Bridging  the  Agile-­‐to-­‐PMO  Communica7on  Gap  

Brent  Barton,  President,  Agile  Advantage,  Inc.    

  An  Agile  Story    A  PMO  Story    Scrum  (An  Agile  Project  Management  Framework)    Tradi<onal  Earned  Value  Management    Agile  Earned  Value  Management  (AgileEVM)    Project  Case  Study    Open  Discussion  

*Slides available via slideshare.net or gettingagile.com

  An  Agile  Pilot  ◦ One  Scrum  Team  

This  is  the  best,  simplest,  easiest  to  use  applica1on  we  have  ever  go7en  in  both    

Customer  Care  and  the  Retail  Stores!    

Whatever  you  all  did,  I  want  more  of  that!  

Value  

Cost  Savings  

New  Revenue  

Compliance  

Customer  Sa<sfac<on  

Employee  Sa<sfac<on  

Shareholder  Value  

Revenue  Reten<on  

  Cost  Savings  

  Employee  Sa<sfac<on    Customer  Sa<sfac<on  

  New  Revenue    through  efficiency  

  Next  Annual  Budget:      Agile  Program  (Using  Scrum)  ◦  >$75  Million  Project  ◦  ~100  People  involved  ◦  Quarterly  Roadmap  

I  am  so  Happy!  

  At  the  same  <me  as  the  “Big  Agile”  Program…  ◦  Dissolved  all  PMOs  ◦  Created  a  new  ePMO  ◦  Moved  all  Project  Managers  to  ePMO  

  Newly  Re-­‐orged  Project  Manager  innocently  turned  a  project  red  (Scope,  Schedule  issues)  ◦  9  mee<ngs  with  VP’s  and  Sr.  Directors  ◦  Effec<vely  trained  this  PM  never    to  put  projects  in  red  

Scope

Schedule Cost

  [Project]  Por`olio  management  is  the  coordinated  management  of  por`olio  components  to  achieve  specific  organiza7onal  objec7ves  

  Organiza<ons  that  do  not  link  por`olio  management  to  governance  increase  the  risk  that  misaligned  or  low  priority  ini<a<ves  will  consume  cri<cal  resources  

- Standard for Portfolio Management

  Capitalize  on  opportuni<es    Minimize  the  impact  of  threats    

  Respond  to  changes  in  the  market  

  Reinforce  focus  on  cri<cal  opera<onal  ac<vi<es  

- Standard for Portfolio Management

  Priori<za<on  to    maximize  “Business  Value”  

  Effec<ve  delivery  to    minimize  costs  

  Re-­‐alloca<on  of  resources    when  costs  are  too  high    or  the  benefit  is  too  low  

  Rolling  wave  planning  is  a  form  of  progressive  elabora<on  planning  where  the  work  to  be  accomplished  in  the  near  term  is  planned  in  detail  and  future  work  is  planned  at  a  higher  level  of  the  WBS.  

2008 Project Management Institute. A Guide to the Project Management Body of Knowledge (PMBOK® Guide) — Fourth Edition

  It  is  not  possible  to  completely  specify  an  interac<ve  system.  Wegner’s  Lemma,  1995  

  Uncertainty  is  inherent  and  inevitable  in  sogware  development  processes  and  products.  Ziv’s  Uncertainty  Principle,  1996  

  For  a  new  sogware  system  the  requirements  will  not  be  completely  known  un<l  ager  the  users  have  used  it.  Humphrey’s  Requirements  Uncertainty  Principle,  c.  1998  

  Stack  Ranked  Priori<za<on  based  on  Business  Value  and  risk  

  Self  organizing,  cross-­‐func<onal  teams  

  Defini<on  of  Done    Poten<ally  Shippable  Increments  

  Velocity    Con<nuous  Improvement  

  Priori<za<on  to    maximize  Business  Value  

  Effec<ve  delivery  to    minimize  costs  

  Re-­‐alloca<on  of  resources    when  costs  are  too  high    or  the  benefit  is  too  low  

"  Scrum "  Scrum (but no cost management)

Management Reserve!

(PV)

Total Allocated Budget!

Time!Now!

Completion!Date!

