Innovation in SAFe

SUMMARY

SAFe? is presented as the “dual operating system” to the traditional organizational hierarchy, the enabler of business agility and the sustainably faster, higher quality delivery at scale that organizations will require to survive and thrive in the digital age. Our suggestion is that SAFe, as presented, is aligned more to supporting sustaining innovation than to disruptive innovation. We describe why we think this is an important, even urgent situation to consider addressing, and we suggest a few innovations at the strategic, release train, and team levels of the framework that we think may prove useful. Some of these suggestions represent sustaining innovation applied to the framework itself, and at least one or two are likely to be disruptive.

INTRODUCTION

From the perspective of The Scaled Agile Framework (SAFe), it is the capability to learn, adapt, and to deliver faster and higher quality solutions at scale that drives success and leadership in the digital age. In taking on the mission to help organizations achieve this capability, SAFe, like the development industry it supports, has evolved; it is now in its 6th major version. That evolution can be viewed as having proceeded along several dimensions:

• Technology. Incorporating breakthroughs in technology and method as they have taken hold - such DevOps, Behavior and Test Driven Development, and Design Thinking to name a few – Scaled Agile has incorporated their use into the SAFe framework
• Community. By actively supporting a large professional community, Scaled Agile has matured the framework through direct application and ongoing learning
• “Consumability.” Articles in the constantly growing SAFe body of knowledge have been updated and rewritten relentlessly, not just to incorporate additional learning and guidance but to improve readability and consistency of expression. The same is true of the visual framework
• Systems Thinking. Much like an Agile Team gradually expanding its zone of responsibility, SAFe has extended its scope to the broader systems view of being an “operating system for business agility.”

This is all to the good and it is in the hope of contributing in some small way to that relentless improvement that we share these observations about innovation within SAFe. Our belief is that opportunities exist for SAFe to

• Incorporate additional breakthroughs in creating and managing innovation
• Provide separate and distinct support for disruptive innovation as fundamentally different from sustaining innovation
• Incorporate a more complete look at innovation itself from team to portfolio, applying the same systems thinking perspective that has led to addressing business agility in the framework

Moreover, we believe there is some urgency to doing so.

INNOVATION IN SAFE

To begin we should acknowledge where innovation already is incorporated in the fabric of SAFe. Some might suggest that if you had to distill SAFe’s purpose down to just a few words that it might be something like “to enable sustainable innovation at scale.”

As this article is primarily intended for someone with good familiarity with SAFe and is not intended to go on forever, we’ll simply attempt to point some of the pervasive innovation enablers in the SAFe framework today. They can be found in:

• The SAFe principles - Particularly taking an economic point of view, building incrementally, working systems, decentralizing decision making, and more
• The core competency of a Continuous Learning Culture - In fact, all the core competencies could be included from the perspective that agility at all levels and in the organization are needed to completely facilitate innovation
• Continuous Exploration - Here is where a home base for innovation is evident, with hypotheses, Lean Startup thinking, Innovation Accounting, market research, designing for the customer and Lean UX
• Customer Centricity and Design Thinking
• The entire Continuous Delivery Pipeline from the perspective of rapid launches and feedback loops
• Rapid, collaborative planning and decision making from Participatory Budgeting and Lean Portfolio Management down to PI Planning
• Lean business cases and lean governance
• Investment Horizons
• The Innovation and Planning Iteration
• Inspect and Adapt
• Measurement

Even a cursory look shows ingredients and enablers of innovation appearing at all levels of the SAFe framework. What more could we want? Is there any part of innovating as an organization that is not touched on that is liable to trip us up in the long run by its absence? Are there any areas where an additional level guidance could be added to ensure that true innovation is kept alive and not overcome by our mechanics? Are there areas outside the framework that dramatically impact its ability sustain innovation?

WHAT MORE COULD WE WANT?

To explore whether there might be additional innovation topics or guidance that could further clarify, elevate, amplify, protect, or sustain innovation in SAFe, we look at the question from three different viewpoints:

1. By looking top-down or outside-in at the framework and considering innovation organizationally and strategically
2. Zooming in and looking at innovation more bottom-up or inside-out from areas of practice within framework
3. General observations that come out of the first two

Looking Top-Down / Outside In – An Organizational and Strategic Look at Innovation

The ability to respond to disruptive innovations like digital technology is key to an organization’s survival. This is described well in SAFe training and its references to Carlota Perez’s work on the cycles of technology revolutions . But there’s another seminal work that I think we should include in this conversation too - Clayton M. Christensen’s The Innovator’s Dilemma. It is not for nothing that The New Yorker called Christensen “The most influential business thinker on Earth.”

