Business valueiIs a conversation_kent-mcdonald_#bddxny

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Kent McDonald explains how Business Value is a conversation, not a number, at the Agile Testing & BDD eXchange in New York (Oct 1sr 2012). Find this and other presentations at this conference her: http://skillsmatter.com/event/agile-testing/agile-testing-and-bdd-exchange-nyc/wd-23

Business Value is a Conversation,
Not A Number
Kent J. McDonald
@beyondreqs

Agenda

What is business value?

Conversations that consider value

Did we deliver value?

The Prime Directive:
Deliver Business Value!
*The organizers
wish to apologize
for any gratuitous
trekkie references
that may appear
in this
presentation.

What is business value?
I’ll know it
when I see
it

Justice Potter Stewart, concurring opinion in Jacobellis v. Ohio 378 U.S. 184 (1964), regarding
possible obscenity in The Lovers.

In alignment
with
organizational
strategy

Why do we want to know
Business Value?

To make decisions!

Purpose = What problem are
you trying to solve?

Considerations

= What could impact value?

Costs & Benefits

= What’s the impact on business objectives?

An example would be
handy right about now

How much should we build?
Always
Often or
7% Always used
Often 20%
Never 13%
45%
Sometimes
16%

Rarely
19%
Rarely or
Never used64%
Standish Group Study, Reported by CEO Jim Johnson, XP2002

DEVELOPMENT

VALUE INPUTS

INPUTS
PROCESS

OUTPUTS

ANALYSIS

VALUE
VALUE INPUTS

INPUTS
PROCESS

OUTPUTS

Enterprise System Replacement

New
System

Initial Approach to Analysis

New
System

ANALYSIS

Example

In Scope Model

aka Break
the Model Test

I(a)
Taking it a step further…
I(t)
I(d)
Development
Example

In Scope? Model
Test

Test

The Missing Link!
I(tp)

Feature Injection
Business Analysis
feeding Examples into a
Development Process
(especially Agile)

Hunt the Value
“Inject” only relevant
features
Communicate with
examples

Devised by Chris Matts

Purpose Based Alignment Model

Do we take this Innovate,
on? Create

Achieve and
Minimize/ maintain parity,
Eliminate Mimic,
Simplify

Decision Filters
Simple rules to guide
decision making
Disperse throughout
the organization
Used for (among others)
Strategy alignment
Scoping
Design approach

“To be the low cost airline.”
- Southwest Airlines

“Will this help us be
the low cost airline?”
- Southwest Airlines

Purpose and Decision Filters

To be the
low cost
airline

Will this help us be
the low cost airline?

The Billboard Test

Order new
pages by
2pm and get
them tomorrow!

Health Insurance Capabilities

Dental
insurance Analytics

Claim processing
Agent payment
Life Insurance Enrollment
Eligibility

How to treat the
multiple commissions rules?

How do we know we have actually
delivered value?

Do these indicate value?
ROI
Return on Investment
NPV
Net Present Value
TCO
Total Cost of Ownership
IRR
Internal Rate of Return

Objectives
Specific
Measureable
Agreed Upon
Realistic
Timely

Sample Objectives

By Dec 2012 increase By Dec 2012 reduce paper
inventory turns from 5/year apps from 1,000/month to
to 10/year 500/month

Measuring Your Objectives
Objective 1 Objective 2
Measure Inventory Turns Paper Apps

Definition The number of times Number of apps received
inventory is sold in a year via mail or fax

Data Source Inventory Tracking System

What to Measure Cost of Goods Sold/ Average Count of applications
Inventory received via mail/fax

Frequency of Measure Yearly Monthly

Sample Size N/A N/A

Who will collect data Inventory Accounting Analyst Data entry specialists

How will data be collected Report created by Inventory Count paper applications
Tracking Systems when entered

Baseline 5 1000

Target 10 500

If you remember nothing else…
Business value is a
conversation to help us
decide:
Is it worth it?
How much should we
build?
How unique should it
be?
Use business objectives to
tell if you delivered value

Questions?

