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Wednesday, December 10, 2008 by Anthony DeMarco Technology readiness is a critical cost driver of development programs.  Many high technology programs fail because initial cost and schedule expectations were based on the assumption that the technologies employed were proven,  when actually they were not. Space programs have the most dubious history in this regard.  I once listened to a Lockheed Martin executive explain how the X33 space shuttle was a great vehicle, but was canceled because it was, "two inventions short of meeting the requirements". Canceled after over one billion dollars were spent. Starting development projects that have constrained budgets and ...
Original Post Date: Thursday, October 30, 2008  Software cost estimation is hard.  I have learned this the hard way – as a software developer and later as the manager of software development projects. Today, as a builder of cost estimating software, I learn something everyday about software development that reinforces the fact that software cost estimation is hard. I attend a lot of trade shows and I talk to a lot of software people about how they estimate software costs.  Many of them have no formal process, many don’t collect data as projects progress, many of them perform estimates off the ...
Original Post Date: Tuesday, October 7, 2008  Jacob has a great comment to my recent post on getting it "right the first time".  He notes that requirements are often fuzzy and that estimates rely on peoples' opinion of cost and duration - and that the are often wrong.  He asked what silver bullet we have. Our silver bullet is a proven discipline that makes people better estimators and sheds light on fuzzy requirements. It starts with the people. Becoming an accurate estimator requires the same step-by-step approach as any learned skill such as golf or tennis or swimming (things I ...
Original Post Date: Monday, October 6, 2008  According to Gartner, Service Oriented Architectures (SOAs) will be used in more than eighty percent of mission critical operational applications and business processes by the year 2010.  Perusal of the literature on SOAs leads to visions of ease of implementation and cost savings of epic proportions.  And it is likely that not only will service oriented implementations results in cost savings, but that without them many currently envisioned capabilities in the corporate world and the Department of Defense (DoD) will be impossible to deploy, maintain, and evolve as technology explodes and requirements and ...
Original Post Date: Wednesday, October 1, 2008  As I prepare my remarks for the first PRICE Systems International Symposium and User Group Meeting in Asia hosted by the PRIGENT corporation, I am astounded by the recent globalization of the Defense Industry.  Worldwide weapon systems acquisition has been permanently changed by:  the merger of US defense contractors in the 1990's, the entry of European contractors into the US Defense Industry (EADS, BAE) in the 2000's, and the entry of Korea into the global market happening now. Today, BAE Systems ...
Original Post Date: Thursday, September 18, 2008 While many at Bear Stearns, Lehman Brothers, Merrill Lynch, and AIG are staggering from the Wall Street financial crisis, others on the acquisition side are contemplating the fate of redundant operations created by the these consolidations.  This reminds me of the rapid consolidation of the global Aerospace and Defense (A&D) during the 90's after the fall of the Berlin Wall.  Granted, this consolidation is happening at a much faster pace, but it would be wise for decision-makers to do a little performance measurement before they slash and burn redundant operations.  During the A&D consolidation, the General Electric Corporation called ...
Original Post Date: Wednesday, September 10, 2008 Martin Woodward ‘s comparison of software development to Sudoku does an excellent job of explaining why software cost estimation is hard.  We constantly hear about software development projects that are unsuccessful because they have violated one or more aspects of the Project Management Triangle  - they are either delivered late, delivered over budget or fail to deliver the capability that users require. And while I firmly believe that software development is an engineering discipline, software project estimation is often more complicated than estimation for other engineering disciplines because software project output is not nearly ...
Original Post Date: Wednesday, September 10, 2008 A good point is made in a comment to my last post, Chris Carter says, "As estimators I think it is our duty to tell our customer (management) what we assess the possible range of outcomes to be so that they can make use of this information ".  I agree that we should always deliver an indication of accuracy every estimate.  Uncertainty and risk analysis is an integral feature of TruePlanning and we educate our clients on the value of estimate ranges to optimizing project and portfolio performance. The uncertainty-based probabilistic confidence-level of an estimate that ...
