W10 Agile Testing 5/4/16 13:45
Budgeting, Estimation, Planning, and #NoEstimates: They All Make Sense for
Agile Testing
Presented by:
Michael Harris
David Consulting Group
Brought to you by:
350 Corporate Way, Suite 400, Orange Park, FL 32073
888-‐-‐-‐268-‐-‐-‐8770 ·∙·∙ 904-‐-‐-‐278-‐-‐-‐0524 -‐ [email protected] -‐ http://www.stareast.techwell.com/
Michael Harris David Consulting Group Michael Harris has more than thirty years of broad management experience in the IT field—in R&D, development, production, business, and academia—and held numerous senior executive positions in Fortune 500 companies. An author and speaker on a range of topics related to the value visualization of IT, Michael is considered a leader in the software development industry. He became president, CEO, and majority owner of David Consulting Group (DCG) in 2006. Michael is a co-‐author of The Business Value of IT: Managing Risks, Optimizing Performance, and Measuring Results. Read more at valuevisualization.com.
Phone: +1-610-644-2856
Measure. Optimize. Deliver.
softwarevalue.com
©2016 David Consulting Group
StarEast 2016
Budgeting, Estimation, Planning,
#NoEstimates
and the Agile Planning Onion
Michael Harris President & CEO
©2016 David Consulting Group
All Budgets, Estimation and Plans Are . . .
Fantasies
. . . more or
less
©2016 David Consulting Group
Why Do We Budget, Estimate and Plan?
Why centers on answering a four very basic questions:
– When will “it” be done?
– How much will “it” cost?
– What is “it” that I will actually get?
– What can I afford?
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Budgeting v Estimation v Planning
• How much money should I allocate?
• Which projects or products should we fund?
• Which projects will return the greatest amount of value?
Budgeting
• What can be delivered?
• When can we deliver?
• How should teams be allocated? Estimation
• What tasks need to be completed?
• Who needs to complete specific tasks and when? Planning
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©2016 David Consulting Group
Classic Budgeting, Estimation and
Planning
– The budgeting process is a forecast helps make
decisions about which pieces of work are to be done.
– The estimate ( believed to be more accurate) makes a
project about when the work will be completed
(estimates the four questions).
– Planning provides tactical, task level guidance.
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Too high
1.5x
2x
1,25x
.8x .67x
.5x
*Probability
.25x
4x
P1 P2 P3 P4 P5
Actual
-
Too Low
Cone of Uncertainty
-
Good Guess
Estimation
Budgeting
Planning
©2016 David Consulting Group
The Cone of Uncertainty
Too high
1.5x
2x
1,25x
.8x .67x
.5x
*Probability
.25x
4x
P1 P2 P3 P4 P5
Actual
-
Too Low
Cone
of
Uncertainty
All work has a cone of
uncertainty
– Sales, Testing,
Messaging
All: different steps and
widths!
-
Good Guess
Estimation
Budgeting
Planning
©2016 David Consulting Group
Time . . .
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Budgeting
• Primary Stakeholders: Executives, Finance, Deal Makers
Estimation
• Primary Stakeholders: Project Managers, Team Members, Middle Management
Planning
• Primary Stakeholders: Team Members, Project Managers
P
r
o
j
e
c
t
T
i
m
e
l
i
n
e
©2016 David Consulting Group
Budgeting Answers
• How much money should I allocate for software
development, enhancements and maintenance?
• Which projects or products should we fund?
• Which projects will return the greatest amount of value?
Most organizations have a portfolio of work that is larger
than they can accomplish, therefore they need a mechanism
to prioritize.
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Planning Flow In Agile
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Mike Cohn’s Planning Onion
©2016 David Consulting Group
Defining An Estimate
• Targets
–Statement of a desirable business objective
–Example: Taxes must be paid by April 15th
• Commitments
–A promise to deliver
–Example: I promise not to leave my taxes until the last
minute
• Estimates
–A prediction
–Example: Preparation of my taxes will require many pots
of coffee, a large part of a bottle of aspirin, an internet
connection and around two weekends to complete.
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Impact of Ineffective Estimating
• Impact of major schedule slippage is often
dramatic:
1. Unrecoverable revenue losses
2. Not first to market
3. Public failure
4. Possible legal repercussions
• Corporations are more significantly impacted by schedule
pressures than any other factor
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Does The Past Predict The Future?
A story of
childish hijinks,
black paint, a
truck and
straight roads.
Sometimes
prediction
depends on
the context.
©2016 David Consulting Group
Estimation Pathologies (Jim Benson)
• The three-level process described above, if misused, can
cause several team and organizational issues.
• Proponents of the #NoEstimates movement often classify
these issues as estimation pathologies.
