What if we found ourselves building something that nobody wanted? In that case, what did it matter if we did it on time and on budget?

—Eric Ries, The Lean Startup [1]

Epic

Definition: An Epic is a significant solution development initiative.

Due to their considerable scope and impact, epics require the definition of a Minimum Viable Product (MVP) [1] and approval by Lean Portfolio Management (LPM).

Portfolio epics are typically cross-cutting, typically spanning multiple Value Streams and PIs. To accelerate learning and development and reduce risk, SAFe recommends applying the Lean Startup build-measure-learn cycle for these epics.

Details

This article describes the portfolio epic’s definition, approval, and implementation. Agile Release Train (ART) and Solution Train epics, which follow a similar pattern, are described briefly at the end of this article.

There are two types of epics, each of which may occur at different levels of the Framework. Business epics directly deliver business value, while enabler epics advance the Architectural Runway to support upcoming business or technical needs.

It’s important to note that epics are not merely a synonym for projects; they operate quite differently, as Figure 1 highlights.

Figure 1. Epics are not projects
Figure 1. Epics are not projects

SAFe discourages using the project funding model (refer to the Lean Portfolio Management article). Instead, the funding to implement epics is allocated directly to the value streams within a portfolio. Moreover, Agile Release Trains (ARTs) develop and deliver epics following the Lean Startup Cycle discussed later in this article (Figure 6).

Defining Epics

Since epics are some of the most significant enterprise investments, stakeholders must agree on their intent and definition. Figure 2 provides an epic hypothesis statement template for capturing, organizing, and communicating critical information about an epic.

Figure 2. Epic hypothesis statement
Figure 2. Epic hypothesis statement

Download

Epics above the approval Guardrail are made visible, developed, and managed through the Portfolio Kanban system, where they proceed through various states of maturity until they’re approved or rejected. Before being committed to implementation, epics require analysis. Epic Owners take responsibility for the critical collaborations needed for Business Epics, while Enterprise Architects typically guide the Enabler epics that support the technical considerations for business epics.

Creating the Lean Business Case

The result of the epic analysis is a Lean business case (Figure 3).

Figure 3. Lean business case
Figure 3. Lean business case

Download

The LPM reviews the Lean business case to make a go/no-go decision for the epic. Once approved, portfolio epics move to the Ready state of the Portfolio Kanban. When capacity and budget become available from one or more ARTs, the Epic is pulled into implementation. The Epic Owner is responsible for working with Product and Solution Management and System Architects to split the epic into Features or Capabilities during backlog refinement. Epic Owners help prioritize these items in their respective backlogs and have ongoing responsibilities for their development and follow-up.

Defining the MVP

Analysis of an epic includes the definition of a Minimum Viable Product (MVP) for the epic. In the context of SAFe, an MVP is an early and minimal version of a new product or business Solution used to prove or disprove the epic hypothesis. Unlike storyboards, prototypes, mockups, wireframes, and other exploratory techniques, the MVP is an actual product that real customers can use to generate validated learning.

Estimating Epic Costs

As Epics progress through the Portfolio Kanban, Portfolio Leadership will eventually need to understand the potential investment required to realize the hypothesized value. This analysis requires a meaningful estimate of the cost of the MVP, and the forecasted cost of the full implementation should the epic hypothesis be proven true.

  • The MVP cost ensures the portfolio is budgeting enough money to prove or disprove the Epic hypothesis. It helps ensure that LPM makes sufficient investments in innovation aligned with Lean budget guardrails.
  • The forecasted implementation cost considers ROI analysis, helping determine if the business case is sound, and allows the Portfolio Leadership and the VMO to prepare for potential adjustments to value stream budgets.

The Epic Owner determines the amount of the MVP’s investment in collaboration with other key stakeholders. This investment should be sufficient to prove or disprove the MVP’s hypothesis. Once approved, the value stream cannot spend more than the defined investment cost to build and evaluate the MVP. If the value stream has evidence that this cost will be exceeded during epic implementation, further work on the epic should be discussed with Portfolio Leadership before exceeding the MVP’s estimated cost.

Estimating Implementation Cost

Considerable strategic efforts often require collaboration with external Suppliers to develop Solutions. The MVP and the anticipated full implementation cost estimates should include internal costs and forecasted external Supplier expenses.

Estimating epics in the early stages can be challenging since there is limited data and learning at this point. As illustrated in Figure 4, ‘T-shirt sizing’ is a simple way to estimate epics, especially in the early stages:

  • A cost range is established for each t-shirt size using historical data
  • The gaps in the cost ranges reflect the uncertainty of estimates and avoid excessive discussion around edge cases
  • Each portfolio must determine the relevant cost range for the t-shirt sizes

The Epic Owner can incrementally refine the total implementation cost as the MVP is built and learning occurs.