Christensen demonstrated with great clarity and a compelling array of case histories – from the disk drive industry to power shovels, microcomputers to inkjet printers, insulin products, and more – that great companies can fail for the very reason that they are so successful - listening to their customers and serving their markets. They focus on what he referred to as sustaining innovation – innovation that he points out can be radical, technically challenging, and hugely expensive – but that is entirely led by and responds to what the organization’s core market is looking for and that provides the margins the company demands. The company’s processes and values will be grounded in this market.

He defines truly disruptive innovations as those that initially offer less performance in key areas than the core market expects, but proves attractive to new, initially smaller markets and at lower margins. Early entrants who get it right then incrementally improve both quality and cost in the crucible of these early markets and ultimately move up-market to disrupt the higher end market leaders. And, that lower end market itself may subsequently explode. So, it went with the disk drive industry, with the excavator market, as well as microcomputers, to say nothing of the car industry.

That is a poor summary of Christensen’s groundbreaking work, which shares other central learnings and truly deserves an end-to-end read. A key one that comes out of the above analysis and is likewise demonstrated convincingly, is that companies in this situation virtually never succeed by trying to integrate disruptive innovation within the existing company structure, values, and resource management. Many of the current leading organizations are superbly attuned to their market and customers and align with their values. Even where funds are set aside and there is a strong leader, disruptive innovations get choked off in the day-by-day decisions of middle management’s operations.

Other great thought leaders in innovation and product management have echoed this need for separation, assisted by practices for retaining fluid flow of knowledge sharing and opportunity (as emphasized by Kanter ).

This problem of thriving in disruption is exactly what SAFe intends to address, acting as the “dual operating system” that John Kotter describes. The seven core competencies of SAFe that ring its practices and that Scaled Agile focuses on in describing the essence of SAFe provide a strong foundation. We begin our look at innovation from an execution perspective though, at the central heartbeat that Leffingwell describes as the real magic of SAFe, is PI Planning. By this point we are well into the innovation journey - execution of large bets at scale with committed resources concurrently attacking features in support of objectives and market targets.

It is in this context that the teams of the Agile Release Train (ART) are engaged. Product Management engagement with teams prior to this point isn’t a focus of SAFe articles or fundamental training. It is similar with Continuous Exploration. Even though it is emphasized as an ongoing activity, all of those activities culminate in features ready for PI Planning. Without more elaboration of how teams are engaged in early discovery, other than through Product Manager – Product Owner conversations, the sense at least is that early feature hypothesis exploration, experiments and Human Centered Design activity are all being done with minimal involvement of those teams. This makes the framework susceptible to the no-doubt unintended consequence of the ART becoming a “feature factory,” that derogatory phrase from product management and innovation circles describing the situation where teams are handed solutions to build rather than customer problems to participate in solving. This may be a side effect of scaling – and the truth is that it is often the case where only a few teams are involved – but it is not the path to breakthrough product innovation and leadership in the eyes of a number of product management thought leaders.

We’ll discuss this more in the bottom-up look. From a top-down or outside-in perspective the process, even with the inclusion of Continuous Exploration in the ART, does not on the face of it address the separation of sustaining and disruptive innovation that Christensen and others have demonstrated is need for success.

Christensen points out that in disruptive innovation you often not only don’t know exactly what the customer wants at first, neither does the customer. You need, as he said presciently, a model of discovery and failure as you seek to find the market, and that it is less a technological problem than a problem of markets, one that needs to be separated from sustaining innovation.

This need for separation applies up through Portfolio Management. Even with the benefit of the 3 Horizons model of investment governance that SAFe incorporates, years of evidence and experience from Christensen, Geoffrey Moore, and others strongly suggests that it will be a great challenge for a group of collaborating, highly competent executives, deeply knowledgeable and attuned to what works in their markets and for their customers, to maintain two completely different concepts of perceived value and measurement in their ongoing adjustment of resources.

SAFe does, in addition to the 3 Horizon investment model, include in its recommended approach to portfolio governance the setting of adjustable capacity allocation guardrails. Targets are set for how capacity allocation (resources) should work for such categories as architecture runway (enablement), new feature development, technical debt, and potentially other categories. Individual trains tune their targets with this guidance in mind. This mechanism might be used to set capacity targets for disruptive vs sustaining innovation. Christensen and others demonstrate though that despite such reasonable approaches the existing market and customer alignments will, over time, ultimately strangle disruptive innovation in the course of myriad lower-level decisions.

