We talk a lot in the agile world about “delivering value”. It is the focus of almost every agile workshop I have attended, is a catchphrase in the agile world, and is the focus of agile projects. But how do we know if we are delivering value, if we are doing the right thing?
When we plan an agile project, one of the things we do is assign point estimates (tee-shirt sizing, team estimating, etc.) to provide a framework to understand the relative complexity of getting a story to “done”. We also prioritize these stories so that we work on the “most important” story first, leaving the least important stories until later in the project. But we need to go further.
One technique I use is to assign “value points”, which, like estimating points, are relative measures of the value returned by each story. But what do these points mean?
All projects should have a financial aspect to them, be it increased revenue, cost of entry into a new market, regulatory exposure, or something similar. This financial benefit should, of course, outweigh the cost of the project, yet I see projects dragging on and on, eating more of the potential profit from each project. How, then, do we know when to stop spending?