AgileEVM Webinar 0611 New Templatev2 - Collab I have been helping teams and organizations in...

Information For Good Decision Making

AgileEVM

2

I have been helping teams and

organizations in transitioning to agile

methods as a hands-on ScrumMaster,

Agile coach and Scrum trainer since 2003.

My focus is on coaching teams and

organizations to effectively provide value

to key stakeholders and customers

through the frequent delivery of software.

My passion lies in helping organizations

plan and implement effective Agile

transformations.

Tamara Sulaiman Runyon, PMP, CST

[email protected]

Webinar Perspective – the audience

Copyright © 2010 CollabNet, Inc. | www.collab.net

Participants new to Agile & Scrum, and familiar with Earned Value Management (EVM)

Participants new to EVM, and familiar with Agile and Scrum

Participants new to both Agile and EVM

Webinar Objectives: To Discuss

Copyright © 2010 CollabNet, Inc. | www.collab.net

• What AgileEVM is• 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• How AgileEVM can be applied

at the portfolio level

First: What is Earned Value Management?

5 Copyright © 2010 CollabNet, Inc. | www.collab.net

Why Use EVM?

EVM integrates the areas of technical performance,

schedule and cost.

“The single most important benefit of

employing earned value is the cost efficiency

readings it provides.”


Why Use EVM – there’s more…


EVM provides early warning of performance problems while there is

time for corrective action.”

Validity of method – well known, PMI standard, in

use for Project Management for over 40

years.

Business Reasons to Use EVM

Earned Value Management - A Time Line


PMI - EVM Community of Practice


Conferences, Certification exams…. They’ve got it all!

Traditional EVM can get complicated


ANSI EIA 748 EVMS Standards

Why Use Agile Software Methods?


Amr Elssamadisy – Patterns of Agile Practice Adoption – The Technical Cluster

Reduce time to market

Increase value to market

Increase quality to market

Increase flexibility

Increase visibility Reduce Costs

Scrum: A Quick Review

2Copyright © 2010 CollabNet, Inc. | www.collab.net

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

Agile Performance Tracking?


“The challenge is to create Agile...…implementations of the EVM

principle…” http://en.wikipedia.org/wiki/Earned_value_management

AgileEVM = Traditional EVM & Scrum

Where Does AgileEVM Add Value?


Communication Decision Making

Portfolio Level Visibility

Why Use AgileEVM?

Add a cost component to Agile metrics

Balance the needs of all stakeholders

Optimize the value of releases

Make better business decisions


AgileEVM Metrics


Schedule Performance Index (SPI)

Cost Performance Index (CPI)

Velocity per Sprint

Earned Value vsPlanned Value

A Couple of Notes:

• Earned Value Metrics track progress against plan; they do not track earned business value.

• AgileEVM does not replace Agile Burn-down, Burn-up charts, or any other metric you are currently using.


Defining the initial Release Baseline

Release Baseline

# of Planned Sprints

Sprint Lengths

Budget At Complete Planned

Release Story Points

Start Date


Measuring Progress


Story Points Completed

Story Points Added

Actual Cost

Current Sprint

• To Date

• (Can be a negative number)

• To Date• (must match the

time period the work was performed

• To Date


AC – Actual Cost

PV – Planned Value

EV – Earned Value

EAC –Estimate at Complete

CPI – Cost Performance

Index

SPI –Schedule

Performance Index

“AgileEVM is like Death by Acronym”T. Perry, SolutionsIQ

AgileEVM – Basic Equations

• Planned Value• = Expected % complete * BACPV• Earned Value• = Actual % complete * BACEV• Cost Performance Index• = EV / ACCPI• Schedule Performance Index• = EV / PVSPI


Foundation for AgileEVM – Percent Complete


The key: 0% or 100% complete ruleThe key: 0% or 100% complete rule

Actual Percent Complete = Story

points completed/Total story points planned

Expected Percent Complete = Number of Sprints completed/Total

Sprints planned

An Example


Basic Data:

• Budget at Complete = $175,000• Planned Sprints = 4• Completed 1 Sprint• Planned Story Points = 200• Story Points Completed = 40• Actual Cost = $65,000

Step 1: Calculate the Expected % Complete

The number of sprints completed divided by the number of sprints planned in the release.Therefore: We’ve completed 1 sprints. We have 4 sprints planned in the release. 1/4 = .25 = 25%

Expected Percent Complete = 25% or .25


Step 2: Calculate The Actual % Complete

Story points done/ Story points planned for the release

Example: We have 200 story points planned in the release. At the end of Sprint 1 we have completed 40 story points.

