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Enterprise Agile Planning, Project Portfolio Management

Enterprise Agility in Financial Services

Learnings from the 2019 Planview Horizons Customer Conference

Published By Swetha Channappa

Financial services roundtable

We facilitated a roundtable discussion of our customers at the 2019 Planview Horizons Customer Conference where enterprise agility in financial services organizations was discussed. We learned more about some of the biggest struggles financial institutions face with a focus on capacity planning, funding models, and digital transformation.

The topic discussed for most of the roundtable was how to get work done with the best impact to drive business results.

Since financial services institutions typically work within well-established practices to mitigate risks, new ways of working aren’t always immediately accepted. Financial services companies often operate with a traditional approach to project and portfolio management where annual budgets define how projects are funded and executed. This is in stark contrast to an Agile approach, which uses self-organizing teams to reach specific goals with one common objective in mind — deliver value to the customer with speed. Teams are allocated budget as part of an Agile Release Train or larger value stream (instead of a project-wide budget tied to an annual planning or budgeting cycle) and is measured on the value delivered over a shorter period of time, usually between 3-6 months. In this case, the budget is adjusted at any time during the cycle to accommodate changes in customer requests.

Enterprise agility

Challenges arise when senior leadership has yet to adopt an Agile mindset, even if their teams have. Each participant in our roundtable admitted that leadership and organizational culture were the largest obstacles when implementing Agile. Even in organizations where teams were already practicing Agile, it was common for senior leadership to favor the more traditional portfolio management due to their comfort with detailed project plans and heavier governance.

Teaching leadership and helping them understand a new way of working will make the shift more manageable. To lead in a scaled-Agile environment, leaders must learn to give up the driver’s seat and learn to steer, by providing direction to the end destination. Agile teams are largely self-governing. Senior leaders provide space to innovate, but not how. Teams work closely with customers, both internal and external, to identify the root of problems and innovate to solve them. Therefore, it makes sense to allow the teams themselves to be responsible for setting and achieving success metrics. The best Agile leaders support their teams by staying out of the way and focusing instead on doing the things that only leaders can do: Creating and communicating long-term visions, setting and sequencing strategic priorities, and building the organizational capabilities to achieve those goals. Agile leaders are responsible for driving customer value through enterprise agility – not just productivity, or profitability – as an indicator of their success.  There are many ways to determine whether a team is increasing its ability to innovate with agility and speed:

  • Strategic importance
  • Budget limitations
  • Availability of people (as an indicator of effective capacity management)
  • Return on investment
  • Cost of delay
  • Risk levels
  • Interdependencies among teams
  • Pain points felt by customers and employees weighed against the organization’s capabilities and constraints.

Understanding these metrics can help leaders prioritize and sequence projects and therefore effectively execute their short- and long-term visions for scaling Agile.

Understanding and Responding to Today’s Changing World of Work

In addition to the topic above, during the roundtable, nearly everyone was concerned with how to measure performance in a new work environment. Traditionally, two of the biggest Key Performance Indicators (KPIs) of success reviewed by managers were whether a project was on time and on budget. But these two metrics don’t really work with an Agile approach, where budgets and timelines are determined in increments and aligned to different value streams, as opposed to determined annually for an entire project.

Some companies continue to look at whether a project’s on time and on budget to measure the success of an initiative. This can lead to some of the following limitations:

  • Difficulty estimating and making projections, which can lead to goals and outcomes being continuously changed
  • Annual budgets make it hard to ensure each team has the optimal funding to reach their desired outcomes
  • Initiatives are often driven by the finance department, because they’re the ones approving annual budgets

Measuring performance and success can be viewed differently. This is especially true when considering the variety of work methodologies popular in today’s changing world of work.  Some companies work with one methodology, but many find a solution to this challenge by selecting a hybrid approach. Whether it’s traditional project management, iterative work management, collaborative work management, or Lean and Agile practices, companies are making a transformation to tracking and measuring performance with solutions and tools that work with all of these methodologies to best meet the needs of each organization.

Here are some of the benefits realized by a large banking institution that recently put a Lean-Agile lens on a traditional PPM approach:

  • Regulatory and compliance requirements are still an important aspect of how they use PPM for portfolio management
  • Teams are now empowered to use Lean and Agile methodologies and enterprise Kanban to continuously improve their unique workflows
  • The PMO and stakeholders have visibility into flow, blockers, and dependencies; and teams can better coordinate work planning, execution, reporting, and alignment with value streams and strategy
  • The organization is optimizing strategy to delivery and taking next steps toward incremental funding with Lean Portfolio Management, maintaining a clear line of sight along their transformation journey with this hybrid approach

Measuring Performance and Success

With a traditional project management approach, performance is measured by deadlines and budgets. Alternatively, with a Lean and Agile approach, you look at where you want to go and how you want to get there. Then, measure your success based on the contributions that bring you closer to your objectives and outcomes. This requires the business to define strategic goals with measurable results. Using a Lean budgeting approach takes the focus away from budgets and deadlines and allows organizations to incrementally fund the deliverables that matter most. You can learn more about the benefits of Lean budgeting by reading The 7 Stages to Lean Budgeting Success eBook.

If your organization is considering a move to Lean and Agile practices and principles, we recommend leveraging a portfolio management solution that offers an easy way to measure and quantify performance through dashboards, providing senior leadership with a real-time view into:

  • What’s delivered
  • How it’s delivered
  • When it’s delivered
  • The progress toward strategic objectives

Having the ability to represent the progress of the objectives and demonstrate the value provided to the organization can make it easier to manage expectations and ensure that everyone is on the same page in terms of organizational goals and desired outcomes.

Making the Shift to Continuous Improvement

Many of the participants at the conference are currently using a traditional PPM framework for budgeting, planning initiatives, or both. Project management puts initiatives on a linear, often long-term timeline. Annual budgets are determined by finance and distributed to fund projects lasting six months to a year. This doesn’t leave much room for adjustment and brings people to the work.

Compare this with the outcome-based approach of Lean-Agile practices. Initiatives (work) is brought to the team and released in shorter cycles. The team receives direct feedback (from the customer or early indicators), which is then applied to make improvements. Shorter cycle times give teams the opportunity to continuously improve their product through feedback, which helps ensure that the end-deliverable is aligned with customer preferences and expectations.

This blog offers insight into new and emerging work methodologies so your organization can better deliver on your strategic initiatives that matter most to customers. Learn more about this and other exciting information covered in our Horizons conference:

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Written by Swetha Channappa

Swetha works in Marketing as a member of the Demand Generation team specializing in Account Based Marketing. She believes that every prospect and customer has challenges unique to their roles, responsibilities, and processes, which we can creatively enable them to overcome. What Swetha loves about working at Planview is the collaboration between teams to make sure Planview prospects and customers feel empowered with our tools and solutions that make these challenges seem more like opportunities.