Negotiating Agile Contracts - Agile Alliance · Consider the Agile Manifesto This document, created by those many consider to be the founders of the Agile movement, describes the
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Angela Druckman & Jimi Fosdick
Certified Scrum Trainers and Agile Process Mentors
adruckman@collab.net
Negotiating Agile Contracts
Creating Effective Agreements for Guiding Agile
Projects
2 Copyright © 2011 CollabNet, Inc. Portions used with permission. All Rights Reserved.
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Overview
•Introductions
•The purpose of a contract
•The Agile Manifesto
•Characteristics of a good Agile contract
•Defining a project goal
•Describing roles and responsibilities
•Agile project artifacts
•Change management
•Writing the contract
•Final words of advice
3 Copyright © 2011 CollabNet, Inc. Portions used with permission. All Rights Reserved.
3
A Bit About Us
Angela Druckman, CST
Having served as a Product Owner, ScrumMaster and team member, Angela Druckman has
seen first-hand how Agile practices and Scrum in particular can lead organizations to project
success. As one of CollabNet’s Certified Scrum Trainers and a member of its Agile Thought
Leadership team, she helps organizations harness the benefits of Agile practices through
public and private courses, as well as onsite private Agile Transformation coaching.
Jimi Fosdick, PMP, CST
With more than 14 years of experience in product development, Jimi Fosdick has worked in
a wide range of industries, including publishing, software, advertising, and the public sector.
As one of CollabNet’s Certified Scrum Trainers, he conducts dozens of public courses
around the world each year, helping organizations to surface dysfunction and improve
processes through Scrum.
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What is the Purpose of a Contract?
Why do organizations create contracts with
outside entities like consultants, contractors
and partners? Is it to:
• Provide an exhaustive description of the work to
be done?
• Describe all deliverables and expectations in
detail?
• Make sure they have an advantage over the
other party?
When you set out to make any signed
document a weapon you limit its value!
5 Copyright © 2011 CollabNet, Inc. Portions used with permission. All Rights Reserved.
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Consider the Agile Manifesto
This document, created by those many consider to be the
founders of the Agile movement, describes the follow Agile
values:
• Individuals and interactions over processes and tools
• Working software over comprehensive documentation
• Customer collaboration over contract negotiation
• Responding to change over following a plan
Every choice has a cost and being too fixed in a work
plan is no different!
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Characteristics of a Good Agile Contract
Creating an effective Agile contract is about both
understanding agreements and providing options.
A good Agile contract will have some or all
of these characteristics. It will:
•Describe the project goal
•Denote roles and responsibilities
•List key artifacts
•Explain the change management process
•Provide estimates
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What is a Project Goal?
A project goal is not the same as a list of requirements! It
describes the target at which you are aiming. Once you agree
on that target, the path there can vary.
• Hire caterers
• Clean house
• Order cake
• Book DJ
• Purchase decorations
• Choose photographer
vs. Plan a birthday party for 25
guests
A key benefit of Agile is that, once a project goal is
defined, the path to get there can flex.
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Describing Roles and Responsibilities
Agile methods like Scrum rely on clear paths
of responsibilities to be effective. Your Agile
contract should describe:
•Which party will fulfill the Product Owner
role and what that role entails
•Consultants - keep in mind a client Product
Owner is always more work for you
•Clients – fulfilling the Product Owner role is a
great way to control project costs
•The approval process for calling product
backlog items “done”
•Team member rights and responsibilities
•Which party will fulfill the ScrumMaster role
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Agile Project Artifacts
In the beginning, it can be simplest to continue to
use most or all of your standard project
documentation, with the following tweaks:
•Make BRDs, HLDs, DDDs, etc “living
documents” that are updated each sprint and
signed at the end of the project
•Clearly state that the team will be committing to
work from the Product Backlog exclusively
•Use references in user stories/ product backlog
items to refer back to larger documentation
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Change Management – No more CCRs!
• Clients will no longer be required to
create client change requests (CCRs) to
ask for requirement changes. They can
simply revise the product backlog
•Quite possibly the biggest selling point to clients
when offering an Agile approach to a project
•Emphasize clients can and should do this every
sprint
•Re-emphasize that whatever is at the top of the
product backlog is what the team is going to build
•“Money for nothing, change for free”
The change management section of your contract will likely
change dramatically!
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Providing Estimates
It is reasonable for a customer to want to know how much a body of
work is likely to cost. Agile contracts can provide estimates in:
•Releases
•Example: “Based on known requirements we think this work will require a team
of 5 staff 4 releases to complete, with a release occurring on the 10th day of
every other month.”
•Sprints
• Example: “Based on known requirements we think this work will require a team
of 5 staff 8 sprints to complete, plus or minus one sprint.”
•Hours
•Example: “Based on known requirements we think this work will require a team
of 5 staff a total of 675 hours to complete +/- 15%.”
Where do these estimates come from? They come from…
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The Statement of Work Sprint
•Define the project goal
•Build the beginnings of the product backlog
•Assemble the team
•Determine roles and responsibilities
•Create estimates
The deliverable, or sprint goal, of an SOW sprint is the contract itself.
It can be reviewed and signed at the Sprint Review meeting and the
team can begin creating software the next day.
SOW sprints can provide clients huge cost savings
over traditional requirements gathering phases!
An SOW sprint is not the same thing as a requirements sprint – it is
much more valuable! In it you can:
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Some final words of advice…
•Value the ability to define and the ability to
flex
•Try to maximize both to your advantage
•Involve your audit group early in the process
•Let the right path emerge
•Make use of your organization’s “Exception Form”
or similar document in the beginning
•Realize and believe that contracts can be
mutually beneficial
•Get help from a coach that has experience
writing Agile contracts
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