Agile Development Blog

Yesterday, we kicked off Rally’s Roadshow announcing the industry’s first Agile Portfolio Management solution. What an incredible opportunity to tell the Rally story, hear an inspiring presentation from Geoffrey Moore on how to escape the pull of the past, listen to the real-life story of aligning strategy and execution from Nina Schoen at Getty Images, and moderate a panel so lively that the panelists starting asking each other the questions.

Catch the Next Agile Portfolio Management Roadshow

Panelists Geoffrey Moore, Nina Schoen, Todd Olson, Dave West, Ronica Roth

The best way to learn more about this new solution is to tune in to our Agile Portfolio Management roadshow. Although we kicked it off this morning in the Bay Area, you can still catch Dec 8 in Boston (with Dave West from Forrester Research, Chris Haley from The CBORD Group, and Rallyers Todd Olson, Ann Konkler, Rick Simmons and others) and Dec 13 in Dallas (with author Dean Leffingwell, Chad Holdorf from John Deere, and Rallyers Todd Olson, Isaac Montgomery, Julie Chickering and others). If you can’t attend in-person, sign up for the virtual event where we webcast nearly the entire event from keynote to panel presentation, and incorporate online questions.

Self-Serve Materials to Learn More

Below are a few additional materials if you’re the self-serve type. The recorded webcast and slides of the above roadshows will be posted soon as well.

• Strategy Meets Execution web site - Learn about the full solution, including Rally Portfolio Manager, Agile Portfolio Steering Workshop and educational resources.
• IDC case study – Pay special attention to the great case study written by Melinda Ballou that highlights the work of Nina Schoen and her team at Getty Images on getting alignment through Kanban portfolios. Nina spoke about her real-life experiences at this morning’s Bay Area event.
• Press releases – Check out the Agile Portfolio Management press release, and also another announcement made today on our new board members Tim Wolf and Mark Carges.

Next stop of the roadshow is Dec 8 in Boston, MA. We hope to see you there!

Ryan Martens is CTO/Founder of Rally Software, a recovering Entrepreneur-in-Residence at the Unreasonable Institute and chief promoter of the Entrepreneurs Foundation of Colorado. You can follow him on Twitter @RallyOn.

I just played our fourth Agile portfolio planning game with a team of executives. First they had to rank and plan a portfolio of new product ideas, enhancements, architectural refactorings, and other work. It’s tough to balance competing priorities against strategic financial targets. Then we simulate a monthly steering council that must react to new learnings, development mishaps and market changes, all while maintaining strategic alignment.

I’ll give you a hint to winning the game:  Turn that waterfall team into Scrum teams early, and pay attention to quality.

Wagged by Plans: Is It Time to Change?

Do any of these problems sound familiar?

Execs play an Agile steering game

• The organization funds all or most proposed projects, and expects to make progress on them all simultaneously.
• Teams adjust each iteration based on new learnings, but the annual plan for the organization does not change.
• Teams adjust, but it’s hard to know whether the adjustments throw the portfolio off-goals.
• Projects are managed within silos; trade-off decisions are not made across the portfolio. As a result, some silos are under-capacity and others are overcapacity. Or, the whole doesn’t add up to the strategic objects for the organization.
• Teams are judged on their ability to deliver value; the portfolio is judged on its ability to meet plan.

If these scenarios apply to you, you’re probably ready to bring Lean and Agile principles into your portfolio management process. Especially if you have already solved these problems:

• Your Scrum teams are cross-functional and persistent and have learned to deliver consistently on iteration and mid-range commitments.
• Your Kanban teams have reduced significant waste in their value stream and consistently deliver to service level agreements.
• Agile teams have achieved a fairly consistent velocity/throughput (amount of work delivered per timebox) while delivering against quality goals.
• The Product Owner group elaborates requirements just-in-time, feeding teams a steady stream of high-value work.
• You have added the structures that enable multi-team programs to coordinate dependencies and deliverables within a closely related group of teams.

In working with earlyvangelists to develop our Agile Portfolio Management solution, we learned that in most organizations the portfolio is managed under the old, plan-driven paradigm, which is at odds with the Agile practices at the team and program level. However, it is equally clear that we cannot begin to challenge that paradigm before we’ve reached a certain level of Agile maturity.

It is too hard to engage the business before development has a track record of success.

It is too hard to build a realistic roadmap before teams have developed a steady velocity.

It is too hard to emphasize steering before teams have the discipline to deliver iteratively and incrementally.

Advance Your Agile Practices: The Agile Enterprise
Our early work delivering the Agile Portfolio Steering service has been exciting.  Fellow coach Isaac Montgomery and I have watched a room simply buzz as a group of leaders begins to imagine and employ the paradigm shift from plan-driven to value-driven portfolio management.

