A. Participatory budgeting forums that lead to Value Stream budget changes
B. Capacity allocation of the Value Stream compared to process mapping
C. Determining if business needs meet the Portfolio Threshold
D. Allocation of centralized vs decentralized decisions in the Enterprise
The Correct Answer is
A. Participatory budgeting forums that lead to Value Stream budget changes
Explanation
One component of a Guardrail in Lean Portfolio Management (LPM) is:
- Participatory budgeting forums that lead to Value Stream budget changes
Guardrails in Lean Portfolio Management are designed to provide guidance and boundaries within which portfolio decisions are made, ensuring alignment with strategic objectives while allowing flexibility and autonomy where it’s most needed. Participatory budgeting forums are an essential aspect of these guardrails. They involve key stakeholders in the decision-making process regarding the allocation of budgets to different value streams. These forums are meant to ensure that budget allocations are aligned with strategic priorities, optimize the flow of value, and adapt to changing business needs or market conditions.
Let’s briefly address why the other options are not considered components of a Guardrail in LPM:
- Capacity allocation of the Value Stream compared to process mapping: While understanding capacity allocation and process efficiency is important within Lean Portfolio Management, these aspects are not specifically identified as components of LPM guardrails. Guardrails are more about strategic decision-making boundaries rather than operational efficiency metrics.
- Determining if business needs meet the Portfolio Threshold: This is part of the decision-making criteria within LPM but is not described as a “guardrail” component. The concept of a portfolio threshold is about evaluating whether potential investments meet certain criteria of significance or return on investment, but the guardrails are more about how decisions are made within those criteria.
- Allocation of centralized vs decentralized decisions in the Enterprise: While the balance between centralized and decentralized decision-making is a crucial aspect of Lean Portfolio Management, it’s not specifically highlighted as a guardrail component. The emphasis on guardrails is more directly related to how investment decisions are aligned with strategy and managed within the constraints of budgeting and resource allocation.
Guardrails in Lean Portfolio Management help ensure that while the organization strives for agility and responsiveness, it remains aligned with its long-term strategic goals and financial constraints. Participatory budgeting forums exemplify this by involving a broad range of stakeholders in key financial decisions, ensuring transparency, alignment, and collective ownership of the outcomes.
Other Leading SAFe 6.0 Question – What is the goal of the House of Lean?