Scaled Agile Framework (SAFe) Lean Portfolio Management Practice Exam

Which of the following best describes a 'Lean Budget Guardrail'?

1. Strict accounting procedures

2. Guidelines to ensure appropriate funding levels

3. Flexibility in budget allocation

4. Rules for resource allocation

The correct answer is: Guidelines to ensure appropriate funding levels

The concept of 'Lean Budget Guardrail' refers to guidelines that help organizations maintain appropriate funding levels for their initiatives while promoting agility and adaptability in resource allocation. These guardrails are designed to encourage a balance between fiscal responsibility and the need for innovation, enabling teams to respond to changing priorities without being hindered by rigid funding processes. By establishing these guidelines, organizations can ensure that funding is aligned with strategic objectives, allowing for continuous delivery of value while also enabling quick adjustments as business needs evolve. This approach is essential for Lean-Agile organizations, as it fosters an environment where decisions can be made based on current realities rather than outdated plans. In contrast, the other options do not capture the essence of Lean Budget Guardrails. Strict accounting procedures may impose unnecessary constraints, limitation flexibility in budget allocation could stifle innovation, and rules for resource allocation might not be adaptable enough to respond to shifting demands. The focus on guidelines in option B provides the necessary framework to manage funding effectively while still embracing agility.