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Value Mapping with Fewer Dollars and more Sense - Natalie Warnert Agile2016

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Prioritization of work is hard across all levels of the organization. When we focus on feature value, often the first indicator of value is dollars versus effort expended. But what about value that is not realized through dollars? Our customers do not only think in dollars.

By expanding the definition of what value can truly mean, we can normalize, rationalize, and quantify value in new and different ways that make sense to all of our customers. We can assess value across programs as well as engage team members and stakeholders through interactive activities. In a way, it’s like relative sizing to drive values that appeal to many different consumers of your product.

Natalie first demonstrates traditional value estimation (dollars) and the resulting feature map/prioritization. Then, we look at other types of value realization through a team or program level activity using common customer sense. The activity provides participants with hands-on experience estimating and mapping feature value sans dollars on a level playing field. This gives Product Owners and teams a better baseline to align enterprise and program roadmaps with their own team or product priorities - and most importantly what the customer actually values - dollars aside!

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Value Mapping with Fewer Dollars and more Sense - Natalie Warnert Agile2016

  1. 1. @natali ewarnert VALUE MAPPING WITH FEWER DOLLARS AND MORE SENSE Natalie Warnert – #Agile2016
  2. 2. @natali ewarnert • Natalie’s background • The fight for priority – org levels • Traditional value measurement • Activity 1 & debrief • Customer value measurement • Activity 2 & debrief • Bringing it all together AGENDA
  3. 3. @natali ewarnert Natalie Warnert www.nataliewarnert.co m
  4. 4. @natali ewarnert PERSONAL IMPORTANC E
  5. 5. @natali ewarnert DOCUMENTS AGILE PRINCIPLES: Our highest priority is to satisfy the customer through early and continuous delivery of valuable software. SCRUM GUIDE: A framework within which people can address complex adaptive problems, while productively and creatively delivering products of the highest possible value. The Product Owner is responsible for maximizing the value of the product and the work of the Development Team. www.agilemanifesto.org, www.scrumguides.org
  6. 6. @natali ewarnert THE FIGHT FOR PRIORITY PORTFOLI O PROGRAM TEAM
  7. 7. @natali ewarnert Long term roadmaps Strategy PORTFOLIO PRIORITY Performance objectives Funding allocation
  8. 8. @natali ewarnert PORTFOLIO PRIORITY Strength: ROI Deficiency: Being laser focused Leads to inconsistent messaging and constant priority changes. What features to buy from what teams?
  9. 9. @natali ewarnert Roadmap alignment Features: -Top down -Laterally -Bottom up PROGRAM PRIORITY Dependency management Funding projects/teams
  10. 10. @natali ewarnert PROGRAM PRIORITY Strength: Value stream Deficiency: Correct balance Balance portfolio wants with team constraints across the product
  11. 11. @natali ewarnert Team roadmap -Enhancements -New functionality -Tech debt -Defects Dependencies TEAM PRIORITY Constraints
  12. 12. @natali ewarnert TEAM PRIORITY Strength: Customer factor Deficiency: Bigger picture Keep focused on the same thing in the long run – but it’s personal.
  13. 13. @natali ewarnert BRAINSTORMING ACTIVITY What issues have you noticed between priority valuation at different levels of the organization? Who usually ”wins” and “loses” these discussions?
  14. 14. @natali ewarnert If everythin g is a priority than nothing is a priority. ”
  15. 15. @natali ewarnert TRADITIONAL VALUE MEASUREMENT val·ue /ˈvalyo͞o/ Verb 1.estimate the monetary worth of (something). “the feature was valued at $45,000” Synonyms: evaluate, assess, estimate, appraise, price www.google.com
