Identifying Agile Project Fit

Detailed elements to investigate on these four dimensions are available in the last unit.​

This figure, Preconditions Agile – What It Takes, provides a great summary of preconditions for an Agile project.​

​

The Cone of Uncertainty is a term often used in project management to describe the phenomenon by which project unknowns decrease over time. Understanding the principle behind the cone of uncertainty can help project managers and analysts as they estimate projects.​

The cone of uncertainty is a graphic depiction of the increasing accuracy that's possible for estimates as the details of a project become more known over time. Project managers and developers use the cone of uncertainty to guide estimates and to manage expectations.​

The term Cone of Uncertainty is used in software development where the technical and business environments change very rapidly. ​

However, the concept, under different names, is a well-established basic principle of cost engineering. ​

Most environments change so slowly that they can be considered static for the duration of a typical project, and traditional project management methods, therefore, focus on achieving a full understanding of the environment through careful analysis and planning. Well before any significant investments are made, the uncertainty is reduced to a level where the risk can be carried comfortably. ​

In this kind of environment, the uncertainty level decreases rapidly in the beginning and the cone shape is less obvious. ​

The software business, however, is very volatile and there's an external pressure to decrease the uncertainty level over time. The project must actively and continuously work to reduce the uncertainty level.​

The Cone of Uncertainty is narrowed both by research and by decisions that remove the sources of variability from the project. These decisions are about scope, what's included and not included in the project. If these decisions change later in the project, then the cone will widen – and you’ll end up with an hourglass shape instead.​

Note that the Cone of Uncertainty concept is independent of both of the following:​

• The billing approach (Time and Material versus Fixed Price Project)​

• The methodology (Waterfall versus Agile)​

The difference between Agile and the traditional (Waterfall) approach is how the knowledge about the cone of uncertainty is used by the project and product management team.​

The frequent reviews of the product increment that happens at the end of every cycle is the manner in which the Agile approaches are attempting to reduce the uncertainty. Feedback is received and real business needs are identified this way. Cycle by cycle, the estimation of the remaining work is improved based on the gained knowledge.​

Another difference in the Agile approach is that the cost/budget utilization is kept within some guardrails and the scope is adjusted to fit these guardrails while also making sure that the minimum viable product is created. After the core functionalities are secured, the additional functionalities are implemented ordered by value, until the budget is consumed.​

Note that the conditions that challenge Agile aren’t complete no-goes. Instead, they’re risk elements that need mitigating.​

Probably more than traditional waterfall, Agile needs to be tailored on a case-by-case basis, and some features are more often usable than others.​

This is one of our early examples of Agile projects. In this case, it's a regulated utility business in Europe.​

This figure shows a fast track solution implementation in the United States.​