How to build an agile contract - Scrum...How to build an agile contract Some steps to get you...

How to build an agile contract

Some steps to get you thinking in the right direction

By Martin Kearns 25th October 2017

Scrum Gathering Dublin

Listen Intently, RETHINK EVERYTHING, Deliver Incrementally

This is me

My goal today is not to educate you and for you to feel fully empowered to implement my thoughts immediately.

I want to leave you with more questions to consider back in your work environments.

@kearnsey #rethinkeverything

Our Tribe will be known by the way we Rethink Everything to deliver value to our community

Individual rationality leads to a worse outcome for both than what is possible

Project variation

Change request

Over spend

Leads to Best price Recover

Unhappy customers

Prisoners Dilemma – players cannot get out of the dilemma by taking turns exploiting one another. The struggle to establish one’s reputation can be a major feature of intense conflicts.

We are only now starting to realise the impact of interdependencies within our business ecosystem.

Weneedtoinstillapartnershipmindsetintoanagilecontractandleveragethelearningofiterations.


What problems do you want to focus on?

SeeHandout

Unlessamicabilityisseeninareciprocallightcollectiveresponsibilityandco-operationwillbedestroyedinquicksuccession.


Complete Exercise ASAPWhat does a business want from a contractual engagement?

What is preventing achieving their goal?

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It is hard or maybe even impossible to extract, codify and transfer past knowledge in a way that makes sense outside it’s original setting

The only way to gain such knowledge is via an incremental process of learning by practice

Projects have to discover their own way

Place less emphasis on best practice

A system will only be disturbed by information based on what is going on

inside the organisation


We really need to shake this place up!

Order (Date, Cost, Time) is better than deep complexity regardless of information lost.

NOT !!!!!!!!!!!!!!!

Our minds incline toward the instant and the obvious (Habit) under a false pretense that it will help in our own survival.


Be wary of well-walked paths

Once we know something, that knowledge makes it nearly impossible to remember not knowing.

We become a prisoner to our tacit experience.

Agile contracts are less about designing to get it right first time and more on learning and responding to new information as it emerges within the lifecycle of a project /

engagement

Wemustinstilllearningandtheabilitytorecalibratetonewinformationasitemergeswithinthelifecycle

ofanengagement.


Name the enemy

Meaning of software

Software means a right, including a licence, to use software. Expenditure on software includes expenditure you incur on acquiring or developing software or in having another person develop software principally for you to use to perform the functions for which you acquired or developed the software.

Expenditure in relation to software projects is capitalised and depreciated from the time you use the software or install it ready for use.

You can’t capitalise a fictitious Business Case and/or a Business Requirements Document and/or the effort you place into writing a crap contract.

….. End of story

Construct co-operation into the contract

The more important thing is that the contract represents the intention, expected behaviours and accountability to the approach.

The trick is to encourage co-operation, by making sure there is the right pressure to encourage parties to reciprocate.

Theweightofpastfailuregrowsheavyonyourshoulderspreventingtheneededreactiontodisruptcurrentnorms

Principle 1. Exploit early information by front-loading the process


Design in the price-point for learning

Time

Value / $ cost

Pay

to le

arn

The ability to iterate is an economical decision.

Where feedback is seen to shape an outcome through

a) Re-enforcingb) Adaptingc) Serendipity d) Failing e) Pivoting

Minimise the cost of learning so that emotions can be controlled and rational decision making is the norm

Iterate

Acquisition ofknowledge

Prioritize on early value

Re-purposeFunding

Learning

Demonstrable value

Incremental

Min. viableproject

Qua

lify

Early


An Experimental – Learning Cycle

STEP 4 – Assess

Carefully assess the tangible evidence of the sprint and determine whether

to Pivot / Fail / Persevere / Pause

Develop understanding of cause and effect

STEP 1 - Discover

Run workshops where focusis on refining concepts

through identifying newinformation / causation

Observe risk profile

STEP 2 - Conceptualise

Build the hypothesis on whatknowledge is required to assess confidence and the

desire to proceed

Prepare test environment

STEP 3 - Execute

Use sprints to prove / disprove project

assumptions and the cohesiveness of the team

Work purposefully

Learning by Experimentation

Via a cross-functional team


Step 1 – Designing your process of discovery

STEP 1 - Discover

Run workshops where focusis on refining concepts

through identifying newInformation / causation

Observe risk profile

Discovery requires a willingness to risk, or admit, not knowing when we confront directly the full weight our confusion or

dilemma we are facing.

“Real dialogue is where two or more parties become willing to suspend their certainty in each others presence.”

David Bohm

Lookingforthesameinformationwearecomfortablewithwillrecreatethesystemsofold.


We need to broaden our perspective

Early sprints encompass project experimentation, where understanding what works and does not work are of equal importance for learning.


Principle 2: The definition of done is a strategic decision

Roles / Functions

Infrastructure

ContinuousIntegration

Dev P.C.