$ PMB

EAC

Time

Planned Value

(AC) Actual Cost

Performance Management Baseline

Estimate at Complete

(EV) Earned Value

CPI < 1 CPI =1 CPI > 1

Over Budget On Budget Under Budget

SPI < 1 SPI =1 SPI > 1

Behind Schedule On Schedule Ahead of Schedule

Cost Performance Index (CPI=EV/AC)

Schedule Performance Index (SPI=EV/PV)

  Integrates  cost  and  schedule  management    Forecasts  in  financial  units  based  on  units  used  for  actual  cost  

  Decades  of  use    Part  of  PMBOK  (ANSI/PMI  99-­‐001-­‐2008)    Part  of  EVMS  (ANSI/EIA-­‐748-­‐B-­‐2007)  

  Typical  implementa<ons  expect  everything  fully  defined  up  front  

  No  asser<on  of  quality    Claiming  value  earned  on  intermediate  work  products  

19

Ugh!  

  A  planning  package  is  a  holding  account  (within  a  control  account)  for  budget  for  future  work  that  it  is  not  yet  prac<cable  to  plan  at  the  work  package  level.  The  planning  package  budget  is  <me-­‐phased  in  accordance  with  known  schedule  requirements  (due  dates)  for  resource  planning,  and  the  plans  are  refined  as  detail  requirements  become  clearer  and  the  <me  to  begin  work  draws  nearer.  A  program  may  elect  to  break  the  work  assigned  to  a  control  account  into  smaller  groupings  of  tasks,  i.e.,  mul<ple  planning  packages,  for  internal  planning  and  control  reasons.  

-Earned Value Management Systems ANSI/EIA-748-B-2007

  There  is  no  standard  advance  planning  look-­‐ahead  period  (i.e.,  a  planning  “horizon”  or  “window”)  for  conversion  of  planning  packages  into  work  packages  that  is  appropriate  for  all  programs  or  condi<ons.  Each  organiza<on  must  determine  its  own  policies  in  this  regard.  

-Earned Value Management Systems ANSI/EIA-748-B-2007

  Priori<za<on  to    maximize  Business  Value  

  Effec<ve  delivery  to    minimize  costs  

  Re-­‐alloca<on  of  resources    when  costs  are  too  high    or  the  benefit  is  too  low  

"  Scrum

"  EVM (cost management but no benefit management)

"  Scrum (but no cost management)

Value

Constraints (Schedule, Cost, Scope)

Quality

Source: Jim Highsmith

Strategic  

Required  to  make  good  Decisions  

Informs  and  Guides  

  Mathema<cally  proven  that  Forecasts  based  on  average  velocity  (story  points)≡  es<mate  at  complete  EAC  (dollars)  

  Key  Assump<on:    The  ra<o  of  (story  points  completed)/(total  story  points  in  a  release)  is  a  good  measure  of  Actual  Percent  Complete  

Sulaiman, Barton, Blackburn “AgileEVM - earned value management in Scrum Projects,” 2006 http://ieeexplore.ieee.org/xpl/freeabs_all.jsp?arnumber=1667558

  Release  Baseline  ◦ Budget  (BAC)  ◦  Ini<al  Scope  ◦  Start  Date  

  Each  Itera<on  (Sprint)  ◦ Points  accepted  by  Product  Owner     meets  Defini<on  of  Done  ◦ Points  add  or  removed  from  release  scope  ◦ Actual  Cost  

  Now  we  can  focus  on  Value…  

  Integrated  Cost  and  Schedule  informa<on  provides  beser  insights  than  schedule  alone  

  Focus  on  delivering  value    Constraints  inform,  not  dictate  outcomes    Quality  must  be  part  of  the  decision  process    AgileEVM  helps  communicate  by  transla<ng  points  to  dollars  

  President:  Agile  Advantage,  Inc.    Former  CTO,  Development  Manager,  PMO  Manager,  Agile  Coach,  Mentor,  Cer<fied  Scrum  Trainer,  ScrumMaster,  Product  Owner  

  Ac<ve  prac<<oner  delivering  value  using  Agile  and  helping  others  do  it;  from  small  Product  companies  to  very  large  IT  organiza<ons  

brent@agileadvantage.com www.agileadvantage.com Blog: gettingagile.com Twitter: brentbarton

"   Ar<cles  •  “Manage  Project  Por`olios  More  Effec<vely  by  Including  Sogware  Debt  in  the  Decision  Process”,  Cuser  

Journal  2010  •  “AgileEVM  –  Earned  Value  Management  in  Scrum  Projects”,  IEEE  2006  •  “Implemen<ng  a  Professional  Services  Organiza<on  Using  Type  C  Scrum”,  IEEE  •  “Establishing  and  Maintaining  Top  to  Bosom  Transparency  Using  the  Meta-­‐Scrum”,  AgileJournal  •  “All-­‐Out  Organiza<onal  Scrum  as  an  Innova<on  Value  Chain”,  IEEE