Kent McDonald
kentjmcdonald@gmail.com
@BeyondReqs
www.beyondrequirements.com
Slides available from:
http://www.knowledgebridgepartn
ers.com/presentations/businessval
ueconversation/

IT managers often talk about the technology in far more technical terms than business people can understand (or actually care about!). If stronger communication and integration is to take place between the IT and other internal business units, then IT needs to learn how to talk and listen very differently. Dr. Anderson provides guidance about how to be a better business communicator focusing on how to create and deliver presentations that contain detailed technical information in a way that is engaging to a non-IT audience and allows you to better connect with business people. For more information on Dr. Jim Anderson and his company, Blue Elephant Consulting, find out more on the web at http://www.BlueElephantConsulting.com

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Do you work at an organization that is "scaling" agile or thinks they need to do "agile at scale"? Do you find yourself asking these questions: - What does scaling agile really mean, and is it necessary that we scale? - If scaling means working with a large team, how do we make sure everyone is moving in the same direction? - How do we deal with the complications that come with scaling, such as the dependencies that are inherently created? Join Kent McDonald as he suggests answers to these questions in the form of 3D’s: - Do "scaling" only when necessary - Decision making in a complicated environment - Dependencies and how to deal with them As we examine these topics, Kent introduces simple, yet powerful techniques your teams can use to be more effective in an environment where scaling seems to be the right answer. You’ll walk away with ideas on how to apply these techniques in your own situation. Learning Outcomes: - Use the Context Leadership Model and the Cynefin model to determine if scaling is the right answer - Encourage informed decision making through Purpose Based Alignment and decision filters - Minimize dependencies through collaborative planning & consistent communication

Estimating in Software Development: No Silver Bullets Allowed

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What do poker, Greek oracles, an Italian mathematician from the Middle Ages, and the path of hurricanes have in common? Given the title of this presentation, chances are it has something to do with estimation, and you’ll have to attend this session to get the full connection. Kent McDonald explores the challenges and realities of trying to estimate software-related knowledge work—analysis, testing, development, and the entire project effort. A major challenge is that there are no guaranteed ways to arrive at perfectly accurate estimates, which not surprisingly is why they are called estimates. Kent introduces and gives you a chance to practice quick and practical estimating techniques that will work in different situations—guesstimating, break it down and add it up, and planning poker. Kent has found that these “lite” estimation techniques are almost always just as informative as the ones you just spent six weeks formulating.

Lessons Learned in Product Ownership

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Elicitation and requirements analysis are some business analysis skills that are extremely helpful in an agile setting especially for team members responsible for product ownership. Equally helpful, if not more so, are the skills that teams use to interact with stakeholders, make decisions, and react to actual situations as they arise. The best way to understand the relevance of these skills is to share stories of successful, and perhaps not so successful interactions on real projects and discuss what the team learned. Join Kent as he shares stories from his experiences as Submission System Product Owner and relates the things he learned to useful skills for all business analysts. You’ll get a chance to tell Kent where he went wrong and also consider how to apply the lessons learned in your own setting. Along the way you’ll hear about some techniques for addressing common project situations that work well as long as you get the nuances right.

What it Really Means to Be Agile

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Some teams think they can be agile by using a defined process or set of practices as defined by one of the agile approaches. This is just “doing Agile.” Other teams are agile in name only – the team says it’s “doing Agile” but ends up using the same old practices and achieving the same results. Teams adopt agile for a variety of reasons, but it’s not the process or set of practices they select that produces the results they seek. Teams are most successful when they adopt a particular mindset in order to “be agile”. Join Kent McDonald as he describes this mindset through 7 key ideas based on how people and organizations work best. We’ll discuss some specific techniques you can use to adopt the mindset on your project, how the project manager role changes along with the mindset, and how to help your team move from “doing Agile” to actually “being agile”.