It’s not to say that disruptive and sustaining innovation can’t be managed together in any fashion – at some level they have to be in order to steer the organization - only that explicit strategy and guardrails are required to fill the void, such as those that Geoffrey Moore describes in his 4 Zones of Management.

And it is a problem, since as Bansi and Tuff point out, in the long run the 10% invested in disruptive innovation accounts for 70% of revenue. To address it, the organization has to know when it’s looking at disruptive or sustaining innovation and how to respond accordingly.

As Christensen laid out, a successful organization’s potential and even proclivity to miss and succumb to disruptive innovation is so definite and its impact so profound, that dealing with this reality belongs in the innovation DNA of any organization, particularly large successful ones. This is especially true now since, as Steve Blank points out, the old timeframe of 3-6 years applied to disruptive innovations in the 3 Horizons model no longer applies: “Today disruption – Horizon 3 ideas – can be delivered as fast as Horizon 1 ideas.”

Looking Bottom-up

Turning from a partly organizational, partly strategic perspective, we shift to a bottom up or inside-out execution view of innovation in the ART.

The comingling of disruptive and sustaining innovation in SAFe also holds as we move downward into the Innovation and Planning iteration, ongoing solution integration and cross-team collaboration. The release train and the value stream are aligned to flow together on rhythm toward common goals. A percentage slice of disruptive innovation incorporated in PI Planning and the train’s cadence, will almost certainly have different objectives, measurement, possibly even different (messier) process, and different markets than the rest of the ART. It is not likely to align naturally.

One solution is to have an innovation ART. This might work provided the surrounding governance context is established that addresses separation of disruptive and sustaining, along with mechanisms for knowledge sharing between disruptive and sustaining innovation areas and the broader business, creating opportunities for growth for personnel, and explicit management of the disruptive innovation portfolio. One problem is that a whole ART may be much too big, by definition, for the early stages of a disruptive innovation. We’ll come back to this point.

Continuous Exploration

The Continuous Exploration portion of the Continuous Delivery Pipeline of the SAFe release train plays a huge role in innovation in SAFe. In Continuous Exploration product managers are collaborating with architects, business owners and other stakeholders to hypothesize products, perform market research and use Customer Centric Design Thinking and Lean Startup to shape Minimum Marketable Features. Vision and Architecture are shaped along with a solution roadmap, and the MMF and, assuming its business case still holds, the feature ultimately makes its way to prioritization and PI Planning.

As a whole, Continuous Exploration appears to align well with Christensen’s definition of sustaining innovation. Crafting architecture and a solution roadmap for scalability and general robustness and setting it in the context of features (minimum marketable features) suggest on the face of it a high familiarity and degree of certainty and comfort with customers and the market and a context of incremental improvements. This compares with, in disruptive innovation, very early experiments in a search of market fit. The early market may be small and unprofitable, and early failures toward learning are anticipated and baked in. Architecture is expected to be refactored as market demand is established.

We touched on Continuous Exploration in the top-down, outside-in look at innovation in SAFE. Here, the topics - in many ways product management topics – not currently discussed in detail in the framework but of high interest to use from an innovative perspective, include does not currently delve into extensively

• How teams can collaborate with product management in problem solving, experiments, and Design Thinking in early discovery. This is relevant in both sustaining and disruptive innovation.
• Assuming team involvement in Discovery is established, how are these activities whose objective in SAFe is features for subsequent PI planning, integrated into the teams current PI work. - Particularly if it is disruptive innovation, where the markets and objectives may be quite different from what the rest of the ART is aligning toward

As noted earlier, team creative participation early and shared ownership in discovery, experimentation and problem solving is widely seen as a hallmark of great product teams. Sustaining that fluid collaboration with product management in scaling may be a challenge, but one that needs to be met. As Marcus Aurelius is credited with saying, “The obstacle is the way

The Iteration and Planning Iteration

SAFe also makes space for team members to innovate freely in the Innovation and Planning (IP) iteration and speaks of innovation riptides occurring back upward from delivery through learning and teams being given the space to experiment. This encouragement of universal grassroots contribution of ideas is all good! One can infer that these riptides would roll up through the Product Owner and ART Syncs, to Product Management and Business Owners and, depending on size and perceived impact, to the portfolio, or a sustaining innovation handled at the ART level.

Given the distinct barriers described earlier for disruptive innovation when it is forced to directly compete with sustaining innovation, significant attrition can be expected as ideas move upward. Given what’s at stake, explicit practices for shepherding innovation opportunities, especially disruptive innovations, up and down the framework with visibility, speed, and fluidity organizations should consider.

SUMMARY OBSERVATIONS

SAFe does not explicitly distinguish between the treatment of disruptive and sustaining innovation. As Christensen showed and has been reinforced by others, this can be fatal, and some distinction and nurturing governance outside the delivery model for sustaining innovation is needed.