The buzz begins because of the people in the room; namely, a cross-functional group of leaders (directors, VPs, SVPs) from the business, product/portfolio, and technology. Together, we explore and understand the current challenges around building realistic roadmaps, tracking the progress of initiatives, and leveraging the agility of teams without losing focus and alignment. Sometimes this group has never built so shared a view of the organization.

There can be a moment of frustration when we’ve made the challenges so clear. But then the energy gets high as Isaac and I begin to provide possible solutions in the form of Lean practices. Together we dig into redesign their portfolio processes, to inject the visibility, feedback, governance and focus that enables Agile to work at scale.

Rally has already begun to see patterns in the Lean practices that implement more adaptive portfolio management.

• Map the value stream from concept to cash, and build a Kanban board to represent those states. “In Development” is just one state.
• Limit work-in-progress on that board. Fewer initiatives in play means better throughput, productivity, time to market, responsiveness, and reduced risk.
• Emphasize value and budget over cost estimates. This requires new data and a new mentality.
• Provide clear strategic objectives  and constraints, and then let the people closest to the work (the teams) plan the work. Use clear visualizations and data to verify the results align back to the strategy. Help teams adjust as necessary to remain aligned.
• A rolling wave cadence of planning and steering helps your leadership be both strategic and adaptive.
• Effective portfolio management will require planning and learning at different levels of the organization, on different levels of abstraction and strategy, and on different cadences.

The Service: Re-Tool for Agile Portfolio Management
Built on those early deliveries, I’m excited to now offer more generally our Agile Portfolio Steering workshop. I think it provides a powerful benefit through focused work.

Inspired by the lessons of the portfolio planning game, the leadership group works with an Agile coach to begin to redesign its portfolio management process:

• How could we have better value data on proposed projects?
• How can we decide our investments rather than be wagged by cost projections?
• How could we fund fewer projects?
• How could we commit to goals rather than to lists of features?
• What data would we need to be able to steer the portfolio effectively?
• How often should we steer the portfolio? A project? A program?
• Could we reorganize our teams to enhance flexibility?

The outcome might be a new planning process, new data requirements, new progress visualizations, new planning and steering councils, and more.

The service is listed as “2 days”. In reality, we have learned that a leadership group might not spend two whole days in a room with us, but the hours they commit will be intense, with short breaks and working lunches, because this work matters. Dollars are at stake; business success is at stake. We will work together to design the right on-site session.

Stay tuned for more details during our Dec 6 and beyond launch events. We look forward to working with your organization, to understanding your context, and what challenges you have to align the work of your Agile teams and your strategic goals. What prevents you from delivering all the value you could to your business?

As Rally’s “Solutions Evangelist”, Ronica Roth promote solutions for our customers that combine product and process. She also promotes fun that involves mountains and snow.

In summer, the Entrepreneurial Thought Leaders series at Stanford released their video podcast with Geoffrey Moore on his new book “Escape Velocity” As soon as we saw it, I contacted Geoffrey to see if I could get an early copy of the book. Geoffrey was very happy to share and subsequently talk to me about how Rally could help promote this great new book and web site, Escape Velocity, which launches today.

I highly recommend the book, buy it today, and see the video. As you can see from my collections of his books, I love his work. His command of English and simple models always makes reading his books a real pleasure. I got “Crossing the Chasm,” when I was in school as an engineer back in the 1980′s.  I enjoyed working with him and The Chasm Group back in 2000 while I was at BEA. But, now this newest book has hit while Rally is working with customers that struggle with escaping the “pull” of the past. As Geoffrey describes, this is “A better vocabulary to talk about power versus performance.” I see many customers describing why they invest in Rally – to transform their execution and offer power.

As a result, this book is not just interesting for product management, but for the executives in engineering, marketing and sales, as well as the whole executive team. Because my team was so excited about this book, we were able to get our marketing team excited too. I am thrilled to announce that Zach and I will be interview Geoffrey live on September 22nd. Please consider joining us for this webinar.

Now to helping us make this interview work for you. Zach and I are going to run this interview based on our understanding of this book and our experiences, but we are also very interested in your questions. We will support chat and Twitter during the webinar, but your comments on this post would be even more appreciated. Here are some of the our draft questions:

• Most Agile development teams have fixed the execution power level – what is next and why?
• I have read all your books – can you reflect on this book in relationship to past works? Is the really the capstone?
• For a recent graduated from college, what order would you have him read your books?
• Do you assume engineering needs to be Agile to pull off this approach?
• You mention it’s important to separate differentiation, neutralization and optimization efforts, why?

What is top of mind on this topic for you?

