In my August 26, 2015 blog post, I talked about the importance of ensuring all stakeholders involved in a software development initiative can visualize the value. By understanding the economic drivers for a project, the IT team will be able to make better tactical decisions throughout the development process.
But, how exactly can both the business unit and IT team visualize the value? I have developed a 5-step Value Visualization Framework (VVF) to provide a clear directive to discuss, define, measure, and prioritize software development initiatives based on their ability to deliver on the value expectations.
VVF is a simple model that can become a valuable tool to drive IT’s continuous alignment with the business unit’s end objectives. The 5-steps are as follows:
STEP 1: Define the units of value delivery (e.g. number of subscribers, hours saved in the process)
STEP 2: Define the value of the project in specific units (e.g. 17 new subscribers once deployed)
STEP 3: Define the “size” (e.g. 100 story points)
STEP 4: Define the cost of delay of the implementation challenge, including level of complexity, duration, etc. (e.g. $2,000 penalty for a missed deadline)
STEP 5: Quantify the economic value once deployed (e.g. $30 per subscriber)
The VVF can be used in conjunction with popular methodologies, such as Agile, that don’t provide an explicit way to measure the value throughout the software development process. VVF determines the values by which to measure the application development initiative and enables IT and the business unit to track actual versus target values and make timely adjustments when necessary, to get back on track to achieve the end goal.
Michael D. Harris