LPM Post

Apr

19

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting — Continued

LPM Post

  Prompts for Guiding Portfolio Maturity Conversations   1) Truth: What assumptions about our portfolio, funding, or governance need to be re-examined from “First Principles Thinking“ (Are we doing things because they’re true – or because they are familiar?) 2) Flow: Where does work or money get stuck in out system, and what would happen if we visualized that flow end-to-end? 3) Learning: How do we ensure each experiment – strategic, financial, or technical – creates shared learning instead of isolated data? 4) Alignment: Are our KMM, LPM, TBM and Accounting practices maturing at the same pace, or is one…

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Apr

18

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting — Continued

LPM Post

    Roadmap to Enterprise Evolution 1) Identify your current maturity level across all four lenses: KMM (flow maturity), LPM (Strategic Agility), TBM (Value Economics), Accounting (Financial Adaptability) 2) Expose misalignments (e.g., Lean Funding with Traditional Accounting) 3) Co-create the next evolutionary step using shared “First Principles” and measurable outcomes “The goal is not perfection – it is continuous congruence between how we think, fund, and deliver value." LPM is on Amazon

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Apr

17

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting — Continued

LPM Post

  Putting all these together is Key To Successful Portfolio Coaching   KMM Level 6: Whole Enterprise LPM is on Stage 6 = Evolutionary enterprise. Living portfolio model – continuous co-creation and ecosystem Value. State: Organization functions as an adaptive system – strategy, governance, and culture unified. TBM view: Enterprise-wide Value networks and ecosystem cost optimization. Accounting view: Value economics fully integrated with strategic flow; sustainability metrics embedded. “We are a learning, value-centered, living system.” LPM is on Amazon

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Apr

16

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting — Continued

LPM Post

  Putting all these together is Key To Successful Portfolio Coaching KMM Level 5: Congruent LPM is on Stage 5 = Evolved portfolio. Portfolios adapt fluidly to strategy; feedback loops across enterprise. State: Purpose-driven improvement; culture aligned with Lean Agile Values. TBM view: Strategic funding transparency across business domains. Accounting view: Continuous forecasting; adaptive capitalization; flow-based performance. “Purpose, learning, and funding flow together.” LPM is on Amazon

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Apr

15

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting — continued

LPM Post

  Putting all these together is Key To Successful Portfolio Coaching   KMM Level 4: Risk-Hedged LPM is on Stage 4 = Adaptive, learning. Decision-making decentralized; guardrails replace approvals. State: Risk-managed delivery systems; governance transparent and data-driven. TBM view: Predictive investment analytics; value realization tracking. Accounting view: Agile capitalization and expense alignment (Value-based). “We balance innovation, risk, and Value, dynamically.” LPM is on Amazon

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Apr

14

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting — continued

LPM Post

    Putting all these together is Key To Successful Portfolio Coaching   KMM Level 3: Fit-for-purpose   LPM is on Stage 3 = Adaptive portfolio. Continuous prioritization and portfolio flow optimization.   State: End-to-end service design; predictability and governance mature.   TBM view: Portfolio-level cost governance; investment-to-value traceability   Accounting view: Dynamic funding tied to portfolio performance metrics.   “We manage flow, risk, and learning – not just numbers.”   LPM is on Amazon  

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Apr

13

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting — continued

LPM Post

Putting all these together is Key To Successful Portfolio Coaching KMM Level 2: Customer-driven LPM is on Stage 2 = Lean Agile Foundation. Funding begins shifting to Value Streams; teams align to strategy. State: work linked to customer outcome; flow metrics appear TBM view: IT cost transparency improves; early Value Stream cost views Accounting view: Supports Agile budgeting; rolling-wave planning. “We plan around Value, not just cost” LPM is on Amazon  

