talking about everything
in the air is professional ScrumProduct thinking. And, of
course, agile. Thanks,everybody. Scrummorg,
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
is part two. Gosh, we liked itso much. We've come back for
more. So part one and now PartTwo was a podcast focused on
answering the questions thatcame out of a recent agile
(00:42):
product, operating model,product portfolio management
webinar. We got a lot ofquestions. We started answering
them, and we only got, actually,for the first two. So you know,
if you're looking at my Kanbanboard, we didn't get we didn't
move many across the board. Sowe've got some more to talk
(01:02):
about today, and just like inpart one, I've enlisted two
people to help me with answeringthese questions, Yuval, Yvette,
PST, an expert in the field whocan blend lean portfolio
management Kanban andprofessional Scrum, sometimes
while on a a treadmill, which isvery impressive to see. I'm not
(01:27):
going to lie there. Welcome tothe podcast. Your Val, thank
Yuval Yeret (01:31):
you, Dave, not on a trend. I'm standing on the
treadmill. I'm not walking on
Dave West (01:38):
there we go. Which is which is good, which is good.
I'm glad you, because you'remaking me feel really bad. And
then we've also very lucky tohave dar Fernandez, executive
advisor to scrum.org, ex CIO anddelivery lead for two very large
financial institutions, and he'sbeen applying product thinking
(01:58):
in their portfolios, Tia andFidelity Investments. So we're
going to share some of hisinsights there. Welcome to the
podcast, Darryl.
Darrell Fernandes (02:09):
Thank you, Dave. We're looking forward to a
conversation
Dave West (02:12):
part two, so we started. So maybe listeners, if
you've not listened to part one,you probably should, but that
doesn't mean that you can't getstuff out of part two, I'm going
to jump straight in to thequestion that we're that's on
next on my list, which is aroundbudgeting and funding. We've got
(02:35):
a couple of questions here, butreally the first one is, I'm
concerned that funding theproducts versus funding the
teams won't work for fornonprofits. And I think the
question was, one of the keyconcepts of the webinar, was,
fund the products, not the work,and that, that's a fundamental
(02:59):
sort of concept. And this, thisquestion really says, Hey, we're
already far too busy. We'vealready got like 87 initiatives.
How the heck can I fund theseproducts? Instead, what I'm
doing is I'm funding work andhoping that the products evolve
in parallel. So I know you'veall you must. You've, you're
(03:21):
doing this actually, at themoment with a large
organization, there's a lot ofthings moving. They've, you've
got people that are already too,too busy, and suddenly are
adding product on top. Whatwould be your words of wisdom on
that?
Yuval Yeret (03:36):
I don't know that it's wisdom, but more often than
not in the organizations that Iwork with, the funding model
already funds teams. I mean, wesay products, and you know,
there are differences in how wework in product oriented ways,
(03:57):
but funding teams is prettycommon now in situations where
you fund the teams, it doesn'tmean that the teams aren't busy
working on too many initiatives.
It means you have an issue ofjuggling too many initiatives
that you need to deal with. Andyou know, the way around that is
to start to see the flow andimprove the flow. We can talk
through that, but it's not afunding concern. It's not that
(04:19):
the funding model needs tochange. On the other end, in
organizations that do have afunding model for initiatives,
again, the key challenge thatyou need to face. There are two
challenges. One is, are wewilling to change our funding
model and fund stable teams andget decouple the funding and
(04:42):
budgeting conversations from theteam structure in what, what
work are we doing? Conversation?
Essentially in your annualoperating plan, say these are
the teams or groups, or if.
Portfolios that we have, andthis is their operating budget,
and it is what it is. And nowwe're empowering product owners,
(05:05):
portfolio owners, whateverlevel, to do the right thing.
The key challenge there issometimes political, because in
organizations where the work isfunded based on initiatives. You
often have finance people andPMO people that are managing,
(05:25):
you know, those investments andare managing to this funding
moving to a mode where you findteams, often, is a big change
for these people, and you knowthe feeling that they're losing
control, and you need to givethem an alternative. Evidence
based management is analternative that can, you know,
(05:48):
show them that there's value inthe work that is being done. But
it is a change. And again, thischange is very different than
you have lots of things inflight, and you need to focus on
fewer people. And that would bea concern regardless.
Dave West (06:06):
Okay, so, gosh, there's two things there. I do
want to lean in a bit on this,you know, fund the work thing,
because I think that we have, Ihave some examples of where that
isn't the case, and it is a realchallenge. But the you sort of
dropped a bombshell about pMOSthere, Yuval, that I just need
(06:26):
to, well, I'm not sure we'llfinish it, but bring up. So what
you're saying is that pMOS, whohistorically have managed these
complicated I mean, we've allfilled in timesheets, you know,
which I remember that was myFriday afternoon after the pub,
which I'm not sure that was agood thing or a bad thing, but I
got through it. But the thesepeople that are in these
(06:49):
organizations, in the PMOproject offices, etc, are going
to have to basic, well, youwould encourage them to change
what they're focused on, toreally coaching and enabling
evidence to be the primarymechanism of progress and
building, dare I say, dashboardswith the teams to demonstrate
(07:11):
progress against that evidence.