ContinuousDelivery

PredictiveAnalytics

Iterative Development

DigitalEnabled

SME in team no automation

TDD/Build server

We must engineer the removal of interfaces between functional groups in order to speed up the process of team learning.


Testing the landscapeBusiness Shared ServicesIT

SharedUnderstanding

Incremental Value

Demonstrable Value Empirical Evidence

By working to a shared “definition of done” we have the ability to test the beliefs around collective responsibility, culture and

required behaviors to achieve success.

Learning increases linked cause and effect without the normal organisation factors that obscure our ability to

commit to an outcome.

Done

Weneedtohaveacross-functionalteamthatworksfrombeginningtoendtogethertoenablechallengingthecurrentmindset,decision-makingandlearnthemeaningofco-operation.


Outline a definition of done

Roles / Functions

Infrastructure

• “DefinitionofDone”inrelationtoaUserStoryDeliverablemeanstheAcceptanceCriteriawhichisapplicabletoallUserStorieswithinaSprint,asamendedfromtimetotimeinaccordancewiththisContract;


Step 2 – Engineer rapid feedback to shape ideas by reinforcing, modifying or complementing existing knowledge

Retaining cognitive diversity is a required capability within teams to allow differentiation, permitting the emergence of new thinking and new

realisations of what is possible.

STEP 2 - Conceptualise

Build the hypothesis on whatknowledge is required to assess confidence and the

desire to proceed.

Prepare test environment


Exploit early information by front-loading the process

3.1 During the Design Stage in respect of the Pilot, the Supplier must:

3.1.1 Perform at a minimum 3 x 1 week Sprints;

3.1.2 Define and prove against the Minimum Viable Product hypothesis;

3.1.3 provide training to the Purchaser’s Project Team members and other Purchaser stakeholders in relation to the agile and scrum frameworks;

3.1.4 provide at least 3 data points and from these define team velocity

(progress);

3.1.5 derive any high level architecture;

3.1.6 seek and provide feedback and reflection on a weekly basis; and

3.1.7 conduct and facilitate workshops with the Project Team to establish, agree and document, Constraints, and Risk Profile for the Delivery Stage.

Engineeringtheamicabilitytolistenliesinanappreciationofinterdependency.Thismustbeexperienced.

Lookingforthesameinformationweare

Principle 3: Create a hypothesis to generate variables of interest


Steer the direction to what and where you wish to learn

Regardless of what backlog items are delivered the culture and capability of the team will be demonstrated.

Experimentation

Degree of intervention

Activity Description

High

Some

Low

Exploration

Observation

A focus on interface and technical functionality to assess feasibility of the intended solution exceeds behavioral concerns.

Regardless on what backlog items are delivered the culture and capability of the team will be demonstrated.

Set your hypothesis NOW!

No I won’t bring back that other slide.

The learning objective is for you to create the focused language required to get the desired behavior and purpose across to others.


Ensure MVP is a core milestone

1. GO / NO GO CHECKPOINT DATE

1.1 Within 3 Business Days' of the Go / No Go Checkpoint Date, the Purchaser may elect to terminate the Contract via written notice to the Supplier (Termination Notice) if:

1.1.1 the Minimum Viable Product was not achieved by the Go / No Go Checkpoint Date; or

1.1.2 the Purchaser believes that the Minimum Marketable Features are unlikely to be achieved during the time agreed by the parties for the Construction Delivery Phase or within the Fees described in clause Error! Reference source not found.; or

1.1.3 the Purchaser believes that the Minimum Marketable Features proposed to be achieved will not adequately meet the requirements of the Purchaser.


Step 3 – Test intent against the behaviours and velocity achieved via MVP Sprints

Provide the rapid feedback necessary to shape behavior, process and solutions by reinforcing, modifying or

complementing existing knowledge.

STEP 3 - Execute

Use sprints to prove / disprove project

assumptions and the cohesiveness of the team.

Work Purposefully


Principle 4: Enable the viability and resilience of systems to become purposeful

Weneedtolookatthebigpictureandmakethemostofunplannedevents.

Thecostofkeepingtoapre-definedmindsetintimesofadversityorbadchoicesmakesnosense.


“Stretch to fit”The intent of M.V.P. information is to off-balance norms between two parties and open new and more meaningful conversations.


By moving away from command and control to one of “autonomy to outcome” you create a self-deterministic system.

The gap between rational and behavioral viewpoints can spell the difference between project success and failure.

Focus on the individual integrity

Heart or mind?

You can dodge a rule you can’t dodge a principle

Create an agreed set of fundamental truths around a project that are the foundations for system belief, individual intuition and decision making.

