UNPACKING BUSINESS VALUE

AgileCamp Dallas Rich Mironov @richmironov

•  Process improvements: throughput, quality, building things right

•  Assumes strategic prioritization and useful market outcomes

•  Does “Business Value” still taste like customer success?

Agile’s Focus on Velocity

There’s nothing more wasteful than brilliantly engineering a product that doesn’t sell, or a project that doesn’t matter.

•  “The Business” separated from “The Team” •  Assigned value, not market outcome •  Early (fixed) estimates •  Prioritizing unlike things algorithmically •  Are paying customers saying “yum?”

We’re Forgotten What Real Business Value Tastes Like

Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.

•  New product/service •  Promise of future revenue

•  Feature/workflow improvement •  Promise of future user happiness

•  Technical debt reduction •  Promise of future velocity

•  Test automation, CI-CD •  Promise of faster releases

•  System improvements •  Promise of future operational savings

Many Flavors of Business Value

Hypothesis: •  Project business value estimates +/- 70% •  1 in 10 will deliver zero value Would that change portfolio planning and stakeholder interactions?

Business Value Error Bars >> Development Error Bars

1.  Negotiate real trade-offs with decision-makers 2.  Relative, like-with-like comparisons 3.  Reality-based budgeting (projects don’t end) 4.  Get closer with actual users (paying customers)

What Can We Do?

Development can never build as fast as we can dream

•  “CEO says it’s really important.” •  “We already promised it to a big prospect.” •  “How hard could it be? Probably only 10 lines

of code.” •  “We’ve been talking about this for months.” •  “We’ve gone agile, which gives us infinite

capacity...” •  “My neighbor’s kid could do this in an hour.”

Magical Thinking

•  Most requests will go unfulfilled •  Roadmap: what we are building (instead of new request)? •  What commitments would we drop to add this? •  Trade-offs among like items

#1: Real Trade-Offs are EXCLUSIVE ORs (not ANDs)

Features  for  current  release  

50%  

Quality,  test  automa6on,  tech  

debt  15%  

Management,  overhead,  10%  

Future  R&D,  5%  

One-­‐offs,  non-­‐roadmap  20%  

Typical Commercial Software Development Budget

Prioritizing Within Buckets #2. Prioritization within buckets

•  Quick-sort top candidates •  Let us negotiate complex issues •  Live stakeholders around the table •  WSJF assumes accuracy and independence

that I rarely see

Prioritization Algorithms Get Us 80% There

•  Programs/products run for a very long time •  Things we dropped from V1.0 •  What we learn, new needs,

platform evolution •  Yet we budget as if projects end on ship date

•  Need sustaining budget until end-of-support

#3: Reality-Based Budgets

•  External customers pay our salaries

•  Measure satisfaction, adoption, usage, revenue

•  Meet them, hear their stories, look for joy

#4: Get Closer to (Paying) Customers

•  Talk in terms of paying customers •  Use your own products •  Listen in on customer calls/

interviews/UX tests* •  Ask for success metrics •  Look at revenue •  Celebrate customer improvements

Things You Can Do (This Week)

•  Business Value is essential •  Different flavors •  Not precise enough for

auto-sort •  Sample what your real

customers taste

Take Aways

Rich Mironov

Mironov Consulting San Francisco, CA rich@mironov.com 1.650.315.7394 twitter.com/richmironov linkedin.com/in/richmironov