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How to make a LOT more money using agile - 0 views

www.agileforall.com/...e-a-lot-more-money-using-agile agile roi agile-roi
shared by Yuval Yeret on 04 Jun 09 - Cached
  • How to make a LOT more money using agile
  • More frequent releases
  • expectations must be set for releases to be smaller but still have significant marketable value.  It also means managing scope for smaller releases so the value can actually be delivered to meet the expectations.  If we make the assumption these two pre-requisites can be handled, then we can also assume faster releases are possible.  Yes, I know, releasing software is expensive, requires other groups, etc.  For now, let’s assume all of those costs are negligible compared to the potential results and see where we end up.
  • ...14 more annotations...
  • team of 8 people work on a project for a year with an anticipated ROI of 100% after 2 years.
  • $1,000,000 (approximately) in 12 months to build the product
  • get $2,000,000 in revenue within the 12 months following release.
  • ROI is calculated as $profit/$invested which in this case is ($2,000,000-$1,000,000)/$1,000,000 or 100%
  • cash expended, which in this case exactly matches the investment since we did all of the investment prior to receiving any return.
  • Let’s assume that scope can be managed so the product can be delivered in two phases, each taking 6 months.
  • each piece of the product is worth about half of the revenue value of the complete product
  • 6 months at an investment of $500,000 to build the first piece
  • 6 more months at an additional cost of $500,000 to complete the second half
  • after 6 months revenue starts to be brought in for the first release
  • the amount of revenue during the first 6 months of release of the first half of the product would be $500,000 ($2,000,000 for full product for 12 months = $500,000 for half product for 6 months).
  • matches the cost for building the second half of the product, so the cash expended is actually only $500,000 for building the product vs. $1,000,000 for building the product in one step.
  • After phase 2 of the product is completed it too starts to bring in revenue.  We now have the complete product, so we can get full value of it during each time period.  In other words, during the next 12 months it will generate $2,000,000 in revenue.  This brings total revenue to $2,500,000 which means our ROI is now 300% (higher profit divided by smaller investment - $1,500,000 profit / $500,000 invested).
  • Month Expense Revenue Cash (Profit) Total Revenue 6 $500,000 $0 -$500,000 $0 12 $500,000 $500,000 -$500,000 $500,000 24 $0 $2,000,000 $1,500,000 $2,500,000
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Kickstart Agile the Kanban Way InfoQ Q&A with Yuval Yeret - 0 views

www.infoq.com/...kickstart-agile-kanban kanban infoq yuvalyeret
shared by Yuval Yeret on 14 Nov 14 - No Cached
  • Yuval Yeret on 14 Nov 14
     
    Kickstart Agile the Kanban Way by @yuvalyeret @BenLinders http://t.co/CdAwoxtShu via @InfoQ
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