Tales from a Trading Desk

Agile questions from a CFO/vendor management perspective

Here are a few general questions about Agile development from a CFO/vendor management perspective that we have had over the past year or so:

1. How much the IT business solution will cost
2. When will the IT business solution be delivered
3. Will the ultimate solution be much greater in scope and cost than what the CFO signed up for
4. Will the business really put the effort in with the development team to make Agile work
5. How can you tell how good your Agile team really
6. How do you know if your Agile team is giving you good value for money
7. How can you tell when you have problems with your Agile team

Question 1 and 2 are really about estimation, and not specific to Agile.  Whatever methodology is used to develop software, before the project kicks off, some estimation is usually needs to answer the questions of time/budget. Extreme Programming Applied, page 70 has a few interesting statistics on this subject based on 200 projects, 1997-1999.

Question 3 is really about project management.  Scope change, the cost curve, ambiguous requirements etc can all influence the scope/cost.  At least with Agile, the iteration game allows management to see very quick what is being delivery, re-priorities stories and better understand the quantity of work required to delivery requirements - Agile offers feedback early and often. Chapter 11, Extreme Programming Applied is probably relevant to this point.

With regards to question 4, Agile does require that the customer sign up to the process of software development.  As in almost any development, lack of customer input will at the end of the day effect the output.  The Agile Manifesto stipulates that business and development staff must work together.

Questions 5, 6 and 7 can probably be answered by looking at what is achieved within iterations - velocity.  The whole concept of Test Driven Development (TDD) and Continuous Integration (CI) also comes into play here, with feedback early and often allowing management to full understand what is happening within the project.

Update: Victor has an interesting posting on budget forcasting.