Prioritizing Portfolio Backlog to Maximize Value Steve Mayner Agile Asia 2016
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Prioritizing Portfolio Backlogs to Maximize Value Using Multi-Criteria Decision Analysis Stephen Mayner Senior SAFe® Program Consultant Scaled Agile, Inc.
Transcript of Prioritizing Portfolio Backlog to Maximize Value Steve Mayner Agile Asia 2016
Prioritizing Portfolio Backlogs
to Maximize
ValueUsing Multi-Criteria Decision Analysis
Stephen MaynerSenior SAFe® Program Consultant
Scaled Agile, Inc.
SAFe® Senior Program ConsultantScaled Agile, Inc.
[email protected]@stevemaynerstevemayner
#aafhyd #SAFe #WhereIsART
OUR HIGHEST PRIORITY IS TO SATISFY THE CUSTOMER THROUGH EARLY AND CONTINUOUS DELIVERY
OF VALUABLE SOFTWARE.Agile Manifesto, Twelve Principles
AGILEMANIFESTO.ORG/PRINCIPLES
“
”(The Lodge at Snowbird Ski Resort, where Agile was born…)
what is Things only have the value that we give them.
Molière 1622-1673
Stock priceMarket shareCapitalizationROIEPS
shareholder
EthicsFair Trade
EnvironmentVolunteerismLocal Growth
Human Rights
social
Filling unmet…jobs…pains…gains
Cost effectiveDifferentiated
customer
SafetyPay & Benefits
OpportunityLearning
Networking
employee
CollaborationInnovationVolumeIntegrationAnalytics
supplier/partner
Business ValueShareholder
Value
SocialValue
CustomerValue
Employee Value Supplier/
Partner Value
Learning
Org. Agility
Innovation
Internal Systems
How do leaders know which indicators of business value to follow in order to achieve the desired
business outcomes?
Schwartz, M. (2016). The art of business value. Portland, OR: IT Revolution
They don’t.
Schwartz, M. (2016). The art of business value. Portland, OR: IT Revolution
They have a hypothesis.
Schwartz, M. (2016). The art of business value. Portland, OR: IT Revolution
scaledagileframework.com
scaledagileframework.com
scaledagileframework.com
scaledagileframework.com
Billing
Trigger: Customerorder
Shipping/TrackingCRM
Operational Value Stream (Example: Order processing)
People who operate the systems
Systems:
Value: Order delivered
#1-Take an economic view#2-Apply systems thinking
#3-Assume variability; preserve options#4-Build incrementally with fast, integrated learning cycles
#5-Base milestones on objective evaluation of working systems#6-Visualize and limit WIP, reduce batch sizes, and manage queue lengths
#7-Apply cadence, synchronize with cross-domain planning#8-Unlock the intrinsic motivation of knowledge workers
#9-Decentralize decision-making
If you only quantify one thing, quantify the —Donald G. Reinertsen, Principles of Product Development Flow
weighted-shortest job (WSJF)
Reinertsen, D. (2012). The principles of product development flow: Second generation lean product development. Redondo Beach, CA: Celeritas Publishing
+ time criticality + risk reduction-
Job size
Reinertsen, D. (2012). The principles of product development flow: Second generation lean product development. Redondo Beach, CA: Celeritas Publishing
Quantifying thebusiness value
Multi-Criteria Decision Analysis
(MCDA)…a general framework for
supporting complex decision-making situations with multiple and
often conflicting objectives that stakeholders groups and/or
decision-makers value differently
Belton, V., & Stewart, T. (2002). Multiple criteria decision analysis: An integrated approach. Springer.
Multiple stakeholdersStructured decision alternatives
Facilitate decision dialogueQuantify categorical criteriaUnify plural value dimensions
Step #1
Program portfolio management team determines
describing business value
Launch NextGen ProductReduce operating costs
Ensure complianceDecrease employee turnover
Increase customer satisfactionReduce carbon footprint
Step #2
Program portfolio management team determines
Quantifying business value
5 – directly enables product to go to market4 – direct precursor to releasing product to market3 – strongly improves ability to launch2 – moderately improves ability to launch1 – nominally improves ability to launch0 – no relationship to launching the nextgen product
Scoring definition example
5 – required to comply with regulations, laws, directives0 – not required for compliance
Scoring definition example
For this decision analysis technique, an ordinal scale (Likert) is more appropriate than interval scale (Fibonacci)
Step #3
Program portfolio management team determines
Quantifying business value
launch nextgen productreduce operating costsensure compliancedecrease employee turnoverincrease customer satisfactionreduce carbon footprint
weighting example
Step #4
Program portfolio management team builds
Putting it all together
Criteria Weight Scoring Definitions RawScore
WeightedScore
LaunchNextGenProduct 30% 5– directlyenablesproducttogotomarket4– directprecursortoreleasingproducttomarket3– stronglyimprovesabilitytolaunch2–moderately improvesabilitytolaunch1– nominallyimprovesability tolaunch0– norelationshiptolaunchingthenextgenproduct
3 9
CostSavings 20% 5– Immediate AND>=$100M4 –Within1yearAND>=$25M3 –Within2yearsAND>=$10M2–Within3yearsAND>=$1M1–Within5yearsOR>=$100K0– Nocostsavings
4 8
Compliance 20% 5– Requiredtocomplywithregulations, statutes,directives0– Notrequiredforcompliance
5 10
Decreaseemployeeturnover
10% 5– Directlyreducesturnover>=25%4 –Directlyreducesturnoverbetween 18%to24%3 –Directlyreducesturnoverbetween 10%to17%2– Directlyreducesturnoverbetween 1%to10%1– Indirectly reducesturnover0– Noconnectiontoemployeeturnover
2 2
Increasecustomersatisfaction
10% 5– Providesatop5mostrequestedproductcapability4 – Providesatop50mostrequestedproductcapability3 – Directlyresolvesa top5mostcommonlyreportedissue2– Directlyresolvesa top50mostcommonlyreportedissue1– Providesunrequestedproduct/serviceenhancement0– Noconnectiontocustomersatisfaction
4 4
Total ValuePoints 33Apply to epics, enablers, capabilities, features
Use modified planning poker with
numbered cards 0 – 5 to achieve
consensus
+ time criticality + risk
Job size
+ time criticality + risk reduction
Job size
Story points
NextG
enProduct
Costsavin
gsCompliance
Emplo
yeeturnover
Custo
mersatisfaction
Carbonfootprint
TotalValu
ePoints
StoryP
oints
WSJF
Weighting 3 4 5 2 1 4Epic6 5 5 4 4 2 4 81 1800 0.045Epic5 2 1 2 2 1 1 29 750 0.039Epic1 3 3 1 2 2 2 40 1500 0.027Epic2 2 3 5 4 3 3 66 3000 0.022Epic4 0 1 3 1 1 4 38 2000 0.019Epic3 0 1 5 2 2 4 51 4500 0.011
0
10
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30
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50
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1 2 3 4 5 6 7 8 9 10 11 12
Program Increments
Value Burnup Chart
Value Points
ConsistentFair
DefensibleUnderstandable
Measurable
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