Business case & funding

Every project should have a business case regardless of the method chosen to deliver it. A clear understanding of the value the project is going to bring to an organisation is necessary when making decisions about the relative priority of features and when they can be delivered.

It is important though to understand and accept that estimates made at this stage can only be extremely high level and therefore unlikely to be accurate. This is why Product Backlog Items are estimated in days, because to estimate in any smaller increment would convey a false sense of accuracy. It is also likely to be true though that the estimate of potential business value attributable to the project is going to be just as inaccurate. The ratio of the benefit delivered to the cost of delivery will help determine if a project is worthwhile and as this is a ratio the accuracy of both sides should be approximately the same. In other words, it isn't worth expending effort trying to make really accurate estimates of effort unless you are prepared to do the same for the expected business benefit. This time would be better spent actually delivering benefit rather than agonising over the accuracy of estimates.

Due to Scrum's iterative nature, inaccuracy of estimates soon become apparent when seeing real data on how fast the team are able to deliver working software. This means that Scrum projects far more effectively mitigate the risk of inaccurate estimates and therefore do not need to waste time trying to de-risk the estimation process upfront. One often overlooked advantage of using Scrum is that it is also very easy to see if a project is viable at all. If a business requirement is too demanding for the team and technology available - it should become apparent after only one Sprint that the team will not be able to deliver the required functionality. This will allow the business to cancel the project after spending money on one month's development rather than finding this information out 6 / 12 / 18 months down the line. Scrum puts the control of the project firmly back in the hands of the business.