This presentation highlights what measure may be missing from a managers tool box. Once we establish what measures are necessary, we will learn more about the missing measure and how to apply it to manage projects, manage performance and even manage the customer.

1. Software Estimation:
Better Information, Better Decisions
David Herron
d.herron@davidconsultinggroup.com
2013

2. Decisions, Decisions
• What decisions need to be made?
• Who makes those decisions?
• What information is available?
• How effectively do we make decisions?
• What is the impact of poorly made decisions?
©2013 David Consulting Group

3. Business and Technical Decisions
Strategic
Positioning
Continuous (Business &
Technical) Deliver
Process
Improvement Value
Improve Productivity Satisfy Customer
Reduce Time to Market Improve Competitive Position
Increase Quality
Increase
Lower
Market
Costs
Share
Improve Increase
Margins Shareholder Revenues
Value
©2013 David Consulting Group

4. Establish an Information Framework
Executive Management
Enterprise Dashboard Milestone Baseline Plan Actual
%
Var Project Resource and Effort Status
Business
Decisions
Checkpoint A – Charter & Kickoff 1/10/2008 1/10/2008 1/10/2008 0%
Requirements Complete 1/28/2008 1/28/2008 1/28/2008 0% 1,600
2/4/2008 2/4/2008 2/15/2008
Project Resources/Hours
Vendor Selection Complete 7%
1,400
PMP/Schedule Complete 2/12/2008 2/12/2008 2/28/2008 11%
1,200
Checkpoint B– Planning & Reqs 2/28/2008 3/15/2008 11%
1,000
Design Complete 3/15/2008 4/15/2008 20%
800
Development Complete 4/15/2008 4/30/2008 10%
600
Checkpoint C– Midpoint 4/30/2008 5/15/2008 10%
4/30/2008 5/15/2008
400
Testing Complete 10%
5/10/2008 5/30/2008
200
Training Complete 13%
5/30/2008 6/15/2008
0
Go Live 11%
8
8
8
8
08
8
8
08
8
8
8
8
6/1/2008 6/30/2008
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Lessons Learned/Cust Sat Survey Complete 19%
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Checkpoint D – Deploy & Close 6/1/2008 6/30/2008 19%
Performance
Cum Planned Effort Allocated Cum Actual Effort Spent
"Earned Value" Baseline Total Hours
Project Defect Status Requirements Growth and Stability
1000
900
800
200
150
Measures
# of Requirements
700
# of Defects
600 100
500
400 50
300
200 0
100
0 -50
8
8
8
08
8
08
8
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Added Changed Deleted Total Reqs
Total Defects Discovered Total Closed Defects
Process Process Management Measurement Baseline
Repository
Process
Impro Measures Enterprise
..
ve
Contr Project Score Mngmnt Req Des Build Test Environ
BI Product Releases | Q2 2007 56.2 68 62 68 58 41 35
ol
Database
EDW Phase IV: Applicant Tracking System 44.3 68 49 57 35 28 35
CRM Product Maintenance Releases | Q3 2007 60.2 73 74 68 65 41 27
Road to 90: In Bound 36.4 57 44 32 46 22 27
Exec SAR PM 2.0 37.5 50 51 25 46 28 27
Defin Measur Meetings | Teleconf. vendor selection 46.6 68 62 57 38 25 27
ute e
CoBRA Application 53.6 77 64 50 46 50 31
e Web 2.1 53.2 61 72 48 58 41 31
Proce Web 2.0 Q1 Maintenance 43.7 61 54 20 58 44 31
Q3 2007 Web v2.1 Enhancements / Maintenance 47.3 61 54 20 58 41 31
ss Web v2.2 (EPN) 59.8 77 69 55 58 53 31
Web v2.2 Enhancements / Maintenance | Q4 2007 44.2 61 54 20 65 41 31
Project PAL Historical
Measures
Project X Project Y Project Z Project
Data
©2013 David Consulting Group

5. Why Are We Estimating?
Planning
Budgeting
Managing Projects
Allocating Resources
Managing Expectations
Proj. Portfolio Mngmnt
0% 20% 40% 60% 80% 100%
©2013 David Consulting Group

6. Decisions Relevant to Project Managers
• Shifting priorities
– Scope
– Schedule
• Managing expectations
– Customer
– Senior Management
• Lack of performance
– Productivity
– Skill levels
• Controlling Costs
©2013 David Consulting Group

7. Estimating Best Practices
The Software Engineering Institute’s (SEI) requirements for good
estimating:
• Corporate historical database
• Structured processes for estimating product size and reuse
• Mechanisms for extrapolating benchmark characteristics of past
projects
• Audit trails
• Integrity in dealing with dictated costs and schedules
• Data collection and feedback processes foster correct data
interpretation
©2013 David Consulting Group

