the five time-tested keys of...
TRANSCRIPT
5/27/13
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The Five Time-tested Keys of Estimating
that Successful PMs Can't Live Without!
GR8PM
Traditional Agile Hybrid Training � Coaching � Consulting
Copyright, GR8PM, 2013, all rights reserved.
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What can you expect from this training? ! Proven Ideas and Clear Principles. ! Practicality over Theoretical Purity. ! Plenty of Time for Questions!
Five Keys to Estimating Introduction
Purpose and limits of this training? ! Transfer as much knowledge as possible. ! Identify valuable sources of information. ! Accept we can’t cover everything in detail in
only 1 hour!
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Introduction: John Stenbeck, PMP, CSM, CSP, PMI-ACP
! Sr. PM Consultant for client-side ERP implementations
! Experience in Accounting, IT, Aerospace, Construction, and Manufacturing
! Train technical professionals in Aerospace, Defense, High Technology, Financial Services, Bio-medical and Life-science fields
! Adjunct instructor at the University of California San Diego (UCSD)
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Introduction: John Stenbeck, PMP, CSM, CSP, PMI-ACP
! Featured speaker at HP’s National Conference (2002), Oracle’s Annual Conference (2003), and PeopleSoft’s International Conference (2004).
! One project reached the Federal Supreme Court. ! Front page feature in the San Diego Union and
LA Times; Guest on Oprah and the Today Show. ! Past President and VP of Prof. Dev. for PMI-SD
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GR8PM Introduction: ! PMP® and PMI-ACP® Exam Prep classes ! Scrum Master Certification classes ! Corporate On-site seminars:
! Command Course in Agile Project Management ! Project Management Boot Camp ! Crash Course in Leadership ! Masters Course in Estimating and Risk Management
! Organizational Support Services: ! Agile Enterprise Roll-out Consulting ! Contract Project Managers
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GR8PM Introduction: Partial List of Past Clients ! Booz Allen Hamilton, Inc., McLean, VA
! Guinness Bass Import Company, Greenwich, CT
! Lucent Technologies – Bell Labs, Allentown, PA
! Nike Corp., Beaverton, OR
! Oracle Corp., Redwood Shores, CA
! Orange County Public Works, Orange, CA
! Qualcomm Inc., San Diego, CA
! U.S. Army – Space & Terrestrial Comms., Fort Monmouth, NJ
! U.S.D.A. – National Finance Center, New Orleans, LA
! Visa – Smart Cards, Foster City, CA
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Five Keys to Estimating:
Key #1 – The Law of Imprecision
GR8PM
Traditional Agile Hybrid Training � Coaching � Consulting
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TIM
E COST
QUALITY
PMBOK® Guide, Third Edition
Cost
Scope
Qualit
y
Customer Satisfaction
Risk Ti
me
PMBOK® Guide, Fourth Edition
Iron Triangle transformed into Hell-of-a-Hexagon From Three to Fifteen Interrelationships.
Five Keys to Estimating Key #1 – The Law of Imprecision
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Why must estimates be imprecise?
Five Keys to Estimating Key #1 – The Law of Imprecision
“It is better to be roughly right than precisely wrong.” John Maynard Keynes
Value
100% 80% 60% 40% 20% 0%
TIME
Accuracy
Accuracy vs. Value vs. Time
Cost
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! Fundamental Premise of Planning
% Design Estimate Estimate Types Complete Accuracy ROM 0 – 10 % +100% to – 50% Budget 15 – 25 % +30% to – 15% Definitive 45 – 100 % +15% to – 5%
Five Keys to Estimating Key #1 – The Law of Imprecision
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TIME: T T+30 T+60 T+90 T+120 T+180
WORK
ESTIMATE (BUDGET)
FORECAST (ROM)
! Cost-effective Planning Despite Uncertainty
Five Keys to Estimating Key #1 – The Law of Imprecision
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Why do imprecise estimates?
Five Keys to Estimating Key #1 – The Law of Imprecision
A little effort helps a lot! But a lot more doesn’t.
EFFORT
AC
CU
RA
CY
Value
80%
10 Hours
90%
50 Hours
Planning ROI: Is it 5 : 1 10 : 1 15 : 1 or ??
