Is there a natural tension between agile development and traditional cost management or do we need to return to basic principles? Even when you are flexible, you still need to make a plan, build an estimate and measure what you have achieved.

1. IT Cost Management
Summit
Philharmonie Haarlem
The Netherlands
Paul Marston
Senior Vice President
SPA International Division
4 October 2022
Agile Development and Agile Cost Estimating:
A Return to Basic Principles

2. Overview
2
• A little on my background and perspective
• Agile is everywhere these days…
• But what is it really?
• A natural tension between Agile Development, Traditional
Management Practices, and Cost Estimating Methodologies; Are
they incompatible?
• A Return to Basic Principles
• The best of all possible worlds…

3. Background and Perspective
3
Advanced Analytics
• Data Science
• Modeling & Simulation
• Cost Estimating
• Schedule Analysis
• Risk Analysis
• Operations Research
Systems Planning & Analysis, Inc.
Strategy, Policy,
Compliance
• Defense Strategy &
Policy
• Cyber Policy
• Deterrence Stragety
• Arms Control &
Compliance
Agile Development
• Product Management
• SCRUM
• Full Stack Development
• UI/UX
• Cyber Security
Systems Engineering
& Safety Analysis
• Systems Engineering
• Systems Safety
• Operations Analysis
• Model Based Systems
Engineeing
Project Management
• Acquisition Planning
• Risk Management
• Systems Engineering
• Test & Evaluation
• Financial Management
DHS
Coast
Guard
DOE
OSD
DARPA
Marine
Corps
Navy
Space
Force
NASA
Australia DF
Air Force
Joint
Staff Army

4. Background and Perspective
4
Advanced Analytics
Operations Research
Data Science
Modeling and Simulation
Wargaming
Predictive Analytics
Risk Assessments
Analysis of Alternatives
Agile Software Development
Software Innovation Lab
CMMI Level 3 for Software Development
State of the Art Modeling Environment
Systems Engineering & Safety Analysis
Systems Engineering
System Safety Engineering
Research and Development
Testing and Evaluation
Operations Management
Engineering Management
Model-Based Systems Engineering
Strategy, Policy & Compliance
Defense Strategy and Policy
Cybersecurity Policy
Deterrence Strategy and Assessments
Arms Control and Treaty Analysis
Organizational Structure and Process Development
Strategic Planning and Decision Support
Program & Acquisition Management
Program and Project Management
Risk Management
Business and Financial Management
Knowledge Based Solutions

5. Agile is everywhere these days
5
agile
agile
software
agile development
agile acquisition
agile procurement
agile
contracting
agile defense
SCRUM
epic
sprint
Backlog
manifesto
feature
story

6. But what is it really?
6

7. Get to work / Be Flexible Plan / Execute Plan / Data-Driven / Measurable
A natural tension; Are they incompatible
7
Agile Manifesto
• Uncovering better ways
of developing software
by doing it
• Individuals and
interactions over
processes and tools
• Working software over
documentation
• Customer collaboration
over contract negotiation
• Responding to change
over following a plan
Traditional Management
• Set objectives and
planning
• Organizing
• Motivating and
Communicating
• Measuring performance
• Developing people
* Peter Drucker
Estimating Methods
• Planning
• Understanding
• Documenting
• Data-based
• Probabilistic
• Measure & Assess
• Learn

8. A return to basic principles
8
Establish a Technical Baseline
Define Ground Rules & Assumptions
Gather Data & Normalize
Develop Appropriate Methodologies
Consider Risk, Uncertainty, and Calculate Probabilistic Estimates
Put Estimates at the Center of Project Plans
Measure, Evaluate, Learn and Implement Process Improvements

9. A return to basic principles
9
Establish a Technical Baseline
Define Ground Rules & Assumptions
Gather Data & Normalize
Develop Appropriate Methodologies
Consider Risk, Uncertainty, and Calculate Probabilistic Estimates
Put Estimates at the Center of Project Plans
Measure, Evaluate, Learn and Implement Process Improvements

10. A return to basic principles
10
Establish a Technical Baseline
Define Ground Rules & Assumptions
Gather Data & Normalize
Develop Appropriate Methodologies
Consider Risk, Uncertainty, and Calculate Probabilistic Estimates
Put Estimates at the Center of Project Plans
Measure, Evaluate, Learn and Implement Process Improvements

11. The best of all possible worlds…
11
• Maybe agile will be replaced with something new in coming years
• But it’s here now, and part of continuum to improve and become
more effective
• Cost estimators must play a constructive role in the process by
– Being relevant
– Faster and, yes, more agile
– Balance good estimating practices with the pace of the agile process
– Gather new data, apply sound analytic techniques, and learn
– Agile needs data-driven analysis to push development resources toward
activities that will meet overarching requirements