Because that, that's, that's abig change to most pMOS,
Yuval Yeret (07:17):
rather than that.
Oh, a bit more than that. Okay,if you're moving to a product
oriented portfolio, one of thekey things that you're doing is
you're saying, If, until now,let's say 80% of my budget was
allocated to initiatives, and20% was business as usual,
(07:37):
change management that you trustand empower teams to work on.
It's typically what you want todo is not just manage the same
initiatives using productorientation. You actually want
to push a lot more of the budgetinto these product teams,
(07:58):
product groups, and tell them,here's your budget, here's 50%
of the overall budget, whateverthe number you need to come up
with. What makes sense, but yougo manage it. I'm not gonna
micromanage you. I'm not gonnatell you how to work on this
initiative. There will be fewerinitiatives that need
(08:19):
management. There would be fewerprogram managers, you know, that
will be busy, busy runninginitiatives in the organization.
There would be more productowners, product managers
throughout the organization,that make decisions around what,
what features, what you know,investments make sense, what
should be in those productbacklogs while the funding is
(08:41):
stable. That's a meaningfulchange that. And you know that
there's the conversation aroundmoving from program management
to value management and beingenablers and having a different
role in this organization.
That's a huge change for forpMOS,
Dave West (09:04):
Daryl, you've been a little quiet, and I apologize
for that, as we talked aboutthis, but tell me, you know, in
the organizations that you werepart of, and you don't have to
obviously, share any secrets,but that's the kind of change
that you were driving. I meanthis value management, rather
(09:26):
than portfolio management. This,you know, the ownership your
Darrell Fernandes (09:31):
outcome, yeah, outcome impact driven
right? And empower the teams toto get to that outcome. There's
balance, right? There's balancein the long term, sustainability
of the deliverable versus theshort term feature function of
the deliverable, but, but theoutcome of the impact is really
what you're trying to drivetowards. In this particular
question. It's interesting tome, so I'm going to do a little
(09:54):
bit of a pivot, because I seetwo things in this question that
intrigue me a little bit. Oneis. I see a notion that there's
these product teams of one, orthese product teams of one or
two, and those those individualsare overwhelmed. And I can look
back to the Phoenix Project as agreat example of flow and flow
constriction. And it's it's notin the app dev side, it's more
(10:16):
in the dev ops side, but itstill talks a lot about the same
challenges that you see herewhen you have app dev product
teams of one or two, where youjust you can't get all the work
through and take taking a stepback from that you generally
want to build broader. You mayonly have funding for one or two
people, or ability to invest inone or two people in a product,
(10:39):
but you need to then join otherother products together to
create some structure thatallows you when priorities drive
to go wider than one or twopersons of capacity to deliver
value, right? So you have toreally take a step back and
evaluate whether these productteams of one or two are the
(11:00):
right thing for yourorganization in most cases, when
we came across those, we took astep back and said, We need to
merge some things that ourproduct teams are one or two
that have like dev skills orlike business partners, etc, to
get more capacity and theaccountability then becomes a
little broader, because you haveto balance across multiple
(11:20):
outcomes. It's a little harder,but you have that capacity on
demand, quote, unquote, when youneed it to deliver true business
value for a specific reason. Sothat's one piece, the other
piece that's pretty interestingabout this question, less about
our topic at hand, maybe, butnuanced in the nonprofit piece
of this question, which inmission based organizations,
(11:41):
priorities are really hardbecause everything is so
important to the mission, and insolving the problems towards the
mission is such a almostemotional effort that it becomes
hard to prioritize. And so whatI read into this question a
little bit, and this is me kindof doing way more, way more
(12:04):
interrogation than is probablyappropriate. Is that this
particular organization probablyisn't prioritizing, well, right?
They want to do everything witha limited set of resources, and
there's not clear ways to tobalance the most important
things with the less importantthings. Everything's important
because it's a mission, right?
So, so everything becomesimportant and that becomes a big
(12:26):
challenge. I think the productmodel and the portfolio
management on top of the productmodel can actually expose that
risk and expose that challengein a different way, and if you
use it to your advantage, Ithink forcing those
conversations at the portfoliolevel, through this vehicle
becomes a value add, and I thinkit can, can drive the
prioritization to the rightlevel of the teams necessary to
(12:49):
help the people doing the workdo the most important work,
because it's all important. So II know that's a little bit of a
pivot from the from the programmanagement side of the question,
but, but that's kind of where Isaw this question going. So
Dave West (13:08):
I mean, running a mission based organization value
and impact against that missioncan sometimes annoyingly, I have
to be honest, brings that upwhen we have our regular
meetings about how I'm runninghis his business, and the, you
know, sort of impact, impact andvalue, everything that we do has
(13:32):
to have any has an economicelement, but it also has an
impact element, and we have tobalance those. But it's about
making choices. And choices arereally hard to make,
particularly as and this is theother thing about mission based
that you're not non profit. Youknow these sort of organizations
you you know your stakeholdersare in. You really want to
(13:54):
satisfy those stakeholders. Andchanging priorities is as a huge
impact, maybe a personal, humanimpact, which which we don't see
so much in a big financialorganization, maybe so
interesting. So I do want tolead us to another topic around
budgeting, though, that is, youknow, that sort of CapEx, these
(14:15):
timesheets, putting time intothe right buckets, you know,
making sure you capitalizeappropriate investments. I
remember when I was my firstjob, 92 I think it was
commercial union, which nolonger exists, not, not because
of me, just, just for therecord, they got merged with
(14:38):
another insurance company andthen brought into another one
and the huge Aviva, amazingorganization, actually, big
scrum shop anyway, but sorry,but the I remember having to
create time sheets on thatFriday afternoon, and I remember
one of the motivations for doingit, one of the reasons why my
boss, Geeta Shah, said that Ineed. To do it was because of
(15:02):
the way in which money was beingcapitalized, etc. So you had
projects, and you had workinside those projects and and
all this sort of stuff does.
