Managing the Impossible with an Agile Budget

WRITTEN BY Isaac Hogue

agile budget

The Agile Budget

Release planning is without a doubt one of the most challenging responsibilities for agile teams… at least that’s what I’ve experienced both personally and while coaching enterprises through transformations.

Most teams are working to deliver solutions where the question of “what will I get” at the end of a release can not be left open ended. Furthermore, these teams don’t have an unlimited capacity. They are working within what appears to be a constrained iron triangle, cost, time and scope are all fixed. Mike Cottmeyer’s recent blog about the agile home builder, discusses this challenge from the perspective of establishing a categorized budget.

It is an approach that I’ve seen work on several occasions.  The process is pretty straight forward, not easy… but also not complex :)

Here’s a script that I like to use to help move teams from “this is impossible” to, “hey I think we can deliver!”

Getting Started

Before determining how much of the budget should be spent on features, its important for the team to understand the goal of the eventual release.  To help with this, I usually encourage the team to form of a mock press release, announcing their successful release to the world.  Typically this includes key areas or attributes of the release that have made the release impactful to the reader. These are now key success areas for the release

Establishing your Budget Categories

Each of these key success areas start to emerge as high-level categories within the context of a releases budget that can be used to help focus initial scope conversations. From here the key stakeholders can allocate their budget across each of the category areas.

Quick sidebar, the asset that is available for budgeting is usually the delivery system’s planning velocity.

Keep your Eye On the Ball (successful release, budget available)

Now that budget categories are set, the teams need to start working through their release plans and refining their needs for the “right” implementation based on the budget available.  There are many methods for going about this process; but, by far my goto method starts with high-level acceptance criteria for each category, or feature area, that can be clarified through a mix of example user journeys or system interactions. The funds available to each of the categories should be brought down and further applied to each of these so that the planning team remembers to keep its eye on the ball.  A successful release will need to both (1) deliver the functionality needed, and (2) live within the budget that is available.

This is key, without a focus on the budget available (cost) most teams will struggle to limit the scope of a release until its too late. Early budget constraints help to drive out scope that is not critical to the success of a release.

What do you think, what are your favorite ways to vary scope to successfully deliver on previous market commitments?  For more on this topic, take a look at an earlier blog about calculating the budget, in cost, for agile teams.

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1 comment on “Managing the Impossible with an Agile Budget”

  1. Alan

    In agile projects agile budgeting focus is on optimizing use of resources based on rolling forecasts and not adhering blindly to fixed annual plans and budgets. Agile pioneers advocate doing quarterly or even monthly forecasts instead of one big annual forecast and dynamic resource allocation based on emerging threats and opportunities.

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