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RE: [scrumdevelopment] Re: WIP

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  • Mike Dwyer
    Thanks for the cite Jeff. Question. How do people handle windows of opportunity ? Since we are living in a world where a product, feature or function can go
    Message 1 of 27 , Sep 4, 2005
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      Thanks for the cite Jeff. Question.

      How do people handle 'windows of opportunity'? Since we are living in a
      world where a product, feature or function can go from innovative to
      commodity in a matter of months, how do you factor in the time it takes you
      to get to market and the time you have in the market before you are copied
      or superceded.

      This pushes the revenue argument to the next level stating that a long ROI
      may in fact be counter productive.

      Michael F. Dwyer

      "Planning constantly peers into the future for indications as to where a
      solution may emerge."
      "A Plan is a complex situation, adapting to an emerging solution."

      -----Original Message-----
      From: scrumdevelopment@yahoogroups.com
      [mailto:scrumdevelopment@yahoogroups.com] On Behalf Of Jeff Sutherland
      Sent: Sunday, September 04, 2005 2:10 PM
      To: scrumdevelopment@yahoogroups.com
      Subject: Re: [scrumdevelopment] Re: WIP

      An issue that is a lot more important than WIP is whether what is in
      the queue is in the right priority order or is even worth doing. For
      companies with big bucks ready to do a lot of analysis, they should
      use Software by Numbers:
      http://www.amazon.com/exec/obidos/tg/detail/-/0131407287/002-3446661-8579227

      Denne and Cleland-Huang show that unless you systematically forecast
      cost vs. revenue vs. time for each item in the product backlog you
      will lose at least 25% of the potential revenue and in some cases up
      to 400% of the achievable revenue.

      There is also the issue that 45% of the WIP on the average should
      never be built. A Software by Numbers analysis will do enough
      micro-costing of the product backlog that it should flush most of this
      out.

      People should always start with:

      1. Avoid doing this - where's the revenue time line?
      2. Given the revenue time line, is this the most important thing to do now?

      Software by Numbers nicely factors in architectural change and
      maintenance into the revenue stream, something most other methods
      avoid or do poorly leading to revenue loss.

      Without answers to these questions you should always do nothing with
      the WIP. Every line of code you write you will maintain for the rest
      of your working life (or some poor proxy will maintain it). When it is
      useless code, it is an Albatross that you will wear forever. Be
      extreme and avoid coding at all costs.

      Jeff Sutherland

      On 9/4/05, mwpolen <mwpolen@...> wrote:
      > While I agree that cycle time (the time from customer request to
      > customer fulfillment) is the most important measure I do wonder how
      > you can get any software organization to buy into it. I have found
      > that simple elegant measures, really anything simple, to be too
      > simple for the people with the $BIG$. The people in charge seem to
      > think "hey if it really was that simple everyone of my peers would
      > be doing it this way...NAH this can't work it's a complicated job
      > and complicated jobs require complicated ______" In this can
      > measurement is the fill in the blank.
      >
      > So how do the people in group handle my perceived conundrum?
      >
      > -Mike



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    • Steven Gordon
      When the numbers indicate that we should not be implementing a particular feature today, that does not mean that the numbers might not change in 3 months, 6
      Message 2 of 27 , Sep 4, 2005
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        When the numbers indicate that we should not be implementing a particular feature today, that does not mean that the numbers might not change in 3 months, 6 months, or a year from now.  
         
        Doing the requisite analysis to project the value of a feature over time is not free, so there is a tendency to not redo them every quarter.  Or worse, when updating the calculations, not taking the time to questioning whether an assumption that made sense when the value was first calcuated still makes sense today.
         
        So, when the numbers tell us not to implement a feature this quarter, should we tell the customer:
        1. The feature will not be done this quarter, but we will keep it on our backlog and look at it again next quarter, or
        2. The feature will not be done now and we will therefore remove it from our backlog - you can resubmit it next quarter if you think it makes sense then.
         
        The second one reduces cycle time at the expense of forcing the customer to resubmit feature requests periodically.  I prefer the first, but I am not the customer.
         
