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Agile Project Management: Creating Innovative Products, Second Edition By

Jim Highsmith

……………………………………….. Publisher: Addison-Wesley Professional Pub Date: July 10, 2009 Print ISBN-10: 0-321-65839-6 Print ISBN-13: 978-0-32165839-5 Web ISBN-10: 0-321-65920-1 Web ISBN-13: 978-0-32165920-0 Pages: 432 Slots: 1.0

Table of Contents | Index

Copyright Praise for Jim Highsmith’s Agile Project Management, Second Edition Praise for Jim Highsmith’s Agile Project Management The Agile Software Development Series Acknowledgments About the Author Foreword Preface

Introduction

Conventions The Agile Software Development Series

Chapter 1.

The Agile Revolution

Agile Business Objectives Agility Defined Agile Leadership Values Agile Performance Measurement The APM Framework Performance Possibilities Final Thoughts

Chapter 2.

Value over Constraints

Continuous Flow of Customer Value Iterative, Feature-Based Delivery Technical Excellence Simplicity Final Thoughts

Chapter 3.

Teams over Tasks

Leading Teams Building Self-Organizing (Self-Disciplined) Teams Encourage Collaboration No More Self-Organizing Teams? Final Thoughts

Chapter 4.

Adapting over Conforming

The Science of Adaptation Exploring Responding to Change Product, Process, People Barriers or Opportunities Reliable, Not Repeatable Reflection and Retrospective Principles to Practices Final Thoughts

Chapter 5.

An Agile Project Management Model

An Agile Enterprise Framework An Agile Delivery Framework An Expanded Agile Delivery Framework Final Thoughts

Chapter 6.

The Envision Phase

A Releasable Product Envisioning Practices Product Vision Project Objectives and Constraints Project Community Final Thoughts

Chapter 7.

The Speculate Phase

Speculating on Product and Project Product Backlog Release Planning Final Thoughts

Chapter 8.

Advanced Release Planning

Release (Project) Planning Wish-based Planning (Balancing Capacity and Demand) Multi-Level Planning Capabilities Value Point Analysis Release Planning Topics Emerging Practices Final Thoughts

Chapter 9.

The Explore Phase

Agile Project Leadership Iteration Planning and Monitoring Technical Practices Coaching and Team Development Participatory Decision Making Collaboration and Coordination Final Thoughts

Chapter 10.

The Adapt and Close Phases

Adapt Product, Project, and Team Review and Adaptive Action Close Final Thoughts

Chapter 11.

Scaling Agile Projects

The Scaling Challenge An Agile Scaling Model Building Large Agile Teams Scaling Up—Agile Practices Scaling Out—Distributed Projects Final Thoughts

Chapter 12.

Governing Agile Projects

Portfolio Governance Portfolio Management Topics Final Thoughts

Chapter 13.

Beyond Scope, Schedule, and Cost: Measuring Agile Performance

What Is Quality? Planning and Measuring Measurement Concepts

Outcome Performance Metrics Output Performance Metrics

Shortening the Tail Final Thoughts

Chapter 14.

Reliable Innovation

The Changing Face of New Product Development Agile People and Processes Deliver Agile Products Reliable Innovation The Value-Adding Project Leader Final Thoughts

Bibliography

Index

Agile Computing Software Engineering Jim Highsmith Addison-Wesley Professional Agile Project Management: Creating Innovative Products, Second Edition

Copyright Many of the designations used by manufacturers and sellers to distinguish their products are claimed as trademarks. Where those designations appear in this book, and the publisher was aware of a trademark claim, the designations have been printed with initial capital letters or in all capitals.

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Library of Congress Cataloging-in-Publication Data

Highsmith, James A., 1945- Agile project management : creating innovative products / Jim Highsmith. p. cm. Includes bibliographical references and index. ISBN-13: 978-0-321-65839-5 (pbk. : alk. paper) ISBN-10: 0-321-65839-6 (pbk. : alk. paper) 1. Software engineering. 2. Agile software development–Management. I. Title. QA76.758.H54 2010 005.1–dc22

2009019147

Editor-in-Chief Karen Gettman

Executive Editor Chris Guzikowski

Senior Development Editor Chris Zahn

Managing Editor Patrick Kanouse

Project Editor Mandie Frank

Copy Editor Margo Catts

Indexer Tim Wright

Proofreader Kathy Ruiz

Publishing Coordinator Raina Chrobak

Cover Designer Louisa Adair

Compositor Mark Shirar

Copyright © 2010 Pearson Education, Inc.

