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Estimating and planning Agile projects
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Agile Estimation for Fixed Price Model

Agile Estimation for Fixed Price Model

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Agile Estimation for Fixed Price Model

  1. 1. Agile Estimation for Fixed Price Model Challenges & Possible Solutions Jayanthi Srinivasan Linkedin: Jayanthi S, PMP,ITIL,PMI-ACP,SAFe SA
  2. 2. 2 About Me  PMP, ITIL, PMI-ACP, SAFE SA Certified  More than 16 years in IT Industry  Specialized in  Agile Coaching  Assessment  Transformation
  3. 3. 3 Key Highlights Context – Agile & Upfront Estimation in Fixed Price Model at Proposal Stage Fixed Cost instead of Fixed Scope As a Solution Implementation Challenges Change Management Process Fixed Cost instead of Fixed Scope as a Solution Estimation Barriers Recommended Sizing Techniques Requirement Clarity Levels Story Point Computing Approach Definition of Done Story Point Computing Models First Velocity Computation Velocity Decelerators & Accelerators How do we arrive at Schedules? Overall Agile Story Point Estimation and Planning Framework Sample Estimation How do we track the budget during project execution? Conclusion
  4. 4. 4 Context – Agile & Upfront Estimation in Fixed Price Model at Proposal Stage Agile Estimation Progressive Requireme nts No Team Clarity Fixed time, Cost, Scope Implications if not considered
  5. 5. 5 Fixed Cost instead of Fixed Scope As a Solution Fixed Price Model Challenges Change Management - Fixed Cost instead of Fixed Scope Story Sizing Techniques Story Point Computation Models First Velocity as a Magic Number Team Size Total Effort Schedule Arrival Budget Tracking
  6. 6. 6 Implementation Challenges The Agile Triangle Reference: http://2.bp.blogspot.com/x_mffEtfUTg/UQAz2HidX3I/AAAAAAAAAPY/gvkVuRRRZLI/s1600/Figure3.jpg Limited Scope Control Frequent Prioritization More Adaptable Collaborative Continuous Delivery
  7. 7. 7 Change Management Process Scrum Change Management Process Reference: http://www.gregmester.com/wp- content/uploads/2015/08/IterationPlanningChange.jpg  No changes during a sprint.  However Scrum framework allows the Product Owner to add Change Requests in the product backlog.  The Change Requests (story point estimated) to be prioritized by Product Owner.  The equivalent Story point user stories are replaced and re- prioritized.
  8. 8. 8 Fixed Cost instead of Fixed Scope as a Solution  Estimate by story points with the initial set of requirements.  Identify an approach to compute the story points and share the approach with customer and arrive at a common understanding.  Adapt for changes up to the extent of consumption of the initially estimated story points with some buffer.  Beyond the initial estimate of story points, it can be considered as additional cost.
  9. 9. 9 Estimation Barriers Cost Effort No Actual Team players at Proposal Phase Identifying the Right Sizing Technique to arrive at Story points Requirement clarity Management Release is the first of its kind (No previous velocity)
  10. 10. 10 Recommended Sizing Techniques Spikes Story UI Changes DB changes Test cases Automation Scripts CM / packaging Task Breakdown Story Story 1 Story 2 Story 3 Story Splitting Spike sample stories and stack other stories relative to those stories Sizing Scales T- Shirt Fibonacci Series Team Conscience Expert Opinion
  11. 11. 11 Requirement Clarity Levels Theme •Low Epic •Medium Story •High Task Initial Requirements RFP BRD User Cases Workshops Sources Clarity levels
  12. 12. 12 Story Point Computing Approach  Define Done criteria  Define a Story Point Computing Model  Compute total Story points Never convert Story Points to Efforts. It would be a very big disaster!
  13. 13. 13 Definition of Done Story 1 Story 2 Story 3 Software with all features work as defined by the user story All QA testing for completed features is done with no pending defects Regression tests pass All documentation is completed Planned stories demonstrated to the Product Owner, Customer and other stakeholders Story 1 Story 2 Story 3 Sample DoD DoD can evolve Sprint on Sprint based on the requirements and past learnings
  14. 14. 14 Story Point Computing Model 1- Story Point – Task Matrix http://www.slideshare.net:80/MarrajuBollapRagada/estimating-story-points-in-agile- magic-approach-47345114 The guidelines for each complexity factor can be pre-defined considering clarity, technical, data and functional complexities.
