Managing project performance: alignment of Agile and traditional metrics

MANAGING PROJECT
PERFORMANCE:
Agile and Traditional Metrics
Laimonas Lileika
Project Manager
October 11th, 2012

ABOUT MYSELF

Laimonas Lileika | Agile Tour Vilnius 2012 October 15, 2012 2

PROBLEM STATEMENT

Organization that has
been committed to a
Earned Value Management
traditional project
(EVM) serves as the basis for
management for over
management and project
50 years
reporting in CSC

Is it possible to map Agile metrics
with traditional? In other words: is
it possible to run the project using
Agile methodology, and still
report the project in accordance
to the corporate CSC standards?


WTF

AGENDA

I. The role and types of metrics
II. Traditional metrics overview
III. Demonstration and Interpretation
IV. Sum up


DISCLAIMER

This is my personal interpretation based on experience, however not
validated by… any… opinion leader.

You might disagree with what you will hear/read, and that’s totally fine –
I will wait for you to present next year your own findings.


THE RUTHLESS WORL OF METRICS


WHY DO WE USE METRICS ANYWAY?

• Because we have to
– Make business-decisions;

– Provide meaningful information about important things;

– Consider to change what/how we currently do;

– Recognize the result and judge it;

– To estimate the future;


GREAT VARIETY OF METRICS ACROSS BOTH
METHODOLOGIES

AGILE METRICS TRADITIONAL METRICS
• Story point burndown • Earned Value
• Sprint burndown • Planned Value
• Release burndown • Actual Costs
• Velocity • Cost Variance
• Story points completed • Schedule Variance
• Running Tested Features (RTF) • Estimate at Completion
• Business Value completed • Estimate to Complete
• Work in progress • Performance Indexes: CPI; SPI
• …….. • ……..


TYPES OF METRICS

Productivity /
Value
Performance

Predictability Quality


THE TRADITIONAL METRICS


EARNED VALUE MEASUREMENT

• Creates an objective assessment of project status and likely outcome by
measuring and reporting work accomplished.
Message  I AM MEASURING WORK ACCOMPLISHED

• EVM is about measuring project performance, comparing budgets to
actuals in scope, schedule, and resource
Message  I AM COMPARING BUDGETS TO ACTUALS

• In the end, it’s not about value as “business value” – it’s value as in
“actually done” – and the other nice word used for this is “earned”


3 MAIN MEASUREMENTS

Measurement Explanation
Planned Value (PV) the amount of work planned to be
accomplished
Earned Value (EV) the value which is earned by the time
the work is completed
Actual Cost (AC) actual cost of work performed
(money/hours)


COST VARIANCE

FORMULA Explanation
CV = EV - AC Tells me how many hours team is
running behind or ahead the
planned/budgeted hours

SHEDULE VARIANCE

FORMULA Explanation
SV = EV - PV Tells how many hours we are running
behind or ahead the schedule


PERFORMANCE INDEX NO. 1: CPI

FORMULA Explanation
CPI = EV / AC answers the question “are we spending
more than we are creating”

PERFORMANCE INDEX NO. 2: SPI

FORMULA Explanation
SPI = EV / PV answers the question “are we creating
the value at the speed we expected?”


DEMONSTRATION


PREREQUISITES FOR DEMONSTRATION

• Earned Value will be measured at the very basic level – hours.
• Scrum methodology


6 HOURS / DAY = 24 HOURS
1 2 3 4 5 6 7 8 9 10


Hours Hours
Day
Remaining Burnt

0 240 0
1 228 12
2 213 15
3 194 19
4 166 28
5 130 36
6 98 32
7 60 38
8 38 22
9 20 18
10 0 20


Actual Total
Hours Hours Required
Day Work Work EAC
Remaining Burnt Burn
Effort effort


Actual Total
Day Work Work EAC
Effort effort

0 240 0 0 0 240 0


HOURS
BURNED
4 HOURS
TASK 1 6 ESTIMATED
HOURS
2 REMAINING
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amet, consectetur
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tempus

ACTUAL
6 WORK
EFFORT


Actual Total
Day Work Work EAC
Effort effort

0 240 0 0 0 240 0

1 228 12 24 24 252 24

TASK 1 6 TASK 2 12 TASK 3 6
2 6 4
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amet, consectetur amet, consectetur amet, consectetur
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Aliquam tempus Aliquam tempus Aliquam tempus

6 2x6 6


Actual Total
Day Work Work EAC
Effort effort

0 240 0 0 0 240 0
1 228 12 24 24 252 24

2 213 15 24 48 261 36


Actual Total
Day Work Work EAC
Effort effort

0 240 0 0 0 240 0
1 228 12 24 24 252 24
2 213 15 24 48 261 36

3 194 19 26 74 268 45


Actual Total
Day Work Work EAC
Effort effort

0 240 0 0 0 240 0
1 228 12 24 24 252 24
2 213 15 24 48 261 36
3 194 19 26 74 268 45
4 166 28 27 101 267 50
5 130 36 32 133 263 46
6 98 32 36 169 267 34
7 60 38 24 193 253 26

8 38 22 24 217 255 12


Actual
Hours Hours Total Work Required
Day Work EAC
Remaining Burnt effort Burn
Effort
0 240 0 0 0 240 0
1 228 12 24 24 252 24
2 213 15 24 48 261 36
3 194 19 26 74 268 45
4 166 28 27 101 267 50
5 130 36 32 133 263 46
6 98 32 36 169 267 34
7 60 38 24 193 253 26
8 38 22 24 217 255 12
9 20 18 24 241 261 14
10 0 20 24 265 265 20


TIME TO MAP AGILE WITH TRADITIONAL

Measurement Agile explanation Value
Planned Value Team’s capacity 240 hours
(PV)
Earned Value It is something be burn ∑Hours burnt
(EV)
Actual Cost (AC) Actual effort It is just the
same!


