1. Kanban for
Portfolio Management
Gaetano Mazzanti
@mgaewsj
Agile42

2. sounds familiar?
too many things to do
slipping schedule
continuous resource reallocation,
multitasking
too slow to react

3. demand
capacity

4. the illusion of predictability
delays
defects
plan
uncertainty
emerging knowledge
impediments
more detailed planning
rigid change management
additional overhead

5. welcome to uncertainty

6. Project Portfolio Management (PPM) is the centralized
management of processes, methods, and technologies used by
project managers and Project Management Offices (PMOs) to
analyze and collectively manage a group of current or proposed
projects based on numerous key characteristics. The objectives
of PPM are to determine the optimal resource mix for delivery
and to schedule activities to best achieve an organization’s
operational and financial goals ― while honouring constraints
imposed by customers, strategic objectives, or external real-
world factors.
wikipedia

7. traditional portfolio
tenets
Governance
Compliance
Control
PMO (budget administration, staffing, auditing)

8. traditional portfolio
“pillars”
Top-down
Centralized Annual Budget
Detailed Planning
Fixed date, fixed cost, fixed scope
(fixed fate L)
Cumbersome electronic tools
starting vs finishing
people as “resources”
full capacity allocation
PUSH!

9. we love Excel!

10. rebooting teams
project “completed”:
reboot the team and…
start again L ouch!
teams are rebooted, project to project, putting
together different people each time and
expecting to have predictable outcomes
Tuckman model of team development

11. On time, On Budget Conformant to Specs
oops!
how is success measured

12. inspired by Joakim Sunden

13. What is Lean Kanban?
The Kanban method is an
evolutionary approach to change

14. Lean
add value without generating waste

15. muri, mura, muda

16. principles of the
Kanban method
start with what you do now
agree to pursue incremental, evolutionary change
respect the current process, roles, responsibilities
titles
encourage acts of leadership at all levels in your
organization – from individual contributor to senior
management

17. Kanban
six core practices
visualize
limit WIP
manage flow
make process policies explicit
implement feedback loops
improve collaboratively, evolve experimentally

18. if you can’t see it
you can’t manage it

19. Visualize
Knowledge work is invisible. If you can’t see
something, it is (almost) impossible to manage
it.
Collaborative process improvement is almost
impossible if work and workflow are invisible
and if process policies are not explicit.
David J Anderson

20. a Kanban board
visualize to understand the process
how the process works and fails to work for
you and your customers
how it can be changed

21. expose dysfunctions

22. Limit WIP

23. balancing
demand capacity
demand
capacity
no matter how good you are at filtering
capacity is always full (and more)

24. # of items in system (WIP)
B
C
D
F
E
A
ideas
elaborate
do
delivered
validate
G
H
I
# of items in a specific
state = 2
# of items in
specific area = 4
total # of
items = 9

25. limiting WIP
fewer commitments
more options
finishing stuff- stop starting start finishing

26. 100% utilization myth
idle work
vs
idle workers
efficiency (doing things right)
vs
effectiveness (doing the right things)

27. multitasking
sucks
it’s easier to start
than it is to finish

28. multitasking sucks
visualphotos.com
1
2
3
4
5
6
YOUR MULTITASKING
IS MY BOTTLENECK
Jim Benson
1
2
3
4
5
6

29. let work flow
let work flow

30. visualize flow
ideas
elaborate
do
delivered
validate
B
C
D
F
E
A

31. visualize flow
B
C
D
F
E
A
ideas
elaborate
do
delivered
validate

32. highlight issues
B
C
D
F
E
A
ideas
elaborate
do
delivered
validate
!
!