All rights reserved. Printed in the United States of America. This publication is protected by copyright, and permission must be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise. For information regarding permissions, write to:

Pearson Education, Inc Rights and Contracts Department 501 Boylston Street, Suite 900 Boston, MA 02116 Fax (617) 671 3447

This material may be distributed only subject to the terms and conditions set forth in the Open Publication License, v1.0 or later (the latest version is presently available at http://www.opencontent.org/openpub/).

ISBN-13: 978-0-321-65839-5

Text printed in the United States on recycled paper at RR Donnelley, Crawfordsville,

Indiana.

First printing July 2009

Dedication To Wendie, Debbie, and Nikki

Agile Computing Software Engineering Jim Highsmith Addison-Wesley Professional Agile Project Management: Creating Innovative Products, Second Edition

Praise for Jim Highsmith’s Agile Project Management, Second Edition “This second edition is a remarkable palimpsest that overlays critical enterprise aspects such as scaling agile, governing agile projects, and measuring agile performance onto its original, award-winning agile project management foundation. If you’re an agile manager or executive seeking a holistic understanding as well as the critical details of agile project management—this edition will be a very valuable addition to your bookshelf.”

—Sanjiv Augustine, President, LitheSpeed and Author of Managing Agile Projects

“Jim continues to successfully communicate complex project management concepts and interactions in an easily digestible manner. The breadth and depth of practical agile experience, insight, and guidance is immense. In typical fashion, he tempers ‘agile religion’ with the reality that agile development is not right for every situation or everyone.”

—Robert Holler, President and CEO of VersionOne

“This book is one of the very best on the topic of agile methods for project management, offering profound concepts and actionable guidelines. Stressing the need to abandon the old paradigm of “following a plan with minimal changes,” in favor of “adapting successfully to inevitable changes,” this book is one of those rare books suitable for both novice and seasoned project managers.”

—Alexander Laufer, Director, Center for Project Leadership, Columbia University author, Breaking the Code of Project Management

“Jim’s second edition is a timely update that extends this decade’s progress to the Project and Program Managers making the transition to agile project management. This edition expands on the topics of governance and performance management, helping PMs shape new models of adaptability, serving teams and continuous value delivery. It addresses the critical questions that PMs face in release planning, backlog preparation, capacity planning, and risk reduction. Jim knows how to talk to project managers, detailing agile phases that lead to adaptable learning and creating greater value in spite of high expectations and constraints. This is the one handbook on agile project management I would recommend for any business or technical leader who has a hand in the agile community.”

—Ryan Martens, CTO & Founder, Rally Software

“Envisioning a different way of working begins with a shift in thinking. Jim Highsmith shares an exciting vision and the new way of thinking behind the Agile Revolution in his latest book, Agile Project Management. Through storytelling and examples, Jim draws us into appreciating a new way of fostering creativity and innovation. This is required reading for anyone looking for a fresh perspective that can change the

way teams develop new products.

Antoine de Saint-Exupery once said, ‘If you want to build a ship, don’t drum up people together to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea.’ Agile Project Management helps us chart a course along those lines. There’s no doubt that great products and a new way of how teams work together will be the result.”

—Michael Mah, Director, Benchmarking Practice, Cutter Consortium and Managing Partner, QSM Associates Inc.

“I have always considered the first edition of Jim Highsmith’s Agile Project Management to be the source for information on agile project management and good project management in general. In the second edition, Jim has done a great job of extending coverage to the key aspects of spreading agile thinking to portfolio management and the rest of the organization. Again, a must have for a project, program, or portfolio manager’s book shelf.”

—Kent J. McDonald, Program Manager

“It’s been almost twenty years since Jim and I first started to collaborate. Jim was always fond of saying that more has been written about Software Development than is known. In this second edition of Agile Project Management, Jim’s writing has finally caught up with all that needs to be known. The rest is up to you and your experiences.”

—Sam Bayer, Ph.D., CEO b2b2dot0

“When Jim’s first APM book hit the shelves five years ago it added much needed structure to project and product release planning levels. His APM principles and practices have been widely and successfully adopted worldwide. In this edition Jim adds many new insights, values, principles, and practices based on his extensive experience helping large enterprises scale their agility across projects, programs, products, and divisions. This latest edition is chock full of valuable new ideas and practical applications.”