Ryan Martens is CTO and founder of Rally Software, a recovering Entrepreneur-in-Residence at the Unreasonable Institute and chief promoter of the Entrepreneurs Foundation of Colorado. You can follow him on Twitter @RallyOn.

Zach Nies is the co-CTO at Rally Software and passionate about building successful software products and a proud member of the Boulder/Denver Agile community for the last ten years. You can follow him on Twitter @ZachNies.

Rally was founded shortly after the signing of the Agile Manifesto, the document created at a 2001 meeting of leading software developers at Snowbird, Utah, that gave rise to the Agile movement. Since then, Rally has taken what we’ve learned from leading countless enterprise Agile transformations and funneled our collective experience into a formula that includes our Agile ALM platform and products, our expert coaching services, a vast library of educational resources, and a supportive community for asking questions and sharing advice. In celebration of the 10-year anniversary of the signing of the Agile Manifesto, Rally had a special commemorative activity at the Agile2011 conference.

Bryce Widom, chalkboard artist and painter, joined us and literally drew, in real-time, the history of Agile. Rally team members and conference attendees collaborated on the stories that made up this “Road to Agility” starting with the Agile Manifesto, and continuing with important milestones such as Dr. Dobb’s Agile adoption survey, Forrester’s Agile ALM Wave report and the formation of the PMI’s Agile community of practice. Bryce also drew colorful stories that illustrated benefits of agility from companies like Betfair, John Deere and McKesson.

Announcements

The announcements we made at the conference are a culmination of Rally’s experience in helping organizations expand Agile practices to maximize value across the entire organization, along with strengthening support for multi-process development (check out these video interviews on SSQ’s blog to hear more). Our first announcement highlights Rally’s support for multi-process Agile. As Agile moves deeper into new functional areas, Rally’s Agile ALM platform, products and coaching services have been evolving to meet these diverse needs. When Scrum is not the best fit, we include support for other Agile methods such as Kanban and high-assurance methods to ensure that we can be the go-to partner for all enterprise Agile roll-outs. We announced:

• Enhanced Kanban support, including support for Class of Service highlighting and reporting. Read this product blog post for more details.
• Support for new customizable defect reports that support all processes.
• A new Iteration Summary Panel for Scrum teams that provides in-product coaching assistance. The panel guides teams based on their performance and offers coaching-authored best practices.
• Apps that support traceability and documentation in Rally within High Assurance organizations (check out this blog series on High Assurance Software Development).

Our second announcement signifies the bridging of Agile into the Project Management Office (PMO). In its 10th year, Agile’s mainstream appeal has broadened its reach from the technical to the business parts of the organization. We recognize the trend and are helping to ease the transition for all parties. We announced:

• Unmatched integrations with industry-leading Project and Portfolio Management (PPM) vendors like Oracle Primavera, CA Clarity, Daptiv, and Planisware.
• An update to Rally Idea Manager, the leading Agile ALM demand management solution. This release bolsters the integration with Rally and provides a new leaderboard to drive end-user engagement.
• Availability of a new Agile Portfolio Steering services offering. This offering represents the next frontier of Agile and includes an interactive simulation to facilitate collaboration between Agile teams and business stakeholders.

Field Guide

At Agile2010, we provided vuvuzelas in celebration of the World Cup and, while I’m sure that many of you annoyed your families with these, we decided to leave you with a lasting educational giveaway at Agile2011. We assembled a content guide written by our coaches on Agile best practices. We hope you find this field guide useful in your day-to-day activities – download your copy here.

Thanks to everyone who contributed to the “Road to Agility” illustration, whether you were at Agile2011 or were following our progress on Twitter, Facebook and Flickr. In addition to celebrating the 10-year anniversary of the Agile Manifesto with the community at Agile2011, Rally also embraced the opportunity to reflect on how much we’ve learned from helping some of the world’s largest organizations apply Agile practices. We look forward to making continued meaningful improvement in our industry, and leading the next 10 years of Agile innovation.

Todd Olson is VP of Product at Rally Software. He is a marathon runner and cake baker. Find Todd on Twitter at @tolson.

This is the second post in our blog series, Measuring the Impact of your Agile Investments. The series focuses on measuring the impact that Agile practices have on business outcomes.

For many leaders, increasing the productivity of the development organization (delivering features the business needs and generating improved ROI) is their primary and over-riding goal. ‘Doing more with less’ is a mantra they preach to their teams continuously, and which colors every decision they make.

Yet few have a clear and consistent definition of productivity or an effective means of measuring it.

Productivity: a relative measure of the efficiency of a system in converting inputs into useful outputs.

Productivity: the ratio of the real value of outputs to the combined input of labour and capital.

Productivity: a measure relating a quantity and quality of output to the inputs required to produce it.