What do Scrum Masters Really Do? And do we need them?

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The Scrum Master role is a foundational concept of Scrum, yet like everything else, the role and it’s value should not be fixed. As with everything else related to agile, the nature of the Scrum Master role, and whether it is needed or all, depends a great deal on context. As teams discover this, it leads to some common questions: * What do Scrum Masters Really Do? * Do we even need Scrum Masters? Join Jodi and Kent as we examine the Scrum Master role and attempt to answer the above questions. We’ll share our experiences and give you a chance to share your perspectives with each other. By the end of the session, you'll have more insight into the Scrum Master role and how it applies (or not) to your situation. After all, the only consistent answer to the above questions is “it depends”.

Anyone Can Write User Stories. It's the (Shared) Understanding That's Important

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“Who should write user stories?” “How can I write better user stories?” When should we write user stories?” All questions frequently asked. And all questions entirely missing the point. Just as the *holding* is the most important part of the rental car reservation, the *shared understanding* is the most important part of the user story. Join Kent to learn how user stories help you build shared understanding of the right solution with your team. Along the way, learn some techniques to address common issues that stand in the way of getting everyone telling the same story. Learning Objectives: * Start with value, then identify stories * One way to stop solutioning * Dealing with dependencies (that may not be there) within your backlog * Ways to split user stories into a more manageable size * Mapping your way to acceptance criteria

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You have been tapped for an exciting new project. A member of the executive team recognizes that the company needs to transform to meet the evolving needs of your dynamic marketplace. They know that Agile will be part of that transformation, they tap you to lead the effort, and now they think their work is done . While that is exciting and an honor for you, you still need the active engagement of the senior leadership team to create a culture where Agile practices can flourish. The support from the top is critical to drive the type of innovation and flexibility that will be required to successfully implement any new idea – but especially one as (positively) disruptive as Agile. This session describes how senior leaders need to act differently in an enterprise transitioning to agile, and some helpful patterns individual contributors can use to leverage politics in a positive manner to lead up through influence and help senior leaders make the transition. These patterns are based on Heather and Kent’s experiences at a variety of organizations driving or helping to drive changes including, but not limited to adopting agile approaches. Along the way, we’ll give you a chance to share your thoughts and experiences using politics in a positive (or perhaps not so positive) way to help an enterprise transition to agile.

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Agile approaches emphasize delivering business value to stakeholders. The concept of business value is a difficult concept to get your arms around, doubly so if you are working in a Not for Profit. One way to address the problem is to see the idea of business value for what it is – an aid for making decisions. In this talk Kent McDonald describes three simple techniques that you can use to make decisions in your Not For Profit. Kent describes how to apply the idea of business value to not for profits and shows how you can use three techniques – Real Options, Decision Filters, and Purpose Based Alignment to make decisions in any kind of organization, even Not for Profits.

Collaborative Modeling In A Nutshell

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Better. Faster. Cheaper. Many IT organizations are constantly seeking the "best" practices that will deliver those characteristics, and the fact that they continue to search indicates they haven’t found them yet. It could be they are looking in the wrong place. Most efforts around achieving better, faster, cheaper center around becoming ultra efficient. Effectiveness may just be the better target. Join Kent McDonald to explore the difference between efficiency and effectiveness and learn three simple, yet powerful, techniques that he has found can help teams be more effective. You’ll learn how to: Build a shared understanding of the problem you are trying to solve Establish clear guard rails for distributed decision making Measure progress based on outcome, not output Along the way he’ll share stories about how he has used these techniques and help you figure out when these techniques may work in your situation. You may be able to get faster and cheaper with efficiency, but in order to get better outcomes, you need to be effective. Come to this session to learn how.

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Business valueiIs a conversation_kent-mcdonald_#bddxny

1. Business Value is a Conversation, Not A Number Kent J. McDonald @beyondreqs

2. Agenda What is business value? Conversations that consider value Did we deliver value?

3. The Prime Directive: Deliver Business Value! *The organizers wish to apologize for any gratuitous trekkie references that may appear in this presentation.