Hours Actual
Hours
Day Remaini Work AC EAC PV EV CV SV CPI SPI
Burnt
ng = ETC Effort
0 240 0 0 0 240 0 0 0 0
1 228 12 24 24 252 24 12 -12 -12 0,50 0,50
2 213 15 24 48 261 48 27 -21 -21 0,56 0,56
3 194 19 26 74 268 72 46 -28 -26 0,62 0,64
4 166 28 27 101 267 96 74 -27 -22 0,73 0,77
5 130 36 32 133 263 120 110 -23 -10 0,83 0,92
6 98 32 36 169 267 144 142 -27 -2 0,84 0,99
7 60 38 24 193 253 168 180 -13 12 0,93 1,07
8 38 22 24 217 255 192 202 -15 10 0,93 1,05
9 20 18 24 241 261 216 220 -21 4 0,91 1,02
10 0 20 24 265 265 240 240 -25 0 0,91 1,00


EARNED
VALUE
4 PLANNED
TASK 1 6 VALUE
ESTIMATE TO
2 COMPLETE
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tempus

ACTUAL
6 WORK
EFFORT


HOURS
BURNED
4 HOURS
TASK 1 6 ESTIMATED
HOURS
2 REMAINING
amet, consectetur
tempus

ACTUAL
6 WORK
EFFORT


Total
Hours Actual
Hours Work
Remaining Work EAC PV EV CV SV CPI SPI
Burnt effort =
= ETC Effort
AC
240 0 0 0 240 0 0 0 0
228 12 24 24 252 24 12 -12 -12 0,50 0,50
213 15 24 48 261 48 27 -21 -21 0,56 0,56
194 19 26 74 268 72 46 -28 -26 0,62 0,64
166 28 27 101 267 96 74 -27 -22 0,73 0,77
130 36 32 133 263 120 110 -23 -10 0,83 0,92
98 32 36 169 267 144 142 -27 -2 0,84 0,99
60 38 24 193 253 168 180 -13 12 0,93 1,07
38 22 24 217 255 192 202 -15 10 0,93 1,05
20 18 24 241 261 216 220 -21 4 0,91 1,02
0 20 24 265 265 240 240 -25 0 0,91 1,00


SPI < 1 means behind schedule (EV < PV) CPI < 1 means over budget (EV < AC)
SPI = 1 means on schedule (EV = PC) CPI = 1 means on budget (EV = AC)
SPI > 1 means ahead of schedule (EV > PV) CPI > 1 means below budget (EV > AC)


TRADITIONAL AND AGILE PERFORMANCE METRICS

Ideal Ideal
Hours Actual Total Requir
Hours daily Hours
Day Remaini Work Work EAC ed PV EV CV SV CPI SPI
Burnd hours Burnt
ng Effort effort Burn
own burn
0 240 240 240 0 0 0 240 0 0 0 0 0
1 216 24 228 12 24 24 252 24 24 12 -12 -12 0,500,50
2 192 24 213 15 24 48 261 36 48 27 -21 -21 0,560,56
3 168 24 194 19 26 74 268 45 72 46 -28 -26 0,620,64
4 144 24 166 28 27 101 267 50 96 74 -27 -22 0,730,77
5 120 24 130 36 32 133 263 46 120 110 -23 -10 0,830,92
6 96 24 98 32 36 169 267 34 144 142 -27 -2 0,840,99
7 72 24 60 38 24 193 253 26 168 180 -13 12 0,931,07
8 48 24 38 22 24 217 255 12 192 202 -15 10 0,931,05
9 24 24 20 18 24 241 261 14 216 220 -21 4 0,911,02
10 0 24 0 20 24 265 265 20 240 240 -25 0 0,911,00


SO IN THE END…


TO SUM UP – IT IS POSSIBLE TO MAP!

TRADITIONAL AGILE
Teams tend to earn things Teams tend to burn things
Planned value (PV) Team’s capacity (TC)
Earned value (EV) Burned value (BV)
Actual cost (AC) Actual cost (AC)
Estimate to Complete (ETC) Remaining Hours
Estimate at Completion = AC + ETC EAC = AC + Remaining Hours


THOUGHTS TO CONSIDER

• Why not measure the value using story points instead of hours? Story
points have much more to do with value than hours;
• How do we report the whole project and not the iteration?
• What about Earned Value Management and Business Value
Management?


Thank You

October 15, 2012 65

Managing project performance: alignment of Agile and traditional metrics

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