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Apr

12

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting

LPM Post

  Putting all these together is Key To Successful Portfolio Coaching   KMM Level 1: Team Focused   LPM is on Stage 1 = Awakening. Pilot Agile teams; leaders start asking: “Why?”; visible work starts. State: Teams visualize work (basic Kanban); early flow awareness.   TBM view: Initial mapping of IT costs to services   Accounting view: First attempts at flexible budgeting; limited agility.   “We’re starting to see where the work goes,” LPM is on Amazon  

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Apr

11

2026

By Clarence Galapon

Kanban Maturity Model (KMM) 7 Stages Vis-a-Vis LPM, TBM, and Accounting

LPM Post

Putting all these together is Key To Successful Portfolio Coaching This chapter show how David Anderson’s Kanban Maturity Model (KMM) 7 Stages align with Lean Portfolio Management (LPM) + Technology Business Management (TBM) + Accounting vis-a-vis maturity lenses. KMM Level 0: Oblivious LPM is on Stage 0 = Traditional portfolio. State: Reactive, hero-based, no portfolio visibility. Command and control; project funding; unclear value alignment TBM view: Basic cost tracking only. “Keep the lights on” Accounting view: Traditional cost centers; annual budgets; no agility. “We manage money and people. not value or flow.” LPM is on Amazon  

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Apr

10

2026

By Clarence Galapon

Key Insight

LPM Post

In SAFe LPM, the goal isn’t to eliminate accounting rules – it is to apply them Leanly so that compliance coexists with agility and continuous value delivery while staying audit-ready. LPM is on Amazon  

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Apr

09

2026

By Clarence Galapon

Aspects and LPM Approach to Each

LPM Post

Funding Model – Value Stream funding instead of project funding Expense type handling – Work-based classification (CapEx vs. OpEx) Budget Cadence – Annual budgets with dynamic reallocation Compliance – GAAP / IFRS=aligned through incremental capitalization Governance – Lean Budget Guardrails ensure alignment and transparency LPM is on Amazon

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Apr

08

2026

By Clarence Galapon

Yearly Expense Alignment

LPM Post

LPM uses Lean Budgeting and Participatory Budgeting (PB) to handle yearly expenses: Budgets are planned at the portfolio level, by Value Stream, not project Spending boundaries are managed through guardrails, not fixed project budgets Reallocation happens continuously based on value, learning, and capacity – not calendar cycles This means: The annual plan exists, but funding flows dynamically across initiatives during the year. LPM is on Amazon  

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Apr

07

2026

By Clarence Galapon

LPM Collaboration with Finance

LPM Post

Define capitalization policy – Clarify what qualifies as CapEx under GAAP / IFRS Set allocation model – Determine % split between capitalized and expensed work Enable lightweight time tracking – Simplify reporting without reintroducing waterfall bureaucracy Align on audit requirements – Ensure Agile accounting data satisfies compliance needs LPM is on Amazon

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Apr

06

2026

By Clarence Galapon

Example

LPM Post

Work type: New Product development. Classification: Capitalized. Example: Building new SaaS feature Work type: Enhancement of existing capability. Classification: Capitalized. Example: Extending data analytics module Work type: System maintenance or support. Classification: Expensed. Example: Bug fixes, minor updates Work type: Infrastructure costs. Classification: Expensed. Example: Cloud hosting, DevOps tools Work type: Training or experimentation. Classification: Expensed. Example: Upskilling. POCs LPM is on Amazon

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Apr

05

2026

By Clarence Galapon

Understanding Capitalized vs. Expensed Work … continued

LPM Post

2) Classify Work by Activity Work items are tagged as capitalization or expensed at the team or feature level Capitalization rules are applied in collaboration with accounting (following GAAP / IFRS) Time tracking can be minimal – often based on proportional estimates from completed features 3) Use Lean Budget Guardrails Guardrails ensure spending remains aligned to strategic themes and portfolio epics Budget flexibility allows dynamic reallocation between CapEx and OpEx as priorities shift 4) Incremental Capitalization Costs are capitalized as value is delivered, not when the entire project completes This supports Agile’s incremental delivery model while staying compliant LPM is…