4. What is business value? I’ll know it when I see it Justice Potter Stewart, concurring opinion in Jacobellis v. Ohio 378 U.S. 184 (1964), regarding possible obscenity in The Lovers.

5. Increase Revenue

6. Protect Revenue

7. Reduce Costs

8. In alignment with organizational strategy

9. Why do we want to know Business Value? To make decisions!

10. What type of decisions?

11. Is It Worth It?

12. Purpose = What problem are you trying to solve?

13. Considerations = What could impact value?

14. Costs & Benefits = What’s the impact on business objectives?

15. An example would be handy right about now

16. Conference Submission System

17. What other decisions?

18. How much should we build? Always Often or 7% Always used Often 20% Never 13% 45% Sometimes 16% Rarely 19% Rarely or Never used64% Standish Group Study, Reported by CEO Jim Johnson, XP2002

19. How does value play into that?

20. DEVELOPMENT VALUE INPUTS INPUTS PROCESS OUTPUTS

21. ANALYSIS VALUE VALUE INPUTS INPUTS PROCESS OUTPUTS

22. Huh?

23. Perhaps another example…

24. Enterprise System Replacement New System

25. Initial Approach to Analysis New System

26. New Approach to Analysis New System

27. ANALYSIS Example In Scope Model aka Break the Model Test

28. Psst, by the way…

29. I(a) Taking it a step further… I(t) I(d) Development Example In Scope? Model Test Test The Missing Link! I(tp)

30. Feature Injection Business Analysis feeding Examples into a Development Process (especially Agile) Hunt the Value “Inject” only relevant features Communicate with examples Devised by Chris Matts

31. And one final decision?

32. How Unique Should It Be?

33. Purpose Based Alignment Model

34. Purpose Based Alignment Model Do we take this Innovate, on? Create Achieve and Minimize/ maintain parity, Eliminate Mimic, Simplify

35. Decision Filters Simple rules to guide decision making Disperse throughout the organization Used for (among others) Strategy alignment Scoping Design approach

36. “To be the low cost airline.” - Southwest Airlines

37. “Will this help us be the low cost airline?” - Southwest Airlines

38. Purpose and Decision Filters To be the low cost airline Will this help us be the low cost airline?

39. The Billboard Test Order new pages by 2pm and get them tomorrow!

40. Ok, one more example…

41. Commission System

42. Health Insurance Capabilities Dental insurance Analytics Claim processing Agent payment Life Insurance Enrollment Eligibility

43. How to treat the multiple commissions rules?

44. How do we know we have actually delivered value?

45. Do these indicate value? ROI Return on Investment NPV Net Present Value TCO Total Cost of Ownership IRR Internal Rate of Return

46. Objectives Specific Measureable Agreed Upon Realistic Timely

47. Sample Objectives By Dec 2012 increase By Dec 2012 reduce paper inventory turns from 5/year apps from 1,000/month to to 10/year 500/month

48. Measuring Your Objectives Objective 1 Objective 2 Measure Inventory Turns Paper Apps Definition The number of times Number of apps received inventory is sold in a year via mail or fax Data Source Inventory Tracking System What to Measure Cost of Goods Sold/ Average Count of applications Inventory received via mail/fax Frequency of Measure Yearly Monthly Sample Size N/A N/A Who will collect data Inventory Accounting Analyst Data entry specialists How will data be collected Report created by Inventory Count paper applications Tracking Systems when entered Baseline 5 1000 Target 10 500

49. If you remember nothing else… Business value is a conversation to help us decide: Is it worth it? How much should we build? How unique should it be? Use business objectives to tell if you delivered value

50. Questions? Kent McDonald kentjmcdonald@gmail.com @BeyondReqs www.beyondrequirements.com Slides available from: http://www.knowledgebridgepartn ers.com/presentations/businessval ueconversation/

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