Figure 4. Estimating epics using example T-shirt sizes and an example cost range in one enterprise
Figure 4. Estimating epics using example T-shirt sizes and an example cost range in one enterprise

Supplier Costs

An epic investment often includes the contribution and cost from suppliers, whether internal or external. Ideally, enterprises engage external suppliers via Agile contracts, which supports estimating the costs of a supplier’s contribution to a specific epic. For more on this topic, see the Agile Contracts extended guidance article.

Forecasting an Epic’s Duration

While it can be challenging to forecast the duration of an epic implemented by a mix of internal ARTs and external suppliers, an understanding of the forecasted duration of the epic is critical to the proper functioning of the portfolio.

Like an epic’s cost, its duration isn’t easy to forecast as it includes several components, such as internal duration, supplier duration, and the collaborations and interactions between the internal and external teams. Practically, unless the epic is wholly outsourced, LPM can focus on forecasts of the internal ARTs affected by the epic, as they are expected to coordinate work with external suppliers.

Forecasting an epic’s duration requires an understanding of three data points:

  1. An epic’s estimated size in story points for each affected ART can also be calculated using T-shirt sizes and replacing the cost range with a story point range.
  2. The historical velocity of the impacted ARTs.
  3. The percent (%) capacity allocation that ARTs can dedicate to working on the epic. This allocation typically results from negotiation between Product and Solution Management, Epic Owners, and LPM.

In the example shown in Figure 5, a portfolio has a substantial enabler epic that affects three ARTs, and LPM seeks to gain an estimate of the forecasted number of PIs.

ART 1 has estimated the epic’s size as 2,000 – 2,500 points. Product Management determines that ART 1 can allocate 40% of total capacity toward implementing its part of the epic. With a historical velocity of 1,000 story points per PI, ART 1 forecasts between five to seven PIs for the epic.

Figure 5. Example worksheet for forecasting an epic’s duration
Figure 5. Example worksheet for forecasting an epic’s duration

After repeating these calculations for each ART, the Epic Owner can see that some ARTs will likely be ready to release on demand earlier than others. However, the forecasted duration to deliver the entire epic across all ARTs will likely be between six and eight PIs. If this forecast does not align with business needs, negotiations such as adjusting capacity allocations or increasing the budget for suppliers will ensue. The Epic Owner updates the forecasted completion once work begins on the epic.

Implementing Epics

The SAFe Lean startup strategy recommends a highly iterative build-measure-learn cycle for product innovation and strategic investments. This approach for implementing epics provides the economic and strategic advantages of a Lean startup by managing investment and risk incrementally while leveraging the flow and visibility benefits of SAFe (Figure 6).

Gathering the data necessary to prove or disprove the epic hypothesis is highly iterative. These iterations continue until a data-driven result is obtained or the teams consume the entirety of the MVP budget. In general, the result of a proven hypothesis is an MVP suitable for continued investment by the value streams. Otherwise, any further investment requires the creation of a new epic.

Figure 6. Epics in the Lean startup cycle
Figure 6. Epics in the Lean startup cycle

After it’s approved for implementation, the Epic Owner works with the Agile Teams to begin the development activities needed to realize the business outcomes hypothesis for the epic:

  1. If the hypothesis is true, the epic enters the persevere state, which will drive more work by implementing additional features and capabilities. ARTs manage any further investment in the epic via ongoing WSJF feature prioritization of the ART Backlog. Local features identified by the ART, and those from the epic, compete during routine WSJF reprioritization.
  2. If the hypothesis is false, Epic Owners can decide to pivot by creating a new epic for LPM review or dropping the initiative altogether and switching to other work in the backlog.

After evaluating an epic’s hypothesis, it may or may not be considered a portfolio concern. However, the Epic Owner may have ongoing stewardship and follow-up responsibilities.

Lean budgets’ empowerment and decentralized decision-making depend on Guardrails for specific checks and balances. Value stream KPIs and other metrics also support guardrails to keep the LPM informed of the epic’s progress toward meeting its business outcomes hypothesis.

ART and Solution Train Epics

Epics may originate from local ARTs or Solution Trains, often starting as initiatives that warrant LPM attention because of their significant business impact or initiatives that exceed the epic threshold. ART and Solution Train epics may also originate from portfolio epics that must be split to facilitate incremental implementation. Like any other epics, ART and Solution Train epics deserve a Lean business case that captures these significant investments’ purpose and expected benefits. The ART and Solution Train Backlogs article describes methods for managing the flow of local epics that do not meet the criteria for portfolio attention.

Learn More

[1] Ries, Eric. The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses. Crown Business, 2017.

Last update: 6 September 2023