So, in simplest terms:

Productivity = Valuable Outputs / Costly Inputs

Be Careful What you Wish For

While I am a ardent believer in the value of metrics, it is important to keep in mind the potential for unintended consequences. Individual and group behaviors will evolve to meet your measures – not necessarily your goals. So ensure that the measures you use promote the behaviors you desire.

Most documented productivity metrics in software development define a unit of output as either a KLOC (thousand lines of code) or as a Function Point. Both have significant disadvantages.

KLOCs are generally favored for the simple reason that they’re unambiguous and easy to measure. However, they can unintentionally promote poor design and coding practices. Elegant, efficient, maintainable software takes more time to write, and takes fewer lines of code. Therefore, a KLOC metric inadvertently creates a disincentive for building high-quality software, and rewards poorly thought through designs and shoddy craftsmanship.

While Function Points don’t necessarily promote poor design and craftsmanship, they have their own unique challenge – they are famously difficult and expensive to calculate and measure.

Perhaps even more importantly, both KLOCs and Function Points ignore the core aspect of ‘Value’ inherent in our definition of output – and therefore productivity.

It has been stated that 64% of the features and function in the typical software system are rarely or never used (Standish 2002). Calling the code that delivers these features and functions “productive” may be a mischaracterization.

Similarly, those features and functions that ARE commonly used are generally not of uniform value. The Pareto Principle would suggest that 80% of the value is delivered by 20% of the effort. Yet KLOC and Function Point-based metrics treat all features and functions (and code) delivered as interchangeable. This promotes focusing on the easiest and lowest technical risk; rather than the most valuable, most innovative and greatest business risk…

Output is a measure of the value delivered, not the effort expended.

A number of people in the Agile community have written about an alternative unit of output measure – Value Points.  While the simplicity and value focus of this model is appealing, it has challenges when scaled beyond a few teams. In order to be meaningful at the organizational level, you must normalize the relative value point scale across teams and programs – which can be difficult and expensive.

Also, the Value Point approach does not easily translate to initiatives and/or divisions that may not be delivering in an Agile manner. Having a common measure of output, and therefore productivity, is critical to measuring the impact of your Agile investment.

So, the approach we recommend is to associate a percentage of the total value of a given initiative to each Minimally Marketable Feature (MMF) or production release. These percentages can then be applied to a any monetary business justifications (ROI, NPV, Discounted Cashflow, etc.) to arrive at an expected dollar value realized from each release.

Hence,

Productivity = Total Value Realized (delivered to production) /  Total Cost of production (labor)

Using this approach, your organization (be it a Scrum team, a multi-team Agile program, a waterfall project, or even an entire product development group) base-lines their productivity for a period of time and monitors the change over time.

Example:

The division has 3 initiatives in progress:

• Initiative A:  Total Expected Value $5MM; being delivered by a Scrum team with an iteration run-rate of $70,000.
• Initiative B:  Total Expected Value of $25MM; being delivered by 5 Scrum teams with a combined iteration run-rate of $400,000.
• Initiative C:  Total Expected Value of $50MM; being delivered according to a project plan and resource matrix that charges $2.5MM to the project in the 1st quarter.

In Q1:

• Initiative A: Released to production monthly and delivered a total of 60% of Expected Value; or $3MM. 25% of the backlog has been burned-down in terms of story points. Total Cost $210,000. PRODUCTIVITY = 14.29
• Initiative B: Released to production quarterly and delivered a total of 65% of Expected Value; or $16.25MM. 35% of the backlog has been burned-down in terms of story points. Total Cost $1.2MM. PRODUCTIVITY = 13.54
• Initiative C: Completed requirements definition and is 50% done with Detailed Design, and delivered 0% of Total Expected Value. Total Cost $1.2MM. PRODUCTIVITY = 0

*undelivered work is WIP, and therefore not yet productive.

Aggregate Division Productivity for Q1 = 7.38

As you can see, it would be relatively straightforward to predict Q2 productivity – at the initiative as well as division levels – by assessing the various product roadmaps and traditional project plans. Those projections could then be used to:

• drive discussion about trade-offs on where to allocate limited capacity and maximize productivity
• staff and fund initiatives where productive potential is high, and to cancel successful projects whose greatest productive potential has already been harvested
• inform intelligent business decisions – which is WHY we’re measure outcomes

By understanding the productivity of the development organization (its efficiency in delivering features the business needs and delivering improved ROI), leaders can effectively drive improvements and business decisions that maximize productivity – Doing More with Less.

The next topic I’ll address in the Measuring Impact series is Quality. Most organizations claim to have a Quality focus, yet few take a holistic view of Quality or appreciate the strong correlation between Quality and our other Outcome Metrics – Productivity, Responsiveness, Customer Satisfaction, Employee Satisfaction and Predictability.