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Five Keys to Estimating:
Key #2 – Estimating is hard.
GR8PM
Traditional Agile Hybrid Training � Coaching � Consulting
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Exercise: ! Form a 3-person team. ! Identify the #1 risk that every project faces.
Five Keys to Estimating Key #2 – Estimating is Hard
Answer: ! There is nothing more expensive than building
(and selling!) the wrong product!!
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Five Keys to Estimating Key #2 – Estimating is Hard
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PROBLEMS
SOLUTIONS
CONE OF UNCERTAINTY
! What is the challenge of estimating?
Five Keys to Estimating Key #2 – Estimating is Hard
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CONE OF UNCERTAINTY PROBLEMS
SOLUTIONS
! How is estimating improved?
Five Keys to Estimating Key #2 – Estimating is Hard
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CONE OF UNCERTAINTY
TRADITIONAL PROJECT MANAGEMENT 4 WEEK CYCLE-TIME 3WEEK CYCLE-TIME 2 WEEK CYCLE-TIME
! What does Agile contribute?
Five Keys to Estimating Key #2 – Estimating is Hard
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FEATURE USAGE
Feature Usage reported by Jim Johnson, Chairman, Standish Group International, Inc., XP2002 Conference, Sardinia, Italy
! How is the Cone of Uncertainty narrowed?
Five Keys to Estimating Key #2 – Estimating is Hard
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It is not about the “Unknown Unknowns”
Five Keys to Estimating Key #2 – Estimating is Hard
As we know, there are known knowns. The things we know we know.
We also know, there are known unknowns. That is to say, we know there are things we do not know.
But there are also unknown unknowns, the things we don't know that we don't know. Donald Rumsfeld, Feb. 12, 2002, DOD news briefing
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Three Key Questions: ! What is the purpose of the estimate? ! How precise of an estimate do I really need? ! How much time do I have?
Five Keys to Estimating Key #2 – Estimating is Hard
Best Practices: ! Obtain historical data for similar projects. ! Evaluate similarities and differences. ! Apply expert judgment. ! Document the estimate and assumptions.
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Five Keys to Estimating:
Key #3 – Use the right tools.
GR8PM
Traditional Agile Hybrid Training � Coaching � Consulting
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Traditional: Graphical WBS
Objective
Phase 1 Phase 2
Work Package 1
Work Package 2
Work Package 1
Work Package 2
Activity 1 Activity 2 Activity 3
Task 1 Task 2 Task 3
Agile / Scrum: Feature Structure
Product
Theme 1 Theme 2
Epic 1 Epic 2 Epic 3 Epic 4
Story 1
Story 2
Story 3
Task 1 Task 2 Task 3
DETAILS
Few & Broad
Many & Specific
Five Keys to Estimating Key #3 – Use the right tools
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Roadmap – 1 Year (Sr. Mgt.)
Release #1 – 4 Months Release #2 – 4 Months Release #3– 4 Months Feature
#1 Feature
#2 Feature
#3 Feature
#4 Feature
#5 Feature
#6 Feature
#7 Feature
#8 Feature
#9 Feature
#10 Feature
#11 Feature
#12
BACKLOG: Stories
#1 thru #n
Feature #1
Feature #2
Feature #3
Feature #4
Feature #5
Feature #6
Rolling Wave – 6 Months
Five Keys to Estimating Key #3 – Use the right tools
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Capacity Analysis ! 6 Developers x 3 wks. x 4 Iterations = 72 weeks ! 72 wks. x 60% efficiency = 43 weeks ! 43 weeks = Planning Limit
Five Keys to Estimating Key #3 – Use the right tools
! Stories are: ! Extra Small (XS) = 1 week to complete ! Small (S) = 2 weeks ! Medium (M) = 3 weeks ! Large (L) = 5 weeks ! Extra Large (XL) = 8 weeks
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Smaller
XL L M S XS
Larger
PRIO
RIT
Y
HIGH
LOW
1 8 5 5 2
2 3
3 2
2 3
3 5
Iteration #1 = 44 days
1
1
8
8 5
5 5 2 3
5
Iteration #2 = 43 days
8 8
8 5
2 3 3 5 Iteration
#3 = 45 days
8 5 5 2 3 Iteration
#4 = 23days
Five Keys to Estimating Key #3 – Use the right tools
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Release #1 – 4 Months
Iteration #1 – 4 Weeks Iteration #2 – 4 Weeks Iteration #3– 4 Weeks Iteration #4– 4 Weeks
Stories Stories Stories Stories Stories Stories Stories Stories Stories Stories Stories Stories
Iteration #1 DEFINITIVE ESTIMATE
Iteration #2 DEFINITIVE ESTIMATE
Iteration #3 DEFINITIVE ESTIMATE
Iteration #4 PLANNING POKER
Five Keys to Estimating Key #3 – Use the right tools
Release #2 – 4 Months
Iteration #5 – 4 Weeks Iteration #6 – 4 Weeks Iteration #7– 4 Weeks Iteration #8– 4 Weeks
Stories Stories Stories Feature Feature Feature Feature Feature Feature Stories Stories Stories
Iteration #5 PLANNING POKER
Iteration #6 PLANNING POKER
Iteration #7 AFFINITY ESTIMATES
Iteration #8 AFFINITY ESTIMATES
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Five Keys to Estimating:
Key #4 – Measure early and often.
