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Is this good for us?

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  • Sebastian J. Reingold
    Hi, my name is Sebastian and I m working for a software development company. I m re-reading Ken Schwaber s book: Agile Project Management with Scrum for 2nd
    Message 1 of 12 , Feb 2 8:02 AM
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      Scrum Users

      Hi, my name is Sebastian and I’m working for a software development company.

       

      I’m re-reading Ken Schwaber’s book: “Agile Project Management with Scrum” for 2nd time and I found something that kept my attention.

      It says:

       

      “Buyers might even choose not to have the entire system built if they are satisfied with only a subset of the total functionality they’d initially envisioned”

       

      But which is the advantage of this for software development companies?? Aren’t we loosing money in these cases??

      May be some of you have experienced this and can help me with this doubt.

       

      Thank you,

      Sebastian.

       

       

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

      <EPI/> - Deploying ideas

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

      Sebatian J. Reingold

      Developer

      Epidata Consulting SRL

      Maipu 521 Piso 1 Of.:"A"

      Buenos Aires, Argentina

      Ofi: 5031 0060 / 61

      Cel: 15 6676 3715

      www.epidataconsulting.com

    • Mishkin Berteig
      The advantage is that it builds trust. Clients don t trust vendors. Wouldn t it be nice if they did? Not just nice, but it might even turn out to be a
      Message 2 of 12 , Feb 2 8:03 AM
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        The advantage is that it builds trust.  Clients don't trust vendors.  Wouldn't it be nice if they did?  Not just nice, but it might even turn out to be a competitive advantage!
         
        Mishkin Berteig
        mishkin@...
        http://www.agileadvice.com/
        "Truthfulness is the foundation of all human virtues" - Baha'u'llah


        ----- Original Message ----
        From: Sebastian J. Reingold <sebastian@...>
        To: scrumdevelopment@yahoogroups.com
        Sent: Friday, February 2, 2007 11:02:31 AM
        Subject: [scrumdevelopment] Is this good for us?

        Hi, my name is Sebastian and I’m working for a software development company.

         

        I’m re-reading Ken Schwaber’s book: “Agile Project Management with Scrum” for 2nd time and I found something that kept my attention.

        It says:

         

        “Buyers might even choose not to have the entire system built if they are satisfied with only a subset of the total functionality they’d initially envisioned”

         

        But which is the advantage of this for software development companies?? Aren’t we loosing money in these cases??

        May be some of you have experienced this and can help me with this doubt.

         

        Thank you,

        Sebastian.

         

         

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

        <EPI/> - Deploying ideas

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

        Sebatian J. Reingold

        Developer

        Epidata Consulting SRL

        Maipu 521 Piso 1 Of.:"A"

        Buenos Aires, Argentina

        Ofi: 5031 0060 / 61

        Cel: 15 6676 3715

        www.epidataconsulti ng.com




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        Try the free Yahoo! Mail Beta.
      • Eric Lefevre
        I agree. Lean Software Development: From Concept to Cash has several examples of companies that pro-actively suggested ways for their customers to save money
        Message 3 of 12 , Feb 2 8:09 AM
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          I agree. "Lean Software Development: From Concept to Cash" has several examples of companies that pro-actively suggested ways for their customers to save money by consuming less of their services.

          Some (smart) customers also arrange contracts so that the service company get a bonus if the system delivered was less costly than planned. Systems that are 90% complete but provide good enough functionalities would fall in that category.



          On 02/02/07, Mishkin Berteig <mishkin@...> wrote:

          The advantage is that it builds trust.  Clients don't trust vendors.  Wouldn't it be nice if they did?  Not just nice, but it might even turn out to be a competitive advantage!
           
          Mishkin Berteig
          mishkin@...
          http://www.agileadvice.com/
          "Truthfulness is the foundation of all human virtues" - Baha'u'llah


          ----- Original Message ----
          From: Sebastian J. Reingold <sebastian@...>
          To: scrumdevelopment@yahoogroups.com
          Sent: Friday, February 2, 2007 11:02:31 AM
          Subject: [scrumdevelopment] Is this good for us?

          Hi, my name is Sebastian and I'm working for a software development company.

