Cutter Summit 2007: Contracting Agile Development

A by-the-bullets summary of the Cutter Summit 2007 interactive breakfast roundtable: "Contracting Agile Development – Thoughts and Experience Around the World", conducted by Jens Coldewey.

Bullets

• Contracting agile projects is a big problem for which Jens admits he doesn't have a complete solution.
• It's an even bigger problem in Germany.
  • There are 4 or 5 contract structures defined by civil law, 2 of which may apply.
    1. The delivery contract. What your contract has to deliver, when it is to be delivered and how much it will cost? Basically: what, when and cost. This is one of the reasons that waterfall is popular. Perceived as very friendly to the recipient of the services, but Jens disagrees and thinks it causes the recipient trouble by forcing people to stick to a contract even when the contract no longer makes sense.
    2. Service contract. Goes back to the ancient Romans. Marcus Classus(sp?) (Julis Caesar buddy) and fire brigade. Half of Caesar's fortune. This contract specifies help and money. Perceived as being very friendly to contractor.
• Business views this as an IT problem, which it isn't. (See Jens' chart.)
• Example of a contract someone's done (in U.S.): Service contract, it's not T&M per se. We define the number of patches and the number of hours we'll work. Customer can add a patch if they'd like (which will need more hours).
• Example: Master contract that defines process, payment terms, warranty and such.
• Fixed price contracting goes to the best liar.
• Litigation is big in America. Contrast with Poland, where people just don't sue each other. There's not as much risk of litigation.
• Approach: Discovery phase. Refuse to fixed bid a project. Difficulty here is that you've got to be willing to walk away from the business.
• Two participants work for a state government. They do a lot of T&M. But are under tremedous pressure to do fixed scope, fixed price.
• It's often not about the value delivered, it's about the game. "I win, you lose, I get the promotion."
• Cites Poppendieck study of percentage of functionality that's often used.
• Caps.
• Mary Poppendieck's chapter in the book on contracting. All of the examples come from auto manufacturing.
• Vendor relationship management systems. Doesn't work: Price and willingness to go down on price. Works: Value, efficiency, flexibility.
• Some discussion of shared responsibility approaches.
• The last word: Use a master services agreement at the high level and keep the specificity in short-term agreements.