Musings on project management: Agile cost of value

Wednesday, September 10, 2014

Agile cost of value

Everywhere I go I make it clear that agile in the enterprise begins with a business case. I make this point in my books* and blog postings over and over. The logic of this is obvious on its face: if you are going to spend other people's money (OPM) they'll hold you accountable. Accountable for what? That's what the business case is for... to answer that question. And, if your processes require a project charter, you can morph the business case in the charter.

But agile goes a step further: agile asks that the customer/user/product manager be embedded in the project and empowered to interpret the requirements in the backlog: sequence them, give them priorities, and recommend new ones, ones to change, and ones to delete.

So, given that empowerment, what then is the utility of the business case. What happens to accountability?

Actually, and in the spirit of keeping it simple, yet effective:

If the customer/user/product manager recommends changes in requirements, not anticipated in the business case, and these changes are material to the business proposition (cost of value), Agile provides two methodology opportunities:

The retrospective evaluation leading to the next formulation of the next iteration's backlog, and
The release planning session (or process), leading to production releases to the business.

Beyond these methodology opportunities, each business may have processes to handle business case changes that would overlay the project methodologies.

In each opportunity, the witting and accountable product manager goes back to the business case to evaluate impact to the cost of value, very likely consulting with affected stakeholders. It could be messy of course, and it could delay things, but following the agile principle of provoking change early on, it's really in the job jar of the agile product manager to be pro-active about attending to the business case.

* Maximizing Project Value, Chapter 3, discusses the agile business case
Project Management the Agile Way, Chapter 2, also describes how to build an agile business case