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Apr

04

2026

By Clarence Galapon

Understanding Capitalized vs. Expensed Work

LPM Post

Capitalized Expense (CapEx): Work that creates or enhances a long-term asset – typically software features or systems that provide future economic benefit. Example: Developing a new feature or product capability. Operational Expense (OpEx): Work that runs or supports the business – maintenance. support, minor fixes, routine operations. Example: Bug fixes, system monitoring. training, support tickets. In Lean Agile accounting, both types of work can exist within the same Agile Release Train (ART) or Value Stream. Capitalization SAFe provides Lean Agile guidance for working with finance to ensure compliance while maintaining flow. Key Practices: 1) Fund Value Streams (not projects) LPM…

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Apr

03

2026

By Clarence Galapon

How LPM Integrates With Finance and Accounting – Capitalized vs. Operational Expenses

LPM Post

Traditional Accounting – Projects are funded and tracked individually LPM – Value Streams are funded continuously Traditional Accounting – Capital vs. Expense split determined per project LPM – Split determined by type of work within the Value Stream Traditional Accounting – Recognizes costs after project completion LPM – Accounting evolves incrementally as value is delivered Traditional Accounting – Emphasis on Budget Compliance LPM – Emphasis on value and flow efficiency LPM is on Amazon

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Apr

02

2026

By Clarence Galapon

Summary

LPM Post

Aspect: Goal – Align technology spending with business strategy Aspect: Focus – Transparency, value, accountability Aspect: Enables – Lean Budgeting, portfolio governance, and value delivery Aspect: Outcome – Data-driven, value-based investment decisions LPM is on Amazon

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Apr

01

2026

By Clarence Galapon

The Connection: TBM + LPM = Value-Based IT Management

LPM Post

In SAFe, TBM provides financial visibility and decision framework that LPM uses to: Set Lean Budgets Apply guardrails for spending Fund Value Streams dynamically Drive business agility across the enterprise in essence, TBM turns IT from a “black box cost” into a transparent, strategic enabler of business value. LPM is on Amazon

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Mar

31

2026

By Clarence Galapon

Why TBM Matters in SAFe LPM

LPM Post

TBM helps portfolio leaders answer key questions: Where is our technology investment going? Are we funding the highest-value initiatives? How efficiently are we using our resources? How do we optimize our budgets for maximum strategic impact? By applying TBM, organizations move from cost-center thinking to close delivery thinking. LPM is on Amazon

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Mar

30

2026

By Clarence Galapon

Core TBM Practices Integrated into SAFe LPM

LPM Post

TBM Concept: Cost Transparency – Provides detailed visibility into where technology funds are spent (e.g., run, grow, transform the business) TBM Concept: Value Mapping – Links spend to SAFe Value Streams, ensuring funding decisions are tied to customer and business value. TBM Concept: Benchmarking – Compares portfolio costs and performance with industry standards to guide optimization. TBM Concept: Showback / Chargeback models – Encourages accountability by showing (or charging) costs to consuming business units. TBM Concept: Run-Grow-Transform model – Categorizes spend to ensure the right balance between between operations, innovation, and transformation initiatives. LPM is on Amazon

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Mar

29

2026

By Clarence Galapon

TBM’s Role in SAFe LPM

LPM Post

In SAFe LPM, TBM supports the “Lean Budgeting and Guardrails” function by: Bringing transparency to portfolio costs Aligning funding with Value Streams Enabling data-driven decision-making for investments SAFe LPM and TBM work together to shift from project-based to Value Stream-based funding. LPM is on Amazon

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Mar

27

2026

By Clarence Galapon

Why Lean Governance Matters

LPM Post

Traditional governance = slow, centralized, and risk-averse. Lean governance = adaptive, transparent, trust-based. It ensures organizations can: a) Respond quickly to change b) Maintain fiscal responsibility c) Stay compliant and auditable d) Deliver more value, faster In Short: Lean Governance in LPM = “Doing the right oversight, at the right level, at the right time – with minimal delay and maximum value. LPM is on Amazon