8. Basis of Estimates
Prior Experience
Historical Data
Commercial Data Bases
Industry Bnchmk Data
Other
0% 20% 40% 60% 80% 100%
©2013 David Consulting Group

9. Establishing a Level of Performance
COLLECT COLLECT
QUANTITATIVE DATA QUALITATIVE DATA
Size Process
Collection Effort Methods
Duration Skills
Cost Tools
Quality Management
Analysis Measured Capability
Performance Profiles
Results Baseline
Performance
©2013 David Consulting Group

10. Developing a Performance Profile
Product Performance Performance Risk
Deliverable D Indicators Factors
C D Time to Market Management
B Definition
Level of Effort
A Quality (Defects) Design
Build
Test
Environment
DELIVERY PROFILES
MEASURES (Size) RATE
21 19 FP/PM PROFICIENCIES
A
B 36 13 FP/PM INADEQUACIES
C 58 16 FP/PM
D 110 10 FP/PM
: 550 5 FP/PM
©2013 David Consulting Group

11. Quantitative Performance Evaluation
Quantitative Assessment:
COLLECT
QUANTITATIVE DATA
Size  Perform functional sizing on all selected projects.
Effort  Collect data on project level of effort, cost, duration
Duration and quality.
Cost  Calculate productivity rates for each project, including
Quality functional size delivered per staff month, cost per
functional size, time to market, and defects delivered.
Measured
Performance Results:
Baseline
Productivity
Average Project Size 133
Average FP/SM 10.7
Average Time-To-Market (Months) 6.9
Average Cost/FP $939
Delivered Defects/FP 0.0301
©2013 David Consulting Group

12. Create a Profile of Key Variables
Management Definition Design
• Team Dynamics • Clearly Stated • Formal Process
• Morale Requirements • Rigorous Reviews
• Project Tracking • Formal Process • Design Reuse
• Project Planning • Customer Involvement • Customer Involvement
• Automation • Experience Levels • Experienced Development
• Management Skills • Business Impact Staff
• Automation
Build Test Environment
• Code Reviews • Formal Testing Methods • New Technology
• Source Code Tracking • Test Plans • Automated Process
• Code Reuse • Staff Testing Experience • Adequate Training
• Data Administration • Effective Test Tools • Organizational Dynamics
• Experienced Staff • Customer Involvement • Certification
• Automation
©2013 David Consulting Group 11

13. Qualitative Performance Evaluation
COLLECT
Qualitative Assessment
QUALITATIVE DATA  Conduct interviews with members of each
Process
project team
Methods
Skills  Collect Project Profile information
Tools  Develop Performance Profiles to display
Management
strengths and weaknesses among the selected
Capability projects
Profiles
Results
Project Nam e Profile Score Managem ent Definition Design Build Test Environm ent
Accounts Payable 55.3 47.73 82.05 50.00 46.15 43.75 50.00
Priotity One 27.6 50.00 48.72 11.36 38.46 0.00 42.31
HR Enhancements 32.3 29.55 48.72 0.00 42.31 37.50 42.31
Client Accounts 29.5 31.82 43.59 0.00 30.77 37.50 42.31
ABC Release 44.1 31.82 53.85 34.09 38.46 53.13 42.31
Screen Redesign 17.0 22.73 43.59 0.00 15.38 0.00 30.77
Customer Web 40.2 45.45 23.08 38.64 53.85 50.00 34.62
Whole Life 29.2 56.82 28.21 22.73 26.92 18.75 53.85
Regional - East 22.7 36.36 43.59 0.00 30.77 9.38 30.77
Regional - West 17.6 43.18 23.08 0.00 26.92 9.38 26.92
Cashflow 40.6 56.82 71.79 0.00 38.46 43.75 38.46
Credit Automation 23.5 29.55 48.72 0.00 38.46 6.25 26.92
NISE 49.0 38.64 56.41 52.27 30.77 53.13 53.85
Help Desk Automation 49.3 54.55 74.36 20.45 53.85 50.00 38.46
Formula One Upgrade 22.8 31.82 38.46 0.00 11.54 25.00 46.15
©2013 David Consulting Group 12