Does that change with theproduct model? Now you, you
know, you, you obviously livethis. You worked a lot with
finance. Obviously, fidelity isa different perspective than
maybe Tia on this. But whathappened? How can you do it? You
(15:23):
can
Darrell Fernandes (15:26):
do it. It takes work, right? It's not
free. Capitalization can't beunwound if you have significant
capital portfolio,capitalization happening can't
be unwound in a single cycle. Ittakes. It takes, in cases,
years, if you even choose to tolessen your capitalization
(15:47):
approach. So you have to findtools that allow you to track
the work in a way that that canstill be capitalized and still
solve that business problem,which your P and L requires,
right? If you've got that builtinto your P and L, you can't
ignore it. You have to solve forit. So you've, you can, you can
(16:09):
use feature tagging, which is anapproach to that. And you can
automate feature tagging if, ifyou're still tracking hours, it
becomes easier. Manyorganizations have walked away
from tagging hours and kind ofgotten to a model where they do
associate allocation of theirFTEs, which is a estimation of
(16:32):
how much work is happeningagainst features, and those
features are then tagged and ina discretionary or a non
discretionary bucket. So thereare ways to do it, and there are
ways to automate a good portionof that and simplify it, but,
but it must be done. You can'tjust turn it off, at least in my
experience, because of thefinancial impacts to turning it
(16:54):
off, in a immediate sense,become too big to explain, and
so you have to find a way tomanage through it. And maybe you
choose to through a glide pathover years, wind out of your
capitalization. Maybe you don't.
That's a business decisionthat's market driven. There's,
there's a lot of things outsideof product delivery that go into
(17:16):
that.
Dave West (17:20):
Yeah, so I mean, and you worked through this with
finance, so basically, byinvolving your CFO, and you know
that part of the organization,who actually, from my
experience, and maybe you Val,you're going to say, I'm wrong
here when, when I asked, comesto you, but my experience is
those people really want tohelp, but they actually don't.
(17:43):
They don't want to be abottleneck, a hurdle, a burden.
They actually want to drive goodstuff into the processes.
Absolutely.
Darrell Fernandes (17:54):
I'm sorry, Yuval, just one thing, and then
I'll flip it to you when youtalk about this approach, and
the fact that it's evidencebased, and it brings more
transparency than maybe otherapproaches. They actually really
want to jump on board, becausethey're not used to having that
level of exposure and andclarity to what what's actually
happening. Yuval, I'll flip itto you. Sorry, yeah,
Yuval Yeret (18:16):
I would agree, in general, but it is you change
and finance. People are not thepeople you know that risk is
something that they would liketo avoid, even when they're in a
business of, you know, helpingpeople manage risk. So what I
found is the evolutionary pathworks like you don't have to
(18:43):
change how you do yourcapitalization and your time
sheets on day one of workingtowards a product oriented
portfolio management approach.
You, you know, like we do withvelocity based on story points
versus throughput, don'tnecessarily throw away your
(19:03):
story points on the first day. Imean, I, you know, I'm a content
trainer. A lot of PSDs aresaying, No, you know, don't do
story points, partially becauseyou know what we've brought into
the community. But you know, whynot use them in parallel for a
while and see that it makessense to, you know, to trust the
(19:27):
throughput, and there's noadditional value in what you get
with the story point. So here aswell, do Timesheets in parallel
to doing feature tagging orusing, you know, new tools that
can associate check ins to thecode base with JIRA tickets and
(19:49):
show you stuff. There's lots ofcool stuff that's available
these days, but run it inparallel and see that. Then.
Evidence that you get makessense, and over time, maybe you
can start to remove thosetimesheets. That's what I'm
seeing most of. To be honest,most of the clients I worked
(20:11):
with, it took them years, if atall, to stop doing timesheets as
part of this, because it wasn'tthe biggest fight worth fighting
at the time.