  15. 15. 15 Story Point Computing Model 2 – Effort Matrix Sample Base Effort in Person Hours based on multiple Technologies Java .Net Oracle XS 8 8 10 S 12 16 16 M 20 24 24 X 24 32 30 XL 30 48 40 Story point mapping from an effort range Story Point Effort Range 1 0-10 2 10-20 3 20-40 5 40-60 8 60-100 13 >100 Epic Feature Story Technology Mapping Classification Effort Story Point Epic 1 Feature 1 Story 1 .NET XL 48 5 Epic 1 Feature 1 Story 2 Java S 12 2 Epic 2 Feature 1 Story 1 .NET X 32 3 Epic 2 Feature 1 Story 2 Java X 16 2 Epic 2 Feature 2 Story 2 Oracle XS 10 1 Map Story Points from Complexity –Sample Effort Matrix
  16. 16. 16 First Velocity Computation When there is no velocity data and no clue on the how the first velocity would be, consider the first few stories planned for iteration. Perform task breakdown for one story and compute the effort in hours. Similarly, few more stories can be taken up till the first iteration effort is achieved. Different combinations of Team Size and Velocity may be worked out and analyzed
  17. 17. 17 Velocity Decelerators & Accelerators Velocity Decelerators (VD) - Sample Item Factor Level Team Expertise High – 0.98 Medium – 0.80 Low – 0.5 Project Tools Availability High – 0.98 Medium – 0.80 Low – 0.5 Project Product Owner Availability & Participation High – 0.98 Medium – 0.80 Low – 0.5 Project Requirement Clarity High – 0.98 Medium – 0.80 Low – 0.5 User Story Velocity Accelerators (VA) - Sample Item Factor Level Common Components High – 1.5 Medium – 1.3 Low – 1.1 Project Common Test Cases High – 1.5 Medium – 1.3 Low – 1.1 Project Repeat Releases of the same kind High – 1.5 Medium – 1.3 Low – 1.1 Project Velocity = V * VD * VA Set up your own Velocity Accelerators and Decelerators based on your project based experience and past learning
  18. 18. 18 How do we arrive at Schedules? •First Velocity from one scrum team •Number of Scrum Teams •Project Start Date •Sprint Duration •Total Story Points Input •Story Sizing Techniques •Story Point Computation Model •Velocity Accelerators & Decelerators Tools & Techniques •End Date of the Project •Total Engineering Efforts Output
  19. 19. 19 Overall Agile Story Point Estimation and Planning Framework – Part I Step# Steps Inputs Tools and Techniques Output 1 Product Backlog creation/refinement Initial Requirements Customer Workshops Product Backlog (Initial) BRD Dialogs Use Cases Interviews RFP Functional Decomposition Product Backlog (from Customer) DEEP Sample Product Backlog from Past Projects 2 User Stories Creation/refinement Product Backlog INVEST Product Backlog with user stories BRD Requirements Document Sample User Stories from Past projects 3 Definition of Done RFP Checklist DOD (Sprint and Release levels) Customer Dialog Sample DOD from past projects Defined Delvierables List of Engineering Activities NFRs 4 Prioritization and Sequencing Product Backlog with User Stories MoSCOW Product Backlog with Prioritization and Sequence Functional Flow Kano ROI Priority Sequencing Risk
  20. 20. 20 Overall Agile Story Point Estimation and Planning Framework – Part II Step# Steps Inputs Tools and Techniques Output 5 Story Sizing and Total Story points computing Product Backlog with Prioritization and Sequence Story Point Matrix Product Backlog with Story points DOD (Sprint and Release levels) Effort Correlation Matrix Task Break Down Approach Spikes 6 Define Sprint length RFP Customer Preference Fixed Length of Sprint Team Preference Team Comfort Coordination with external parties User Story Clarity 7 Effort & Story point of Initial set of Stories Product Backlog with Prioritization and Sequence Spikes Effort of each Story DOD (Sprint and Release levels) Task Break down Story point of each Story Story Splitting Team Conscience Initial Set of Stories Expert Opinion 8 First Velocity from 1st Scrum team Initial Scrum team size Cumulative Story Effort Match with Single Sprint Effort Velocity = Cumulative Story point count Single Sprint Effort (Initial team Size * Sprint Length) Cumulative Story Point Effort
  21. 21. 21 Overall Agile Story Point Estimation and Planning Framework – Part III Step# Steps Inputs Tools and Techniques Output 9 Compute Number of Sprints FirstVelocity Agile Estimation Template No. of Sprints Total Story points Sprint length Additional Rework, Buffer, Release Sprints 10 Additional Full time Efforts Computation Pre-Engineering Sprints length Agile Estimation Template Additional Efforts (Sprint 0/ Framework Sprint/Regression) Pre-Engineering Team Size Time Box for each Scrum Ceremony Scrum Master Efforts Effort for Additional Meetings Scrum of Scrum master Efforts 11 Effort for Additonal Partime roles Part Time Role Players (Agile Coach, Architect etc) Agile Estimation Template Additional Effort Duration 12 Pre-Engineering Efforts (Before the Engineering Sprint duration) Sprint zero Activities Agile Estimation Template Additonal Effort Duration Team Size