• Jim Benson, author of Personal Kanban, established a
taxonomy of estimation pathologies that includes:
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©2016 David Consulting Group
Estimation Pathologies (Jim Benson)
• Guarantism – a belief that an
estimate is actually correct.
• Swami-itis – a belief that an
estimate is a basis for sound
decision making
• Craftosis – an assumption that
estimates can be done better
• Reality Blindness – an insistence
that estimates are prima facie
implementable.
• Promosoriality – a belief that
estimates are possible (planning
facility)
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©2016 David Consulting Group
#NoEstimates
Reflects A Continuum of Thought
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Throughput #NoProject
Woody
Zuill
Vasco
Duarte
• Break work down in small
chunks
• Assemble minimum viable
product (MVP) for feedback.
• Generate continuous
feedback and re-planning.
• Break work down in small
chunks
• Continuously measure
throughput.
• Average throughput used for
forecasting
#NoEstimates Continuum
©2016 David Consulting Group
When Does #NoEstimates Work?
• The idea of #NoEstimates can be applied at the level of
planning and estimation IF the right conditions are met.
Conditions include:
– Stable teams
– Adoption of an Agile mindset (both team and
organizational levels)
– A backlog of well-groomed stories
• For a sprint, a team can easily answer:
– When will “it” be done?
– How much will “it” cost?
– What is “it” that I will actually get?
– What can I afford?
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©2016 David Consulting Group
Planning Onion and Timing
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Budgeting
Estimating
Planning
Mike Cohn’s Planning Onion
Analogy
Parametric - Light
Integration Planning
Standup Meetings
#NoEstimates
(Type II)
#NoEstimates
(Type I)
©2016 David Consulting Group
Case Study Context
Large software development firm, moderately hierarchical culture and several very large project and many smaller
Mixed of SCRUM/XP, Kanban, SAFe for some large programs, Plan Based projects and Independent Testing
Strenuous budgeting process with tax accruals
Entrenched Program Office provides administrative functions
Mixture of internal projects and outsourced work.
©2016 David Consulting Group
Change Began With A TMMi Assessment
• Assessment Process
– Survey
– Process and Artifact Review
– Interviews
• Analysis and Reporting
– Gap Analysis
» Strengths and Weaknesses
» Heat Maps
» Prioritized Improvements
• Action Planning
Process and
Artifact Review
Interviews
Synthesis
Planning
Survey
65%
35%
©2016 David Consulting Group
Putting Assessment Results Into Action
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Evolution
• High Level Estimation (product and release):
Release Plans and product road maps were easily be built from
forecasts for all external products and internal applications with 500
users or more.
• Agile teams with a track record of delivering value on a regular basis.
Were allowed to leverage #NoEstimates for planning. Other conditions
include:
– Stable Teams
– Agile Mindset (both team and organizational levels)
– Well-groomed Stories
– Integrated Testing Personnel
• All projects and products are required to find a way to answer the
classic questions of when, what and how much work will cost whether
the work is done by single teams or by scaled Agile programs.
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©2016 David Consulting Group
Technique Pallet
• Budgeting Techniques
– Analogy (Macro)
– Business Case
– Road Mapping
• Estimation Level Techniques
– Parametric Estimation
– Analogy
– Planning Poker and Rate (form of release planning)
– #NoEstimates (Flow)
• Planning Techniques
– Work Breakdown Structures (Plan Based – non integrated testing personnel)
– Points (various – FP mostly) and Sprint Planning
– Points (various) and Continuous Flow (Kanban)
– Stand Up Meetings
– #NoEstimates (Flow)
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©2016 David Consulting Group
Not All Happiness - Contractual Agile
• All outsourced contracts being transitioned to fixed cost and
date contracts leveraging a hybrid Scrum / Plan Based
project management solution.
• The PMO actively tracks these vehicles.
• #NoEstimate techniques are not allowed in this
organizations contract vehicles.
– Raja Bavani, Senior Director at Cognizant Technology
Solutions stated in a recent conversation with Tom
Cagley that he thought that #NoEstimates was a non-
starter in a contractual environment.
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©2016 David Consulting Group
Final Thoughts
• All budget, estimates and plans are by definition are
imprecise
• Only be accurate within a range of confidence
• The single number contract which generates anger and
frustration fueling #NoEstimates movement.
• #NoEstimates and classic estimation are tools to generate
feedback and create guidance.
• The goal is usually the same, it is just that the mechanisms
are very different.
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©2016 David Consulting Group
Questions?
Mike Harris, SM, SPC4
President
DCG Software Value
+1.610.644.2856 x22
Tom Cagley, CFPS, CSM,
CTFL. SPC4
Vice President
DCG Software Value
(440) 668-5717