  16. 16. @natali ewarnert ROI Net profit/cost of investment = ROI OR… how much can we profit from this investment (percentage)? Tangible TRADITIONAL VALUE MEASUREMENT - ROI
  17. 17. @natali ewarnert Cost of Delay – what is the cost of having NOT done this? [value + urgency + risk reduction & opportunity enablement] TRADITIONAL VALUE MEASUREMENT – COST OF DELAY
  18. 18. @natali ewarnert Cost of Delay – what is the cost of having NOT done this? [value + urgency + risk reduction & opportunity enablement] If we have an equal cost of delay pick the shortest job first TRADITIONAL VALUE MEASUREMENT – COST OF DELAY Feature Cost of Delay Duration A $2 2 B $2 1
  19. 19. @natali ewarnert Cost of Delay – what is the cost of having NOT done this? [value + urgency + risk reduction & opportunity enablement] If we have an equal duration pick the highest CoD TRADITIONAL VALUE MEASUREMENT – COST OF DELAY Feature Cost of Delay Duration A $2 2 B $1 2
  20. 20. @natali ewarnert Cost of Delay – what is the cost of having NOT done this? [value + urgency + risk reduction & opportunity enablement] What if it’s not one or the other? TRADITIONAL VALUE MEASUREMENT – COST OF DELAY Feature Cost of Delay Duration A $2 2 B $2 1 C $1 2
  21. 21. @natali ewarnert Cost of Delay – what is the cost of having NOT done this? [value + urgency + risk reduction & opportunity enablement] Weighted shortest job first (WSJF) Implementation and decision to use CD3 = CoD/Duration TRADITIONAL VALUE MEASUREMENT – COST OF DELAY Feature Cost of Delay Duration CD3 = CoD/Duration A $2 2 1 B $2 1 2 C $1 2 1/2
  22. 22. @natali ewarnert Prioritize the work items into a program roadmap based on monetary measures only Incorporate Cost of Delay, Duration, Weighted Shortest Job First, and ROI Left = lower value Right = higher value Lower Value Higher Value ACTIVITY 10 MINUTES
  23. 23. @natali ewarnert What was difficult about the activity? What were the first few items in your prioritization order? Last few? How realistic is it to get everything done? Which scope would likely get cut? What was missing from the conversation about priority and valuation? Take a picture of your priority arrangement. ACTIVITY DEBRIEF
  24. 24. @natali ewarnert WSJF is important, but not as important as how we calculate it TRADITIONAL VALUE MEASUREMENT
  25. 25. @natali ewarnert WSJF is important, but not as important as how we calculate it Cost of Delay [value + urgency + risk reduction/opportunity enablement] TRADITIONAL VALUE MEASUREMENT
  26. 26. @natali ewarnert WSJF is important, but not as important as how we calculate it Cost of Delay [value + urgency + risk reduction/opportunity enablement] And duration… TRADITIONAL VALUE MEASUREMENT
  27. 27. @natali ewarnert WSJF is important, but not as important as how we calculate it Cost of Delay [value + urgency + risk reduction/opportunity enablement] And duration… But it’s an estimation at best TRADITIONAL VALUE MEASUREMENT
  28. 28. @natali ewarnert WSJF is important, but not as important as how we calculate it Cost of Delay [value + urgency + risk reduction/opportunity enablement] And duration… But it’s an estimation at best And when we estimate in a box (especially with money), we are more often than not WRONG TRADITIONAL VALUE MEASUREMENT
  29. 29. @natali ewarnert But the customer does not care about value as a measure CUSTOMER VALUE MEASUREMENT
  30. 30. @natali ewarnert But the customer does not care about value as a measure Customer thinks of value as: val·ue /ˈvalyo͞o/ Noun 1. the regard that something is held to deserve; the importance, worth, or usefulness of something. “this product is of great value” Synonyms: worth, usefulness, advantage, benefit, gain, good, help, merit www.google.com CUSTOMER VALUE MEASUREMENT
  31. 31. @natali ewarnert As a…I want…so that… CUSTOMER VALUE MEASUREMENT
  32. 32. @natali ewarnert As a…I want…so that… As a customer/user/subscriber… I want [certain functionality] So that I can do something that is valuable to me and gain satisfaction by doing it CUSTOMER VALUE MEASUREMENT