           

          I'm re-reading Ken Schwaber's book: "Agile Project Management with Scrum" for 2nd time and I found something that kept my attention.

          It says:

           

          "Buyers might even choose not to have the entire system built if they are satisfied with only a subset of the total functionality they'd initially envisioned"

           

          But which is the advantage of this for software development companies ?? Aren't we loosing money in these cases??

          May be some of you have experienced this and can help me with this doubt.

           

          Thank you,

          Sebastian.

           

           

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

          <EPI/> - Deploying ideas

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

          Sebatian J. Reingold

          Developer

          Epidata Consulting SRL

          Maipu 521 Piso 1 Of.:"A"

          Buenos Aires, Argentina

          Ofi: 5031 0060 / 61

          Cel: 15 6676 3715

          www.epidataconsulti ng.com




          Sucker-punch spam with award-winning protection.
          Try the free Yahoo! Mail Beta.


        • John Posada
          ... Is it better to have a happy customer who buys more and tells others how great your company and product are, or a customer from whom you get the most
          Message 4 of 12 , Feb 2 9:07 AM
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            > But which is the advantage of this for software development
            > companies??
            > Aren't we loosing money in these cases??
            >
            > May be some of you have experienced this and can help me with this
            > doubt.

            Is it better to have a happy customer who buys more and tells others
            how great your company and product are, or a customer from whom you
            get the most money, but thinks they might have paid more for stuff
            they didn't need?



            John Posada
            Senior Technical Writer

            "I think the problem, to be quite honest with you, is that you've never actually known what the question is."
          • Aaron Korver
            Put yourself in the customer s shoes here for a second. You ve signed a contract for a 6 month project. All of the functionality that you wanted was done in
            Message 5 of 12 , Feb 2 9:27 AM
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              Put yourself in the customer's shoes here for a second.  You've signed a contract for a 6 month project.  All of the functionality that you wanted was done in 4 months, but you still have 2 months left in the contract.  What do you do?  Since you signed the contract,  you still have to pay the developers for the next 2 months while they have no work.  So, you make up features that you won't use and start gold plating your application, adding complexity that is unnecessary.

              Wouldn't it be nice to simply ship the product and stop work on the project?  Customer collaboration over Contract negotiation.

              Aaron Korver

              On 2/2/07, John Posada <jposada01@...> wrote:

              > But which is the advantage of this for software development
              > companies??
              > Aren't we loosing money in these cases??
              >
              > May be some of you have experienced this and can help me with this
              > doubt.

              Is it better to have a happy customer who buys more and tells others
              how great your company and product are, or a customer from whom you
              get the most money, but thinks they might have paid more for stuff
              they didn't need?

              John Posada
              Senior Technical Writer

              "I think the problem, to be quite honest with you, is that you've never actually known what the question is."


            • Steven Gordon
              ... How are we losing money if we are getting paid for the work we did do? Do you mean we are leaving money on the table ? ... I have found that the sooner
              Message 6 of 12 , Feb 2 9:50 AM
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                On 2/2/07, Sebastian J. Reingold <sebastian@...> wrote:
                >
                > Hi, my name is Sebastian and I'm working for a software development company.
                >
                > I'm re-reading Ken Schwaber's book: "Agile Project Management with Scrum"
                > for 2nd time and I found something that kept my attention.
                >
                > It says:
                >
                >
                >
                > "Buyers might even choose not to have the entire system built if they are
                > satisfied with only a subset of the total functionality they'd initially
                > envisioned"
                >
                >
                >
                > But which is the advantage of this for software development companies??
                > Aren't we loosing money in these cases??

                How are we losing money if we are getting paid for the work we did do?
                Do you mean we are "leaving money on the table"?

                >
                > May be some of you have experienced this and can help me with this doubt.
                >

                I have found that the sooner the customer can deploy the system, the
                sooner enhancement requests start coming from the users (these
                enhancements are often not among the initial requirements that the
                customer chose not to implement).

                Your customer now has income (or at least value in the case of
                internal systems) being returned by the deployed system as well as
                happy users asking for more functionality. The opportunity for
                continued business is ripe. Usually, the total amount of software
                development work for a given client generated by this approach far
                exceeds the initial contract.

                I am so confident of this approach that I do not mind a series of
                montly contracts with the client instead of a single long-term
                contract.

