Simple forecasting with my spreadsheet - as presented at London Lean Kanban Days 2018 LLKD18

1. Forecasting For
Beginners
Dan Brown

2. About Me
Dan Brown
Kanban Coach & Teacher
KanbanDan@gmail.com
@KanbanDan

3. • We often talk about estimates as if
they are something meaningful
• We normally mean forecast when we
say estimate
• Forecasts aren’t guesses

4. Maths is our friend (honest)
• Maths often gets a bad rep
• We often think of complex things
we had to learn from first principles
at school
• But you don’t need to understand
the inner workings of an engine to
be able to drive a car
• It’s a good idea to have an expert
on hand when the engine needs
fixing
Solve x and y where:
y = x2 - 5x + 7
y = 2x + 1

5. The problem with Disneyworld
• What’s the downside of
Disneyworld for guests?
• Avoiding the queues
• There’s an App for that…
• It uses historic data and the
“Travelling salesman problem”
• The right maths in the right place
• Longest Disney queue I’ve stood
in was 15 minutes

6. Gameshows?
• The “Monty Hall Problem”
drives maths undergrads mad
• 3 doors, one prize
• What are the odds you pick the
right door?
• 33%
• What if Monte removes a
losing door? What are your
odds now?
• Should you change your
choice?

7. Agreeing terms
• PRODUCT – A service that makes
sense to a customer
• EPIC – a big story. Too big for a team
to finish in a fortnight
• STORY – a single unit of work that
finishes in between 2 and 9 days

8. Lets think in Asteroids
Epics
Products
Stories

9. Ready Player 1
What happens if we shoot an “Product” sized asteroid?

10. Shoot a “Product”
Slow “Products” break into 3 medium paced “Epics”

11. Shoot an “Epic”
Medium paced “Epics” break into 4 fast paced “Stories”

12. How did this strategy work out?
Oops!

13. Then this usually happens
We get an Expedite work item to deal with!

14. Back to sanity
We could finish epic 1’s 4 stories, then the next epic of product 1… That way we
always finish something valuable rather than showing progress on lots of things

15. Conclusion (The answers near the front of the book)

16. Step one - Workshop
• Run a workshop to
break down your
initial product into
epics

17. Step two
• Break down the first 5 epics into stories
• Count the stories in each epic
• Ignore the middle 3 numbers
• Assume the Biggest and Smallest
represent the range
• Assume the mid point of the range is
the median number of stories per epic
X X X X XX
Fewest stories Most stories

18. Step three – get to work!
• Measure the Lead Time to
complete each of the first 11
stories.
• Initial data gathering is done!
• You can also use the 85th
Percentile as your story SLA
KEEP
CALM
AND
START
WORK!

19. Graph time
• You now have enough data to draw a
Cumulative Flow Diagram (CFD).
• Number of stories on Y axis against
date on the X axis
• Shows “To Do”, “Doing” and, “Done”
• Plot a cone of certainty using 15th and
85th Percentiles

20. To Do
Done
Doing
X

21. CFD Forecasting Key Points
• Always use ranges, not individual dates
• Make it visible
• Teach people how to read it
• The truth is the truth.
• This makes it visible, undeniable and
non-negotiable
• Moves the conversation on to business
decisions
• This is real data from a real development
team…

22. Frequency chart
85th %ile
• Lead time frequency chart will show YOUR
Weibull distribution
• Use this to help decide when to start time
bound stories

23. Where do I start
• Go to github.com/kanbandan
• Click on PredictiveCFD
• Download the Excel workbook
• Make yourself a new copy and open the workbook
• You need to play with 2 sheets
• Setup
• On The Board

24. Setup sheet
• I used the standard Excel formatting for Input cells
• You can only change the salmon coloured cells
Blank out the two dates hereSet this date to the first
date of your delivery
Set this dropdown to 11
Set to your work item types

25. On the Board This is all of the data for
the sample sheet

26. On the Board Clear it off and start
adding your stories
No gaps in dates entered
My favourite cheat formula
=IF(ISNUMBER([@[Ready For Demo]]),[@[Ready For Demo]],"")
(If the cell to my right is a number, show it here too. If not show a blank cell here)
Lets you skip columns you don’t want to use
Remember weighting of 1

27. And that’s it…
• You can now look back in wonder at your wonderful
• Cumulative Flow Diagram
• Lead Time Frequency Chart

28. Why it all works
• Explaining the magic numbers (just in case you don't trust me)

29. Let's talk WWII tanks
• The Panzer V was a big
heavy tank. It had better
armour, range and
accuracy than the
Sherman.
• The Allies needed to
know how many were in
France to plan D-Day

30. How many tanks?
• Eisenhower asked both Military
Intelligence and the Bletchley Park
Boffins to work on it
• This is known as
"The German Tank Problem"
MI BPB
June
1940
1000 169
June
1941
1550 244
Aug
1942
1550 327
Real
122
271
342

31. Maths beats estimates
• So do we need to do lots of
maths?
• Good news - you don't.
• There IS a formula, but I'm not
going to bother you with it today.

32. The answers
• With 5 samples you are 12.5%
likely to find a bigger value and
12.5% likely to find a smaller
value than your existing range.
75% chance within range
• With 11 samples you make that
90% chance inside range, 5%
above and 5% below.

33. Putting it to use
•It works for:
•tank gearbox serial numbers
•story sizes
•or even dating partners

34. Why not just estimate?
• How do you weigh something big on
bathroom scales?
• Cut it up and weigh all the small
parts?
• The problem is the tolerance
cumulates and makes the
measurement so inaccurate it’s
useless
• 200 days ± 120 days isn’t much use to us

35. Should we stop estimating?
• Estimates are useless,
estimation is essential
• The benefit of whole team
estimation is the sharing of
tacit knowledge, just before working on the
thing we’re talking about.
• It deliberately introduces conflict
• No groupthink

36. Getting started
• all you need is:
•a date stamp
(or a pen)
•a spreadsheet
(or some graph paper)
https://github.com/kanbandan/PredictiveCFD