Skill development has the learner and the company as its addressees.

On the part of the learner, the focus is on:

Building knowledge, skills, and expertise

• Pursuing interests and inclinations
• Career planning
• Improving personal opportunities on the labor market

On the part of the company, it is important to

strategically develop personnel

• build the right mix of skills, strategic personnel development
• ensure the implementation of the strategy
• align with portfolio and technology expertise

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Which ever organization you form, it is not the right one… Adapted Architectures

Once you know the basics of your business strategy, i.e., how the business will generate revenue and profit, you can start designing an architecture that supports the business requirements or aligns them with the capabilities to technologies and the architecture.

Example: If one of your company’s main offerings is to supply emission control systems to passenger cars, the transition to electric-powered vehicles would require new products, a very different technology base, and profound adjustments in organizational and employee capabilities.

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• Aligning with the business, not managing current operations
• Portfolios – With the help of portfolios, a company can concretize its strategy and make it feasible. Portfolios help to focus on the right priorities.

If you look at the term portfolio in general, it is a selection of topics and an allocation of resources.

Based on this, we introduce three types of portfolios that are central to the concretization of a strategy:

• Products: the classic portfolio of products, customers and markets
• Architecture(s) or technology: the set of technical solutions available to a company.
• Skill: the capabilities of individuals and groups

Tools

• Conway’s Law: and the inverse Conway maneuver
• BAPO: The BAPO model by Jan Bosch describes four aspects of a development activity and also suggests a sequence for processing them. 

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The Boston Consulting Group portfolio divides a company’s various products into four categories based on their relative market share and market growth, depending on their position in the product life cycle: question marks, stars, cash cows and poor dogs. The product portfolio is a subset of the corporate portfolio that can be defined down to the level of the individual product (share of sales, profit, growth rates, etc.).

Source: Wikimedia

Three Horizons

The idea of the three horizons is based on the observation that different development phases require different control mechanisms:

• Horizon 1 (0-12 months), also known as the operational horizon. Operations relate to the present and the immediate future:
  the focus here is on current day-to-day business. Horizon 1 ranges from daily to a few weeks to a few months into the future. Execution is often not affected by grand strategic visions that are to become reality in a few years.
• Horizon 2 (12-36 months), also known as the tactical horizon:
  Tactics is what moves us from today’s portfolio to tomorrow’s portfolio, i.e. connecting execution with strategy, i.e. providing guidance on how to develop today’s operations into tomorrow’s state.
• Horizon 3 (36-72 months), also known as the strategic horizon, determining the direction of future business:
  Strategic considerations and decisions live in horizon three. They determine the future direction. We need a vision of where we want to be in the future in terms of market, customers and environment.

The original formulation of the three-horizon model focuses on fixed time horizons. This rigid view is considered outdated; modern developments are more interesting.

Our personal preference is Simon Wardley’s integrated view of the evolution of products, practices,

Consequences

The three-horizon model suggests a distinction of goals, metrics and tools according to horizon.

The three horizons model is attributed to Mehrdad Baghai, Stephen Coley and David White, “The Alchemy of Growth”, New York: Perseus Publishing, 1999.

Lean-Agile Portfolio Evolution

Portfolios at SAFe

The portfolio level is the highest level considered by SAFe. In a large enterprise, there may well be several portfolios, each defining its own value streams and solutions. However, all these portfolios are considered in the context of the corporate strategy: the enterprise strategy drives the portfolio strategies, and the portfolio owners in turn inform the corporate strategy owners.

The important concepts are as follows:

• Value streams are longer-term development efforts that create a continuous flow of new products and services. Value streams are implemented through one or more programs or (also known as) Agile Release Trains in a solution.
• Lean budgets are provided for solutions or Agile Release Trains. The budget for an iteration of a solution or a release train (program increment) is available to product management.
• Portfolio Kanban systems. SAFe suggests a Portfolio Kanban system for Business Epics and for Enablers. They ensure that the number of initiatives in which investments are made is limited.
• Epics are large initiatives in a portfolio. Business Epics describe new functionality, while Enabler or Architecture Epics encompass overarching technological changes that keep a system operational and future-proof.
• The portfolio backlog is the top-level backlog in SAFe and contains the prioritized epics that have passed through the Kanban system and are waiting to be implemented by a release train.
• Strategic topics are specific driving elements that link the portfolio vision with the company’s overall strategy.

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