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IMPROVE ESTIMATION MATURITY
using Functional Size Measurement and Industry Data
INTRODUCING ME
Drs. Harold van Heeringen, Senior Consultant ADM Benchmarking at METRI.
• Netherlands Software Metrics Asso...
OVERVIEW
• Industry estimation maturity
• Effect of low maturity
• Maturity levels
• FPA
• Estimate with FPA
• Historical ...
SOFTWARE PROJECT RESULTS
4 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
IMPACT
• Deliver too late: losing business.
• Fail/stop: loss of time, money,
business and still no solution for
the probl...
SOFTWARE ESTIMATION MATURITY
• Software project industry: low maturity
• Low estimation maturity;
• No or little formal es...
RESULTS OF LOW ESTIMATION MATURITY
• Many projects are not estimated in a professional way
• Only expert estimates, no use...
ESTIMATION MATURITY MODEL*
8 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Developed by Dan Galorath – www.galorath...
REALISTIC ESTIMATES
A realistic estimate is one of the most important conditions for a successful
project.
The estimate is...
LOW/HIGH ESTIMATES
10 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Non-linear extra costs
-Planning errors
-team e...
LEVEL 1 AND 2 ESTIMATES
• Bottom-up , assign effort hours to work items, based on knowledge and experience
• Advantages:
•...
OVERVIEW
12 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Expert
Estimates
Level
1 and 2
TWO WAYS TO ESTIMATE
13 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Objective
Size
Effort
Cost
Estimating &
Bench...
OVERVIEW
14 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Parametric
Estimates
Level 3-5
FUNCTIONAL SIZE
 What the software should be able to do (functionality) Functional
expressed in a number Size
based on an...
FUNCTION POINT ANALYSIS (FPA)
• Can be used early in the project, when functional requirements are known
• Independent of ...
BASIC ESTIMATION MODEL
17 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
measures
risk analysis
risks
consequences
F...
TIME VS COST
18 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Paul Masson’s
Law
Parkinson’s
Law
Brooks’
Law
Minimal...
TEAM SIZE: IMPACT ON PRODUCTIVITY
19 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Larger team size means lower
ove...
OVERVIEW
20 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
EffortorCost
Duration
Impossible
zone
Impractical
zone
Mi...
OVERVIEW
21 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
Price/FP
Duration (months)
Impossible
zone
Impractical
zo...
HISTORICAL DATA
• Parametric estimation models need historical data to estimate
• Preferred for estimation: data of the co...
INTERNATIONAL SOFTWARE BENCHMARKING STANDARDS GROUP
• Independent and not-for-profit;
• Full Members are non-profit organi...
OVERVIEW
7500 rows in Excel, Easy to analyze
24 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
EXAMPLE
• Data Quality: A or B
• Year of Project > 2012
• Project Type: Enhancement
• Primary Programming language: Java
•...
PARAMETRIC ESTIMATION IN PRACTICE
• Parametric Estimation is carried out by a number of ‘more mature’
organizations:
• Glo...
FPA INTERNATIONAL
• Brazil: FPA used intensively in software contracts: Price per FP
• Especially early methods (Nesma)
• ...
COUNTRY REPORT
• 12 countries
- >40 projects submitted
- Australia
- Brazil
- Canada
- Denmark
- Finland
- France
- India
...
PRODUCTIVITY PER COUNTRY (HOURS/FP)
29 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
0
2
4
6
8
10
12
14
16
18
PDR
M...
SPEED (FP PER CALENDAR MONTH)
30 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
0
10
20
30
40
50
60
70
Speed
Mediaan...
MANPOWER DELIVERY RATE (FP/PERSON PER MONTH)
31 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
0
5
10
15
20
25
Manpo...
QUALITY (DEFECTS PER 1000 FP)
32 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
0
10
20
30
40
50
60
Defectdensity
Me...
INTERNATIONAL COOPERATION
• China SPI / IQ Alliance starts working together with international parties to
improve estimati...
THANK YOU!
