Scrum and the World Crisis

and the World Crisis Rafael Sabbagh Marcos Garrido Scrum Why Scrum is the best choice for projects in times of crisis

Speakers
Rafael Sabbagh
Certified ScrumMaster (CSM)
Seven years of experience in IT Project Management and Development Team Leadership
Computer Engineer - PUC-Rio
Master Student in Administration - PUC-Rio
MBA - PUC-Rio
Marcos Garrido
Certified Scrum Product Owner (CSPO)
Six years of experience in IT Project Management and Development Team Leadership
Information Technologist - PUC-Rio
Master Student in Administration - PUC-Rio
MBA - PUC-Rio

Part I The Crisis

The world faces a crisis... USA banks cut credit, despite of help ADDICTED TO RISK

...and the crisis is severe!
“ It’s the worst crisis since 1929!” International Monetary Fund (IMF)
“ The developed countries will face a generalized recession.” Pamela Cox, vice-President of World Bank LatAm/Caribbean
“ It’s a really, really serious situation!” Henrique Meireles, President of Central Bank of Brazil
“ The crisis brings into question the very future of mankind!” Nicolas Sarkosy, President of France

...and the crisis is severe! Who believes the worst of the crisis is gone? … and who believes the worst is still to come?

The recovery will be difficult...
04/17/2009 –Brazil’s Valor Econômico Journal
IMF: the world economy will take longer to beat recession than previously expected and recovery will be slower than is previous crisis
The global extesion of the crisis contributes to extend the recession
Emerging countries will suffer massive net capital outflows in the next years
04/22 and 04/23/2009 – Brazil’s Valor Econômico Journal
IMF: Brazilian economy will shrink 1,3% in 2009
IMF: World economy will shrink 1,3% in 2009 and may grow again in 2010
IMF: The Crisis will be long lasting and recovery will be slow

And technlogy area suffers... US$ 2.5bi losses 3.9 thousand job cuts 10% jobs cut Stocks plunge 90% profit drop 3,000 job cuts 80% drop in sales

And technlogy area suffers... US$ 2.5bi losses 3.9 thousand job cuts 10% jobs cut Stocks plunge 90% profit drop 3,000 job cuts 80% drop in sales Dismissal and profit drop

...as investment diminishes. Global technology spending to drop nearly 4% in 2009 According to Gartner, worldwide companies are cutting their budget. Investment in hardware will drop 15%, while investment in software will increase 0.5%, as software may help companies save money. Associated Press, 04/01/2009 Forrester: worldwide technology spending to drop 3% this year According to Forrester, worldwide spending in IT products and services may drop 3% compared to 2008. Investment in software may remain stable, while expenses with communication equipment, hardware and IT services will drop this year. IDG News Service/EUA, 01.14.2009 remain stable, while expenses with communication equipment, hardware and IT services will drop this year .

The new reality is hard!
Demand for projects shrinking
Longer decision process
Limited access to credit
Margin pressure
Financial problems with most clients
Environment of uncertainty
Constant changes
Resource rationalization

Part II How to survive?

How to survive? The market demands that organizations change the way they work in order to survive these turbulent times. A true PARADIGM BREAK

How to survive? This new way of work shall:
Work well on rapidly changing environments , allowing frequent replanning
Focus on maximizing the client's ROI
Help reduce time-to-production or time-to-market

How to survive? This new way of work shall:
Avoid effort/time waste with subproducts and features that will never be used
Always deliver value to the client, even if the project needs to be halted
increase the communication and feedback between the project's stakeholders, so people will know what needs to be done and what's being done

How to survive? What framework for project development is focused on all those issues ? Scrum

How to survive? Scrum is the best choice for projects in times of crisis! And the crisis is a great opportunity to spread Scrum!

Part III Use Scrum

Crisis characters...
An organization that provides service on projects must increase its competitiveness in order not to lose clients
A director or manager needing to cut operational costs so that his organization may survive
A client which needs to hire specific projects, internal or external ones, but needs to cut costs in order to keep them viable
Why should they choose Scrum?

NO waste ! Non-agile methodologies defend that a big amount of documents must be generated so that a project may succeed Project Charter Preliminary Scope Statement Project Management Plan Change Requests Progress Report Performance Report Acceptance Report Project Closure Report Detailed Schedule Earned Value Analysis Lessons Learned Document Sequence Diagrams Components Diagram Collaboration Diagram State Diagrams Use Cases Diagram Packages Diagram Activities Diagram ...what else?