33. measure flow
B
C
D
F
E
A
ideas
elaborate
do
delivered
validate
G
H
I

34. cycle time
=
WIP / throughput
(throughput = average completion rate)
Little’s Law

35. flow = speed * density

36. slack (%)
absorb variations
% capacity
utilization
queuesize
queue size
grows
exponentially
at high capacity0
5
10
15
20
25
0
10
20
30
40
50
60
70
80
90
100

37. make process policies explicit
(i.e. definition of done,WIP limits, pairing reviews, test
automation, …)
implement feedback loops
(i.e. standups, retrospectives, operation reviews, metrics, …)
improve collaboratively, evolve experimentally
(using models and the scientific method)

38. Lean Agile Portfolio
traits
Value driven
WIP limited
Decentralized, adaptive
Empirical, Probabilistic (statistical data support)
Lightweight business case/specs
Lightweight estimation
Physical Boards
Traditional Portolio Management
Centralized Annual Budget
Detailed Planning
Fixed date, fixed cost, fixed scope
(fixed fate L)
Compliance driven, top-down approach
Cumbersome electronic tools

39. Kanban board design
Ideas
oo
Biz Case
Tech
Assessment
15-30 5-12
Committed
5
In Progress
5
Verification
5
Rejected
Commitment
Point
Business
RD
source David J Anderson

40. Kanban board designs
source Pawel Brodzinski

41. demand analysis
where does work come from?
how is value assigned (and verified) to initiatives?
is arrival rate predictable? (usually not)
Ideas
oo
Biz Case
Tech
Assessment
15-30 5-12
Committed
5
In Progress
5
Verification
5
Rejected
Commitment
Point
Business
RD

42. work item types
standard
fixed date
urgent/emergency
intangible
…
small
medium
large
…
growth
maintenance
innovation
…

43. the magic of visualizing
waiting for
approval
initial design,
planning,
outsourcing,
mold design, etc.
demand
capacity

44. one week later

45. a new board
color = team

46. 46
flow

47. (bad) flow
Z Z Z
Z Z
Z Z Z
Z Z
Z Z Z
Z Z

48. bottlenecks
B
C
D
F
E
A
ideas
elaborate
do
delivered
validate
G
H
I
gate
J
K

49. bottlenecks
B
C
D
F
E
A
ideas
elaborate
do
delivered
validate
G
H
I
gate
J
K
L

50. bottlenecks
B
C
D
F
E
A
ideas
elaborate
do
delivered
validate
G
H
I
J
K
L
gate
items
queueing up
empty
area

51. limit WIP
by # of initiatives (size matters)
by size
by team capacity
by space available
by conversation
…

52. limit WIP by
team capacity / space available
mar apr may jun jul aug sep
Team
A
Team
B
Team
C
Team
D
Team
E

53. once again:
complexity and uncertainty are
intrinsic to knowledge work
we must be able to
react to unfolding events and
adapt to changing circumstances
David J Anderson

54. but… we hate uncertainty
we prefer to take a decision now
even if it risks being wrong
i.e. annual budget (we remove options, we
increase risks)

55. decision making in
uncertainty
balance:
risk/return
maintenance/growth
short term/long term
etc.

56. selection
what to do next?
what to finish next?

57. last responsible moment
selection
Discover
what to do
Do It Validate
Outcome
Reject Commitment
keep your options open
pull

58. selecting/pulling
a project
do first
do next
do soon /
re-evaluate
do sometime
or reject
fit with goals
timeliness
(urgency,
Cost of Delay,
fit with strategy)
source GDS
select what you don’t do

59. what about
specs estimations?
what if you have 50 candidate initiatives and
only 15 can be done?
what’s the point (cost) of specifying and
estimating all 50?
precision is worthless
guesstimation - range + historical data
check and adapt

60. when starting a project
we simply need a rough idea of size and
an understanding of (un)certainty

61. which parameters should you
consider to select what to do next
ROI, IRR, NPV, etc. ?
Do you know your Cost of Delay???
ROI
Cost of
Delay
(1 month)
Project A
25%
5k
Project B
15%
30k
which one would you select next?
example credit: Kenny Rubin

62. cost of delay