This includes the identification of disruptive innovations when they arise, and how to organize to address them.

In Continuous Exploration, engaging teams in early design thinking and experimentation, problem solving with product management, should be preserved as a critical ingredient to sustainably great product innovation.

Given the value that models and lessons learned for addressing these scenarios, whether generated by the SAFe Community or Scaled Agile’ s own continuous improvement of the framework, or both, would I believe highly valuable, given the accelerating pace of the innovation discipline itself and its impact for the organizations and the market when done well.

POSSIBILITIES

Dispositioning Innovations - What kind of Innovation is it?

Christensen made a convincing case that the difference between sustaining and disruptive innovation must be understood and acted on in the interest of an organization’s survival. We touched on some of the key differences.

But knowing the difference, how can an organization respond?

Christensen suggests a model for diagnosing and dispositioning an innovation opportunity.

This 4X4 matrix, based on a diagram from The Innovator’s Dilemma, can be used to examine an innovation opportunity against its fit with organizational processes and values. Process, the vertical axis, refers to the ways of getting work done, including process interactions and timing, collaboration and decision making. If the innovation can be executed within existing processes, then current organizational functions can serve. On the extreme other end are “heavyweight teams,” as described by Clark and Wheelwright, which harken back to the cross-functional teams assembled to create a better copiers, cameras and cars as described in The New New Product Development Game, the article that inspired the name for Scrum. But specifically, Christensen notes, “Heavyweight teams are tools for establishing new capabilities.”

Organizational Values, the horizontal axis represents in particular those things that motivate an organization’s allocation of resources, such as expected market size, expected revenue margins, time to value, and could involve familiarity with markets and channels and expected ways of interacting with those clients and markets. If the innovation swims against these forces it is likely to face “death by a thousand cuts” as mentioned earlier. If the innovation is aligned to the organizational values, then the matrix suggests (and Christensen demonstrated) that even if it represents significant technological challenge and may require different processes, it can be handled within the organization by heavyweight teams. This is quadrant A in the matrix. It is the area of radical but still sustaining innovation that, depending on initial scale, SAFe accommodates (in early stages the size of the effort could be small).

It is only in the case where the innovation does not align with existing organizational processes or values that it needs to be set outside the existing organization. This is a truly disruptive innovation. Specifically, it must not have to compete directly for resources with the rest of the organization’s product work on the same terms.

Clearly the organization’s resource allocations must be viewed holistically by someone at some level. Geoffrey Moore goes into this in Zone to Win. But the above suggests innovations identified as disruptive be isolated from the cadenced portfolio review process of SAFe, for example, concerned with closely tracking incremental results of significant commitments against a different set of values.

The point of all this discussion is to suggest that some early, strategic triage of innovation opportunities is important to ensure an organization is alert to disruptive opportunities and disruption itself and is effective responding to them and in applying its investment horizons.

This early triage of innovation and sending some disruptive innovations down a separate path could integrate or at least align with a more general process focused on nurturing innovation and make it visible across ARTs and business units.

These additions would need to be supported by explicit communication models that ensure frequent information sharing on innovation across value streams and business units - where the greatest differentiating opportunities for the organization may be found to exist - and enabling personal growth and knowledge exchange across areas of sustaining and disruptive innovation.

Is it worth expanding SAFe’s horizon to address these innovation diagnostic practices at some level? SAFe’s own evolution can be seen as one of iterative learning, identifying the next level of impediments to agility and addressing those, continually expanding its own Definition of Done to the now broader focus on business agility. From that perspective, early diagnosis of innovation opportunities seems a natural next step. To reiterate, by early diagnosis we mean identifying where a promising innovation fits on a scale of sustaining to disruptive based on the markets being addressed and values and processes needed to attack it effectively.

Innovation at the Execution Level – Making it all visible

We noted that while SAFe sets the stage for innovation in its competencies and provides space for it at all levels, the dominant use case in SAFe training and references is one of feature teams supporting sustaining innovation coming out of continuous exploration that occurs prior to PI Planning. This does not mean that this is the only story SAFe intends to tell, or that more paths can’t be supported with the framework, ones for example, involving more delegation to the teams, more expansive treatment of Product Management and the glue human communication uniting strategy and stakeholders to teams and outcomes. SAFe, in a rather poor analogy to a great studio, may provide all the structure and tools, but that by itself does not guarantee creation of great songs by professional musicians.

And Scaled Agile is the first to say that SAFe needs to be tailored to the organization’s context and markets.