Dave West (20:25):
They though I am, I'm afraid, reminded of so I had to
basically get 40 hours everyFriday afternoon. And I we used
to have a, this is England inthe 90s. You go to the pub of
Friday lunch, and I'd come backand I look at the projects, and
there was and I'm like, Oh,where are we against those
projects? How much have wespent? And then it doesn't
(20:47):
matter what I did that week, Iwas completely the opposite,
really. I mean, yeah, and thenyeah, and just tried to, then,
oh, and get it to balance. Andthen if it didn't balance, my
bosquito would be like, all overme, and I'm like, I've got,
well, I didn't work on that.
She's like, Well, can you makeit work? But it does take time,
and I think the transition andseeing and getting that
(21:11):
transparency of the change, Ithink it's a bit of a theme for
the change that we'redescribing. Try things, see what
they go that doesn't mean throwaway existing processes
overnight, but at least involvepeople in the change from
finance and and all good thingscan happen. Right? Apply
Yuval Yeret (21:32):
evidence based management. For words, evidence
based management. Dave,
Dave West (21:37):
oh my god, it's going to be turtles all the way down
now. Yuval, so I'm going to getconfused, but yes, it's like,
you need to adopt this in anagile way, using evidence to
drive change and and that'swhether we're talking about
portfolio management, whetherwe're talking about, I don't
know, how we manage features,whether we're talking about
(21:58):
stakeholder engagement, whetherwe're talking about
organizational constructs,governance, compliance. If you
don't use an incremental,evidence based approach to this
very complex socio technicalsystem, you're always going to
be in in trouble. I mean thatthat is, that is the reality.
(22:19):
And yes, this is just one otherthing, all right, so carrying
the theme about, um, let's talka bit, a little bit about the
this, this. I that thisportfolio strategy, you know, we
talked a little bit about, youknow, the choices. But
ultimately, this particularquestion is, how does product
(22:41):
portfolio, strategy change? Ifyou're in a fast startup Tech
with fluid teams, technical debtpiling up all over the place,
they're doing a lot of supporttype your teams are now having
to do a lot of support typeactivities. You know, would you
focus on stabilizing. Thequestion was, would you focus on
(23:03):
stabilizing the product,mitigating that, technical debt,
managing that? Would you focuson, you know, just keeping the
systems going? I actually had avery similar choice to make
when, when I came in as a CPO oftask we had, you know, we were
bootstraps, so we're having topay people, you know,
(23:24):
surprisingly, on the revenuesfrom the products. And I had a
bunch of customers that we'dsold a story to that maybe our
products didn't quite live up toand I but I also had a product
roadmap that that we were usingto drive investment, talking to
VCs, etc, and I wanted todemonstrate progress against
(23:45):
this roadmap. Whilst trying toit was really we were
transitioning from a servicebased company to a product based
company. And it was, it was onlybecause of the inspirational
leadership of Mick Kirsten andneelan and and some others that
provided me the air cover thatallowed me to to do that,
because we made the choice thatultimately the long term value
(24:08):
of the business was going to besearch, as a product company and
as a services company. Yeah, wemight be able to build up. So
this is business for a bit, butthat isn't the long term
strategic value of the business.
So, so I've lived through this,what would you say? You know, I
don't know who wants to youknow, you've allowed you when
(24:28):
you're in this situation whereyou've got a product, you've got
teams aligned, you've got a roadmap, you've got stakeholders,
and you you've got support theoperational element. What you
do.
Yuval Yeret (24:41):
So we need to remember that we're talking
about portfolio, productoriented portfolio management
here. But the answer to theproduct level is both, you know,
turtles all the way. It's whatwe use to make. Distinctions.
And the other piece of this iswe want, in the portfolio level
(25:05):
to create an environment whereproducts are empowered to make
decisions. So if I was in theposition of being a portfolio
leader, first of all, what Ineed to understand is, okay,
what is my situation and what doI want my strategy to be? And I
don't know what's the rightbalance between eliminating
(25:27):
technical debt and keepingcurrent customers happy and
working towards future horizons,but I need to come up with one.
I need to see transparentlywhat's the current level of
investment and set guardrailsfor where do I want to be now
those guardrails, I don't wantto be managing them on a day to
(25:48):
day basis. What I want is tocommunicate them to the
different products, so thatproduct managers, product
owners, owning those productswith their teams, can make
decisions day to day in a waythat is aligned to the strategy
around, how do we want toallocate our capacity around
(26:08):
these, these different concerns?
That is a portfolio managementconstruct? How do we provide
strategic intent around types ofinvestments? And not just what
is the strategy, what are thegoals, but also types of
investments, but creatingautonomy that is aligned to
those investments and
Dave West (26:31):
supporting the challenge, you know, that my
team had, particularly as theyyou know, I initially, I had one
scrum team. Let's not, let's notbe grandiose here. And that
scrum team was very much. Theyhad very strong relationships
with those clients, becausethey'd sold the product back in
(26:53):
the day before I joined,actually, and it was really hard
to go and say, Look, you'regoing to have to say no. In
fact, you're not going to haveto say no, is what we ended up
I'm going to have to say no. Soyou give them to me as the
product owner of that product,and I'm going to have to talk to
them. And that took a bit oftime. Guard rails, we exactly
(27:17):
had those, and we put those invery quickly. We had a CEO with
Mick Kirsten, who lovedmeasuring things, so everything
was in this really comprehensiveSo, and when we slipped on those
guard rails, we hadconversations about it, and we
did slip, but we made choices.