                Steve

                >
                >
                > Thank you,
                >
                > Sebastian.
                >
                >
                >
                >
                >
                >
                > ----------------------------------
                >
                > <EPI/> - Deploying ideas
                >
                > ----------------------------------
                >
                > Sebatian J. Reingold
                >
                > Developer
                >
                > Epidata Consulting SRL
                >
                > Maipu 521 Piso 1 Of.:"A"
                >
                > Buenos Aires, Argentina
                >
                > Ofi: 5031 0060 / 61
                >
                > Cel: 15 6676 3715
                >
                > www.epidataconsulting.com
                >
                >
              • Adrian Howard
                On 2 Feb 2007, at 16:02, Sebastian J. Reingold wrote: [snip] ... [snip] Advantages include: * Happy customers (hence more repeat business, recommendations,
                Message 7 of 12 , Feb 2 10:05 AM
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                  On 2 Feb 2007, at 16:02, Sebastian J. Reingold wrote:
                  [snip]
                  > But which is the advantage of this for software development
                  > companies?? Aren’t we loosing money in these cases??
                  >
                  > May be some of you have experienced this and can help me with this
                  > doubt.
                  [snip]

                  Advantages include:
                  * Happy customers (hence more repeat business, recommendations, etc.)
                  * Great sales tool (we signed of on ProjectFoo 120k under budget)
                  * Increased throughput: More projects in less time
                  * Did I mention happy customers?

                  Cheers,

                  Adrian
                • Sean Donohue
                  Customers ultimately go where they get the best value. If there is a way to provide a customer with better value you can be sure that some competitor will
                  Message 8 of 12 , Feb 2 10:19 AM
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                    Customers ultimately go where they get the best value. If there is a way to provide a customer with better value you can be sure that some competitor will come along and be more than happy to do so.

                    On the macro level this is very good for the industry. The more value customers get from their development dollars, the more customers are willing to make that investment - which drives up demand, expands the market, and raises the equilibrium so that software developers can charge more for their time.

                    If you think about it, customers don't pay for effort, they pay for solutions. I don't care how many hours it took for GM to make my car, I care that it can get around and how much gas it uses and how comfortable it is, etc. If you can provide solutions with less effort, then you can get paid more for your effort.

                    Sean

                    >From: "Sebastian J. Reingold" <sebastian@...>
                    >Date: 2007/02/02 Fri AM 10:02:31 CST
                    >To: scrumdevelopment@yahoogroups.com
                    >Subject: [scrumdevelopment] Is this good for us?

                    >
                    >
                    >Hi, my name is Sebastianand I’m working for a software development company.

                    >I’m re-reading KenSchwaber’s book: “Agile ProjectManagement with Scrum” for 2nd time and I foundsomething that kept my attention.
                    >It says:

                    >“Buyers might even choose not to have the entiresystem built if they are satisfied with only a subset of the total functionalitythey’d initially envisioned”

                    >But which is theadvantage of this for software development companies?? Aren’t we loosing money in these cases??
                    >May be some of you haveexperienced this and can help me with this doubt.

                    >Thank you,
                    >Sebastian.


                    >----------------------------------
                    ><EPI/> - Deploying ideas
                    >----------------------------------
                    >Sebatian J. Reingold
                    >Developer
                    >Epidata Consulting SRL
                    >Maipu 521 Piso 1Of.:"A"
                    >Buenos Aires, Argentina
                    >Ofi: 5031 0060 / 61
                    >Cel: 15 6676 3715
                    >www.epidataconsulting.com
                  • Paul Klipp
                    I have two responses to your concern. 1) In my experience, customers love to hear that they might be delighted before they have spent their budget, but they
                    Message 9 of 12 , Feb 2 10:21 AM
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                      I have two responses to your concern.

                      1) In my experience, customers love to hear that they might be delighted before they have spent their budget, but they always want more. I never had a client yet who didn't significantly change their choice of features and yet still they wanted to get the most for their budget.
                      2) If this did happen, you'd be stuck with a absolutely ecstatically delighted client who paid you a little less than you expected. A client that happy is priceless in the long term. Aim to make all your clients that happy, and you'll have a waiting list. I have a clients waiting months for the chance to work with my team again.