I would be thrilled to provide a catalogue of successful applications of SAFe in different stages of the innovation life cycle and across a gamut of sustaining to disruptive innovation use cases. Time and opportunity permitting I may try to do so. I’m confident that examples are out there in industry and that an intentional effort to collect them through the SAFe Community would be worthwhile. It could fortify the framework as a means for innovation at scale by making clear and visible for multiple use cases across the innovation life cycle for multiple kinds of innovation.

Scaling Down – A SAFe continuum

Though it may seem at first a complete tangent, another potentially valuable piece of knowledge to gain, gather and share are proven paths that smaller and early innovation efforts might follow scale up into SAFe. This could be valuable for at least a couple of reasons.

First of course is the fact that this is how many innovative initiatives start. Even in cases where the ultimate potential is intuited to be large, the initial stages for disruptive innovation will be one of finding opportunity in significant uncertainty, discovery, failing and learning in the search for market fit. Resourcing may start small in relative terms and could go on for an extended period in some cases.

When product-market fit is found, the growth life cycle may be one that doesn’t immediately scale up to SAFe but has a perceived trajectory to do so. Having a roadmap for migration to SAFe, rather than a quantum leap at some threshold, could I think help these products and organizations tremendously to bridge this gap. This migration is likely to have multiple use cases. In some scenarios it may be urgent to scale quickly to rapidly capture the market, as described by Chris Yeh and Reid Hoffman in Blitzscaling.

Secondly, mapping out an incremental path to SAFe could add further clarity to organizations considering its adoption regarding how SAFe insertion fits in the evolution of an organization’s maturity toward business agility, and might help them understand SAFe itself better just by being able to place it fully in context with the organization’s overall evolution.

SAFe is definitionally about Agile at Scale. Whether it makes sense for SAFe itself to “broaden downward” into this space as well is again a question of how much of the innovation continuum is helpful to address to eliminate impediments and smooth that path to scaling, and what relative priority Scaled Agile should put on it. The suggestion is that facilitating this path will ultimately increase SAFe adoption and its success rate and would help place SAFe holistically in the continuum of an organization’s Agile adoption. It might even be an example of Scaled Agile engaging in disruptive innovation. Most importantly of course, it could provide more tools to help organizations reach sustainable innovation.

There is also a third consideration. Looking at how these initially smaller, disruptive initiatives begin and grow would give insight on how to disposition and handle potentially disruptive innovations arising in an existing SAFe environment as well, as described earlier. In fact, the two analyses might significantly overlap.

DISRUPTION IN INNOVATION ITSELF

Evolution in ways of working is continuing. With it, and with the pace of social and technological change that have accompanied and fed it, so too has the discipline of innovation continued to accelerate forward. Elon Musk asserted that “Pace of innovation is all that matters in the long run.” The speed and constancy of the digitally managed, data-driven innovation at Tesla is evidence of that belief put in action and what it can bring about16 . It also shows that innovation itself can be disrupted.

Scaled Agile has been diligent in updating the SAFe to include innovation enablers - such enablers as Lean Startup, Design Thinking, and participatory budgeting to name a few - to strengthen and improve the flow of innovation at scale in the Lean Enterprise. But if there is an underlying premise within this article it is that SAFe, with its mission `1to support sustainable business innovation at scale and its leadership in that market, sits squarely upon this accelerating vortex of innovation change and is itself susceptible to disruption. Two of the opportunities for well-defined methods that we have discussed – early nurturing, diagnosis of and response to disruptive innovation and its variations by the enterprise; and building roadmaps up to SAFe for products moving through and out of market fit – can be seen as new markets and customers for SAFe. Laying paths for even greater flattening and fluidity of discovery paths across product management, teams, and up to executives can be viewed as significant but sustaining innovation - same general market, same product.

The cumulative opportunity, in short, is to connect the dots vividly, end-to-end, on innovation in the enterprise.

Scaled Agile, through its own research and through the strong SAFe community that has been built, is in a strong position to facilitate this forward. It is what Scaled Agile has been doing for the last 13+ years.

A sensible first step is to validate the hypotheses of innovation opportunities for the framework we have just described. There could be multiple other or supporting threads as well, for example expanding our collective understanding of product management as it has matured.

And not to put it all at the feet of Scaled Agile, the more that we can gather, provide, and distill visibly facilitating and channeling frameworks for innovation in the enterprise, the more we will all win.

I believe it’s important that we do. Over the past two decades, competent and committed thought leaders and practitioners have revived, sharpened, and disseminated better practices for collective creativity and working together. It’s not easy. But now more than ever I think it is worth sustaining and carrying forward.