  33. 33. @natali ewarnert So that I can do something that is valuable to me and gain satisfaction by doing it Ease, time-saving Unique/new/differentiating NOT so that the company can make money off of me Intangible CUSTOMER VALUE MEASUREMENT
  34. 34. @natali ewarnert Customer cost of delay What I NEED to do (basic/threshold) What I WANT to do (performance) What I haven’t thought to do yet (delight/excite) CUSTOMER VALUE MEASUREMENT
  35. 35. @natali ewarnert CUSTOMER VALUE MEASUREMENT - KANO Very Satisfied Very Dissatisfied Need FulfilledNeed Unfulfilled
  36. 36. @natali ewarnert CUSTOMER VALUE MEASUREMENT - KANO Very Satisfied Very Dissatisfied Need FulfilledNeed Unfulfilled Basic
  37. 37. @natali ewarnert CUSTOMER VALUE MEASUREMENT - KANO Very Satisfied Very Dissatisfied Need FulfilledNeed Unfulfilled Basic Performance
  38. 38. @natali ewarnert CUSTOMER VALUE MEASUREMENT - KANO Very Satisfied Very Dissatisfied Need FulfilledNeed Unfulfilled Basic Performance Delight
  39. 39. @natali ewarnert CUSTOMER VALUE MEASUREMENT - KANO Very Satisfied Very Dissatisfied Need FulfilledNeed Unfulfilled Time Basic Performance Delight
  40. 40. @natali ewarnert Move feature cards ONLY vertically based on customer value factors Discuss which buckets each feature could fit into based on what the customer values Lower Value Higher Value Delight: Don’t know I want Performance: I WANT Basic: I NEED ACTIVITY 2 – TEN MINUTES
  41. 41. @natali ewarnert Move feature cards ONLY vertically based on customer value factors Discuss which buckets each feature could fit into based on what the customer values Lower Value Higher Value Delight: Don’t know I want Performance: I WANT Basic: I NEED ACTIVITY 2 – TEN MINUTES
  42. 42. @natali ewarnert Move feature cards ONLY vertically based on customer value factors Discuss which buckets each feature could fit into based on what the customer values Lower Value Higher Value Delight: Don’t know I want Performance: I WANT Basic: I NEED ACTIVITY 2 – TEN MINUTES
  43. 43. @natali ewarnert Move feature cards ONLY vertically based on customer value factors Discuss which buckets each feature could fit into based on what the customer values Lower Value Higher Value Delight: Don’t know I want Performance: I WANT Basic: I NEED ACTIVITY 2 – TEN MINUTES
  44. 44. @natali ewarnert Move feature cards ONLY vertically based on customer value factors Discuss which buckets each feature could fit into based on what the customer values Lower Value Higher Value Delight: Don’t know I want Performance: I WANT Basic: I NEED ACTIVITY 2 – TEN MINUTES
  45. 45. @natali ewarnert Which features are now the most important customer value factored in? Which features are more likely to be lower in priority? ACTIVITY 2 - DEBRIEF
  46. 46. @natali ewarnert Customer Feeling Money Run a business Build the right thing WHAT IS MISSING?
  47. 47. @natali ewarnert WHAT IS MISSING? Customer Feeling Money Run a business Build the right thing
  48. 48. @natali ewarnert Time Basic Performance Delight ROI (Valuation = Money) Kano (Value = Feeling)Vs. Value Cost ROI VS. KANO – MONEY VS. FEELING
  49. 49. @natali ewarnert Time Basic Performance Delight ROI (Valuation = Money) Kano (Value = Feeling)Vs. Value Cost ROI VS. KANO – MONEY VS. FEELING
  50. 50. @natali ewarnert Time Basic Performance Delight ROI (Valuation = Money) Kano (Value = Feeling)Vs. Value Cost ROI VS. KANO – MONEY VS. FEELING
  51. 51. @natali ewarnert Time Basic Performance Delight ROI (Valuation = Money) Kano (Value = Feeling)Vs. Program (value stream) Value Cost ROI VS. KANO – MONEY VS. FEELING
  52. 52. @natali ewarnert PERSONAL IMPORTANC E
  53. 53. @natali ewarnert • Development tier (level) can help influence decisions • Value is both a verb and a noun (like Agile) • Think about making money and the customer – balance between importance (activity) WRAP UP
  54. 54. @natali ewarnert THANKS FOR COMING www.nataliewarnert.com #agile2016 @nataliewarnert

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