How to deliver business value with Agile. Delivering business value is arguably the most important aspect of project management and Agile approaches are supposedly the best tools available for making sure business benefits are being realised by prioritising requirements based on what adds more value to the customer. However, while the ceremonies of Agile practices such as in Scrum are easy to follow, defining and measuring business value is hard, which can lead to team focusing on "building the thing right" rather than "building the right thing", falling short of the promises of Agile delivery. In this talk, I'll unpack the main reasons behind this problem and bring some ideas on how teams and organisations can become more value-driven. https://www.youtube.com/watch?v=PYS2Cm0gR_c

1. Dr. David Michel
Delivering Business
Value with Agile
Impact
€
%
18 May 2017

3. 64%of features
rarely or
ever used

4. Dr. David Michel
Delivering Business
Value with Agile
Impact
€
%
18 May 2017

5. Product
Backlog
Sprint
Backlog
Product
Increment
Daily
Scrum
Sprint

6. Hyper-productive teams
Sutherland, J., Downey, S., Granvik, B., (2009) Velocity of MySpace Teams by Sprint [Figure] In Shock Therapy: A
Bootstrap for Hyper-Productive Scrum (p. 72)

7. Hyper-productive teams
Sutherland, J., Downey, S., Granvik, B., (2009) Velocity of MySpace Teams by Sprint [Figure] In Shock Therapy: A
Bootstrap for Hyper-Productive Scrum (p. 72)

8. Peter Drucker
“There is surely nothing quite so
useless as doing with great
efficiency what should
not be done at all

11. Feature
A
Feature
B
Feature
C

14. Declaring Victory
Too Soon

15. Building the right thing
vs
Building the thing right

17. What does the Agile Manifesto says?
Our highest priority is to
satisfy the customer
through early and
continuous delivery of
valuable software
“
”

18. What is it?

19. Price is what you pay…
…Value is what you get
Warren Buffet
“

20. Value =
Benefits
Cost

21. Tangibles
Intangibles

22. If you cannot measure it,
you cannot manage it
• fuzzy numbers lead to fuzzy actions
• Fuzzy numbers are more susceptible to manipulation
“
”
But…

23. Not everything
that can be
counted counts
And not everything
that counts can be
counted
“
”

24. We cannot measure it…
…Yet, we are comfortable
with health-driven practice
e.g. medicine

26. How to become
value-driven?

27. Questions we are interested in…
• Are we on track?
• How are we doing in terms of budget?
• Will we be able to finish in time?

28. Questions we are interested in…
• Did this deliver value to the customer?
• What impact did it have on their business?
• Are they actually using the software?
• Are we building the right thing?
• Are we on track?
• How are we doing in terms of budget?
• Will we be able to finish in time?

31. Refinement
Fidelity
http://availagility.co.uk/2009/12/22/fidelity-the-lost-dimension-of-the-iron-triangle/

33. Iterating vs. Incrementing

35. • Goal: deliver as much as possible
• Output-driven, not outcome

36. Gojko Adzic

37. Business Value Model
Andy Pols
Increase
Revenue
Reduce
Cost
Protect
Revenue
Avoid
Cost
Chris Matts

38. Disciplined Learning
• Risk Reduction = Knowledge
Acquisition
• “Pay to learn”
 Iterative
• “build business value”
 incremental

39. EPIC
Features
Mr. Product Owner
The Team
The conversations should include:
• How do we assess the impact on the
business?
• How do we judge whether this was the
right thing to build?

40. • Did this deliver value to the customer?
• What impact did it have on their business?
• Are they actually using the software?
• Are we building the right thing?
Acceptance
criteria

41. Done
Done Done
Code completed, tested
Released into production

42. Done Done Done
Done
Done Done
Code completed, tested
Released into production
Worked out the value/benefit
User Stories were not considered complete
until they led to validated learning
“
”

43. • Could we not monitor the inventory before?
Hmmm…. Unlikely!
• What impact/change do we expect on the
business once this is implemented?

44. Reformatting the User Story format
We will (benefit/value)
For our (role, persona)
Because we have (what will the
feature do)
As a (role, persona)
I want (what will the feature do)
So that (benefit/value)
As a user, I want to be able to
make changes to my calendar
and search without having to
type on my iPhone, because it
saves me time and hassle
We will save time and hassle, and
increase safety for our users, because
we have an intelligent personal
assistant” that can make changes to
calendars and search using a natural
language user interface.

45. Sell with the benefit (outcome)
Support with the feature (output)

46. Establish value-driven relationship with clients
Define
“value dials”
Value-driven culture
Define
Business value
currency
Develop
Value Metric
Strategy

47. Define
“value dials”
Value-driven culture
Define
Business value
currency
Develop
Value Metric
Strategy
Indicators of
business value
that may or
may not map
to the financial
bottom line.

48. Define
“value dials”
Value-driven culture
Define
Business value
currency
Develop
Value Metric
Strategy
Analogous to
“story point”,
we can
estimate how
“valuable” a
feature is

49. Define
“value dials”
Value-driven culture
Define
Business value
currency
Develop
Value Metric
Strategy
Depending on
the phase of
the project
(start-up,
scale, mature),
the relative
importance of
the value dials
might change

50. Decision based on value/cost ratio

51. Cost of raising the cow
Value of beef
Value of leather
Problem of shared cost
 ROI analysis best used at the level of epics/themes rather
than user stories

52. Usage as a measure of value
Using a product is, above all, a
transaction. The user donates his time
and attention, which are supremely
valuable commodities. In return, you,
the creator, must give her something
worthy of her gift to you
”
“

53. Usage as a measure of value
• Do the users use the feature?
• How often to do they use the feature?
• For how long do they use the feature?
 web technologies are particularly well
suited to do this!
 But only works if users are not mandated
to use the software

54. Let’s wrap up

55. Output != Outcome
Fidelity
Scope is the variable
Problem of shared cost
ROI = value/cost
?
Communicate with value
not features
Backlog size
Building the
right thing ?
Value-driven
Iterative

56. @DavMichel76
david.michel@tessella.com