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180Re: Measuring Business Value

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  • mpoppendieck
    Dec 9, 2001
      I submit that in a for-profit business, true business value is
      rarely a function of cost and generally not a function of meeting a
      deadline. At 3M, arguably one of best companies in the world at new
      product development, development cost and time were simply not an
      issue. But at every phase review, starting with product concept, a
      cost accountant presented a projected P&L. The only bar you have to
      pass was that the margin on this P&L met a high threshold. And guess
      what – this system delivered tons of high margin products!


      --- In scrumdevelopment@y..., "Ken Schwaber" <ken.schwaber@v...>
      > Excellent.
      > Right now software projects only allow variation between cost,
      quality, time
      > and functionality (usually just functionality).
      > I intend to restate the formula as you indicated below, where
      > business value f(cost, time, quality, functionality), so the
      busines person
      > adjusts the four to create business value.
      > Ken
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