34 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
@haroldveendam
haroldveendam
www.linkedin.com/in/harold...
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Improve Estimation maturity using Functional Size Measurement and Historical Data

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Many software projects still fail in recent years, also agile projects. Improving estimation maturity in order to start with a realistic estimate instead of an optimistic one can really save billions of dollars in most local software industries. The Chinese government may now be moving towards an active software estimation maturity improvement strategy in its new 5-year plan. Functional size measurement and relevant historical data as well as parametric estimation tools are key to such a strategy. This presentation was the key-note speech at the China System and Software Process Improvement Association conference on software estimation, Beijing China, May 27 2016.

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Improve Estimation maturity using Functional Size Measurement and Historical Data

  1. 1. IMPROVE ESTIMATION MATURITY using Functional Size Measurement and Industry Data
  2. 2. INTRODUCING ME Drs. Harold van Heeringen, Senior Consultant ADM Benchmarking at METRI. • Netherlands Software Metrics Association (NESMA) – board member and chairman of the working groups ’Benchmarking’ and ‘FPA in contract(ing)’ • International Software Benchmarking Standards Group (ISBSG) – President • Common Software Measurement International Consortium (COSMIC) - Dutch representative in the International Advisory Council (IAC) • Dutch Association for Cost Engineers (DACE) – working group parametric analysis • ICEAA trainer of CEBoK chapter 12: Software Cost Estimation • Speaker at many conferences on software measurement, estimation and benchmarking Slideshare: haroldveendam twitter: @haroldveendam LinkedIn: www.linkedin.com/in/haroldvanheeringen 2 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  3. 3. OVERVIEW • Industry estimation maturity • Effect of low maturity • Maturity levels • FPA • Estimate with FPA • Historical data • Use in the industry 3 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  4. 4. SOFTWARE PROJECT RESULTS 4 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  5. 5. IMPACT • Deliver too late: losing business. • Fail/stop: loss of time, money, business and still no solution for the problem that needed to be solved. • Waste of resources that could have been deployed successfully otherwise. 5 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Failing IT projects cost the Dutch government 7 billion USD per year Projects > 10 million USD only 7% succeeds. In total, only 30% of IT projects are successful. These are tax dollars and one of the reasons the whole country was in recession for years.
  6. 6. SOFTWARE ESTIMATION MATURITY • Software project industry: low maturity • Low estimation maturity; • No or little formal estimation processes ‘expert estimates’ • No or little use of historical data  ‘experience’ • Customers chose suppliers based on price, not reality • Immature project estimation techniques results in low estimates • Unrealistic optimism results often in complete failure! • Lots of schedule and cost overruns • Standish Chaos reports: Most projects fail or are at least unsuccessful • No learning of mistaken, failing over and over again • Low customer satisfaction rates • In Europe: only slightly higher than the financial sector 6 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  7. 7. RESULTS OF LOW ESTIMATION MATURITY • Many projects are not estimated in a professional way • Only expert estimates, no use of estimation models / historical data • Underestimation results in bad planning • Development team too small • Duration too short • Unrealistic milestones • Project management with no grip on the project • Extra management attention, more meetings • Stress in the team  bad quality  more effort • Bad software, low maintainability 7 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  8. 8. ESTIMATION MATURITY MODEL* 8 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Developed by Dan Galorath – www.galorath.com 95% of the industry Estimation Bias Mitigation Begins at Level 2, Solid at Level 3 Majority of software projects are not mitigated for bias, resulting in optimistic estimates.