You know, making payroll was onechoice we often had to make. And
(27:39):
the, you know, it was, it wasinteresting. So guardrails and
empowering make, you know,getting that product owner to
make those decisions was, wascrucial. Daryl, have you been in
a similar situation with some ofyour products?
Darrell Fernandes (27:54):
Absolutely.
And I think, you know, on theportfolio, we talked earlier
about impact, right? And what'sthe impact, what's the outcome?
And so when we talk aboutempowerment, well, empowerment
comes with an accountability,right? You have to You're
accountable for something, andyou're empowered to find the
best way to deliver that. Andwhat we see here is a little bit
of not being able to define theimpact of solving for some of
(28:18):
these technical legacychallenges, therefore, we can't
seem to find the time to go workon them, at least, that's how I
read the question. So, so Ithink you you have to really
look at what, what impact am Ias the leader or the portfolio
level, looking for, how can Imeasure that, and how can I then
(28:40):
value that as it relates tobecause paying, paying, you
know, payroll this month versuspayroll for the next six months
are two different questions,right? And you probably have to
solve for both, yes, how do youbalance the ability to hit
payroll this month but notcreate a situation where you've,
(29:00):
you've done so much debtdelivery that you can't pay
payroll in six months. You haveto really look at that. You have
to understand what's happening.
I, you know, I look at, andyou've all talked about turtling
up here, I look at flow, right?
What is your balance that'sdriving your flow? And if you
have too much technical debt,it's absolutely going to impact
(29:22):
your velocity. So how do youbalance the both at the product
and at the portfolio level, themanagement and, in some cases, a
little bit of extra debts? Okay,because the the revenue side of
the house isn't counting on thatparticular piece of the
portfolio to drive new over thenext three quarters, whatever
the case may be, and you canmanage that differently than the
(29:44):
place where getting to marketquickly is absolutely critical,
and you have to take a differentlook at your debt in that piece
of the portfolio. I'll give youpart for the example, account
opening, right account openingis fairly ubiquitous now it's
fairly. Absolutely standardized.
But if you want to launch a newproduct that's got nuance to it,
(30:04):
you may not use a centralcapability to drive account
opening. You may make a choicefrom a technical debt
perspective, to create a net newexperience to drive that account
opening, to get to marketfaster, to evolve faster, to
learn about what works and whatdoesn't work for a customer with
the intent over time, onceyou're in market, of reverting
(30:26):
back to the mean, of gettingback onto a standard capability
set for account opening, but youhave to make those choices and
create technical debt at timesin order to go as fast as the
market demands. I
Dave West (30:41):
think, from my experience, the most important
thing was to have thatconversation in a very
transparent way, absolutely andthat was now I was blessed,
because I was surrounded bypeople that got it really
quickly and just knew we weretalking the same language from
day one. That's the reason why Ijoined and that really helped,
(31:03):
but we had to make some hardchoices, and I'm reminded of
recently, there's a anorganization called Sonos in the
US that provides wirelessspeakers that ultimately hadn't
managed their portfoliocorrectly in terms of those
guardrails that Yuval describedand their technical debt had
gone out of control, and thenthey added a new product to the
(31:26):
platform. They're using aplatform model, and it broke and
it stopped working. And Ipersonally lost two speakers.
They fell off my system. I haveno idea why I was I was trying
to logicalize how, because Ibought many of them at the same
time, so there wasn't thatanyway, but they just fell off.
(31:46):
And actually still today, one ofthem I can't get back on because
of that, and it has stopped mefrom buying any future Sonos
products, which is, which isinteresting, and I'm sure
they're an amazing organization,and there are, they are on the
road to recovery, but it's thosechoices, having it transparent,
and it's, it's hard, and youhave to get everybody on the
(32:07):
same page. Really, reallyinteresting choices.
Yuval Yeret (32:13):
Yuval, yeah, you know, maybe last quick note
about this, I agree, the mostimportant thing and what the
power of portfolio levelmanagement is the conversations
are happening at the rightlevel. They're happening not
just at the one product level,but across products. But if
(32:33):
those conversations are notconversations that enable trade
offs, if what you're doing is,you heard we need to have goals.
And what you do is everybodygets goals. You Dave get goals,
and Daryl, you get goals, andyou get a goal, and you need a
goal, and everybody getsmultiple goals. Then goals are
(32:56):
not helping you. It doesn't helpto say we need to reduce
technical debt. While we, youknow, create this new
capability, while we do thatother thing, while we launch the
new platform, you need to do itin a way that forces
Dave West (33:10):
trade offs, that makes those conversation
something
Yuval Yeret (33:14):
over something else, like working software over
something. It doesn't mean wewon't do any of the other thing,
but it's a choice.
