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Economic Governance

MikeAccording to a recent article from IEEE Software, the one thing that differentiates an enterprise with a failing Agile practice from an enterprise with a successful Agile practice is the implementation of a governance model that complements Agile. Such a model allows for quantified planning, decision making and measuring that helps to set and manage expectations.

The difference between the traditional engineering governance model and an economic model is that an economic model sets priorities and results based on changing predictions of probable outcomes of the development process. This is where Agile comes into play, as it allows project leaders to quickly react and change course for improved results. If you quantify the costs of change over time and find that your team is consistently improving, then you are becoming more Agile.

For a decade, IBM has dealt with thousands of internal Agile transformation projects. The company’s experience has led it to establish three priorities for delivering sustained improvements in software business outcomes with higher confidence:

  1. Measure change costs continuously in executable software baselines. These measurements will indicate if a project is making progress and allows for changes to be made, if necessary, to put it back on course. This is in line with the Agile principles of continuous integration and test-driven development.
  2. Steer with economics governance by managing target costs and schedules as narrowing distributions of outcomes; predicting outcomes with Bayesian reasoning; optimizing quality as a narrowing distribution of defect classes and density; and communicating progress and quality trends with honesty.
  3. Streamline overhead.

We offer both Agile and Software Metrics Solutions for those who want to start on the path towards economic governance. We have seen first-hand the positive impacts these solutions can have on a company’s time-to-delivery, quality of work and budget management.

Read the article: Economic Governance of Software Delivery.


Mike Harris
DCG President

Written by Michael D. Harris at 05:00
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"It's frustrating that there are so many failed software projects when I know from personal experience that it's possible to do so much better - and we can help." 
- Mike Harris, DCG Owner

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