Compliance

Externalisation

Internalisation

Conformancetoprinciple

ExplicitPractices

Education

Collectivelyresponsible

Selfdetermined

Behavioralnorm


Values Principles Practices Methods

• New information will be identified and valued when change is seen as a necessity for preservation and/or creativity

• Maintain a higher sense of purpose within the team

• People must be empowered to make their own decision as to “How” they can achieve a goal

• A team must consist of all the skills needed to achieve the “Definition of Done”

• Team takes collective responsibility for their processes and outcomes

My Scrum Principles


1. PRINCIPLES OF FAIR EXCHANGE 1.1 The Supplier will provide a report setting out the Principles of Fair Exchange

highlighting any delays by either party and tracking the effect of any such delay at each Review Meeting;

1.2 The Decision Rules will set out the representatives from each parties who are authorized to make decisions arising from the Principles of Fair Exchange reports;

1.3 Any failure by a party to meet its obligations under this Contract may result in a cost attributed to that party in the Principles of Fair Exchange report. Any such cost will be agreed by the parties in accordance with the Decision Rules.

1.4 Any Attributed cost will not be incurred immediately by the relevant party as the Project Team velocity may increase and therefore reduce the effect of any attributable cost.

1.5 The parties will agree, in accordance with the Decision Rules, the effect of any attributable costs which may include an extension of time, a change to the Solution Backlog or an increase of the total User Story Points (in which case clause 11 must be followed) or other incurred cost by the relevant party.

1.6 Any agreement made by the parties as a result of the Principles of Fair Exchange do not effect any other rights or remedies available to each party.

1.7 The Steering Committee will meet to review the Principles of Fair Exchange reports on a 6 weekly basis (Steering Committee Meeting).

Build principles into the contract

Define some control/common principles for the engagement you have defined

You have guessed it, I am not going to share the previous slide - work on your own language.

Try to see how you can explicitly state the expected behavior of two parties into a common/shared understanding of how value is created.


STEP 4 – Assess

Carefully assess the tangible evidence of the sprint and

determine whether to Pivot /Fail / Persevere / Pause

Develop understanding of cause and effect

Provide the rapid feedback necessary to shape behavior, processand solutions by reinforcing, modifying or complementing

existing Knowledge.

Step 4 – test intent against the behaviours and velocity achieved via MVP sprints


Theiterationallowsforanysystemvariabletobecreated,disrupted,corrected&destroyedbycreatingpatternsatscalethatmakecontractleverstangibleandused.

Principle 5: You must prepare and sustain the required energy to observe and measure

To see patterns, we need to step back from the problem and gain perspective

System fractals are created as individuals exercise both freedom and responsibility towards some simple rules.


Create guiding values to outcomeWhat we don’t want in a contract:

People use their shared sense of identity to maximise their unique contribution to project success.

You’re responsible for

How I will decide to punish

---------------

Deliverables

Output Input

We focus on achieving a shared

outcome

Collective Responsibility


Iterations help small differences amplify into powerful and unpredicted system variables in non-linear systems that no model or methodology could achieve – the system feeds back onto itself through the learning cycle.

Don‘t ever forget what an iteration is for

Themostimportantaspectofbalanceisthatthecostsofvalueandeffortarenotequal.Thecostofadditionalvaluecreationmustbeassessedagainstaportfoliolensnotaclauseinacontract.

Agilecontractsneedtoincorporatemultipleexitspointsfactoringtheeconomicsofmarginalvaluetocost.


Some simple but powerful stories

Assessing the levels of maturity being achieve with the backlog over time and a commitment to a fixed deliverable.

Visualizing the movements within a product backlog with velocity and a predicted trajectory of progress / completion.


Making contract deviations visible

Convert to change request

Time

Impa

ct to

Del

iver

y

How can we create system visualisation to achieve corporate awareness

Feel free to reuse some of what you have learnt today

Come up with some new ideas on how you can influence your systems through new forms of measurement and visualisation.


Shared Experience

Hands On

ConstructiveFeedback

Transparency

Shared Success Stories

Strong Metric

Legal Contract Co-created

Adapting to Change

EmbeddedTeam

EvidenceBased

CollaborativeFramework

Collective ResponsibilityPartnership

In any partnership, we recognise that we all have know-how, skills and insights to offer, and we all have the opportunity to learn and grow from one another.

Enlarge the shadow of the future via Partnering

When the probability to work with one another is high, co-operation based on reciprocity is high bringing stability to future delivery


An effective strategy must be able to take into account the history of iteration / interaction to far

MVP

Discount parameter

MMF WEnable multiple exit clauses

With the opportunity for future sprints / interactions co-operation can emerge from a system.

Mutual co-operation depends on their being a good chance of a continuing relationship, as measured by the size of w. Co-operation can be accelerated by making interactions more frequent and the ability to recognisedefection more readily.

Dialogue“Real dialogue is where two or more parties become willing to suspendtheir certainty in each others presence.”

David Bohm

My hope is that I have opened a door through which you can walk into a greater understanding how contracts can be framed.

Listen Intently, RETHINK EVERYTHING, Deliver Incrementally

My hope is that I have opened a door where we can begin to have new conversations in how contracts are framed.

Thank you. Any Questions?

Date post:	20-May-2020
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