Actual % Complete - 40/200 =.2 = 20%Actual Percent Complete = 20% or 0.2


Calculating the Earned Value (EV)


EV = .2 *175000 = $35,000

Actual percent complete = 20%,BAC = $175,000

Multiply Actual % Complete by total budget to calculate Earned Value (EV)

CPI: Earned Value and Actual Cost


What does it mean if EV is higher than your

Actual cost? EV>AC ?

What does it mean if Actual Cost is higher

than your Earned Value?

AC>AC?

Calculating Planned Value (PV)


PV = .25 * 175000 = $43,750

Expected % Complete = 25%, BAC = $175,000

Multiply EPC times the budget to calculate Planned Value (PV)

SPI : Earned Value and Planned Value


So if the Earned Value is less than

the Planned Value?

EV < PV?

What if the Earned Value is equal or

more than the Planned Value?

EV=>PV?

The CPI & SPI Measuring Actual Performance

If: CPI > 1 CPI = 1 CPI < 1

That Means:

Under Budget

On Budget

Over Budget

If: SPI > 1 SPI = 1 SPI < 1

That Means Ahead of Schedule

On Schedule

BehindSchedule

30

Calculating the Cost Performance Index (CPI)


Ideal is CPI = 1

CPI = 35,000/65,000 = .53

CPI = EV/AC

Calculating the Cost Performance Index (CPI)


Ideal is SPI = 1

SPI = 35,000/43,750 = 0.8

SPI = EV/PV

Predicting Estimate At Complete

EAC = $263,000+65,000 = $328,000

ETC = [(1/.53)*($175,000 -35,000) = $263,200

IF: Actual Cost =$ 65,000 Budget = $175,000EV = $35,000 & CPI = .53

Given: ETC = 1/CPI *(Budget – EV)

Given: EAC = AC + ETC


Our Example:

How are we doing?•BAC = $175,000•EV = $35,000•PV = $43,750 •AC = $65,000 •CPI = 53%•SPI = 80% &•EAC = 328,200


We need to make some changes! Fortunately, we found out early…..therefore…

What If We Made Some Changes?

• If we remove scope – reduce the planned story points to 160 points, then•Our EV becomes $43,750.•Our CPI becomes 67%•Our SPI becomes 1.00 – we will finish this work on time.

•EAC = $196,250


When Should AgileEVM Be Applied?


Actual Costs

Boundaries

Equality

AgileEVM at the Program Level

Team Budget PV EV AC CPI SPI Estimate at Complete

Team A $ 300 $ 150 $ 150 $ 150 1 1 $ 300

Team B $1,000 $ 575 $ 500 $ 625 .8 .86 $ 1,250

Team C $ 800 $ 175 $ 200 $ 180 1.11 1.14 $ 720

Program Totals

$ 2,100 $ 900 $ 850 $ 955 .89 .94 $ 2,360


38 Copyright © 2011 CollabNet, Inc. Portions used with permission. All Rights Reserved.38

Agile Development in the Cloud

CollabNet is changing the way software is developed!

• Tools• Agile project management• Agile ALM • Hosted SCCM

• Training • Certified ScrumMaster• Certified Product Owner• Product training

• Coaching• On-site Agile implementation and

mentoring

www.collab.netTEL: 1-888-778-9793 Email: [email protected]

Summary

CollabNet TeamForge is:• The leading ALM Platform for distributed teams• Built by the Subversion experts• Designed to govern and manage Subversion repositories as

part of an overall application lifecycle

Built for Results:• License, support, and infrastructure savings (typically 3 – 7x)• Development productivity gains (typically 10 – 20%; ranges

from 5% to 75% based upon the amount of reuse)• Revenue and innovation gains (can range from tens of

thousands to hundreds of millions of dollars)

Questions?


We have time for questions!

AgileEVM Webinar 0611 New Templatev2 - Collab I have been helping teams and organizations in...

Documents

Transcript of AgileEVM Webinar 0611 New Templatev2 - Collab I have been helping teams and organizations in...