at ADAPT: AgileEVM Delivering Value within Constrained Systems

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  • 1. AgileEVM  Delivering  Value  within  Constrained  Systems   Brent  Barton,  President,  Agile  Advantage,  Inc.    
  • 2. !   The  Problem  !   An  Agile  Story  !   Contracts  vs  Value  !   Scrum  (An  Agile  Project  Management   Framework)  !   TradiAonal  Earned  Value  Management  !   Agile  Earned  Value  Management  (AgileEVM)  !   Project  Case  Study  !   Open  Discussion   *Slides  available  via  slideshare.net  or  geHngagile.com   2  
  • 3. !  Robert  Gates,  the  United  States  Secretary  of   Defense,  in  a  September  2008  speech,  said,   “Our  convenAonal  modernizaAon  programs   seek  a  99%  soluAon  in  years.  Stability  and   counterinsurgency  missions—the  wars  we   are  in—require  75%  soluAons  in  months.   Agile  Methods:  Selected  DoD  Management  and  AcquisiAon  Concerns,   Carnegie  Mellon  University,  October  2011,  p.  ix   ©2011  Agile  Advantage,  Inc.    All  rights  reserved.   3  
  • 4. This  is  the  best,  simplest,  easiest  to  use   applica1on  we  have   ever  go7en  in  both    Customer  Care  and  the   Retail  Stores!    Whatever  you  all  did,  I   want  more  of  that!  
  • 5.   Employee  SaAsfacAon   Cost  Savings    Customer  SaAsfacAon   Revenue   New   RetenAon   Revenue    Cost  Savings    New  Revenue     through  efficiency   Shareholder   Value   Compliance   Value   Employee   Customer   SaAsfacAon   SaAsfacAon   6  
  • 6. !  #  Lives  saved  !  Simple  to  Use  !  Secure  !  ?   Value   ©2011  Agile  Advantage,  Inc.    All  rights  reserved.   7  
  • 7. The  primary  purpose  of  the  [EVMS]  system  is  to  support  program  management*   Scope   Schedule   Cost   8   *  Earned  Value  Management  Systems  ANSI/EIA-­‐748-­‐B-­‐2007  
  • 8. !  Time  and  Materials  (T  &  M)  !  Fixed  Price  !  Cost  Plus  IncenAve  Fee  !  IDIQ/Delivery  orders   •  or  task  orders   These  are     cost-­‐based!   ©2011  Agile  Advantage,  Inc.    All  rights  reserved.   9  
  • 9. Strategic   Value  Required  to   Informs  and  make  good   Guides   Decisions   Quality   Constraints   (Schedule,  Cost,  Scope)   Source:    Jim  Highsmith   10  
  • 10. We  are  uncovering  beqer  ways  of  developing   sorware  by  doing  it  and  helping  others  do  it.   Through  this  work  we  have  come  to  value:  Individuals  and  interacAons  over  processes  and  tools   Working  sorware  over  comprehensive   documentaAon   Customer  collaboraAon  over  contract  negoAaAon   Responding  to  change  over  following  a  plan   That  is,  while  there  is  value  in  the  items  on   the  right,  we  value  the  items  on  the  ler  more.   hqp://agilemanifesto.org/   ©2011  Agile  Advantage,  Inc.    All  rights  reserved.   11  
  • 11. !   It  is  not  possible  to  completely  specify  an  interacAve   system.   Wegner’s  Lemma,  1995  !   Uncertainty  is  inherent  and  inevitable  in  sorware   development  processes  and  products.   Ziv’s  Uncertainty  Principle,  1996  !   For  a  new  sorware  system  the  requirements  will  not   be  completely  known  unAl  arer  the  users  have  used   it.   Humphrey’s  Requirements  Uncertainty  Principle,  c.  1998   12  
  • 12. !   Stack  Ranked   PrioriAzaAon  based  on   Business  Value  and  risk  !   Self  organizing,  cross-­‐ funcAonal  teams  !   DefiniAon  of  Done  !   PotenAally  Shippable   Increments  !   Velocity  !   ConAnuous   Improvement   13  
  • 13. Total Allocated Budget! EAC   EsAmate  at  Complete   Management Reserve! PMB   Performance Management Baseline$   Planned  Value   (PV)   Actual  Cost   (AC)   (EV)   Earned  Value   Time   Time! Completion! Now! Date! 14  
  • 14. Cost Performance Index (CPI=EV/AC) CPI < 1 CPI =1 CPI > 1 Over Budget On Budget Under Budget Schedule Performance Index (SPI=EV/PV) SPI < 1 SPI =1 SPI > 1 Ahead ofBehind Schedule On Schedule Schedule 15  
  • 15. !  Integrates  cost  and  schedule  management  !  Forecasts  in  financial  units  based  on  units   used  for  actual  cost  !  Decades  of  use  !  Part  of  PMBOK  (ANSI/PMI  99-­‐001-­‐2008)  !  Part  of  EVMS  (ANSI/EIA-­‐748-­‐B-­‐2007)   16  
