The document discusses the business case for adopting agile methods over traditional waterfall approaches. It provides examples of how agile practices like iterative development, prioritized backlogs, and frequent releases can improve financial metrics like return on investment, net present value, and break-even point. While some costs like additional training may increase under agile, benefits often outweigh these and include faster time to market, continuous feedback, and higher quality code. The document demonstrates these concepts through examples comparing financial projections of projects using waterfall, releases every 6 months, and releases every 1-3 months with and without prioritization.
5. Measuring Financial Consequences
Return on Investment (ROI) // Kapitalrendite
> Measuring how much of your invested „money“ you get back in return.
Net-Present-Value (NPV) // Kapitalwert
> Sum of all revenues and payments including interests.
Break-even-Point // Gewinnschwelle
> Point in time when accumulated costs and revenue are equally large.
6. Example Case – New Car-Insurance Inventory
Ricola Insurance creates new Car-
Insurance Inventory
Project duration:
12 months
Project costs:
5.000.000 SFR
Earnings after launch:
200.000 SFR each month
Project lifespan:
5 years
7. Agile As In Scrum
Relevant for financial
consideration
> Iterative and incremental
development (Sprints)
> Prioritized requirements
(Backlog)
8. Agile As In Scrum
Not considered with potential positive impact
> Higher team productivity (intrinsic motivation, self-organisation, …)
> Reaction to changes
> Including new ideas
> Stop project in time (all features implemented; cancel project)
Possibly neutral through automation
> Frequent migration & deployment
Not considered with potential negative impact
> Impeded productivity through frequent releases (for users)
> More trainings
> Higher operating costs through running systems in parallel
31. Faster market entrance with interative,
incremental development
Functionality
First Mover Window of Opportunity
> Be the first on the market
with a new product Complete functionality of release
Fast Follower Minimal marketable functionality
> React quickly, when your Δt until product
can be launched
competitors launch a new
iterative,
product incremental
waterfall
t
32.
33.
34. Less non-valuable results
Working software every
month
Continuous customer
feedback
Intensive communication
instead of specification
35. High quality with lasting effect
Definition of Done 100%
90%
80%
70%
60%
50%
40%
Maintenance starts after 30%
20%
10%
2nd iteration 0%
Automating Test,
Integration and
Deployment Unstrukturiertes System
Strukturiertes Sytem
36. Andreas Ebbert-Karroum www.codecentric.de
codecentric AG, Düsseldorf
andreas.ebbert-karroum@codecentric.de