Applying Agile Methodologies in Non-Agile Contractual Scenarios

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Whenever we learn a new technique or process, we tend to begin by focusing on the “ideal” scenario or “pure” approach. Approaching a new idea in this way provides a basis for intellectual debate, opposing viewpoints and perhaps new conclusions, all without real world consequences. This approach also allows us to work out the underlying foundation of the technique, without having to worry about pesky details or complexities that might get us mired down and prevent any real progress. But as one of my Computer Science professors was fond of saying, “Only in theory, are theory and practice the same.” What works in the lab doesn’t always work in the real world, and what works great in one scenario doesn’t always fit every other scenario.

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It is the same in Software Development. We learn new languages, methodologies, or techniques, debate the merits of one approach versus another, and often choose a favored path to focus on. “Agile” Development is a methodology that is currently favored by a large portion of the development community and continues to grow in popularity, while older approaches like “Waterfall” or “Plan-based” development are considered obsolete.

Proponents of Agile development often say things like “you should just use Agile”, “there really is no alternative to Agile”, “Agile is best”, or “Agile is better than [the way you’re doing things now]”. And for them, they’re right. In their particular scenario, for the work they do, in the environment they work in, Agile is best.

Agile Assumptions

Not all scenarios are created equal, however. Agile works best when certain assumptions are met, and if those assumptions are not met the benefits of Agile are not as clear. Some of these assumptions include:

Assumption: The customer is involved throughout

Explanation: The customer (sometimes the end user, the person with the Big Idea, or a person or organization contracting with you to build the thing) is involved at regular intervals during the project lifecycle. They help prioritize and define what needs to be done before the work is done, and get to see what’s been built when it’s built. By continually reviewing and directing change, the customer is able to shape the product to fit their vision as their understanding of that vision evolves.

Challenge: Sometimes the customer is not always available. Sometimes the customer doesn’t even know anything about the system they’re contracting with you to build. Someone else told them to “do the thing”, so they issued a Request for Information (RFI) and/or Request for Proposal (RFP), took input from industry, and awarded a contract to a vendor who will “build the thing”. Sometimes the details of the thing were already determined by a third party – by law, industry standard practice, contract, prior work, or some other method or practice. In these cases, the assumption does not apply and the advantage it gives Agile is not realized. This doesn’t mean you can’t use Agile, it just means that you have to adapt.

Other methodologies, including Waterfall or Plan-Driven Development, do not rely on the customer being involved throughout. They are designed so as to not require that level of involvement, and thus the processes they use do not suffer from its lack (though the final product might).

Assumption: Deliver early, deliver often

Explanation: One of the great benefits of the Agile paradigm is that you get something in front of the end users early. Rather than building a giant monolith system, you release once you’ve completed the Minimum Viable Product (MVP), and continue to release as you implement new features or refine existing features. Facebook launched with far less than it has today, as did Google and Twitter. It often feels like the app or site I’m using today isn’t the same as it was yesterday – and that’s because it probably isn’t.

Challenge: Sometimes you can’t deliver early. Contract terms, legal requirements, or other factors may dictate that an early launch with anything less than 100% is unacceptable. We’ve worked on contracts to build a system which is going to replace an existing system. We cannot launch with anything less than the same functionality the existing system has. Sometimes the MVP and the Final Product are the same. In these cases, the assumption does not apply and the advantage it gives Agile is not realized. This doesn’t mean you can’t use Agile, it just means that you’re not benefiting as much.

Other methodologies assume there will be but one delivery, once the system is built. They are designed around full completion, and include steps which explicitly work towards that goal.

Assumption: Prioritize by Business Value/Technical Risk

Explanation: This goes hand-in-hand with deliver early, deliver often. Because we build the most “valuable” first (and include items which may not have direct business value but are critical for technical reasons), we can be sure that the MVP launch will be compelling and make people want to use the system. The specific details of prioritization include a number of factors or methods – for example something that is very easy to do might be done in an earlier sprint because there’s room in the schedule to fit it in, while a more valuable but complex feature is delayed until a later sprint. Risk should always be a factor in determining value prioritization, as well.