NO waste ! Non-agile methodologies defend that a big amount of documents must be generated so that a project may succeed Project Charter Preliminary Scope Statement Project Management Plan Change Requests Progress Report Performance Report Acceptance Report Project Closure Report Detailed Schedule Earned Value Analysis Lessons Learned Document Sequence Diagrams Components Diagram Collaboration Diagram State Diagrams Use Cases Diagram Packages Diagram Activities Diagram ...what else? Do the cost of production and maintenance of those documents pays? How many of those documents will be kept current and how many will be really useful for the project development?

NO waste ! About 50% of the time is spent on requisites, architecture and specifications on typical projects Requirement Analysis Implementation Tests Maintenance all that is done before building any functionality ! Specification / Architecture

NO waste !
35% of requirements change
65% of functionalities are never or rarely used
About 50% of the time is spent on requisites, architecture and specifications on typical projects Requirement Analysis Specification / Architecture Implementation Tests Maintenance and gets worse...

NO waste ! In times of crisis , is such waste of time and effort acceptable?

NO waste ! After all, the objective of a project is the product - not the documentation! With Scrum, only the documentation strictly sufficient and necessary must be utilized for the project That is, adopt only what will be used.

NO waste ! On Scrum, the Product Backlog is dynamic , for it must keep up with the client’s needs, and those change on the course of the project . Then, whatever is delivered, will be used by the client. The functionalities that will be made are the ones of most importance for the client before the beginning of every sprint.

What if the project gets suspended ? Requirement Analysis Specification / Architecture Implementation Tests Maintenance In a non-agile project, what will the client get if the project gets suspended... ...here? Inception Elaboration Construction Transition

What if the project gets suspended ? Requirement Analysis Specification / Architecture Implementation Tests Maintenance In a non-agile project, what will the client get if the project gets suspended... ...or here? Inception Elaboration Construction Transition

What if the project gets suspended ? Requirement Analysis Specification / Architecture Implementation Tests Maintenance In a non-agile project, what will the client get if the project gets suspended... ...or even here? Inception Elaboration Construction Transition

What if the project gets suspended ? A project with Scrum works differently... VALUE is delivered in every iteration!

What if the project gets suspended ? A project with Scrum always produces an increment on the product which is potentially deliverable at the end of every sprint. As such, if the project gets suspended at any moment, the client may utilize what has been generated on previous sprints, minimizing his risks . In a non-agile project, chances are the client won’t be getting any return whatsoever on the investments made .

What if the project gets suspended ? On an environment of uncertainties , minimizing the client’s risks becomes an important competitive advantage .

Better value first! With non-agile methodologies he only gets value at the end of the project . Source: IBM website Release

Better value first! With Scrum , the Product Owner must always update and reorder the Product Backlog , prioritizing the items with better value for the client. Therefore, Scrum assures the items with better value gets delivered first, gerarating ROI frequently for the client.

Better value first!
In times of crisis , organizations must stay competitives . The Product Backlog priorization by better value allows the organization to:
deliver results to its clients faster than the other players
put in production functionalities that add better value to their businesses more quickly
launch products and new versions of them more frequently on the market

May changes come! Big and frequent transformations happen at times of crisis Changes in legislation and regulation Changes in business rules New business opportunities Important players leave the market Losses and unavailability of budget Fusions/aquisitions and governmental interventions

May changes come! How do traditional methodologies deal with changes ? Change is undesirable! Change is risky! Change is expensive! Change must be negotiated! As almost all the planning is made at the beginning of the project, there’s very little room for changes !

May changes come! How do traditional methodologies deal with changes ? The limited scope contract will protect us! The client will want to change it all! Every change must be negotiated with the client! Its impact must be quantified! Every change must be revised , approved , planned , documented and managed !

May changes come! Change Management is a source of stress on projects that use non-agile methodologies. Stress on the long-term relationship with the client . Daily stress for the develompemt team.

May changes come! How Scrum deals with change ? Scrum faces change as a natural part of the development process Agile manifesto: “ respond to changes over following a plan” The Product Backlog is constantly updated by the Product Owner

May changes come! How Scrum deals with change ? Changes can be introduced on the product by the following sprint ! Such quick response to change becomes a great competitive advantage … ... making it possible to turn a crisis into opportunities !

