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Planning without Estimation<br />Bonnie Aumann and Arlo Belshee<br />
Create the product with the Highest Value<br />You have 90 business days (aka 6 months) to deliver<br />No peeking! <br />...
How it was Rigged<br />Card Values and Costs are selected completely independently<br />The only correlation is that there...
Real Results – Agile Tour 10/6/2009<br />Team 1: <br />Team 2:<br />Team 3:<br />Team 4:<br />With Cost Estimates<br />$40...
 Prioritization Matrix<br /> <br />
 Prioritization Matrix<br /> <br />$$$<br />
 Prioritization Matrix<br /> <br />$$$<br />Investment<br />
 Prioritization Matrix<br /> <br />$$$<br />Investment<br />Cheap!<br />
 Prioritization Matrix<br /> <br />$$$<br />Investment<br />Cheap!<br />WTF<br />
Typical Choices<br /> <br />$$$<br />Investment<br />Cheap!<br />WTF<br />
There’s a problem<br />Choosing this way actually <br />reduces <br />Total Value<br />-- we just saw this happen --<br />
Cognitive Illusion<br /> <br />Logarithmic<br />Linear<br />
Maximum Value<br /> <br />$$$<br />Cheap!<br />WTF<br />Investment<br />“An Edge”<br />
Contact<br /> Bonnie Aumann<br />@bonniea<br />bonniea@bonniea.com<br />ArloBelshee<br />arlo@electroncascade.com<br />
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Higher Value without Estimating

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Estimating features tends to result in projects with lower achieved value - in the same time period! We suggest that this is due to how value grows logarithmically while costs stay linear. Cognitive illusions prevent us from making the best decisions for success.

Half of the presentation "Diagrams for Understanding and Improving Agile Practices," originally presented at Agile 2009 by Arlo Belshee and Bonnie Aumann.

Published in: Business, Technology
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Transcript of "Higher Value without Estimating"

  1. 1. Planning without Estimation<br />Bonnie Aumann and Arlo Belshee<br />
  2. 2. Create the product with the Highest Value<br />You have 90 business days (aka 6 months) to deliver<br />No peeking! <br />The front of the card is all the information you have<br />Estimated Business Value:   <br />Excellent  &gt;  Good  &gt;  Some  &gt;  Low<br />Flip a card<br />Add the Actual Value in $$ to your total<br />Subtract the Actual Cost in days from your quota<br />
  3. 3. How it was Rigged<br />Card Values and Costs are selected completely independently<br />The only correlation is that there are no excellent value cards with a less than a day estimate. <br />Cost estimates are 100% accurate<br />Value estimates have a 25% chance of being &quot;wrong“<br />Wrong is defined as off by a factor of 2, which may or may not actually cause a card to be miscategorized. <br />In particular, that’s more likely to throw off telling whether a given card is “low” or “some” value, and not likely to misfile an excellent – which matches real world.<br />
  4. 4. Real Results – Agile Tour 10/6/2009<br />Team 1: <br />Team 2:<br />Team 3:<br />Team 4:<br />With Cost Estimates<br />$408,182<br />$412,958<br />$215,447<br />$410,647<br />No Cost Estimates<br />$1,465,700<br />$1,183,00<br />$1,166,900<br />$1,227,000<br />Teams did 3 to 4 times better without cost estimates<br />
  5. 5.  Prioritization Matrix<br /> <br />
  6. 6.  Prioritization Matrix<br /> <br />$$$<br />
  7. 7.  Prioritization Matrix<br /> <br />$$$<br />Investment<br />
  8. 8.  Prioritization Matrix<br /> <br />$$$<br />Investment<br />Cheap!<br />
  9. 9.  Prioritization Matrix<br /> <br />$$$<br />Investment<br />Cheap!<br />WTF<br />
  10. 10. Typical Choices<br /> <br />$$$<br />Investment<br />Cheap!<br />WTF<br />
  11. 11. There’s a problem<br />Choosing this way actually <br />reduces <br />Total Value<br />-- we just saw this happen --<br />
  12. 12. Cognitive Illusion<br /> <br />Logarithmic<br />Linear<br />
  13. 13. Maximum Value<br /> <br />$$$<br />Cheap!<br />WTF<br />Investment<br />“An Edge”<br />
  14. 14. Contact<br /> Bonnie Aumann<br />@bonniea<br />bonniea@bonniea.com<br />ArloBelshee<br />arlo@electroncascade.com<br />
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