Dave West (33:25):
But that initiative that in, yeah, so that imagine
there's an initiative associatedwith technical debt, because the
you know that from the flowmetrics, the company has seen
that it's getting harder andharder to add new capabilities.
They're having more defects,etc, becomes an initiative. It
you've got a choice. Then youeither stop, and I had this
(33:47):
actual choice, actually at tasktop. And I remember the the
conversation, this was later onin the journey, when we decided
to build what we called factory,because, you know, we're an
integration hub. And you canimagine that every time somebody
released a new API to theirproduct, JIRA or ServiceNow
everything broke, and so webuilt so I so I'd got this
(34:12):
evolved debt around theconnectors, we called them, that
I couldn't manage effectively.
And we had this conversation. Wehad to make a choice, you know,
to do we stop moving. It wasexactly right. It This wasn't
about status reporting. Thiswasn't about saying red, green,
blue. This was, this was oryellow, or whatever it is.
Sorry. This was about actuallysaying, Okay, we either bring in
(34:34):
some more people to help, whichwe didn't have the budget to do.
Or we do. We start, we slow downon our roadmap, delivery, and we
keep a couple of customers.
Luckily, one of them is dar orso he was fine, but we don't
(34:55):
necessarily service them quiteas well as. As we, as we
historically have, and we had tomake those choices and for six
months. And what was even worse,you that is we made that choice
and then sit, you know, with asix month sort of time frame,
and then, guess what, afterthree months, we realized it was
(35:15):
probably nine months and andthat was, that was, luckily, it
was luckily, it was over thesummer and everybody was on
vacation, so that we ignored,yeah, so we slipped it in there.
But it was, yeah, it was, itwas, it was exactly what you
said, making those trade offs.
It's not about status reporting,it's not about communication.
It's about decision making.
Yuval Yeret (35:37):
One of the things I find really powerful is taking
your goals and putting them on aKanban board. For me, that's
like the essence, what's thesmallest, lightest thing to do
at the portfolio level, takeyour goals, put them on a Kanban
board. Visualize. How many ofthose goals do we have? OKRs,
(36:02):
wildly important goals, rocks,whatever initiatives, epics,
call them, whatever you want tocall them. But how many of those
do we have? Is it realistic if anew goal comes up, don't say
immediately, yes, we have to goand do you know Gen AI,
everybody's doing Gen AI. Wehave to integrate Gen AI into
(36:23):
our organization. Okay, what'sgoing to be the impact of that
versus the other things that arecurrently in flight? Do we want
to switch over to that or tostop, starting, start,
finishing?
Dave West (36:38):
Yeah, and that means making choices. And choices are
hard, and organizations, from myexperience, the larger the
organization, the less willing,really, they are at making
choices. I hate to say that, butit seems to be what I see. They
fill up their boards and theyfill up their initiatives, and
(37:00):
they fill up this stuff. Andthen they, instead of saying,
Well, hang on a minute, we'vegot a business that we don't
know what's going to be in threemonths, so we should leave some
capacity, some slack in thesystem, and they don't do that.
And because everybody's, youknow, everybody's got a mission,
everybody's got a goal. I mean,who doesn't want to go. All
(37:20):
right, so we're coming up totime, but I do have one last
question that is around rolesand responsibilities. My gosh,
we've managed to fly throughthis Kanban board of questions
we're doing. This has been agood one. Today I see practice
second time is always a charm,right? It's well, one question
(37:41):
is, what does cross productmean? Very simple question, what
does it mean to you? I know whatI meant when I presented it. I
mean an initiative that has thatimpacts multiple products in
terms of their functionality orcapability. That's what I think
cross product means, or a veryannoyed product, which is a
different kind of cross I guessthe next question, sorry, Yuval,
(38:04):
I
Yuval Yeret (38:05):
have a caveat on that. Oh, it's an initiative
that significantly, meaningfullyimpacts multiple products. If
I'm working on something and Ineed Daryl to, you know, do a
day of work to help me finish mywork or deploy it. That's not
(38:25):
cross product in the portfoliosense. Yes, so we need to be
careful not to manage all of theorganization's work at the
portfolio level. That's why I'msaying that we need to minimize
the amount of things that wemanage as cross products and
maximize the amount of work weempower product teams to manage
(38:47):
exactly
Dave West (38:49):
and in in the case of Yuval asking Daryl to, you know,
do a small, minor thing so itmake his life so much more easy,
or delivery thing, then that hasjust been managed in the backlog
like any other stakeholder thatcomes and knocks at darryl's
door, cross product initiativesare ones where there's the Yuval
would have a wheelbarrow ofrequests to Daryl and vice
(39:14):
versa, maybe, which startsadding to the complexity of the
situation. Thank you for callingthat out. Yuval, I think that is
really, really, reallyimportant. And honestly, it
isn't a scientific sort ofmeasure, cross product or not.
Cross product, you know, is it700 requests? Is it four? 300 is
(39:35):
it 12? You know, I don't know. Ithink you know when you know,
though, and and I think it, youknow, I think it's sort of
clear. So thanks for for makingthat clearer for our listeners.
