1. Value Creation and Capture: A Model of the Software Development Process Todd Little

2. IEEE Software, May/June 2004

3. About Landmark Commercial Supplier of Oil and Gas Exploration and Production Software Users are Geophysicists, Geologists, Engineers Subsidiary of Halliburton Energy Services Integrated suite of ~60 Products ~50 Million lines of code Some products 20 years old

4. Landmark Product Suite Common Model Representation Well data Production data Seismic data Velocity data Reservoir / Fluid data Structural / Stratigraphic data Common Model Representation

5. What is the Goal? We Ship! On time, to spec, within budget? Maximum efficiency? Maximum throughput? Maximum value

6. What are the knobs? Optimal release cycle duration Staffing levels Process improvement opportunities Where is the uncertainty

7. Model of Development Value Creation Staff effectiveness –Effective staff time vs. team size Value Created –Assumed value of the software vs. Effective development time Rework Time –Time to test and fix the software vs. Effective development time Value Capture –Market Delay Costs vs. Time Resources –Size of the Team –Cost factors

8. Developer Effectiveness

9. Value Creation and Prioritization

10. Rework/Test Time

11. Cost of Delay

12. Integrating the Table Lookups

13. The Big Picture

14. Staffing Decisions

15. Process Impact – e.g. Pair Programming

16. Impact of Dev/Test Ratio 6 developers 3 testers 7 developers 2 testers 5 developers 4 testers

17. Cost Uncertainty

18. Value Uncertainty

19. Target – Plan – Contract A/B/C Prioritization

20. Conclusions Estimating Value is Hard Estimating Cost is Comparatively Easy Comprehending Uncertainty is Hard The Model is not Perfect The Model Provides a Basis for Useful Conversations

21. The Big Picture