—Ken Collier, Ph.D., Agile Consultant and Author

“In this new mainstream world of agile adoption, Jim walks a wonderful and generous line for new and seasoned project managers alike. Jim still has the beginner agile project manager in mind, offering his very clear ideas backed by immediately applicable practices. He continues his agnostic view of agile by sticking to tools for the project manager, regardless of any particular agile framework or method. In this second edition, Jim has remained vigilant to the agile project manager’s success, adding thought-provoking guidance for the bigger agile world.”

—Jean Tabaka, Agile Fellow, Rally Software

“No one makes agile project management as clear, compelling, and real as Jim Highsmith—and without coming off as a cheerleader. His models of agile project management just make sense and important—no, essential—agile nuggets can be found on every page. In particular, Chapter 13, “Beyond Scope, Schedule, and Cost: Measuring Agile Performance,” is required reading. I’m recommending it to all my clients. So read Agile Project Management if you value performance over politics.”

—Christopher Avery, Ph.D., Leadership Mentor, www.ChristopherAvery.com

“Jim challenges conventional wisdom and provides excellent examples of the leadership mindset shifts needed to successfully implement Agile Project Management for products. A must read for all product and project managers.”

—Ron Holliday, Vice President, Financial Services, Fidelity Investments

“There is no better source of wisdom on agile project management than Highsmith’s second edition. A master of explaining all sides of a story, Highsmith helps you understand exactly why traditional project management fails to deliver in a competitive world and how agile management provides a faster, more adaptive and customer-focused process. I love Jim’s real-world stories of companies that are thriving with agile, his in-depth coverage of essential agile management practices, and his innovative ideas on agile governance.”

—Joshua Kerievsky, Founder, Industrial Logic, Inc.

Agile Computing Software Engineering Jim Highsmith Addison-Wesley Professional Agile Project Management: Creating Innovative Products, Second Edition

Praise for Jim Highsmith’s Agile Project Management “Jim Highsmith is one of a few modern writers who are helping us understand the new nature of work in the knowledge economy. A transition—from industrial-age thinking to management more suited to reliable innovation—is well underway. But few people yet understand the implications of this shift. Agile Project Management explains what’s going on with startling clarity. Perhaps more importantly, it provides the vital management structure and practical advice that will support ongoing innovation in your company.”

—Rob Austin, Assistant Professor, Harvard Business School

“There is a lot of attention these days being given to whether organizations are harvesting the maximum benefits from their IT investments. This book is totally in alignment with that theme and should be a must-read for all project participants who are passionate about their projects delivering ‘value for money.’

“The one constant in the vast majority of large projects I see in my role as Project Management Practice Manager for Fujitsu Consulting is change. Yet, true to the observations that Jim has made in this book, the majority of these projects have been executed as if change is not the norm and as if the project initiators were ‘seers’ who could foretell the future with a high degree of certainty. These projects were run on the basis of traditional project management practices, where, simplistically speaking, the project plan was ‘king,’ and performance was measured and couched in terms of ‘delivery to plan.’

“In the past 12–18 months, Fujitu Consulting has seen the potential benefits of adopting more ‘Agile’ approaches in the way we deliver and manage some of our projects and have encouraged our clients to embrace an ‘adaptive’ project culture.”

—Karen Chivers, Senior Consulting Director and Project Management Practice Manager, Fujitsu Consulting (Asia Pacific)

“There is a common set of values that all the Agile methods share, and, in this book, Jim Highsmith uses those values plus his knowledge of the Agile methods to present a common framework for Agile project management. Jim shows us what an Agile approach to project management is about—the essential insights and experiences—plus he expertly combines tools and techniques with proven project management value, those of his own and those from other methods, into this framework.”

—Jeff De Luca, Project Director, Nebulon Pty. Ltd. (Australia)

“Jim’s book, Agile Project Management, addresses one of the key questions asked when adopting an Agile software development methodology, ‘How do you manage the project?’ He spends a lot of time on the values and principles needed to be successful in a less bureaucratic development environment. It requires individual discipline and a substantial mindset shift by all parties. He has done an excellent job

of documenting the behaviors that will create a winning team, no matter what process is being used. I applaud Jim for creating a book that will help take the Agile movement to a new level.”