The other thing was interestingis, in the presentation, I
introduced a bit like the way inwhich lean portfolio management,
they do this idea of ainitiative owner or an epic
(39:58):
owner, or whatever, somebodythat owns. These cross product
initiatives. And the words ofadvice for want to a better term
I provided for that was, youknow, that they need to have a
regular cadence. They need tohave, you know, transparent
artifacts, maybe a backlog,maybe a Kanban board, maybe
blah, blah, blah, and they havean initiative owner. And there
(40:19):
was a question about, what's theconflict between product owners,
initiative owners. So I knowDarryl you, you were in
financial services, where therewere these big initiatives, you
know, whether it's moved tocloud, whether it's GDPR,
whether it's some new sockscompliance, that is, isn't about
socks, it's about somethingelse. But anyway, everyone's got
(40:41):
to wear green socks from now onthat, you know, how did you
balance ownership andempowerment at the team level
with these very powerful seniorpeople that came around and
goes, I need to have this. Thecompany will fail without it. I
think
Darrell Fernandes (40:58):
there's different types of initiative
owners, and you, you hit on acouple there. Dave, right? So
let's, let's talk about cloudmigrations. So, so the first
conversation is, why are youdoing a cloud migration? You're
doing a cloud migration for thecapacity that it can provide
you. From an elasticityperspective. Are you doing? You
know? Why? Why are you doing?
Are you doing it for costcontainment, because it's it's
(41:18):
off prem, and you can manage itbetter all those questions,
right? And if it's those kind ofrisks that you're managing or
impacts that you're managing,you can take something like
Cloud migrations. It's still aninitiative, but empower the
product teams differently thanif you're launching a new
financial product which requiresan account opening and account
(41:40):
reconciliation, tradingcapabilities, which are all
separate products to cometogether to offer a new
financial product. Right? Sothere's different kinds of
initiatives, and I think youhave to be clear, when you ask
somebody to own an initiative,what are the what's their role
in driving the impact, and whattools do they have to drive that
impact? And then the productteams need to understand what
(42:04):
their role is in the in theinitiative. So if I'm an account
opening product owner, and I'mbeing asked to contribute, to
participate with, collaboratewith a new financial product,
then I then I need to understandhow that objective is going to
be fulfilled through myorganization, and how we're
(42:26):
going to measure it, and howit's going to fit with my other
priorities, and have thoseconversations, because I think
that those are the realchallenging initiatives. Is more
the business initiatives thanthe pure tech initiatives in my
in my mind, because theprioritization at the product
level becomes the challenge,right? Because if a product has
multiple priorities coming frommultiple initiatives, and this
(42:48):
is what Yuval, I think, wastrying to avoid, which is only
use the initiative constructwhen you absolutely have to big
enough to to use it, theprioritization becomes, becomes
where the rubber meets the road,and having that portfolio level
conversation about the thechoices that have to be made at
(43:10):
each product level in order tomake the initiative happen, and
make sure the initiative owneris kind of aware of that,
because sometimes the initiativeowner may be taking direction
from one side of the house andthe product owner direction from
another side of the house. Youreally need to reconcile that.
You need to have a vehicle toreconcile that. Go ahead, Yuval,
(43:31):
I see
Dave West (43:35):
Yuval.
Yuval Yeret (43:38):
I think you're making an important assumption
there all that the productowners are product owners. A lot
of organizations that I see atthe point that they're starting
their portfolio journey, youknow, their product owners are
not really the Empowered productowners that we talk about, and
(43:58):
it's a slippery slope. To thepoint where we think the
initiative owners, you know,tell product owners what they
need, and it happens. I thinkyou described the right dream
scenario, that the rightenvironment which we need to
(44:19):
work towards. That's exactlywhat a product oriented
portfolio looks like, where wecarved out products that have
real owners, real empowerment,and those initiative owners
learn to act like productowners. We talk about product
owners as influencers, as youknow, experimenters, they do
(44:43):
need to make some decisions, butthey make decisions about their
initiative. They cannot makedecisions about other products.
They need to influence thepeople in the products. That is
a dynamic that is alien, foreignand. Lot of the people though to
a lot of the portfolios, but Ithink it starts with at least
(45:06):
acknowledging that theinitiative owner comes from the
product owner family. Aninitiative owner in your
portfolio should be one of yourbest product owners or product
managers. They should be anexpert in product ownership. Be
very careful with, you know,because it's at that scale
(45:31):
thinking about it's not somebodyfrom the product world, it's
somebody from the project world.
That's an anti pattern that thatI often see,
Dave West (45:41):
yeah, I mean, and then that makes sense, because,
oh, you got this big initiative.
It's cross product. It's a, youknow, business, it's high
profile. You got your productteams running. And of course,
the natural assumption would beto get a really good project
manager that to get it, becausethere's, you know, it's, it's
ultimately about coordination,isn't it? Well, actually, it's
not. It's about influencing.
(46:04):
It's about building a roadmap.
It's about making trade offs.
