Agile Earned Value Management Workshop)

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AgileEVM Adding Cost Control to the Agile Toolkit Tamara Sulaiman, PMP,CSM-P [email protected]

Transcript of Agile Earned Value Management Workshop)

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AgileEVMAdding Cost Control to the Agile

ToolkitTamara Sulaiman, PMP,CSM-P

[email protected]

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PresenterTamara Sulaiman

• ScrumMaster and Scrum Coach• Agile since 2003• 15 years of management experience across a variety of

industries including software development, construction, non-profit organizations and education

• Certified ScrumMaster (Practitioner)• Certified Project Management Professional (PMP)• Co-author of “AgileEVM – Earned Value Management in

Scrum Projects”

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Workshop Perspective• The examples of

AgileEVM discussed today are based on the Scrum framework

• A basic knowledge of Earned Value Management is presumed

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More Information

www.solutionsiq.com/agile_index.htmlMy email: [email protected]

You will find:• Research paper on AgileEVM• AgileEVM Worksheet (MS Excel)• More information on AgileEVM terms

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Workshop Objectives:

– Why we want to use AgileEVM– What is needed to calculate AgileEVM– How to analyze the results of AgileEVM– Where AgileEVM adds value– When AgileEVM should be applied

To discuss:

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Personal Objectives - Exercise

• Please write, on a sticky note one thing that you would like to learn in this workshop.

• Put your sticky note on the chart ‘Personal Objectives’ and we’ll make sure to address it during, or by the end of the workshop.

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Business Reasons For Using Agile Methods

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Business Reasons To Use Earned Value Management (EVM)

http://en.wikipedia.org/wiki/Earned_value_management

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Additional Benefits of EVM

• “The single most important benefit of employing earned value is the cost efficiency readings it provides.”

http://www.stsc.hill.af.mil/crosstalk/1998/07/value.asp

According to Quentin W. Fleming and Joel M. Koppelman:

• “EVM provides early warning of performance problems while there is time for corrective action.”

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Agile Performance Tracking?

“The challenge is to create Agile...

…implementations of the EVM principle…”

http://en.wikipedia.org/wiki/Earned_value_management

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The Solution!

AgileEVM = Traditional EVM & Scrum

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Why Use AgileEVM?

Tracking costs in Agile methods

AgileEVM_SampleEVM.xls

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30 days

24 hours

Backlog tasksexpandedby team

Potentially ShippableProduct Increment

Release PlanProduct Backlog

Prioritized Featuresdesired by Customer

Sprint BacklogFeatures assigned to Sprint estimated by team

Vision

Jan May Aug Dec

Product Roadmap

What Is Needed To Calculate AgileEVM?

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• AC – Actual Cost• PV – Planned Value• EV – Earned Value• BAC – Budget at Complete• EAC – Estimate at Complete• CPI – Cost Performance Index• SPI – Schedule Performance Index

“AgileEVM Is Like Death By Acronym”T. Perry, SolutionsIQ

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AgileEVM – Percent Complete

• Why are the percent completes so important?• How do you calculate Expected Percent

Complete?• How do you calculate Actual Percent Complete?

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AgileEVM – Defining The Baseline

- 5 simple inputs- Start Date- Budget At Complete- Planned Sprints- Sprint Lengths- Planned Release Story

Points

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AgileEVM – Incorporating The Variables

4 data points•Story Points Completed

•Story Points Added

•Actual Cost

•Current Sprint

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AgileEVM - Analysis

• What does it mean if EV is higher than your Actual cost?

You are spending less money than planned to accomplish the work.

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AgileEVM - AnalysisWhat does it mean if Actual Cost is higher than your Earned Value?

You arespendingmore moneythan plannedto accomplishthe work.

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AgileEVM – Analysis

So if the Earned Value is less than the Planned Value?

You areaccomplishingthe work late; or behindschedule

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AgileEVM - Analysis

What if the Earned Value is equal or more than the Planned Value?

You areaccomplishingthe work on, or ahead ofplan.

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Performance Indices

If: CPI < 1 CPI = 1 CPI > 1

That Means: Over Budget On Budget Under Budget

If: SPI < 1 SPI = 1 SPI > 1

That Means Behind Schedule

On Schedule

Ahead of Schedule

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Where AgileEVM Adds Value

• AgileEVM provides a simple, clear concise method to communicate the release picture to stakeholders.

• The ability to run ‘what if’ scenario’s to help forecast the impact of changes to scope, schedule, and budget.

AgileEVM_SampleEVM.xls

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When Should AgileEVM Be Applied?

• At set, predetermined boundaries like Sprint boundaries, or week / month end

• You must have the actual costs for that period, and the story points completed for that period

• The boundary periods need to be equal in length

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Case Study

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Wrap Up

• Personal Objectives• Prizes!