—Christine Davis, Visiting Scientist, Carnegie Melon University/former Executive Vice President and General Manager, Raytheon

“Welcome to the second generation of Agile methodologies! Agile Project Management is an Agile methodology thoughtfully built on the key ideas and experiences of other AMs. The result is a coherent whole, from principles to practices. If your job is to deliver serious software, keep this book at hand on your library, since in the next ten years you will use it too many times!”

—Michele Marchesi, Professor of Software Engineering, University of Cagliari, Italy

“The world of product development is becoming more dynamic and uncertain. Many managers cope by reinforcing processes, adding documentation, or further honing costs. This isn’t working. Highsmith brilliantly guides us into an alternative that fits the times.”

—Preston G. Smith, Founder and Principal of New Product Dynamics/Coauthor, Developing Products in Half the Time

“Finally a book that reconciles the passion of the Agile software movement with the needed disciplines of project management. Jim’s book has provided a service to all of us.

“Agile software development is largely a grass-roots movement that focuses on reliably delivering software products in a dynamic world. To date, much of the Agile literature has focused on the engineering practices that support an Agile philosophy, and thus the coverage of project management has been limited. In this book, Jim Highsmith addresses project management in the Agile environment. He doesn’t limit this coverage to simply making a case for a new style of project management. Rather, Jim also offers a practical framework and supporting practices that project managers can use to help software development teams be more productive and reliably deliver products that add business value.”

—Neville R(oy) Singham, CEO, ThoughtWorks, Inc.

“Software development is a human activity, although we sometimes try to deny that fact by wrapping high ceremony processes and tools around our teams which, if unleashed, can produce some truly amazing things. Jim knows this all too well from his broad experience in working with a variety of projects, and that experience shines through in this very pragmatic and much needed take on Agile project management.”

—Grady Booch, IBM Fellow

“Agile methods, whether for software development, project management, or general product development, are the ideal approach for building things where change is a risk factor. Everywhere? Highsmith clearly shows how iterative development methods can be successfully applied to project management generally. It is truly groundbreaking when methods refined in the software space can actually inform other disciplines.”

—Charles Stack, Founder and CEO, Flashline, Inc.

“This is the project management book we’ve all been waiting for—the book that effectively combines Agile methods and rigorous project management. Not only does this book help us make sense of project management in this current world of iterative, incremental Agile methods, but it’s an all-around good read!

“Many IT organizations have made a mess of Agile methods and component development. Organizations that abandoned waterfall methods for undisciplined software hacking have given Agile methods a bad reputation in some businesses. A cure for these woes can be found in Jim Highsmith’s new book. You really can combine the benefits of Agile methods with project management disciplines. Jim shows us the way.”

—Lynne Ellyn, Senior VP & CIO, DTE Energy

“Jim Highsmith’s Agile Project Management is a refreshing change in the flow of project management books being published today. The book combines project management theory and practice cast in common-sense terms in a manner valuable to both the student and user. The author’s recasting and renaming of the phases of a project life cycle adds an approach likely to be emulated in the future literature in this discipline.

“His treatment of the general principles to be followed in the Agile Revolution for new product development provides a model of behavior valuable to the enlightened scholar and practitioner of the project management process.”

—Dr. David I. Cleland, Professor Emeritus, Industrial Engineering Department, School of Engineering, University of Pittsburgh

“Product development in the 21st century must move from the world of structure and compliance to one of agility and rapid learning. As a result, project management must change from the administration of tasks to the flexible balancing of possibilities against constraints—’managing on the edge of chaos,’ as the author puts it. This book explains the process of doing just that and should be the foundation for change—readable, full of logic, and a sound process.”

—Michael Kennedy, President, Product Development Solutions/Author, Product Development for the Lean Enterprise

“This is a wonderful and highly practical book. Within hours of putting it down I was

putting some of its advice into practice. It’s a highly thought-provoking book that argues, for instance, that agility is more attitude than process and more environment than methodology. Because of the complexity of today’s software projects, one new product development project can rarely be viewed as a repeat of a prior project. This makes Highsmith’s advice to favor a reliable process over a repeatable one particularly timely and important.”

—Mike Cohn, President, Mountain Goat Software/Author, User Stories Applied: For Agile Software Development

“Jim’s book removes the mystery around Agile project management and its associated techniques while providing a framework of discipline that can be easily applied to any high-tech development and is not limited to software development.”

—Ken Delcol, Director, Product Development, MDS SCIEX

“Iterations are clearly the best way to create the innovative products that customers want to buy. Agile Project Management contains a wealth of ideas and insights about how to make a flexible product development process work.”