Challenge: Sometimes value is irrelevant. Everything has to be built, whether it’s “Mission Critical” or “Nice to Have”. This is often the case with government contracts – any time a government contract states that a vendor “may” implement a feature, you can put your money on the vendor not implementing it. If everything is required, and you’re not delivering until everything’s done, the order in which you implement things isn’t necessarily as important. In these cases, prioritizing by business value may even get in the way. Either way, the benefits Agile receives by this prioritization aren’t realized. This doesn’t mean you can’t use Agile, it just means you do things a bit differently.

Other methodologies may include different guidelines for determining the order in which work is done. Riskier features may be implemented sooner so that they can be more thoroughly tested; or might be delayed until the end to see if the risk materializes and makes the feature irrelevant. Political pressure may dictate priority. No matter what methodology you use, though, you prioritize; and any methodology’s prioritization scheme can be adapted to fit project realities.

Assumption: Change happens

Explanation: Agile embraces change. It’s built around the idea that change is going to happen throughout the project, and by identifying that change early you are better able to build the right system, rather than the system as envisioned by someone months or years ago. Agile’s embrace of change also ensures that if someone made a mistake in the feature needs, the mistake can be caught and corrected sooner.

Challenge: Change comes with cost. If we’ve implemented something and need to go back to change it, something else has to slip – the schedule, the cost, some other feature – change does not happen in a vacuum. The type of change we’re referring to here is a change to something which has already been completed, which was correct at the time it was implemented but is no longer correct due to a change in needs, discovery of some previously unknown factor, or some other reason. We are not referring to completion of a previously known-to-be incomplete feature, such as implementation of a data validation rule which we knew would need to be implemented but did not yet know what it was. The same is true if some new feature needs to be added that wasn’t in the original list. In the case of a Firm Fixed Price (FFP) contract, which is by far the most common scenario we encounter when bidding on government or non-governmental work, the contract may not permit for reduction in features, addition of new features, additional funding, or delayed completion – at least not without significant penalties and/or a contact modification. Yes, we should embrace change. Yes, it’s better (in the long run) to catch the change early, but if the contract doesn’t let us change the work we’re contracted for or the money we’re paid for it, we don’t have much choice. If we can’t get a contract mod, we can’t accept the change.

If you can’t embrace change, the strength that doing so lends to Agile isn’t realized. Other methodologies are designed to reduce change during project execution – change can only occur before the project starts or after it has been completed (usually as a follow-on project.)

Assumption: You don’t know everything in advance

Explanation: This goes hand in hand with “change happens”.  In the old days of software development, the ideal was that you would fully document the system-to-be; then someone else would develop it. This pretty much never works as well as planned, though there have been some notable exceptions where this methodology worked far better than is typical (see “Cloning the IBM PC BIOS”). Agile assumes that you don’t know everything in advance, but rather, figure things out as you go. Yes, advance knowledge helps shape the project, but when you don’t know, you have to adapt to change.

Challenge: The government issues an RFP, and asks for FFP quotes. Because it is impossible to respond with a fixed price for an unknown, the government tries to know as much as they can in advance, so vendors can provide realistic bids, and so the government can identify if a bid is realistic or not. As with “change happens”, however, if the government fails to identify everything in advance they either (a) have to allocate more funding, or (b) sacrifice the features they failed to identify.

Of course, nothing in Agile says you SHOULDN’T know everything in advance – it just assumes you don’t. Other methodologies which are designed around knowing everything in advance, have built-in controls to ensure that as much as possible, this goal is met.

Assumption: Dedicated, co-located teams

Explanation:  Agile favors (but does not require) face-to-face communications, with team members committed to the project and able to maintain a constant pace indefinitely. Daily stand-up meetings during the sprint, planning meetings and product demos at the beginning and end of the sprint, and other components of the Agile methodology work best when these assumptions are true.

Challenge: This works great when you can have it. Small businesses with multiple contracts of varying sizes and durations may need to be more flexible, able to change the team as practical demands dictate, and split peoples’ time across multiple projects concurrently. This often gets in the way of the higher degree of team synchronization which Agile favors.

