In this presentation, I talk of Donald Reinstern's original idea of quantifying using Money units per time unit. However, the Agile world has been comprised a bit by using Fibonacci series or a scale of 1 to 10. Are we compromising the original intent of the author?
3. Confidential C
Achieving differential value - Kano model
• Must-have features (bed,
bathroom, desk, clean)
• Linear features (the more the
better)
• Exciters and delighters (Customers
do not know until they see)
4. Confidential C
Rules for differential features
• Invest in MMFs, but never overinvest in a
feature that is already commoditized.
• Drive innovation by having the courage to
invest in exciters.
• If resources do not allow you to compete on
the current playing field, change the playing
field.
10. Confidential C
Cost of delay
If you only quantify one thing, quantify the Cost of
Delay —Don Reinertsen
Time is money
Change in time ~= change in money
11. Confidential C
Cost of Delay
Project A if delivered
on time
5 million Euros
Project A is delayed by
two months
3 million Euros
Project Revenue
1 million Euros
/ month
12. Confidential C
What is Cost of delay?
• Cost of Delay is a way of communicating the impact
of time on the outcomes we hope to achieve
• To make decisions, we need to understand not just how
valuable something is, but how urgent it is
16. Confidential C
Long-life products – peak “affected”
Unfair competitive advantage or other network effect
Facebook and SnapChat, or Cola brands and PC market
17. Confidential C
Long life cycle, peak value “unaffected” by delay
Established organizations – Automating a process,
improving efficiency, reducing cost of time.
23. Confidential C
User-Business Value
The potential value in
the eyes of the user
What is the revenue
impact on our
business?
Do our users prefer
this over that?
Potential penalty
24. Confidential C
Time criticality
How does the
business value decay
over time?
Will they wait for us
or move to another
solution?
Is there a fixed
deadline?
Effect on customer
satisfaction
25. Confidential C
Risk reduction / Opportunity enablement
What else does this
do for our business?
Is there value in the
information we will
receive? - Security
Does it decrease
future risk of delivery?
Will this feature
enable new business
opportunities - Rating
27. Confidential C
3
10
6
A
B C
Feature Duration Cost of
Delay
WSJF
A 1 10 10
B 1 3 3
C 1 1 1
(1 + 1) * 1 = 2
C
B
A
(1 + 1) * 3 = 6
Effort is constant but CoD varies
Cost of
delay
Time
Cost of
delay
Time
28. Confidential C
1
10
13
A
B C
Feature Duration Cost of
Delay
WSJF
A 1 1 1
B 3 1 0.33
C 10 1 0.1
(1 + 1) * 3 = 6
C
B
A
(10 + 3) * 1 = 13
CoD is constant and effort varies
Cost of
delay
Time
Cost of
delay
Time
30. Confidential C
WSJF
WSJF = CD3 = Cost of delay divided by duration
Weighted Shortest Job First (WSJF) is a prioritization model used to
sequence Features, Capabilities and Epics to produce maximum
economic benefit
31. Confidential C
Cost of delay – Life-cycle profit impact
• Life-cycle profit impact - make decisions quickly, correctly,
and with logic that everyone can understand
• We need a method to express all changes, in all variables,
in the same unit of measure