How are you measuring the impact of your agile investments? Please share your ideas and feedback in the comments.

Isaac Montgomery is the harried father of twin sons, the adoring husband of Angie, a frustrated hack on the golf course, and an Agile Coach at Rally Software. He blogs at Leading Results, you can follow him on twitter at @iwmontgomery

This is a story of how I went from being the poster child for bad posting etiquette on pm.stackexchange.com to becoming their poster child for fast learner! A poignant tale of hubris, struggle, fear, benevolent mentorship, and redemption.

Prequel: The Lure

Some colleagues of mine at Rally Software (Karl Scotland, Ken Clyne, Eric Willeke, Ben Carey, and Ryan Martens) have been telling me about how much they were enjoying their experiences in StackExchange. My CTO colleagues Zach Nies and Mark Gammon have also been enthusiastic about the value of being engaged in the StackExchange community. But I was intimidated. I feared I wouldn’t know how to appropriately engage in either asking a question or answering a question. It turns out my fears were well-founded.

Scene 1: The Leap

I finally decided to jump in. I set-up an account, fairly easy to do. I perused some of the questions already posted by others. I saw the tags and the replies. I saw the voting. Somewhat intimidating. But, I had a topic I was really excited about. I thought it would make a great question. And so I made the leap; I took the plunge. And this is what was wrought:

Scene 2: The Faux Pas

Not a bad question. The problem was that in the text area below the question title, I gave further detail on the question. A lot of detail. I pulled a major faux pas: I waxed poetic on what I thought the answer was. (I’m not going to go into the topic here. Trust me. It was lengthy and unyielding. :-(

Fortunately for me, however, very timely and gentle advice appeared from Mark Phillips and jmort253:

Could they have been any nicer? What a great community!

Scene 3: Meeting with the masters

The good news is that help was on its way. Back in March, we’d spoken with Joel Spolsky (co-founder and CEO of StackExchange.) Ryan’s goal in talking with Joel was to look at how we at Rally could incorporate StackExchange into our upcoming RallyOn conference in May. How could we work together to create community in StackExchange as we were creating community in the conference?

The result? We brought in the great StackExchange masters Anna Lear and Mark Phillips to the RallyOn conference. In his opening remarks at the conference, Ryan introduced our two Zen StackExchange masters and Ryan’s hope for how we could all engage with them to kick start a powerful presence of the Agile community within StackExchange.

Yea! I was going to actually be able to work with Mark and Anna to become more comfortable and more productive in StackExchange!

Scene 4 : Lessons Learned

After Mark held a small session on getting started in StackExchange, I saw him in the hallway. I’d missed the session, but he quickly filled me in. It turned out, he’d used MY question/answer fumble as an example of how NOT to engage in StackExchange. I had become the poster child for bad StackExchange etiquette :-(

But both Anna and Mark quickly took my under their wing. We edited my original question. We commented on one of the answers. We created a new question. And we answered another question. The result was a new exchange of comments:

Close: A Happy Ending

Today, good news abounds. Mark recently wrote a phenomenal blog post: Why StackExchange is Hotter than Twitter

I continue to stay engaged asking and answering questions. I’ve learned to keep my questions short, my comments short, and my answers short. And, I’m gaining reputation points and earning badges, still with gentle guidance from Anna, Mark and “jmort253″.

My Rally colleagues continue to post as well. It is exciting to see the Agile community begin to expand in pm.stackexchange.com. Provocative questions with great answers. And through the tags, we can watch the expansion into other topic areas.

For the happiest ending of all, I’m saving the best for last: my email yesterday from StackExchange!

“Congratulations — you are one of the top new Project Management – Stack Exchange users for the month of May 2011! http://stackexchange.com/leagues/month/pm/2011-05-01 ” There was also the caveat that my name would not appear in the list of users because I still need to earn more reputation points. Okay, June, you are going down!

Help keep the story alive!

To wrap things up: I not only survived jumping into StackExchange; I love it. I’m hooked. So, my story is not over.

Now, I’d love your reply to this post to tell me how you are getting involved in StackExchange.

Jean Tabaka is an intrepid intercontinental traveller, a 6-badge holder in pm.stackexchange.com,  author and Agile Fellow at Rally Software Development. You can follow Jean on Twitter at @jeantabaka

In last week’s blog “Rationale for Project Stratus”, Ryan stated “The model articulated in Dean Leffingwell’s newest book, ”Agile Software Requirements: Lean Requirements, Practices for Teams, Programs and the Enterprise“ is clearly one of the patterns of agile strategic planning.”

In this post, I want to expand on how we reached that conclusion.