 Original Post Date: Wednesday, September 3, 2008 Productivity refers to measures of output from production processes, per unit of input. The labor and materials that go into a project are the input, and the final delivered product represents the output. Your estimated project budget determines the planned productivity, and decomposes to a planned productivity for each individual and each unit of material.  The dynamics of the Project Management Triangle tell us that for a fixed cost (input) and schedule, if I underestimate the scope (output), then I have planned for a lower than optimal productivity.  And Parkinson's Law law tells us that ...
Original Post Date: Wednesday, August 27, 2008 While working with clients who operate under fixed budgets I often hear, "Cost is not an issue when we plan and budget, so why is estimating important?".  I quickly stress that estimating is not just about cost.  It about balancing project scope, cost, time, benefits and risks. If your estimates are not accurate, your projects and portfolios are not optimized – and you are wasting money. Projects are planned and managed within scope, time, and cost constraints. These constraints are referred to as the Project Management Triangle.  Each side represents a constraint.  One side ...
Original Post Date: Friday, August 22, 2008 Software size measurement continues to be a contentious issue within the software industry.  While the software engineering community has made significant progress in it’s quest for the right way to assign value, the journey has not been without missteps and detours.  And there is still more work to be done. When I first started programming it never occurred to me to think about the size of the software I was developing.  This was true for several reasons.  First of all, back in the day, software had a tactile quality through the deck of punched ...
Original Post Date: Tuesday, August 19, 2008 Recently a client approached me with a thought provoking inquiry.  They were interested in performing historical trend analysis on their software projects to support estimating software costs for future technologies.  They have done this for years with hardware procurements and wanted to start performing the same kind of analysis for software. For hardware it’s not that hard to do, we have tangibles like RAM size, processor speed, resolution, etc. The question they had for me was “What are likely candidates on which to perform historical trend analysis for software”.  Think about it.  What ...
Original Post Date: Tuesday, August 12, 2008 I frequently attend trade shows and conferences focused on software development and/or cost estimating.  These shows provide a great opportunity for me to perform informal, unscientific surveys of the state of the software estimating discipline.  When queried on software estimating practices, more than half of those surveyed indicate a method that significantly resembles some attraction at a local carnival.  To the follow up question of “How’s that working for you?” the reply is almost always as expected – “Not too well”. As an industry we have failed pretty miserably at institutionalizing software estimating ...
Original Post Date: Tuesday, August 12, 2008 Nothing drives me crazier than the statement I get from many of our clients during that first meeting, "We are really bad at estimating. So what? Why does it matter? Management does not seem to care."  Business leaders have been duped into believing that inaccurate project estimates are not a concern and that they cannot do better - Wrong.  Bad estimates lower profitability and yes, you can do better.  Please consider that projects are prioritized and launched based on their expected costs and benefits, the return-on-investment (ROI).  So you optimize your portfolio ...
Original Post Date: Wednesday, August 6, 2008 Last week the U.S. Senate Committee on Homeland Security and Governmental Affairs held a hearing entitled "Offline and Off-budget: The Dismal State of Information Technology Planning in the Federal Government".  The prepared remarks by those who testified before the committee make good reading.  You can find them here. The committee focused on the many IT projects that are overrunning cost and schedule, giving most Federal Agencies failing grades on their budget management report card.  My experience while working with Fortune 500 companies is that they do not do much better - we just do ...
Original Post Date: Friday, August 1, 2008 If you are a baby-boomer like me and occasionally suffer from symptoms of mid-life crises it is important to answer the question, " What is the purpose of my work, my mission, my raison d'être?" So, I am starting this blog by taking a step away from the challenges on my desk at the moment to look at the big picture. Business leaders agree that reliable shareholder value lies in companies that sustain profitable growth and are "built to last". Hence, leaders focus on improving key performance indicators (KPIs) throughout their companies to ...
Original Post Date: Friday, August 1, 2008 Whether you are pricing a competitive bid, or you are trying to get a new product to market, estimating accuracy will determine your success or failure.  When pricing a competitive bid, you first want to “ghost the competition” to determine a price-to-win.  Parametric estimating models allow you to quickly estimate the cost of recently priced items from your competition to determine their bidding margins and target a likely price-to-win for a new competition.  I recently worked with one of our clients who has an extensive database of competitive bids from which he can determine ...