  22. 22. 22 Step# Steps Inputs Tools and Techniques Output Template Mapping 13 Post Engineering Efforts(After the Engineering Sprint duration) Post Engineering Activities (Performance Testing, Security Testing etc) Agile Estimation Template Additional Effort Release Plan (Post Engineering Additional Efforts (in case of big bang approaches)) - Sec 9 Duration Team Size 14 Project Start Date Pre-Engineering Duration Agile Estimation Template Revised Project Start Date 15 Project End Date First Velocity First Velocity * N Nearest Agreed End Date = Project End Date Release Plan (Arrive at Schedules) - Sec 11 Velocity Accelerators Accelerators (Common Components, Same team and release, common test cases, etc) N = No. of Scrum Teams Velocity-Accl-Decel Velocity Decelerators Decelerators (Requirement Clarity, Team Comfort, Product Owner Availability etc) No. of Scrum Teams Agile Estimation Template Engineering Start Date Projected Leaves of Team Members Holidays Post Engineering Duration 16 Sprint Planning Product Backlog Agile Estimation Template Stories in each Sprint Sizing-Planning (Sprint #) Computed Velocity Story points for each Story Sequence 17 Scrum Team planning Product Backlog Agile Estimation Template Feature Based Team Sizing-Planning (Scrum Team #) Computed Velocity Story points for each Story Sequence Feature Mapping Stories in each Sprint Overall Agile Story Point Estimation and Planning Framework – Part IV
  23. 23. 23 Sample Estimation Form First Scrum Team (without Scrum Master) Compute First Velocity from First Scrum team Normal – Without applying Velocity Accelerators and Decelerators Applied– After applying Velocity Accelerators and Decelerators Normal Applied Total Story Points 385 385 First Scrum Team Size 5 5 First Velocity 43 22 Number of Scrum Teams 2 2 Story point per sprint (Velocity of Sprint) 86 44 Estimated # of Sprints 4.48 8.92 Estimation Buffer Sprints @ 15% 0.67 1.34 Rework Buffer Sprints @ 10% 0.45 0.89 Additions Buffer Sprints @ 10% 0.45 0.89 Pre-Release Sprint 1 1 Total Number of Sprints 7.0 13.0 Dev Tester Manual Tester Automation BA Configuration UI Team Size 3 2 1 1 0 1 Total Team Size 8 Sprint Duration 10 Days Effort per Sprint 80 PD 560 PH
  24. 24. 24 Sample Estimation Arrival of End Date First Sprint Start Date 1-Nov-2015 1-Nov-2015 Sprint Duration 10 10 Last Sprint End Date 5-Feb-2016 29-Apr-2016 Compute Engineering Efforts Engineering Team Size 10 10 Scrum Masters 1 1 Additional Roles 0 0 Team Size 11 11 Total Effort (in PD) based on Engineering 774.80 1434.93 Project Start Date 1-Feb-2016 18-Jan-2016 Project End date 30-May-2016 21-Oct-2016 Project Expected Duration (months) 4.0 9.2 Arrive at Schedules
  25. 25. 25 How do we track the budget during project execution? • The change management process is by Fixed Cost instead of Fixed • Once the initial estimated Story points are consumed, the Story points beyond this can be considered as additional. • The sources of story points may not be user stories from initial requirements only. As the Sprint execution progresses, Product Backlog gets added with defects, Technical Debt and Change Requests which also carry story points.
  26. 26. 26 How do we track the budget during project execution? – Contd…. A sample way of tracking can be done as follows: Total number of User stories planned = 100 Initial Story Points Estimated = 350 Sprint Duration = 2 weeks Planned Velocity = 50 Expected Number of Sprints = 7 Delivered: Without CRs, defects, technical debt Actual: With CRs/ defects/ technical debt Customized Burn-up Charts
  27. 27. 27 Conclusion  Win-win solution of how Agile software development projects can be executed in the fixed price model proposed.  Fixed Cost instead of Fixed Scope way of execution has been the main highlight.  To achieve this, the different hurdles like Requirement clarity, Story Sizing, Story point computation models, First time velocity and a customized Budget tracking mechanisms have been shared.  This overcomes the upfront Estimation challenges and also an efficient method of arriving at Story points during the proposal stage has been provided.
  28. 28. 28  Head of Agile & DevOps Practice in a Top BFSI company  More than 20 years in IT Industry  Agile Evangelist  Agile Coaching, Transformation, Implementation KV Sharma [LinkedIn: KV Sharma] I Acknowledge….. For reviewing, enabling and contributing ………….
  29. 29. 29 References • http://www.nayima.be/html/fixedpriceprojects.pdf • http://www.gregmester.com/agile-development-requirements-change/ • http://www.agilistapm.com/fixed-price-contracts/ • http://www.timecockpit.com/blog/2014/11/30/How-Fixed-Price- Contracts-and-Agile-Can-Go-Together • http://www.slideshare.net:80/MarrajuBollapRagada/estimating-story- points-in-agile-magic-approach-47345114 • http://www.qaiglobalservices.com/conference/stc2013/pdfs/rashmi_pop li.pdf • https://www.scrumalliance.org/community/articles/2013/october/dealin g-with-bugs-in-the-product-backlog • https://www.scrumalliance.org/community/articles/2015/august/agile- estimation-for-fixed-date-projects-and-fixed • https://www.mountaingoatsoftware.com/blog/how-to-estimate-velocity- as-an-agile-consultant • http://www.agileforall.com/2009/10/patterns-for-splitting-user-stories/
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Agile Estimation for Fixed Price Model

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