I’ll start by introducing Chad Holdorf, Agile Coach and earlyvangelist for Project Stratus. Chad has been guiding Project Stratus in support of Dean’s model. Take a look at what you get with such customer collaboration: http://www.scaledagiledelivery.com/2011/04/22/agile-portfolio-planning/

Now on to how we got there:

As mentioned in the “The Making of Project Stratus” blog, we have been diligently following a customer development process based on Steven Blank’s model. Because the book focuses on startups, we adapted the model to existing companies (like Rally) wanting to deliver new solutions to their market, but one aspect that applies to both is a ruthless search for a handful (3 to 5) of what Blank calls “earlyvangelists”.

Earlyvangelists are customers that have these particular characteristics:

1. Has a problem
2. Is aware of having a problem
3. Has been actively looking for a solution
4. Has put together a solution of piece parts
5. Has or can acquire a budget

#4 and #5 are of key importance: Earlyvangelists have more than just the problem. They have it, want to solve it, already are trying something less than ideal, and have the availability and organizational authority to garner the resources to do something more about it.

With Project Stratus, we found many many customers have the problem (unrealistic roadmaps, poor visibility into development status of marketable features, lack of alignment between business goals and feature work). There is no doubt Rally has a responsibility to the market to produce an agile strategic planning solution. The challenge is finding earlyvangelists that can guide a successful solution to that problem.

We have been grateful to locate a handful of earlyvangelists: customers who have installed the Stratus preview application with their roadmap data, run their planning process for real with it and kept my inbox interesting with plenty of “Catherine, this is great but I need X to really make it work for us.”

If you are attending our RallyON conference on May 10 and 11, you’ll get to meet Chad. If not, track the Scaled Agile Delivery videos he has posted on his site. Thanks Chad for contributing so actively to Project Stratus!

As you can tell, it takes a while to get to the commercial product the right way to ensure the product will be a success for both Rally and its customers.

As we work at delivering the first release of our agile strategic planning product to support the first identified pattern, we are working with other Chads – Nina, Jeff, Dale, and others – to further our study of strategic planning patterns that would warrant product support. Please stay tuned.

Catherine Connor is a Product Marketing Director at Rally Software. She focuses on leveraging agile and lean values for the product manager role. She is the lead for Project Stratus.

Welcome to our new blog series, Measuring the Impact of your Agile Investments. This series focuses on measuring and quantifying the impact that Agile practices have on business outcomes. We’ll explore how putting comparable metrics in place allows organizations to steer improvement efforts in the right direction and realize the biggest payoffs of Agile.

“How do we measure the success of agile?”

It’s one of the most common questions we hear from senior leaders.  And it’s a critically important one for agile evangelists working to justify the organization’s investment in agile and maintain momentum as other priorities compete for leadership attention. The agile community’s typical response to this question has been some form of an agile maturity assessment – such as the Nokia Test. These tools are clear, easy to use and can be extremely effective in helping organizations assess their adherence to good agile practices.  Yet, when used in isolation, they can leave senior leaders unfulfilled – and miss an important opportunity for aligning agile to fundamental objectives.

For business leaders, the question isn’t how well are we doing agile?  The question is how well is agile doing for us?  What impact is agile having on business results? These are the questions senior leaders really want answered.

My response has typically been: “How did you measure your impact on business results before Agile?”

Which is generally met with awkward silence and a muttered admission of: “Not very well.”

The conversation then moves toward why measurement is expensive, why you can’t show progress if you don’t have a baseline, and why you need to be very careful about what and how you measure – lest you create unhealthy behaviors and unintended consequences. Someone ultimately quotes Einstein, we nod our heads thoughtfully, and finally move on to other topics. Crisis averted!

But the question remains: “How do we measure the success of agile?”

And, if Agile Success = Business Success, then the real question is: “How do we measure business success?”

Which is the question we’re beginning this blog series to address.

While every organization will have their own unique objectives and priorities, most can be encapsulated as some combination of these:

• Productivity
• Quality
• Responsiveness
• Customer Satisfaction
• Employee Satisfaction
• Predictability

In the posts to follow we will examine each of these Business Outcomes and look at:

• How can we measure the business outcome?
• What agile practices are effective levers in improving the business outcome?
• How can we measure our agile levers as leading indicators of improved business outcomes?

The first topic I’ll address in the Measuring Results series is Productivity, because for many leaders, increasing the productivity of the development organization is their primary and overriding goal.

Isaac Montgomery is the harried father of twin sons, the adoring husband of Angie, a frustrated hack on the golf course, and an Agile Coach at Rally Software.  He blogs at Leading Results, you can follow him on twitter at @iwmontgomery

I love the leverage  you get when strategic planning is working well.