It's about compromise. It'sabout, you know, and yes, there
is some element of schedulingand the like, but it's not that
isn't the focus, and I thinkthat that is a key skill set
that's often missing in theseinitiatives. The other thing, I
think is really important isthere isn't many of them. I
(46:26):
think that the, you know, themajority of the work needs to be
being done by the product teamsbased on their product roadmaps.
And the not everything is aninitiative just because it
affects multiple products, whichis the point I think you raised
earlier, and I think that'scrucial and and ultimately, we
want to empower the productowners. So give them the guard
(46:47):
rails, give them the the thethis is what we believe at this
point, you know, and then allowthem to be transparently
communicating that to the peoplethat ultimately own the
products. And you know, onething that I've seen a lot is
that you've got differentreporting structures for
different products, meaning thatthe and that can cause a lot of
(47:10):
conflict as well. So, you know,the technology product teams,
or, you know, their productowners report into the CIO, CTO,
whatever, and then you've gotthe business product people
reporting into the businesslines, which ultimately means,
makes it very hard when you'vegot, you know, escalation
issues, because that you've gottwo because the technology
(47:33):
leader has a different set ofgoals than the business leader.
And then then there's this gameof, you know, and is it going to
go away up to, you know, theCEO, and if it's a big financial
company that I'm not sure thatmakes sense. So it just goes
around in circles. Let me justjump
Darrell Fernandes (47:51):
in real quick, Yuval, and then I'll
jump, throw it to you. But Ithink that opens a whole nother
conversation. Dave, aboutaligned incentives, and
regardless of organizationstructure, are people working
towards the same outcomes,right? And if they're not, what
steps can you take to to makethat happen more? Because as
(48:12):
long as people are working todifferent incentives, you're
you're going to have thatchallenge. And the more aligned
you can make, regardless oforganization structure, the
outcomes driving the incentivemodel, the better off you are in
this product centric portfolio,product portfolio centric model.
So I think that's a whole notherconversation. We didn't have a
(48:32):
question about it, but I thinkit's an important one to note.
Yvon,
Yuval Yeret (48:37):
yeah, another rabbit hole that relates to
that. You know, this is justcoming off the of the back end
of a conversation I'm havingwith a real client right now.
What's the scope of theirportfolio? Is it developing
technology products, or is it abusiness portfolio? And I'll
(49:02):
just quickly raise the questionand the impact of it, and maybe
we can discuss it in part three,if we ever do it is, if your
portfolio, as it often is, is anIT technology portfolio, what
might happen is, or what has agood chance of happening, is
(49:24):
that when initiatives come atyour doorstep, it looks like the
classic demand intake processwhere you're told this is what
we need to do to achieve abusiness goal that we've already
decided we need To achieve. Andyou don't have optionality. If
you really want to be a productoriented portfolio and have
(49:46):
optionality and focus on impactand outcomes, it actually leads
you to the fact that you neededto be a business and technology
partnership, not an us and them,where. Where you know,
technology and business areinvolved from day one of
thinking about something in thefunnel and deciding, do we want
(50:09):
to invest now in going to cloud,or in reducing technical debt,
or in Gen AI, or in going intothis weird crypto thing, or
whatever it is, all of those arebusiness decisions that need
(50:29):
product support, and you need tomake these decisions as a
portfolio. That's a much harderchange for some organizations.
You don't necessarily need tostart with that, but you need to
acknowledge it until you're atthat level, it would be hard for
you to be really productoriented and impact oriented.
Dave West (50:50):
I think that you know the reality is that most
organizations are still on theirlegacy. Organizations are on
their journey from Business andTechnology, separate to business
technology, and I think thatproductization can be a really
good tool as a catalyst fordriving that transition.
(51:15):
However, if, if productizationis thought of as something the
IT organization does on its own,then, yeah, you can build some
great technical products, andthat can be, you know, and, but
then it's a very different setof goals, and ultimately leads
you to these challenges, ofthese, you know, ownership
(51:35):
battles, which, which makes notgood for anybody, right? We've
come up to our time, gentlemen,thank you so much for spending I
could. I just learned so muchwhen I have these conversations.
I really do appreciate youtaking the time and listeners.
Thank you for listening. Today,I was with your value at PST,
(51:57):
expert in the field on leanportfolio management, Kanban and
professional Scrum, talkingabout portfolio management.
Portfolio Management. And DarylFernandez, executive advisor to
scrum.org, and ex CIO anddelivery lead. We've been
talking about portfoliomanagement today. We've been
talking about the questions thatcame out of the webinar. We
walked through budgeting andfunding, operational, strategic
(52:19):
investments, you know, capex,OPEX, we talked about strategy
and the challenges of that. Wetalked about roles,
accountabilities andempowerment, all of them, you
know, come to a head at thatportfolio level. Thank you for
listening today to thescrum.org, community podcast. If
you liked what you heard, pleasesubscribe, share with friends,
(52:41):
and, of course, come back andlisten to some more. I'm lucky
enough to have a variety ofguests talking about everything
in the air is professional ScrumProduct thinking. And, of
course, agile. Thanks,everybody. Scrummorg,
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