  9. 9. REALISTIC ESTIMATES A realistic estimate is one of the most important conditions for a successful project. The estimate is the basis for: • Business case; • Planning; • Proposal (outsourcing: fixed price / date); • Financial result of the project… and the organization; • Claiming and releasing of resources; • Alignment between IT and business / customer; • Progress reports / dashboards; • The feeling of the team and the stakeholder. Without a realistic estimate, the project is likely to fail! 9 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  10. 10. LOW/HIGH ESTIMATES 10 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Non-linear extra costs -Planning errors -team enlargement more expensive, not faster -Extra management attention / overhead -Stress: More defects, lower maintainability !! Linear extra costs Extra hours will be used
  11. 11. LEVEL 1 AND 2 ESTIMATES • Bottom-up , assign effort hours to work items, based on knowledge and experience • Advantages: • Always possible to do and relatively easy; • Experts ‘see the bears’. • Disadvantages: • Forgotten activities (e.g. testscript reviews. …); • No good foundation of the estimate, very subjective; • The expert is not going to de all the work (who will ?); • How expert is the expert? (projects are unique); • Experts don’t take into account duration, team size, etc.; • Experts don’t assess the reality value, no real use of history. 11 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Result: expert estimates are optimistic, on average 30% underestimation.
  12. 12. OVERVIEW 12 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Expert Estimates Level 1 and 2
  13. 13. TWO WAYS TO ESTIMATE 13 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Objective Size Effort Cost Estimating & Benchmarking Level 1 and 2 Level 3, 4 and 5
  14. 14. OVERVIEW 14 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Parametric Estimates Level 3-5
  15. 15. FUNCTIONAL SIZE  What the software should be able to do (functionality) Functional expressed in a number Size based on an objectively described method Measurement  ISO/IEC 14143  Something intangible like functionality becomes a physical number that can be used for calculation 15 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 ISO/IEC 24570:2005 nesma.org
  16. 16. FUNCTION POINT ANALYSIS (FPA) • Can be used early in the project, when functional requirements are known • Independent of technical implementation. 500 FP Mobile app = 500 FP Legacy Cobol system • Just as a 20 m2 glass wall = 20 m2 brick wall • Effort to realize the software depends on productivity • Independent of the systems requirements • Objective, verifiable, repeatable, defensible measurement !! • More function points means more functionality: value! • Functional size is the basis for objective software metrics: • Productivity (Hours spend per FP) • Cost Efficiency (Money spend per FP) • Time to Market (FP per calendar month) • Quality (Defects per 1000 FP) 16 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  17. 17. BASIC ESTIMATION MODEL 17 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 measures risk analysis risks consequences Functional size FP hours/cost (provisional) hours/cost (attuned) influences Productivity h/FP
  18. 18. TIME VS COST 18 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Paul Masson’s Law Parkinson’s Law Brooks’ Law Minimal time Optimal effort Time Effort/Cost Realistic Productivity
  19. 19. TEAM SIZE: IMPACT ON PRODUCTIVITY 19 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Larger team size means lower overall productivity. Adding people to a late project only makes the project later.
  20. 20. OVERVIEW 20 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 EffortorCost Duration Impossible zone Impractical zone Minimal duration / highest effort and cost Optimal duration / lowest effort and cost Realistic zone
  21. 21. OVERVIEW 21 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 Price/FP Duration (months) Impossible zone Impractical zone Minimal duration / highest effort and cost Optimal duration / lowest effort and cost Realistic zone 1000 500 6 12