                      All the best,

                      Paul
                      ______________________
                      paul@...
                      www.agileactivist.com


                      On 2/2/07, Sebastian J. Reingold <sebastian@... > wrote:

                      Hi, my name is Sebastian and I'm working for a software development company.

                       

                      I'm re-reading Ken Schwaber's book: "Agile Project Management with Scrum" for 2nd time and I found something that kept my attention.

                      It says:

                       

                      "Buyers might even choose not to have the entire system built if they are satisfied with only a subset of the total functionality they'd initially envisioned"

                       

                      But which is the advantage of this for software development companies ?? Aren't we loosing money in these cases??

                      May be some of you have experienced this and can help me with this doubt.

                       

                      Thank you,

                      Sebastian.

                       

                       

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

                      <EPI/> - Deploying ideas

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

                      Sebatian J. Reingold

                      Developer

                      Epidata Consulting SRL

                      Maipu 521 Piso 1 Of.:"A"

                      Buenos Aires, Argentina

                      Ofi: 5031 0060 / 61

                      Cel: 15 6676 3715

                      www.epidataconsulting.com




                      --
                      ___________________________
                      Paul Klipp, President
                      Lunar Logic Polska
                      Skype: paulklipp
                      paul@...
                      www.llp.pl
                    • jay_conne
                      Hello Sebastian, Question: As a software development company, do you build custom software for clients or are you developing a product for quantity sales? Let
                      Message 10 of 12 , Feb 2 1:15 PM
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                        Hello Sebastian,

                        Question: As a software development company, do you build custom
                        software for clients or are you developing a product for quantity sales?

                        Let me address both options. The following is just my deduction based
                        on the principles and history of Lean/Agile/Scrum discipline.

                        If you're developing for a company's internal use, with Scrum, your
                        users will get 'some' functionality sooner and some later. That
                        earlier functionality ideally will be able to help them do their jobs
                        better sooner. The frequent feedback you get will keep you on the
                        value track in the eyes of your users. But that's the part you
                        probaably know. It could also allow the customer to discover that
                        they had enough benefit to fit their needs for the cost of this
                        project. Then they could apply further assets to other purpose
                        whether that be more software or something else.

                        If you are developing a product for sale, similar consequences apply.
                        An earlier release of a simpler product version could generate
                        cashflow sooner if the functionality is competitive for the price.
                        Subsequent releases could generate upgrade revenue or just a pattern
                        of evolving trust as Mishkin pointed out. At some point the product
                        may have met it's potential in the marketplace and then other products
                        could be pursued.

                        Jay Conne
                        www.jconne.com

                        --- In scrumdevelopment@yahoogroups.com, "Sebastian J. Reingold"
                        <sebastian@...> wrote:
                        >
                        > Hi, my name is Sebastian and I'm working for a software development
                        company.
                        >
                        > I'm re-reading Ken Schwaber's book: "Agile Project Management with
                        Scrum"
                        > for 2nd time and I found something that kept my attention.
                        >
                        > It says:
                        >
                        > "Buyers might even choose not to have the entire system built if
                        they are
                        > satisfied with only a subset of the total functionality they'd initially
                        > envisioned"
                        >
                        > But which is the advantage of this for software development companies??
                        > Aren't we loosing money in these cases??
                        >
                        > May be some of you have experienced this and can help me with this
                        doubt.
                        >
                        >
                        >
                        > Thank you,
                        >
                        > Sebastian.
                        >
                        >
                        >
                        >
                        >
                        > ----------------------------------
                        >
                        > <EPI/> - Deploying ideas
                        >
                        > ----------------------------------
                        >
                        > Sebatian J. Reingold
                        >
                        > Developer
                        >
                        > <http://www.epidataconsulting.com/site/index.php> Epidata
                        Consulting SRL
                        >
                        > Maipu 521 Piso 1 Of.:"A"
                        >
                        > Buenos Aires, Argentina
                        >
                        > Ofi: 5031 0060 / 61
                        >
                        > Cel: 15 6676 3715
                        >
                        > <http://www.epidataconsulting.com/> www.epidataconsulting.com
                        >
                      • Nathan
                        We actually had this happen with a customer recently. The customer gave us a list of needed features which we agreed to add to the product at a set cost. 4
                        Message 11 of 12 , Feb 5 4:00 PM
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                          We actually had this happen with a customer recently. The customer
                          gave us a list of needed features which we agreed to add to the
                          product at a set cost. 4 weeks after the contract was signed we
                          delivered the first cust of those features; this was the product of 2
                          iterations, and contained only 2 of the 5 that they asked for (the
                          customer was aware of this plan). After the customer received this
                          deliverable, they decided that this was enough for them to meet their
                          business goals. They asked us not to implement the other 3 features.
                          , but suggested that they might need some other features instead
                          (sound familiar?).

