AgileEVM

Adding Cost Control to the Agile

Toolkit
Tamara Sulaiman, PMP,CSM-P

tsulaiman@solutionsiq.com
 Presenter
Tamara Sulaiman

• ScrumMaster and Scrum Coach

• Agile since 2003
• 15 years of management experience across a variety of
industries including software development, construction,
non-profit organizations and education
• Certified ScrumMaster (Practitioner)
• Certified Project Management Professional (PMP)
• Co-author of “AgileEVM – Earned Value Management in
Scrum Projects”

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Workshop Perspective
• The examples of
AgileEVM discussed today
are based on the Scrum
framework
• A basic knowledge of
Earned Value
Management is presumed

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 More Information
www.solutionsiq.com/agile_index.html
My email: tsulaiman@solutionsiq.com

You will find:

• Research paper on AgileEVM
• AgileEVM Worksheet (MS Excel)
• More information on AgileEVM terms
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 Workshop Objectives:

To discuss:

– Why we want to use AgileEVM

– What is needed to calculate AgileEVM
– How to analyze the results of AgileEVM
– Where AgileEVM adds value
– When AgileEVM should be applied

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 Personal Objectives - Exercise

• Please write, on a sticky note one thing

that you would like to learn in this
workshop.
• Put your sticky note on the chart ‘Personal
Objectives’ and we’ll make sure to address
it during, or by the end of the workshop.

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Business Reasons For Using Agile Methods

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Business Reasons To Use Earned Value
Management (EVM)

http://en.wikipedia.org/wiki/Earned_value_management

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 Additional Benefits of EVM
According to Quentin W. Fleming and Joel M.
Koppelman:
• “The single most important benefit of employing
earned value is the cost efficiency readings it
provides.”

• “EVM provides early warning of performance

problems while there is time for corrective action.”

http://www.stsc.hill.af.mil/crosstalk/1998/07/value.asp

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Agile Performance Tracking?

“The challenge is to create

Agile...
…implementations of the
EVM principle…”

http://en.wikipedia.org/wiki/Earned_value_management

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The Solution!

AgileEVM = Traditional EVM & Scrum

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 Why Use AgileEVM?

Tracking costs in Agile methods

AgileEVM_SampleEVM.xls

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 What Is Needed To Calculate
AgileEVM?

Vision 24 hours

Jan May Aug Dec

Backlog tasks 30 days
Product Roadmap expanded
by team

Release Plan
Product Backlog Potentially Shippable
Prioritized Features Sprint Backlog Product Increment
desired by Customer Features assigned to Sprint
estimated by team
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 “AgileEVM Is Like Death By Acronym”
T. Perry, SolutionsIQ

• AC – Actual Cost
• PV – Planned Value
• EV – Earned Value
• BAC – Budget at Complete
• EAC – Estimate at Complete
• CPI – Cost Performance Index
• SPI – Schedule Performance Index

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 AgileEVM – Percent Complete
• Why are the percent completes so important?
• How do you calculate Expected Percent
Complete?
• How do you calculate Actual Percent Complete?

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 AgileEVM – Defining The Baseline
- 5 simple inputs
- Start Date
- Budget At Complete
- Planned Sprints
- Sprint Lengths
- Planned Release Story
Points
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AgileEVM – Incorporating The Variables

4 data points
•Story Points Completed
•Story Points Added
•Actual Cost
•Current Sprint

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 AgileEVM - Analysis
• What does it mean if EV is higher than
your Actual cost?
You are
spending less
money than
planned to
accomplish
the work.

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 AgileEVM - Analysis
What does it mean if Actual Cost is higher
than your Earned Value?
You are
spending
more money
than planned
to accomplish
the work.

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 AgileEVM – Analysis
So if the Earned Value is less than the
Planned Value?

You are
accomplishing
the work late;
or behind
schedule

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 AgileEVM - Analysis
What if the Earned Value is equal or more
than the Planned Value?

You are
accomplishing
the work on,
or ahead of
plan.

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 Performance Indices
If: CPI < 1 CPI = 1 CPI > 1

That Means: Over Budget On Budget Under Budget

If: SPI < 1 SPI = 1 SPI > 1

That Means Behind On Ahead of
Schedule Schedule Schedule

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 Where AgileEVM Adds Value
• AgileEVM provides a simple, clear concise
method to communicate the release picture to
stakeholders.
• The ability to run ‘what if’ scenario’s to help
forecast the impact of changes to scope,
schedule, and budget.
AgileEVM_SampleEVM.xls

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 When Should AgileEVM Be Applied?
• At set, predetermined boundaries like Sprint
boundaries, or week / month end
• You must have the actual costs for that period,
and the story points completed for that period
• The boundary periods need to be equal in length

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Case Study

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 Wrap Up

• Personal Objectives
• Prizes!

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