14. Overall Information Framework
Executive Management
Enterprise Dashboard Milestone Baseline Plan Actual
%
Var Project Resource and Effort Status
Business
Decisions
Checkpoint A – Charter & Kickoff 1/10/2008 1/10/2008 1/10/2008 0%
Requirements Complete 1/28/2008 1/28/2008 1/28/2008 0% 1,600
2/4/2008 2/4/2008 2/15/2008
Project Resources/Hours
Vendor Selection Complete 7%
1,400
PMP/Schedule Complete 2/12/2008 2/12/2008 2/28/2008 11%
1,200
Checkpoint B– Planning & Reqs 2/28/2008 3/15/2008 11%
1,000
Design Complete 3/15/2008 4/15/2008 20%
800
Development Complete 4/15/2008 4/30/2008 10%
600
Checkpoint C– Midpoint 4/30/2008 5/15/2008 10%
4/30/2008 5/15/2008
400
Testing Complete 10%
5/10/2008 5/30/2008
200
Training Complete 13%
5/30/2008 6/15/2008
0
Go Live 11%
8
8
8
8
08
8
8
08
8
8
8
8
6/1/2008 6/30/2008
l'0
'0
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Lessons Learned/Cust Sat Survey Complete 19%
g'
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Sep
Ju
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Fe
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D
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Checkpoint D – Deploy & Close 6/1/2008 6/30/2008 19%
Cum Planned Effort Allocated Cum Actual Effort Spent
Performance
"Earned Value" Baseline Total Hours
Project Defect Status Requirements Growth and Stability
Measures
1000 200
900
800 150
# of Requirements
700
# of Defects
600 100
500
400 50
300
200 0
100
0 -50
8
8
8
08
8
08
8
8
8
8
8
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Feb
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Ap
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Au
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D
N
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Added Changed Deleted Total Reqs
Total Defects Discovered Total Closed Defects
Process Process Management Measurement Baseline
Repository
Process
Impro Measures Enterprise
..
ve
Contr Project Score Mngmnt Req Des Build Test Environ
BI Product Releases | Q2 2007 56.2 68 62 68 58 41 35
ol
Database
EDW Phase IV: Applicant Tracking System 44.3 68 49 57 35 28 35
CRM Product Maintenance Releases | Q3 2007 60.2 73 74 68 65 41 27
Road to 90: In Bound 36.4 57 44 32 46 22 27
Exec SAR PM 2.0 37.5 50 51 25 46 28 27
Defin Measur Meetings | Teleconf. vendor selection 46.6 68 62 57 38 25 27
ute e
CoBRA Application 53.6 77 64 50 46 50 31
e Web 2.1 53.2 61 72 48 58 41 31
Proce Web 2.0 Q1 Maintenance 43.7 61 54 20 58 44 31
Q3 2007 Web v2.1 Enhancements / Maintenance 47.3 61 54 20 58 41 31
ss Web v2.2 (EPN) 59.8 77 69 55 58 53 31
Web v2.2 Enhancements / Maintenance | Q4 2007 44.2 61 54 20 65 41 31
Project PAL Historical
Measures End User
Project X Project Y Project Z
Project
Estimates
©2013 David Consulting Group 13

15. Benefits of Good Estimating
• Reduce Risk
• Reduce Costs
• Gain Credibility
• Manage Expectations
• Resource Capacity Planning
• Improve Decision Making Capability
©2013 David Consulting Group

16. Barriers to Successful Estimating
Availability of Data
Lack of Skills
No Documented Procedure
Lack of Automation
Lack of Sr. Mngmnt Support
Est. Not Id as Problem
Other
No Perceived Value
0% 20% 40% 60% 80% 100%
©2013 David Consulting Group 15

17. Basic Estimating Model
• Quantify the size
• Assess the complexity
• Understand the capacity to deliver
DEFINITION CAPABILITY ESTIMATE
CAPACITY
PROJECT X PROJECT X
Schedule
REQUIREMENT to
SIZE COMPLEXITY DELIVER
Costs
Effort
Estimating Model
©2013 David Consulting Group 16

18. Why is Sizing Important?
Finding –
Nine out of ten projects that fail have not been properly sized
Consider –
When you build a house you specify all the functions and features you
want – these are your requirements
The builder then generates an estimate based on the size (square
footage) of your requirements
• Size is the key to effectively managing software projects
©2013 David Consulting Group 17

19. Sizing Options
Internal vs.
Organizational External Power vs.
Specific Industry
Definitions Definitions Defined
Ease of Use
Fewer More
Rules Rules
Modules, Story Lines of Use Case Cosmic,
Use Cases, Points Code Points NESMA FP Hours, Story Use Case COSMIC
Days Points Points NESMA FP
Test Cases IFPUG Function
Points IFPUG Function
Points
Mark II
Mark II
Easier to Harder to
Learn Learn
Less Accurate
Consistency/
More Accurate
Accuracy
Ease of Use
Power
/ Ease
Index
Story Lines of Use Case COSMIC Hours, Power Increases
Points Code Points NESMA FP Days
IFPUG Function
Points
Mark II
©2013 David Consulting Group

