Software by Numbers: Low-Risk, High-Return Development

Software by Numbers is a significant new contribution to value-based, financially responsible software engineering...—Barry Boehm, Ph.D., Director, USC Center for Software Engineering, Creator of COCOMO and Spiral Model

Link software development to value creation and optimize ROI.

Ultimately, software development is about creating value—yet, all too often, software fails to deliver the business value customers need. This book will help you change that, by linking software development directly to value creation. You'll learn exactly how to identify which features add value and which don't—and refocus your entire development process on delivering more value, more rapidly.

Software by Numbers shows you how to:

• Identify Minimum Marketable Features (MMFs)—the fundamental units of value in software development
• Accelerate value delivery by linking iterative development to iterative funding
• Optimize returns through incremental architecture techniques
• Effectively involve business stakeholders in the development process
• Sequence feature delivery based on "mini-ROI" assessments
• Quantify financial risk at every step throughout the development process
• Manage "intangibles" throughout the software development process

Whatever methodology you're already using—whether it's RUP or XP—this book shows how to achieve the goals that matter most to your business: reduced risk, better cash flow, and higher ROI.

Table of Contents

Preface.

1. Software Development after dot.com.

Software Development Is Easy. There's a Method to the Madness. If History Teaches Us Anything… Minimum Marketable Feature. MMF Selection. Opening the Black Box of Software Development. Risk Control. Sigma Techniques. Summary. References.

2. The New ROI.

Applications and ROIs. Why ROIs Matter. The Business Case. Cash Flow Projections. Payback Time. Present Value of Future Money. Net Present Value. Breakeven Time. Internal Rate of Return. Summary of the Terms. An Example. Incorporating MMFs into the Financial Case. Comparing the MMF-based ROI with the Classic ROI. Taking the Risks into Account. The Impact of MMF Ordering. Summary. References.

3. Identifying and Valuing Marketable Features.

Incremental Funding Methodology. Minimum Marketable Features. Candidate MMFs. Determining the Value of an MMF. Development and Delivery Precursors. The MMF Precedence Graph. Architectural Precursors. Summary. References.

4. Incremental Architecture.

The Place of Architecture. Architecture versus Rules. The Problem with Architecture. Pieces of the Pattern. A Value-Driven Approach. The Codependency of Architecture. Taking Architecture in Easy Stages. A Different Decomposition. One-to-Many Dependencies in Architecture. Architectural Coherency. Multiple Inheritance in Architecture. Spiral Architecture. Summary. References.

5. IFM Sequencing Strategies.

Delivering Valued Features. Cost versus Value Analysis. Cost-Benefit Analysis of an MMF Delivery Sequence. The Complexity of the Task. MMF Sequencing Strategies. The Greedy Approach. A Simple Look-Ahead Approach. The Weighted Look-Ahead Approach. Sequencing MMFs and AEs. Risk Mitigation. Iterating the Sequencing Decision. Summary. References.

6. MMF Categories and Parallel Development.

The Impact of MMF Behavior. Time-Sensitive Delivery. Exponential Growth Patterns. Concurrent Development. Summary. References.

7. Managing Intangibles.

Apples and Oranges: Dealing with Intangibles. Managing Intangibles. A Pairwise Approach to Quantifying Intangibles. Hybrid MMFs. The Impact of Intangibles on the Cost-Benefits Analysis. Baseline NPV. Potential NPV. Lost Opportunity Costs. Summary. References.

8. IFM and the Unified Process.

Introduction. Inception. Elaboration. MMF Development and Delivery. MMF Design. MMF Construction. MMF Selection Revisited. Summary. References.

9. IFM and Agile Development.

The Challenges. Incremental Development the Agile Way. Clustering User Stories into MMFs. Release Planning: Bundling User Stories in Releases. Assessing the NPV of the Release Plan. Release Planning Meeting. The Architecture Question. Simplest versus Look-Ahead Solution. Other Agile Development Environments. SCRUM. Summary. References.

10. Informed Decision Making.

A Collaborative Approach. Getting a Project Funded. Manipulating Project Characteristics. The IFM Window. Implementing IFM Processes. The Impact of IFM Strategies on Commercial Frameworks. How Management Benefits from IFM. When Projects Go Wrong. Where Next? Summary. References.

11. A Case Study: IFM in Action.

Introduction. IFM Element Definition Phase. Financial Phase. Computation Phase. Measuring the Effectiveness of the IFM Heuristic. ROI Analysis. Cash Flow and Breakeven Time. Summary.

Appendix A.

Appendix B.

Index.