        One instance where I am a customer is when I submit a resume for a job.  If the response is that I am not a good fit for any of their current openings, I would rather that they keep my application on file than to ask me to resubmit my application whenever I think they might have some new openings that I would fit.
         
        Steven Gordon
         
        On 9/4/05, Jeff Sutherland <jeff.sutherland@...> wrote:
        An issue that is a lot more important than WIP is whether what is in
        the queue is in the right priority order or is even worth doing. For
        companies with big bucks ready to do a lot of analysis, they should
        use Software by Numbers:
        http://www.amazon.com/exec/obidos/tg/detail/-/0131407287/002-3446661-8579227

        Denne and Cleland-Huang show that unless you systematically forecast
        cost vs. revenue vs. time for each item in the product backlog you
        will lose at least 25% of the potential revenue and in some cases up
        to 400% of the achievable revenue.

        There is also the issue that 45% of the WIP on the average should
        never be built. A Software by Numbers analysis will do enough
        micro-costing of the product backlog that it should flush most of this
        out.

        People should always start with:

        1. Avoid doing this - where's the revenue time line?
        2. Given the revenue time line, is this the most important thing to do now?

        Software by Numbers nicely factors in architectural change and
        maintenance into the revenue stream, something most other methods
        avoid or do poorly leading to revenue loss.

        Without answers to these questions you should always do nothing with
        the WIP. Every line of code you write you will maintain for the rest
        of your working life (or some poor proxy will maintain it). When it is
        useless code, it is an Albatross that you will wear forever. Be
        extreme and avoid coding at all costs.

        Jeff Sutherland

      • David J Anderson
        In my work (and my book) I modeled it as investment. The thinking it up can be time-boxed or controlled in some manner. Answer the question... How much are
        Message 3 of 27 , Sep 6, 2005
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          In my work (and my book) I modeled it as investment. The thinking it
          up can be time-boxed or controlled in some manner. Answer the
          question...

          How much are willing to invest in our next innovative idea?

          This is usually constrained in most companies by the funding for the
          marketing department. One of the challenges is that often cost
          accounting prevents technical people from engaging at an early
          enough stage to improve the quality of the ideas.

          David

          --- In scrumdevelopment@yahoogroups.com, Ron Jeffries
          <ronjeffries@X...> wrote:
          > On Tuesday, August 30, 2005, at 1:15:06 PM, David J Anderson wrote:
          >
          > > To my mind, it is clearly not WIP unless it has been started,
          and
          > > that ought to involve a commitment back to the customer
          detailing
          > > when it will be delivered. In manufacturing terms a "due date".
          >
          > > Simply identifying it for the backlog does not count as starting.
          >
          > > The fact that the customer has dreamt it up and considers it
          part of
          > > their value stream is not justification for it becoming WIP. To
          use
          > > the manufacturing term, you could consider it "stock" i.e. it is
          in
          > > inventory, but it isn't WIP until a commitment is made and
          resources
          > > are assigned to work on it.
          >
          > Suppose that thinking it up was costly. Would we still not list it
          > as WIP? I think we would. Perhaps WIP is supposed to be measured in
          > dollars or time, not number of items?
          >
          > Ron Jeffries
          > www.XProgramming.com
          > Example isn't another way to teach, it is the only way to teach.
          > --Albert Einstein
        • David J Anderson
          Dollar Days is all about amplication. It s about improving signal to noise ratio in management accounting. From the perspective of this thread, it is largely
          Message 4 of 27 , Sep 6, 2005
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            Dollar Days is all about amplication. It's about improving signal to
            noise ratio in management accounting. From the perspective of this
            thread, it is largely irrelevant. We're deciding where to start the
            WIP measurement and the lead time measurement.

            David


            --- In scrumdevelopment@yahoogroups.com, "Clarke Ching" <lists@c...>
            wrote:
            > Ron wrote:
            > >Perhaps WIP is supposed to be measured in dollars or time, not
            number of
            > items?
            >
            > Goldratt recommends using "Dollar-days" to measure WIP in factories -
            thus
            > taking into account both time and dollars. I've posted a note below
            > describing Dollar-Days, which I originally sent to Kent Beck's
            Software in
            > Process yahoo group.
            >
            >
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