At Rally, I run our strategic planning process with help from Jean and others in our organization. We have experimented with many agendas, internal facilitators and guests, but we’ve found the most success when Jean facilitates these meetings and I lead them. It is challenging work and we try really hard to create a setting that leads to magic and allows the best to emerge from the group.  As you might imagine, if you know Jean and me, we never stop trying to improve the process. In addition to our desire to keep advancing, the context at Rally keeps changing. Whether from growth, hiring, market changes, maturation of agile, or changes in customer demographics; our overall setting for strategic planning keeps shifting. It is a difficulty that we wrestle with, but knowing it is ultimately unsolvable, we have learned to embrace the dance.

I do not recall what was the chicken and what was the egg, but we started working on strategic agile topics last year and it launched two efforts and blog series: N Levels of Planning, and Scaling Agile to the Strategic Level. In this post I am bringing the two series together to explore tooling the process of strategic planning in an agile context with Catherine and Ronica. Larger Rally customers and past employers have shown that managing a strategic plan in a spreadsheet creates vacuums. Through our efforts at Rally, we have learned that trying to maintain strategic alignment with our development teams without a single source of record to visualize variances on plan versus actual is challenging. (HINT: Slides are not a very capable source-of-record :)

It is difficult to integrate big-bang, waterfall planning/stage-gates and traditional budgeting with effective agile teams who keep learning and adjusting. It is even more difficult to stay on course as an agile organization without effectively closing the feedback loop on roadmap/strategic planning efforts. In the first instance, it is easy to simply be driven by a naive plan. In the latter, it is easy for the development effort to drift apart from the goals and direction.

These well-validated difficulties led to the birth of Project Stratus and the N-Levels of Planning efforts at Rally. These two initiatives are intended to help increase the effectiveness of strategic planning in an agile context.  They are helping us balance the need for forecasting delivery while also benefiting from the fast feedback that flows out of agile teams and programs. We like to talk about this process as steering realistic roadmaps to maximize the delivery of value.

To explore this problem space, we diligently carried out discovery and validation exercises that led to a working application (Project Stratus) and a service offering (Agile Strategic Planning) that we use to ensure the delivery of a Whole Solution. Through our customer interviews, we found that the most common strategic planning solution when doing agile development is a strategic planning person holding the plan of record in an Excel spreadsheet. This spreadsheet holds some form of a roadmap of releases, programs and resource allocations. It is updated on a regular cycle, typically quarterly. However, two major problems exist with the spreadsheet approach.

1. The plan is outdated as soon as the work starts because there are two sources of data; one for planning and one for tracking progress
2. Planning in a vacuum happens as correlating the empirical data into a highly customized spreadsheet leads to outdated data which tends to erode trust

As a result, this most common solution is horribly disappointing with human translations that lead to over-aggressive estimates and/or status updates progress reports. Bringing agile values into this faulty process will shorten feedback loops and bring real data effectively into the cycle.

In exploring the space, we are discovering multiple ways that organizations manage the strategic planning process. As we are still making sense of these patterns, it is early to report on our findings.  However, one approach does stand out.

The model articulated in Dean Leffingwell’s newest book, ”Agile Software Requirements: Lean Requirements, Practices for Teams, Programs and the Enterprise“ is clearly one of the patterns of agile strategic planning. You can see a snapshot of this method on his blog, but if you really want to learn it, you should get his book. It is a clear articulation of how to manage your strategic priorities as series of releases. The book breaks the problem into three agile requirements management areas: the team, the program and the portfolio. The beauty of this approach is how it trains all levels of product owners, product managers and portfolio managers to run in agile unison. Dean developed this model starting with the teams and working systematically up through the enterprise portfolio level (ie bottom to top). And, importantly, Dean worked this iteratively through a number of his consulting customers over the past decade (see the Big Picture section of his blog to the incremental progress laid out over time).

In addition, in Agile Software Requirements, Dean has described a “business epic kanban system” which he uses to make the work in process visible, understand the state of epics as they transition to development, and to get the portfolio planners on a similar agile page as are the agile development teams. He and a number of our customers have used this system effectively in a number of large enterprises, so we know it makes a good starting model for portfolio/strategic planners who run portfolios as a sereis of releases.

As a result, this model of strategic allocation and roadmap planning is proven to work well for agile teams that ship code series of releases. Here is Dean’s model from that book and his web site.

Big Picture: Scaled Agile Delivery Model by Dean Leffingwell

We have a number of customers making very good progress in developing strategic roadmap steering capabilities using this approach and Rally’s Project Stratus. If you are interested in this approach paired with Stratus, consider contacting Dean or Ronica, our services owner, directly or through your Rally Account Manager. (See Ronica’s contact information below.)

We will continue to explore hybrid waterfall/stage-gate, other hybrid agile (scrum/kanban), and continuous flow techniques for strategic planning in the coming months. Please stay tuned.