GR8PM
Traditional Agile Hybrid Training � Coaching � Consulting
5/27/13
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Tracking Systems
Five Keys to Estimating Key #4 – Measure early and often
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Typical Burndown Report
Five Keys to Estimating Key #4 – Measure early and often
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Measurement: Velocity Charts
Sprint
90 80 70 60 50 40 30 20
Story Po
ints Com
pleted
1 10 9 5 6 7 8 2 3 4
Best 3: 67
Avg. 10: 54
Worst 3: 44
Five Keys to Estimating Key #4 – Measure early and often
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Measurement: Velocity Forecasts
Sprints Remaining
Story Po
ints Rem
aining
11 15 16 17 12 13 14
Mean (Worst 3):
44
Mean (Avg. 10):
54
Mean (Best 3):
67
Five Keys to Estimating Key #4 – Measure early and often
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Wor
k C
ompl
eted
Days
Baseline; Planned Value
1 2 3 4 15 5 6 7 8 9 10 11 12 13 14
Actual Cost
Stories Completed Earned Value
Earned Value
Stories Completed
Actual Cost
EVM & Burn-up Chart
Five Keys to Estimating Key #4 – Measure early and often
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Five Keys to Estimating:
Key #5 – Progress = ƒ (Difficulty / Work Velocity)
GR8PM
Traditional Agile Hybrid Training � Coaching � Consulting
5/27/13
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Logic Network Diagrams
What is the Logic Network when you get a flat tire?
STOP REMOVE
REPLACE GO
F
S
Five Keys to Estimating Key #5 – Progress = ƒ (Difficulty / Work Velocity
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Five Keys to Estimating Key #5 – Progress = ƒ (Difficulty / Work Velocity
Increase sophistication of Critical Path Method (CPM).
STOP REMOVE
REPLACE GO
F
S
EARLY STARTDATE DURATION EARLY FINISH
DATE
ACTIVITYNAME or ID
ACTIVITY OWNERPLANNED COST
COST TO CRASHMINIMUM TIME
LATE FINISHFLOATLATE START
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Five Keys to Estimating Key #5 – Progress = ƒ (Difficulty / Work Velocity
Applying the PERT kernel.
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Five Keys to Estimating Key #5 – Progress = ƒ (Difficulty / Work Velocity
To estimate the duration of highly-complex or unknown tasks
use the formula:
The PERT Kernel
LOEe = (Oe + 4MLe + Pe) ÷ 6
The key is in explaining expectations to the estimator!!
Where: LOEe = Level-of-Effort Estimate. Oe = Optimistic Estimate. MLe = Most Likely Estimate. Pe = Pessimistic Estimate.
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The Five Keys
! 1 – The Law of Imprecision ! 2 – Estimating is hard ! 3 – Use the right tools ! 4 – Measure early and often ! 5 – Progress = ƒ (Difficulty / Work Velocity
Five Keys to Estimating Summary
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Five Keys to Estimating
GR8PM
Traditional Agile Hybrid Training � Coaching � Consulting
Please feel free to contact me or get LinkedIn. jstenbeck @ gr8pm.com