                          A couple of weeks later the customer called back and asked if they
                          could make a "substitution" for the other 3 features - they had
                          discovered a new need. We gladly agreed to implement the new feature
                          at no additional cost to the customer. It should not come as a
                          surprise that this feature was already in our backlog. The request
                          moved it up in priority and gave us a willing customer to better
                          define the requirements; a win-win!

                          Did we lose money here? I guess you could make a case that we did.
                          Had we not been using Scrum, we wouldn't have delivered until all 5
                          original features were done. The customer would have then realized
                          this other need and asked for those new features. Perhaps they would
                          have been willing to pay for them. So maybe we lost money, but we
                          also would have created unneeeded features that we'd be stuck
                          maintaining forever. Note that we'd also have a customer that felt
                          like they only got 40% of what they paid for.

                          Instead, because we were using Scrum, what we did was make a customer
                          very happy and we've kept our product lean. This customer has
                          subsequently agreed to provide references and a case study for us.

                          Doing right by the customer is never a bad business decision.

                          Cheers,

                          -Nathan

                          --- In scrumdevelopment@yahoogroups.com, "Sebastian J. Reingold"
                          <sebastian@...> wrote:
                          >
                          > Hi, my name is Sebastian and I'm working for a software development
                          company.
                          >
                          >
                          >
                          > I'm re-reading Ken Schwaber's book: "Agile Project Management with
                          Scrum"
                          > for 2nd time and I found something that kept my attention.
                          >
                          > It says:
                          >
                          >
                          >
                          > "Buyers might even choose not to have the entire system built if
                          they are
                          > satisfied with only a subset of the total functionality they'd initially
                          > envisioned"
                          >
                          >
                          >
                          > But which is the advantage of this for software development companies??
                          > Aren't we loosing money in these cases??
                          >
                          > May be some of you have experienced this and can help me with this
                          doubt.
                          >
                          >
                          >
                          > Thank you,
                          >
                          > Sebastian.
                          >
                          >
                          >
                          >
                          >
                          > ----------------------------------
                          >
                          > <EPI/> - Deploying ideas
                          >
                          > ----------------------------------
                          >
                          > Sebatian J. Reingold
                          >
                          > Developer
                          >
                          > <http://www.epidataconsulting.com/site/index.php> Epidata
                          Consulting SRL
                          >
                          > Maipu 521 Piso 1 Of.:"A"
                          >
                          > Buenos Aires, Argentina
                          >
                          > Ofi: 5031 0060 / 61
                          >
                          > Cel: 15 6676 3715
                          >
                          > <http://www.epidataconsulting.com/> www.epidataconsulting.com
                          >
                        • Heber Ferraz-Leite
                          ... they are ... I completely agree with Nathan s answer on this. Thinking short-termed you might pull out less money out of the customer for change
                          Message 12 of 12 , Feb 5 9:53 PM
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                            >
                            > "Buyers might even choose not to have the entire system built if
                            they are
                            > satisfied with only a subset of the total functionality they'd initially
                            > envisioned"
                            >
                            >
                            >
                            > But which is the advantage of this for software development companies??
                            > Aren't we loosing money in these cases??
                            >


                            I completely agree with Nathan's answer on this. Thinking short-termed you
                            might "pull out" less money out of the customer for change requests on this
                            project. But thinkin mid- and long-term you end up with a customer that is
                            so happy with you that next time he wants something you will be the first
                            company he thinks of.

                            My professional experience is that a happy customer is the best long-term
                            job guarantee.

                            Regards,

                            Heber
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