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Financial Improvements?! Jürgen De Smet [email protected] @JurgenLACoach In/jurgendesmet

OpenAgileRO - The financials behind Software development

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Page 1: OpenAgileRO - The financials behind Software development

Financial  Improvements?!  

Jürgen  De  Smet    

jurgen@co-­‐learning.be  @JurgenLACoach  In/jurgendesmet  

Page 2: OpenAgileRO - The financials behind Software development

My  Journey  

•  1996  -­‐  SoIware  Engineer    •  2001  –  Team  Lead  •  2008  –  Started  Co-­‐Teaching  CSx  trainings  &  help  other  companies  

•  …  2011  –  Manager  of  400+  OrganizaYon  •  Self  Employed  &  Happy  

Page 3: OpenAgileRO - The financials behind Software development

Value  Chain  (Phased  Process)  

Customer  Request  

Account  Manager(s)  

Project  Manager(s)   Analyst(s)   Development   IntegraYon   Deployment   Customer  

Accepted  

Register  Demands   Budgets   Requirements   Code,  Tests…   Defects,  Performance…  

Page 4: OpenAgileRO - The financials behind Software development

Agile  Development  

Customer  Request  

Account  Manager(s)  

Project  Manager(s)   Analyst(s)   Development   IntegraYon   Deployment   Customer  

Accepted  

Page 5: OpenAgileRO - The financials behind Software development

Managers  Point  of  View  

Page 6: OpenAgileRO - The financials behind Software development

Focus  on  Net  Profit?!  

Net  Profit  =  Top  Line/Revenue              -­‐  Bo5om  Line/              Opera9onal  Expense  

Page 7: OpenAgileRO - The financials behind Software development

More  with  Less?  

Page 8: OpenAgileRO - The financials behind Software development

Which  Focus?  

Top  Line?  

Bo5om  Line?  

Net  Profit?  

Page 9: OpenAgileRO - The financials behind Software development

Only  1  Focus!  

ROI  =  Net  Profit  /  Investment  

Page 10: OpenAgileRO - The financials behind Software development

What  is  Investment?  

Page 11: OpenAgileRO - The financials behind Software development

What  about  SoIware?  

Customer  Request  

Account  Manager(s)  

Project  Manager(s)   Analyst(s)   Development   IntegraYon   Deployment   Customer  

Accepted  

Register  Demands   Budgets   Requirements   Code,  Tests…   Defects,  Performance…  

Page 12: OpenAgileRO - The financials behind Software development

Customer  Request  

Account  Manager(s)  

Project  Manager(s)   Analyst(s)   Development   IntegraYon   Deployment   Customer  

Accepted  

An  example…  

AssumpYons:  -­‐  Revenue  =  

1.000.000€  -­‐  OperaYonal  Cost  =  

300.000€  

 

Register  Demands   Budgets   Requirements   Code,  Tests…   Defects,  Performance…  

ROI  =  700.000€  /  150.000€  à  4,6  

Page 13: OpenAgileRO - The financials behind Software development

Customer  Request  

Account  Manager(s)  

Project  Manager(s)   Analyst(s)   Development   IntegraYon   Deployment   Customer  

Accepted  

An  example…  

AssumpYons:  -­‐  Revenue  =  

1.000.000€  -­‐  OperaYonal  Cost  =  

300.000€  

 

Register  Demands   Budgets   Requirements   Code,  Tests…   Defects,  Performance…  

ROI  =  700.000€  /  80.000€  à  8,75  

Page 14: OpenAgileRO - The financials behind Software development

Customer  Request  

Account  Manager(s)  

Project  Manager(s)   Analyst(s)   Development   IntegraYon   Deployment   Customer  

Accepted  

An  example…  

AssumpYons:  -­‐  Revenue  =  

1.000.000€  -­‐  OperaYonal  Cost  =  

300.000€  

 

Register  Demands   Budgets   Requirements   Code,  Tests…   Defects,  Performance…  

ROI  =  700.000€  /  80.000€  à  8,75  

Page 15: OpenAgileRO - The financials behind Software development

Customer  Request  

Account  Manager(s)  

Project  Manager(s)   Analyst(s)   Development   IntegraYon   Deployment   Customer  

Accepted  

An  example…  

AssumpYons:  -­‐  Revenue  =  

1.500.000€  -­‐  OperaYonal  Cost  =  

300.000€  

 

Register  Demands   Budgets   Requirements   Code,  Tests…   Defects,  Performance…  

ROI  =  1.200.000€  /  80.000€  à  15  

Page 16: OpenAgileRO - The financials behind Software development

So…  It’s  All  Management?!  

Page 17: OpenAgileRO - The financials behind Software development

Let  us  zoom  in  on  Scrum…  

Page 18: OpenAgileRO - The financials behind Software development

Stressed  Out  PO?!  

Page 19: OpenAgileRO - The financials behind Software development

Product  Backlog  Inventory?!  

Page 20: OpenAgileRO - The financials behind Software development

Strategic  Plan  

Business  Case  &  Drivers  

CapabiliYes  –  Features  

Use  Cases  –  Themes  –  Epics  

User  Stories  

Test  Cases  

next iteration

Epic/ Story

Strategic Plan

Themes/ Capabilities

Priority

Product Backlog

Bus. Case & Drivers

Velocity  Based!  

Page 21: OpenAgileRO - The financials behind Software development

Focus  ≠  100%  Bussy!  

Doing  the  right  things  to  increase  ROI  of  the  team!  

Page 22: OpenAgileRO - The financials behind Software development

Did  you  get  it?  

Page 23: OpenAgileRO - The financials behind Software development

OpYmizing  Business  =  Kaizen  

•  Invest  in  capacity  improvement  acYons  •  Which  will  lead  to  greater  capacity  and  thus  beper  ROI  of  your  organizaYon  

•  This  instead  of  invesYng  in  building  even  more  inventory!  

•  Not  focussing  on  sales  funnel  or  bopom  line  but  on  ROI  all  the  way.  

Page 24: OpenAgileRO - The financials behind Software development

Why  ROI?  

•  Because  it  increases  the  company  profitability  

Page 25: OpenAgileRO - The financials behind Software development

Why  Agile?  

•  Because  it  helps  focusing  on  capacity  improvements  (retro’s)  

•  Pull  mechanisms  (sprint  planning,  kanban…)  •  It  helps  limiYng  the  inventory  thus  increasing  the  ROI  

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2  words  

Page 27: OpenAgileRO - The financials behind Software development