Agile estimations in a traditional world

Nico De Greef, PMPIndependent Agile Coach

BE

Today’s Methodologies

Traditional Prince2 PMBoK

Agile Scrum

Difference in Approach

Prince2, PMBoK are PROJECT based Agile (Scrum) is a PRODUCT based

Difference in Terminology

Terminology Sprints, Story Points, Velocity

Agilians are not project managers PID, EVM, Gantt Chart, Matrix organization, Critical Path,

Business Case, Project Charter, …?

Governance Compliance Standardized PMO reporting, …

Giveaway

Interview question:How does a project start?

Traditional World

• Scope• Schedule• Cost• Quality

Agile World

• Scope• Schedule• Cost• Quality

Earned Value Management (EVM)

Planned BAC = Initial Budget at Completion PV = Planned Value

Measured AC = Actual Cost EV = Earned Value

Calculated ETC = Estimate to Complete EAC = Estimate at Completion

ProjectStart

ProjectEnd

BAC300.000 €

PlannedMeasured

Today3 months far

(50%)

PV150.000 €

EV(40%)

120.000 €

AC(60%)

180.000 €

EAC = AC + (BAC-EV) x AC / EV= 180.000 + (300.000-120.000) x 180.000 / 120.000= 450.000

EAC450.000 €

a 6 months project

ETC270.000 €

Calculated

NEWProject

End

Earned Value Management

Earned Value Management means MathEstimate to Complete

=(BAC-EV) x AC / EV

Some PMs take a shortcutEstimate to Complete

=BAC – AC

30% is done, 70% remaining

until 1 month before the deadline...

Agile EVM

Estimate to Complete is easy Built-in in Scrum

Before we continue Sprint

Fixed duration of work for the team

Story Functional specification of a task Estimated in story points

Story Point Relative Estimation of effort, risk and complexity Fibonacci compensated

Velocity Number of story points delivered during a sprint

Capacity Number of man-days consumed in a sprint

Agile EVM chart – day 0

For demo purposes:1 sprint = 50.000 €= 5 developers, 20 days, 500€/day

BAC

50% PV after 3 sprints

Agile EVM chart – after 3 months

For demo purposes:1 sprint = 50.000 euro= 5 developers, 20 days, 500€/day

40% (EV)

5+ sprints

ETC

EAC

But upstaffing first 3 months1 sprint = 60.000 euro

AC

Why so easy? Agile Forecasts are based on the story point relative estimation

It takes into account past performance, for future delivery

Example If you planned to spent 10 Story points a sprint 50 story points would be forecasted to 5 sprints

If you actually deliver 5 story points a sprint 50 story points would be forecasted to 10 sprints

No complex re-estimation needed!

Agile EVM Capacity, scope change (less or more story points) and past performance (velocity) impact

number of sprints Number of sprints indicate cost and schedule

Questions ?