Those who don’t communicate ... On a typical waterfall project, when is the client encouraged to participate? Requirement Analysis Specification / Architecture Implementation Maintenance Tests

Those who don’t communicate ... Tests The client perceives the project as a big black box , which content will be revealed solely by the end of the process On a typical waterfall project, when is the client encouraged to participate? Acceptance Tests Specification / Architecture Implementation Maintenance Requirement Analysis

Those who don’t communicate ... Therefore, once the project is finished, the result will hardly fulfill the client’s needs at that moment !

Those who don’t communicate ... How Scrum deals with communication ? The Product Owner is always in touch with client to identify his needs… … and keep the Product Backlog constantly updated and prioritized ...

Those who don’t communicate ... How Scrum deals with communication ? The client frequently gets new versions … ... and can give feedback more quickly to the team through the Product Owner .

Those who don’t communicate ... How Scrum deals with communication ? That way, the client feels involved with the whole process ... ... sharing the responsibility over the project with the team ... ... increasingly trusting the team and the process itself .

Those who don’t communicate ... The relationship with the client stops being merely commercial to become : Partnership Complicity Satisfaction Fidelity A long term relationship is then developed with the client, which can often overcome strong periods of crisis .

Those who don’t communicate ... Progress Report Project Closure Report Lessons Learned Document Sequence Diagrams Component Diagram Collaboration Diagram Change Requests Detailed Schedule With non-agile methodologies, how is project’s visibility promoted its stakeholders? State Diagrams Mainly through documentation , which.. ... takes a lot of work to be made ... is not efficient ...is hard to update ...ends up being dismissed Project Charter Prelminary Scope Statement Project Management Plan Acceptance Report Earned Value Analysis Package Diagram Performance Reports Activity Diagrams Use Cases Diagram

Those who don’t communicate ... With Scrum , project’s visibility is constantly promoted ! Daily meetings Kanban Working at the same environment Client’s involvement Burndown charts Frequent releases Review meeting Retros- pective ...are some examples.

Those who don’t communicate ... Keeping communications open between the project’s stakeholders is the best way to assure that everyone knows what needs to be done and what’s being done . That generates increase of productivity , which is essential to surviving the crisis.

Making the investment count Unlike other methodologies, Scrum explicitly prioritizes the client’s return on investment ( ROI ). One of the Product Owner’s main roles is to guarantee the client’s ROI , always aiming to maximize it by constantly updating the Product Backlog and prioritizing items with better value.

What if you have to cut down the team? With waterfall , roles inside the projects are very well defined What happens in waterfall projects? On an IT project, for example, the programmer programs, the tester tests… The crisis hit the organiztion and it’s necessary to dismiss or realocate members of the team!

What if you have to cut down the team? If the designer leaves the project… ... new windows will have no graphic design ! If the tester leaves the project... ... it will go untested! If the DBA leaves the project... ...who would take care of the database? If the project manager leaves the project... ... it will go ungoverned!

What if you have to cut down the team? If the designer leaves the project… ... new windows will have no graphic design ! If the tester leaves the project... ... it will go untested! If the DBA leaves the project... ...who would take care of the database? Therefore, the whole project’s success is menaced ! If the project manager leaves the project... ... it will go ungoverned!

What if you have to cut down the team? With Scrum , responsibility over delivery belongs to the whole team, no matter the roles And what happens in projects with Scrum ? Although there is a natural specialization, people are stimulated to develop and utilize their secondary abilities ... ... and, in general, will do their best to compensate the lack of team members

What if you have to cut down the team? With Scrum , responsibility over delivery belongs to the whole team, no matter the roles And what happens in projects with Scrum ? Although there is a natural specialization, people are stimulated to develop and utilize their secondary abilities ... ... and, in general, will do their best to compensate the lack of team members So, even with less capacity, the team can keep delivering

What if you have to cut down the team? Alert : dismissing team members must never be the first alternative Shortening the team also diminishes its capacity to deliver value Consequently, the client will be less pleased and will search for other suppliers ... ... making the organization’s situation worse, creating a lose-lose vicious circle

Part IV Conclusions

Conclusions On this presentation, we showed that Scrum is the best choice for projects in times of crisis

Conclusions We offer several arguments so that people can induce others or decide to opt for Scrum in their organizations

Conclusions Once the crisis is overcome , organizations that adopted Scrum will be closer to its clients , focused on results , more compact , objective and transparent.

Conclusions To these organizations, the crisis will have worked like a propelling spring , so that when it’s time for the market to recover, these organizations will launch first.

Part V Bibliography

Bibliography

Contact us http://www.scrumability.net Rafael Sabbagh [email_address] Marcos Garrido [email_address]

Scrum and the World Crisis

by mgarridobr on May 15, 2009

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