Other methodologies which do not assume or require a high degree of coordination between team members or team member responsibilities may not be affected as much by the lack of a dedicated full time team.

Agile in a Non-Agile World

None of this should be taken to mean that Agile is a bad methodology – it isn’t. It’s great. The ideas of Agile have been around long before Agile was a thing and fall into a family of methodologies called Rapid Application Development. The idea is you start development early, continue to develop while you continue to refine requirements, test while you’re still developing, and respond to change as best you’re able. Agile formalizes some things that were previously ad-hoc, and this formalization helps the team plan ahead for all the things Agile helps to improve.

We like Agile development, but there are times when we just can’t do it or recommend it as the appropriate project approach. More often than not, the decision comes down to two factors:  (1) Who is the customer and (2) how is the project funded?

Working with the Government

Working with government customers, there is rarely an opportunity to deliver a partial product or system. Government contracts dictate specific deliverables, and often the funding is set. There are no opportunities to get more money or modify the deliverables (well, we could probably add some free deliverables if we wanted to). In a case such as this, we are likely to provide services using a combination of Plan-Driven and Agile techniques. However, in the end, we are on the hook to deliver a pre-determined set of functionality; that is the risk we assume when we bid on a contract of this nature.

Even non-government customers will generally have budget constraints, and want assurance that a specific set of functionality will be delivered at a specified cost. Agile doesn’t really support that requirement, as it is predicated on frequent change (and potential cost variability). Agile costs tend to be associated with the team size and time spent, i.e., a specific cost per sprint. Many commercial customers are unwilling to accept the risk of an open-ended delivery date and/or uncertain product.

Hybrid Methodology

Within the confines of what we agree upon with our customers, we often utilize a combination of iterative and more traditional methodologies to get our work done. For instance, we may use a type of sprint internally within the development team as a way of organizing the work. We utilize a backlog and frequent communications (like stand-up meetings) to keep the team moving forward.  We conduct sprint reviews with the customer, but may need to limit (or completely curtail) changes.

Is this pure Agile? Not really, but we have long recognized that taking a purist approach to anything is not always the most productive path. We (and our customers) can benefit from our knowledge and experience, and that is really our primary goal.

We can and do try to steer our customers to a more Agile understanding of their needs. We try to use Time and Materials (T&M) style contracts as much as possible, where we are engaged to do an amount of work rather than a specific set of tasks. We find that T&M combined with an Agile process reduces our risk AND reduces the customer’s risk. The customer maintains the control they have in a pure FFP model, risk is shared, and the chances of success are greatly improved.

Always Be Agile

Even if a pure Agile approach to the project as a whole is not possible, you can still use it internally. Even if you are required to use a Waterfall-like approach to the project as a whole, you can still be Agile within each phase. During development, you can still use sprints, you can still have a Product Owner, you can still do backlog prioritization and grooming, welcome change, and manage risk in an Agile way. In fact, on one of the very first projects I worked on at Segue, before Agile was a thing, we were doing two week “sprints” (we just didn’t call them that). We identified the work we were going to do, then we did it, then we looked at what we did. Even though we had a (theoretically) full set of requirements at the start of the project, we welcomed change during execution. We had a customer who was available and involved, who was willing to sacrifice certain features in favor of other, rather than enforcing the strictest interpretation of the contract.

Successful projects have been done using both Agile and Plan-Driven/Waterfall methods, and both methods have seen project failures as well. Software projects have many factors in their success, and development methodology, while important, is only one of those factors. The development methodology used guarantees neither success nor failure. When embarking on a software project, an educated customer and an experienced project team are both essential components for the success of the project.

Through education and understanding, we work with our customers to best manage risk, deliver the right product on time and within budget, and ensure that our customers and their users are satisfied. At Segue we see ourselves as more than just a vendor – we are a technology partner, and our success is very much dependent on that of our customers. And if the realities of a contract prevent us from using pure Agile? Well, we understand the other methodologies and use them where needed, and apply Agile principles where we can.

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