Walker Royce is the vice president of IBM's Worldwide Rational Lab Services. He has managed large software engineering projects, consulted with a broad spectrum of IBM's worldwide customer base, and developed a software management approach that exploits an iterative life cycle, industry best practices, and architecture-first priorities. He is the author of Software Project Management: A Unified Framework (Addison-Wesley, 1998) and a principal contributor to the management philosophy inherent in Rational's Unified Process. He received his BA in physics from the University of California, and his MS in computer information and control engineering from the University of Michigan.

Kurt Bittner is chief technical officer for the Americas at Ivar Jacobson Consulting. He has worked in the software industry for more than 26 years in a variety of roles, including developer, team leader, architect, project manager, and business leader. He has led agile projects, run a large division of a software development company, survived and thrived in several start-ups, and worked with clients in a variety of industries including insurance, banking, and energy. He is the co-author of two books with Ian Spence, Use Case Modeling (Addison-Wesley, 2003) and Managing Iterative Software Development Projects (Addison-Wesley, 2007), as well as many articles, especially in the areas of improving requirements and software development management practices.

Mike Perrow is a writer and editor for the Rational organization within the IBM Software Group. He is the founding editor of The Rational Edge online magazine. In that role, he has worked closely with Rational methodologists and thought leaders, including Walker Royce, Kurt Bittner, and many others, to explain the concepts of iterative software development that underlie the Rational Unified Process and related toolset. He began his career as a technical writer on mainframe systems while teaching technical writing at Old Dominion University. Since then, he has taught periodically and served as an evangelist and marketer for Imagination Systems, Powersoft, and Sybase, Inc. In his parallel life as a creative writer, he has published poems in leading literary journals, including The Southern Review, Shenandoah, and Boston Review.

Preface xiii

About the Authors xvii

Part I: The Software-Driven Economy 1

Chapter 1: The Challenge of Software Project Management 3

The High Stakes in Software Development 4

Institutional Focus 5

Traditional Software ProjectManagement 7

Problems with theWaterfall Approach 8

Summary 11

Chapter 2: Achieving Results: The Case for Software Economics 13

Iterative Development 15

Benefits of the Results-Based Approach 16

TheMark of Success 18

Summary 19

Part II: Improving Software Development Economics 21

Chapter 3: Trends in Software Economics 23

A SimplifiedModel of Software Economics 24

Software Engineering: A 40-Year History 26

Keys to Improvement: A Balanced Approach 28

Summary 30

Chapter 4: Reducing Software Project Size or Complexity 33

Managing Scope 33

Reducing the Size of Human-Generated Code 35

Improving Reuse Using Service-Oriented Architectures 36

Summary 36

Chapter 5: Improving the Development Process 39

Project Processes 39

Using an Iterative Process 40

Attacking Significant Risks Early 43

Improve Practices Incrementally to Meet Goals 46

Summary 48

Chapter 6: Improving Team Proficiency 51

Enhancing Individual Performance 52

Improving Project Teamwork 52

Advancing Organizational Capability 55

Summary 57

Chapter 7: Improving Automation Through Integrated Tools 59

Improving Human Productivity 60

Eliminating Error Sources 61

Enabling Process Improvements 62

Summary 63

Chapter 8: Accelerating Culture Change Through Common Sense 65

Profiles of Successful Organizations 65

Keys to Success 67

Recommendation: Select the Right Project, the Right

People, and the Right Goals 73

Summary 73

Part III: Practical Measurement for Software Engineering 77

Chapter 9: A Practical View of Software Development Metrics 79

Measurements and Goals 80

Variability and Goals 80

Measurement and Iterative Development 81

WhenMeasurement GoesWrong 83

What'sWrong with Detailed Up-front Planning? 85

DecidingWhat toMeasure, Phase by Phase 86

Summary 87

Chapter 10: What to Measure in the Inception Phase 89

Assessing Financial Viability 90

Assessing Technical Viability and Estimating Overall

Project Cost 91

Iteration in the Inception Phase 93

OtherMeasures 94

Summary 96

Chapter 11: What to Measure in the Elaboration and Construction Phases 99

Measurement in the Elaboration Phase 99

Measuring Risk Reduction 102

Measuring Progress 104

Measurement in the Construction Phase 106

Measuring the Project Backlog 107

Measuring Test Coverage 107

Measuring Build Stability 108

Expected Progress Trends in the Construction Phase 109

Summary 110

Chapter 12: What to Measure in the Transition Phase 113

Measurement in the Transition Phase 114

Concluding the Transition Phase 118

Summary 119

Chapter 13: Measuring Projects Embedded in Programs 123

Organizing Projects into Programs 124

Measuring Program Stages 127

Summary 127

Appendix: Getting Started with Iterative Project Management 129

Embarking on Your First Iterative Project 130

Adopting an Iterative Approach Iteratively 144

Conclusion 154

Suggested Reading 157

Index 161

Results-Based Software Management: Achieve Better Outcomes with Finite Resources

Effective software development is no longer merely an IT concern: today, it is crucial to the entire enterprise. However, most businesspeople are not ready to make informed decisions about software initiatives. The Economics of Iterative Software Development: Steering Toward Better Business Results will prepare them. Drawing on decades of software development and business experience, the authors demonstrate how to utilize practical, economics-based techniques to plan and manage software projects for maximum return on technology investments.

The authors begin by dispelling widespread myths about software costs, explaining why traditional, "engineering-based" software management introduces unacceptable inefficiencies in today's development environments. Next, they show business and technical managers how to combine the principles of economics and iterative development to achieve optimal results with limited resources. Using their techniques, readers will learn how to build systems that enable maximum business innovation and process improvement-and implement software processes that allow them to do so consistently.

Highlights include

• How to repeatedly quantify the value a project is delivering and quickly adjust course as needed

• How to reduce software project size, complexity, and other "project killers"

• How to identify and eliminate software development processes that don't work

• How to improve development processes, reduce rework, mitigate risk, and identify inefficiencies

• How to create more proficient teams by improving individual skills, team interactions, and organizational capability

• Where to use integrated, automated tools to improve effectiveness

• What to measure, and when: specific metrics for project inception, elaboration, construction, and transition

The Economics of Iterative Software Development: Steering Toward Better Business Results will help both business and technical managers make better decisions throughout the software development process-and it will help team and project leaders keep any project or initiative on track, so they can deliver more value faster.