  22. 22. HISTORICAL DATA • Parametric estimation models need historical data to estimate • Preferred for estimation: data of the company itself • For new types of projects or no data available: Industry data can be used • Sources of industry data: • Data delivered with the parametric models, e.g. • QSM SLIM: trendlines based on slocs or FP • SEER-SEM: knowledge bases • Data provided by Benchmarking suppliers (METRI, Gartner, DCG, etc.) • Independent (International Software Benchmarking Standards Group) 22 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  23. 23. INTERNATIONAL SOFTWARE BENCHMARKING STANDARDS GROUP • Independent and not-for-profit; • Full Members are non-profit organizations, like China SPI, NESMA, IFPUG, JFPUG, GUFPI- ISMA, FiSMA, QESP, DASMA and Swiss-ICT. • Grows and exploits two open repositories of software data (.xls): • New development projects and enhancements (> 7500 projects); • Maintenance and support (> 1200 applications). • Everybody can submit project data • DCQ on the site / on request (.xls) • Anonymous • Free benchmark report in return • ISBSG and China SPI start working on translating ISBSG materials and increase data collection. 23 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  24. 24. OVERVIEW 7500 rows in Excel, Easy to analyze 24 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  25. 25. EXAMPLE • Data Quality: A or B • Year of Project > 2012 • Project Type: Enhancement • Primary Programming language: Java • Count approach: Nesma or IFPUG • Further refinement, for instance: • Size category • Methodology • Industry • Application type • Team size • Time pressure (duration) • … 25 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 PDR (hours/FP) Number of projects 166 Minimum 4,2 Percentile 10% 5,3 Percentile 25% 6,8 Median 7,8 Percentile 75% 9,4 Percentile 90% 10,2 Maximum 15,3 Average 7,9 Example: 500 FP Java project ROM Estimate Reality Zone: Low (P25): 500 * 6,8 = 3400 hours Likely(Median): 500 * 7,8 = 3900 hours High (P75): 500 * 9,4 = 4700 hours
  26. 26. PARAMETRIC ESTIMATION IN PRACTICE • Parametric Estimation is carried out by a number of ‘more mature’ organizations: • Global software service providers, e.g. HP, Capgemini, Sogeti, HCL, TechM, et cetera. They need to be able to estimate fixed price/fixed duration projects accurately. • ‘More mature’ companies that have implemented an ‘Estimate and Performance Measurement’ process in order to understand their (and their suppliers’) capabilities in order to improve, e.g. many banks, governments, insurance companies, telecom providers. • Next to estimating, performance measurement and benchmarking of completed projects is another main advantage of measuring functional size. • Analysis of the historical data sometimes shows a lot! 26 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  27. 27. FPA INTERNATIONAL • Brazil: FPA used intensively in software contracts: Price per FP • Especially early methods (Nesma) • Government, airlines, telco’s, banks, … • 1 company claims to measure >60.000 FP per month with > 70 CFPA • Netherlands, Korea, Malaysia, Finland and Italy: • FPA recommended and often mandatory in government contracts • Supplier performance measurement in Agile and traditional projects: • Cost/FP • Hours/FP • Defects/FP • FP/month • USA: IFPUG used in the private sector, public sector low estimation maturity (LOC based estimation) 27 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  28. 28. COUNTRY REPORT • 12 countries - >40 projects submitted - Australia - Brazil - Canada - Denmark - Finland - France - India - Italy - Japan - Netherlands - UK - United States 28 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  29. 29. PRODUCTIVITY PER COUNTRY (HOURS/FP) 29 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 0 2 4 6 8 10 12 14 16 18 PDR Mediaan PDR
  30. 30. SPEED (FP PER CALENDAR MONTH) 30 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 0 10 20 30 40 50 60 70 Speed Mediaan Speed
  31. 31. MANPOWER DELIVERY RATE (FP/PERSON PER MONTH) 31 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 0 5 10 15 20 25 Manpower DR Mediaan Manpower DR
  32. 32. QUALITY (DEFECTS PER 1000 FP) 32 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 0 10 20 30 40 50 60 Defectdensity Mediaan Defect density In the UK software is developed fast, but with many defects!
  33. 33. INTERNATIONAL COOPERATION • China SPI / IQ Alliance starts working together with international parties to improve estimation maturity on the Chinese market: • Partnership with ISBSG (2016): • Translate Special Reports into Chinese • Collect Industry data from the Chinese market • Publish reports for Chinese market • Partnership with Nesma (2016): • Translate documents into Chinese • Facilitate Training of consultants in Nesma FPA and Software Estimation practices • Organize Nesma certification exams 33 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016
  34. 34. THANK YOU! 34 CHINA SPI / IQ ALLIANCE CONFERENCE, BEIJING MAY 2016 @haroldveendam haroldveendam www.linkedin.com/in/haroldvanheeringen ISBSG: www.isbsg.org Nesma: www.nesma.org METRI: www.metrigroup.com harold.van.heeringen@metrigroup.com

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