Finally, to fully explore the problem and solution space, we created the RallyON conference. We will host this conference in Boulder on May 10th and 11th. We limited the conference to 150 attendees and it has sold out quickly to our most active users and champions. Don’t worry if you are not attending as there are a number of ways to engage in the conversation including:

• Responding to this post with your challenges, ideas and comments on strategic planning in an agile context
• Sharing your opinion or challenges related to topics that Rally Coaches, Technical Account Managers and Product team members are posting for the conference on our new Coaching Blog.
• Posting your agile, scrum, kanban and xp questions on pm.stackexchange.com or programers.stackexchange.com to have a the community formulate answers to your questions prior, during and after the conference. We will have expert users from both of these stackexhanges on site at the conference to help us leverage this rapidly growing community.
• No matter what choice you make, please tweet your efforts with the #RallyOn11 hashtag. It will get the attention of the Rally coaches, technical account managers and product team, in addition to all the physical and virtual RallyOn attendees.

Please join us online before during and after the conference to explore the topic of strategic agile.

About the authors:

Ryan Martens is a member of NRDC’s Environmental Entrepreneurs,  founder/CEO of the Entrepreneurs Foundation of Colorado, and Founder/CTO at Rally Software Development.

Special Thanks to Catherine Connor, the lead on Project Stratus at Rally and Solutions Evangelist Ronica Roth, who owns our Services strategy at Rally.You can reach Ronica at ronica[at]rallydev.com

(Note: today’s blog post is brought to you by the letter “N”)

Continuing our series on N Levels of Planning, I realize that even the usage of “N” in our definition of planning levels has been perplexing me. Sometimes, I think I get what N means. Imagine N = 5. In this context, you might do higher level planning for your product teams. Create a great product vision. Build a thematic product roadmap. Have these faithfully inform release planning, iteration planning and ultimately daily planning. Okay great. Here, N = 5.  And then I think, “But what about when I move to more continuous flow of value delivery through Agile? Now what is my “N”? I move away from iteration timeboxes for delivery, so no plan there, right? Do I still think about some sense of planning at a product vision level and a product roadmap level? Do I still have some sort product release planning but it just differs in approach in continuous delivery versus timebox delivery? Perhaps I now have N = 2; or, is it 3 or 4? And, perhaps “planning” has a different meaning as well.

We’re not done with the ambiguity yet

The N levels of planning complexity doesn’t stop at the product planning level. Think about now inviting levels of business planning as a natural part of Agile transformation and maturity. If I add in a Strategic Business plan accompanied by a Business Roadmap plan, I’ve now moved to N = 7. Or not if I am not using timebox-driven planning. What if the business uses a milestone-driven approach? For example, we know we have this conference coming up; we want a release for that date. We’ll still use a prioritized backlog for our work and we’ll declare our release based on what functionality is available by the milestone. What is “N” now?

But wait! There’s more!

You’ve brought the business into your Agile transformation. As you do so, are you transforming business with your IT organization? Or, is your Agile transformation in the context of product lines in an ISV?  Your business context may impact what and how you plan. In both contexts, you are running Strategic Business planning and Product Roadmap planning in your N-levels of planning. But what do these plans produce and how do you use them? Here, “N” now may rely on your business context. In the emerging business initiatives, have we uncovered capabilities that spread across portfolios or maybe across products? Are there initiatives that extend beyond business unit boundaries? Does this boundary-crossing work create capability-driven versus product-driven teams? Now, what are our N-levels of Planning?

I wonder if I am going to end up with some sort of quadratic equation to resolve “N”

As we continue to delve into a guide for “N-levels of Planning” in Agile organizations, I believe we are discovering the “N” is driven by the variety of taxonomies that lie in our contexts. Criss-crossing these contexts and their taxonomies, there seems to be some potential skeletal guide for “N”. At the least, consider 4 basic realms in which “N” derives definition:

1. Your level of Agile Adoption into the enterprise (product line only, one business unit, or multiple business units)
2. Your business’s technical organizational and architectural structures (e.g. ISV versus IT)
3. Your thematic (requirements) structures (themes, epics, capabilities, MMFs, stories)
4. Your delivery structures (timeboxes, milestones, or continuous flow)

“N” is a complex variable in N levels of planning. I no longer believe there is one magic formula for “N”. I know for sure “N” does not forever equal 5, something I had been so sure of at one time. I will say, I don’t think “N” is an imaginary number :-) I believe “N” reveals itself as we apply intention around the four structures above for our Agile transformations and maturity. And, your mileage may vary.

More to come on our old friend “N”. But first, what’s your “N”?

Jean Tabaka is a “why bother” latte sipper, crash skier, college hoops fan, author and Agile Fellow at Rally Software Development. You can follow Jean on Twitter at @jeantabaka