  • 16. !   Typical   implementaAons   Ugh!   expect  everything  fully   defined  up  front  !   No  asserAon  of  quality  !   Claiming  value  earned   on  intermediate  work   products   17  
  • 17. !   A  planning  package  is  a  holding  account  (within  a   control  account)  for  budget  for  future  work  that  it  is   not  yet  pracAcable  to  plan  at  the  work  package  level.   The  planning  package  budget  is  Ame-­‐phased  in   accordance  with  known  schedule  requirements  (due   dates)  for  resource  planning,  and  the  plans  are   refined  as  detail  requirements  become  clearer  and   the  Ame  to  begin  work  draws  nearer.  A  program  may   elect  to  break  the  work  assigned  to  a  control  account   into  smaller  groupings  of  tasks,  i.e.,  mulAple   planning  packages,  for  internal  planning  and  control   reasons.   -­‐Earned  Value  Management  Systems  ANSI/EIA-­‐748-­‐B-­‐2007   18  
  • 18. !  There  is  no  standard  advance  planning  look-­‐ ahead  period  (i.e.,  a  planning  “horizon”  or   “window”)  for  conversion  of  planning   packages  into  work  packages  that  is   appropriate  for  all  programs  or  condiAons.   Each  organizaAon  must  determine  its  own   policies  in  this  regard.   -­‐Earned  Value  Management  Systems  ANSI/EIA-­‐748-­‐B-­‐2007   19  
  • 19. !  MathemaAcally  proven  that  Forecasts  based   on  average  velocity  (story  points)  esAmate   at  complete  EAC  (dollars)  !  Key  AssumpAon:    The  raAo  of  (story  points   completed)/(total  story  points  in  a  release)  is   a  good  measure  of  Actual  Percent  Complete   Sulaiman,  Barton,  Blackburn  “AgileEVM  -­‐  earned  value  management  in   Scrum  projects,”  2006   hqp://ieeexplore.ieee.org/xpl/freeabs_all.jsp?arnumber=1667558   20  
  • 20. !   Release  Baseline   •  Budget  (BAC)   •  IniAal  Scope   •  Start  Date  !   Each  IteraAon  (Sprint)   •  Points  accepted  by  Product  Owner     – meets  DefiniAon  of  Done   •  Points  add  or  removed  from  release  scope   •  Actual  Cost   21  
  • 21. !  Now  we  can  focus   on  Value…   22  
  • 22. !   Because  the  performance  measurement  baseline   (PMB)  is  expressed  as  “number  of  story  points   planned”  rather  than  at  the  level  of  specific  tasks,   it  allows  course  correcAons  to  be  made  without   disrupAon  or  re-­‐baselining  of  the  PMB.    !   This  addresses  the  criAcism  expressed  in  the   Defense  AcquisiAon  Reform  Findings  and   RecommendaAons  (DARFAR)  report  regarding  the   inability  of  tradiAonal  EVMS  to  idenAfy  issues   related  to  “contract  requirements  that  uqerly   failed  to  meet  warfighter  needs”  [House  Armed   Services  Commiqee  2010].   Agile  Methods:  Selected  DoD  Management  and  AcquisiAon   Concerns,  Carnegie  Mellon  Urniversity,  October  2011,  p.  63   ©2011  Agile  Advantage,  Inc.    All   ights  reserved.   23  
  • 23. 24  
  • 24. !  Integrated  Cost  and  Schedule  informaAon   provides  beqer  insights  than  schedule  alone   25  
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  • 28. !  Focus  on  delivering  value  !  Constraints  inform,  not  dictate  outcomes  !  Quality  must  be  part  of  the  decision  process  !  AgileEVM  helps  communicate  by  translaAng   points  to  dollars   •  Can  provide  alternaAves  to  contracAng  challenges   29  
  • 29. !   President:  Agile  Advantage,  Inc.   !   Former  CTO,  Development  Manager,   PMO  Manager,  Agile  Coach,  Mentor,   CerAfied  Scrum  Trainer,  ScrumMaster,   Product  Owner   !   AcAve  pracAAoner  delivering  value   using  Agile  and  helping  others  do  it;   from  small  Product  companies  to   brent@agileadvantage.com   very  large  organizaAons    www.agileadvantage.com   Blog:  geHngagile.com   Twiqer:  brentbarton  !   ArAcles   •  “Manage  Project  Por•olios  More  EffecAvely  by  Including  Sorware  Debt  in  the  Decision  Process”,   Cuqer  Journal  2010   •  “AgileEVM  –  Earned  Value  Management  in  Scrum  Projects”,  IEEE  2006   •  “ImplemenAng  a  Professional  Services  OrganizaAon  Using  Type  C  Scrum”,  IEEE   •  “Establishing  and  Maintaining  Top  to  Boqom  Transparency  Using  the  Meta-­‐Scrum”,  AgileJournal   •  “All-­‐Out  OrganizaAonal  Scrum  as  an  InnovaAon  Value  Chain”,  IEEE