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Mar

25

2026

By Clarence Galapon

What Lean Governance Is

LPM Post

Lean Governance ensures that: 1) Funds are allocated to Value Streams, not rigid projects. 2) Decisions are made close to where the work happens (decentralized control). 3) Compliance and risk management are built into the process, not bolted on later. 4) Measurement and transparency replace heavy command-and-control oversight. In other words, it’s governance that enables flow, not governance that slows everything down. LPM is on Amazon

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Mar

24

2026

By Clarence Galapon

Lean Governance

LPM Post

Lean Governance is one of the three core dimensions of Lean Portfolio Management (LPM) in Scaled Agile Framework (SAFe). Purpose: Provide just enough oversight and control to enable value flow – not slow it down. It focuses on how decisions, funding, and compliance are handled – but in Lean and decentralized way. It ensures responsible flow of value. It ensures oversight, compliance, and measurement. LPM is on Amazon

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Mar

23

2026

By Clarence Galapon

Kanban Maturity Model (KMM) — continued, Part III

LPM Post

Level 6 – Whole Enterprise Entire organization operates as a coherent adaptive system Purpose, strategy, and execution flow as one Culture of evolutionary change and leadership maturity “The organization continuously adapts as living system” In short: KMM describes how an organization evolves from chaos → predictability-> reliability-> adaptability-> evolutionary purpose It’s not just about Kanban boards – it is about maturity of culture, management, and flow systems. LPM is on Amazon

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Mar

22

2026

By Clarence Galapon

Kanban Maturity Model (KMM) — continued

LPM Post

Level 3 — Fit-for-purpose End-to-end service delivery workflow mapped Portfolio-level coordination emerges Metrics and policies guide improvement Customer satisfaction becomes a management objective. “We are reliably delivering what customers expect!” Level 4 – Risk-Hedged Governance becomes Transparent Risk management is built into flow systems Cross-service collaboration and portfolio alignment mature. “We balance flow, risk, and value across the organization.” Zone 3: Evolutionary Continuously evolve and self-improve Level 5 — Congruent (Harmony) Decisions are guided by shared purpose and values Continuous improvement is systematic and data-driven Policies and behaviors are consistent across the enterprise. “We evolve through shared principles and constant…

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Mar

21

2026

By Clarence Galapon

Kanban Maturity Model (KMM)

LPM Post

Evolve in Culture, Practices, and Outcomes KMM has 7 maturity levels, grouped under three major evolution zones — Survival, Fit-for-purpose, and Evolutionary. Zone 1: Survival (Maturity Levels 0 to 1) Level 0 – no awareness of flow or process work is chaotic no explicit policies “We do whatever it takes to get things done!” Level 1 – Team-focused Basic Kanban Board Team starts limiting WIP (work-in-process) Basic service delivery awareness emerges “We can see our work and start controllling chaos” Zone 2: Fit-for-purpose Consistency, flow, and Customer Value Level 2 – Customer Driven Services defined and managed to meet customer…

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Mar

20

2026

By Clarence Galapon

Using The Kanban System

LPM Post

A backdrop / History The Kanban System for Software Development that David J. Anderson has introduced in 2004 to the Digital Solutions Industry is a great system for LPM. Note that Kanban has been in use for the longest time in the Industrial Age — created by Taiichi Ohno, and Industrial Engineer at Toyota Motor Corporation in Japan during the 1940’s and 1950’s. The purpose: To improve manufacturing efficiency and reduce waste as part of what became Toyota Production System (TPS). In the Digital age, Mr. Anderson brought Kanban — in 2004 — from manufacturing into the world of Knowledge…

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Mar

19

2026

By Clarence Galapon

Reflection Prompt

LPM Post

From rules to truth — the enterprise evolves when First Principles Thinking, Lean Thinking, Agile Thinking, Leverage, Game theory, and Systems Thinking flow together as one system of learning. Reflection prompt: Which stage of "Thinking” does your portfolio reflect today — and what truths must we uncover next to evolve towards flow, learning, and purpose? LPM is on Amazon

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