20. Why Function Points?
Function Point Analysis is a standardized method for measuring the
functionality delivered to an end user.
• Consistent method
• Easy to learn
• Available early in the lifecycle
• Acceptable level of accuracy
• Meaningful internally and externally
• Function Point counts have replaced Line of Code counts as a sizing
metric that can be used consistently and with a high degree of
accuracy.
©2013 David Consulting Group 19

21. The Function Point Methodology
The software deliverable is sized based upon the functionality delivered.
• Inputs
• Outputs
• Inquiries Five key components are
• Data Stores identified based on logical user view
• Interface Files Input Inquiry Output
Data
Stores
Interface Application
File
©2013 David Consulting Group 20

22. Simplifying the Methodology
The Formal Process:
1. Identify Components
2. Assess Complexity
3. Apply Weightings
4. Compute Function Points
Components: Low Avg High Total
Data Stores __ x 7 __ x 10 __ x 15 ___
Interfaces __ x 5 __ x 7 __ x 10 ___
Inputs __ x 3 __ x 4 __ x 6 ___
Outputs __ x 4 __ x 5 __ x 7 ___
Inquiries __ x 3 __ x 4 __ x 6 ___
Total Function Points ___
©2013 David Consulting Group 21

23. Common Criticisms of Function Points
• FP methodology terms are confusing
• Too long to learn, need an expert
• Need too much detailed data
• Does not reflect the complexity of the application
• Takes too much time
• We tried it before
©2013 David Consulting Group 22

24. Simplifying the Methodology
• Assume complexity to be average
Complexity
Components: Low Avg . High Total
Data Stores __ x 7 __ x 10 __ x 15 ___
Interfaces __ x 5 __ x 7 __ x 10 ___
Inputs __ x 3 __ x 4 __ x 6 ___
Outputs __ x 4 __ x 5 __ x 7 ___
Inquiries __ x 3 __ x 4 __ x 6 ___
Total Function Points ___
©2013 David Consulting Group 23

25. Exercise: Identify the Functionality
PURCHASE
USER USER ORDER
Input
SYSTEM
Inputs ADD, CHG
PAYMENTS
INVOICES
Interface
PURCHASE
ORDER INFO
PAYMENTS
INVOICES
Inquiry
VENDOR
Data Stores USER
PAYMENT
STATUS
ACCOUNTS PAYABLE
Output
USER
PAID
INVOICES
©2013 David Consulting Group 24

26. Determine the Functional Size
The FP Lite Process: TM
1. Identify Components USER USER PURCHASE
ORDER
2. Assess Complexity SYSEM
PAYMENTS
3. Apply Weightings INVOICES
VENDOR
USER
4. Compute Function Points
ACCOUNTS PAYABLE
USER
Components Low Average High Total
Data Stores _______ x7 3 x10 _______ x15 30
Interfaces _______ x5 1 x7 _______ x10 7
Inputs _______ x3 3 x4 _______ x6 12
Outputs _______ x4 1 x5 _______ x7 5
Inquiries _______ x3 1 x4 _______ x6 4
58
Function Point Size
©2013 David Consulting Group 25

27. Estimating Techniques
• Manual, using organizational baseline data
• Manual, using standard industry data
• Automated, using a commercial estimating software package
CAPACITY
PROJECT X PROJECT X to
Input SIZE COMPLEXITY DELIVER Output
Estimating Model
©2013 David Consulting Group 26

28. Estimating Using Delivery Rates
DEFINITION CAPABILITY ESTIMATE
PROJECT X RATE
PROJECT
Schedule
REQUIREMENT X OF
SIZE COMPLEXITY
DELIVERY
Costs
Effort
FUNCTIONAL SIZE PROFILE
©2013 David Consulting Group 27

29. A Comprehensive Measurement of Capability
COLLECT COLLECT
QUANTITATIVE DATA QUALITATIVE DATA
Process
Collection Size Methods
Effort Skills
Duration Tools
Defects Management
Analysis Measured Capability
Performance Profiles
Results Benchmark
Data
Delivery Rates Best
Action
Practices
©2013 David Consulting Group 28

30. Developing a Performance Profile
Product Performance Performance Risk
Deliverable D Indicators Factors
C D Duration (Months) Management
B Definition
Cost (Effort)
A Quality (Defects) Design
Build
Test
Environment
RATE OF PROFILES
SIZE DELIVERY
21 19 FP/PM PROFICIENCIES
A
B 36 13 FP/PM INADEQUACIES
C 58 16 FP/PM
D 110 10 FP/PM
: 550 5 FP/PM
©2013 David Consulting Group 29