Webinar Scaling Agile Development How Do You Source

Webinar Scaling Agile Development: How Do You Source Services And From Whom? Wolfgang Benkel, Principal Analyst Diego Lo Giudice, Vice President, Principal Analyst February 18, 2015. Call in at 10: 25 a. m. Eastern time

Agenda › Market trends on Agile at scale › Your Agile sourcing strategy ›

Market trends on Agile at scale Agile is doing well, but scaling is hard.

© 2015 Forrester Research, Inc. Reproduction Prohibited 4

Agile development is increasing in popularity › Agile is now an accepted and growing development method. › Agile is more successful when based on trusted and long-standing relationships. › Scrum and hybrid Agile-Waterfall are in fashion. › The Agile service experience is growing. Source: February 5, 2014, “How Can You Scale Your Agile Adoption? ” Forrester report © 2015 Forrester Research, Inc. Reproduction Prohibited 5

Most of those that do it expand (or scale) © 2015 Forrester Research, Inc.

Agile methodologies are used by the majority of developers © 2015 Forrester Research, Inc.

Agile upstream 32% Do standup, burn-down/burn-up, and short iterations; product owner; and constant feedback Agile downstream 13% Do upstream plus continuous integration, continuous delivery, and test-driven development Source: February 5, 2014, “How Can You Scale Your Agile Adoption? ” Forrester report

Scaling Agile is hard, but possible. 22% 21% en 50 % and 75% 17% Betwe Less t han 2 5% rganiz of the o han 75 % More t Betwe en 25 % and 4 9 % ation 40% Base: 149 IT professionals from organizations that are planning to implement or have implemented Agile; Source: Forrester’s Q 3 2013 Global Agile Software Application Development Online Survey Note: Percentages do not total 100 because of rounding.

We’ve clearly not done enough!

The Agile modern application delivery cycle has red zones › Upstream: burn-down/burn-up and short iterations, product owner, and constant feedback SAFe Water-Scrum-Fall Enterprise Scrum Agile testing and TDD CI/CD Automation › Downstream: continuous integration, continuous delivery, and test-driven development Source: February 12, 2014, “Navigate The Modern Application Delivery Landscape” Forrester report

Dev. Ops needed to optimize and automate the delivery pipeline and throw walls down between dev-test-ops Application release management Cloud provisioning From business To delivery/ deployment Application deployment automation Agile all the way through Development Build Package repository Test environment Production Stage environment Source: Forrester adaptation of SVT for dummies © 2015 Forrester Research, Inc. Reproduction Prohibited 12

Your Agile sourcing strategy Some key points to consider © 2015 Forrester Research, Inc.

So if Agile is a trend with increasing adoption, how are clients sourcing it? › The catalog of Agile services is rich in the upstream and now also growing in downstream. › Agile is at the top of the clients’ BT agenda, and vendors are preparing to meet their needs. › Agile will change the testing services market forever. › Pricing models and contracts are still the biggest roadblocks in the broader Agile services market. © 2015 Forrester Research, Inc. Reproduction Prohibited 14

Do some Agile transformation work first; you can’t source your behavioral change. . . › Define your sourcing strategy. › Decide when Agile is the right methodology. › Evangelize Agile and Lean values throughout the organization. › Assess your readiness and train your people. © 2015 Forrester Research, Inc. Reproduction Prohibited 15

Different sourcing models will apply to your journey at different times Sample sourcing models 1) Partial outsourcing 2) Co-sourcing mixed model 3) Full outsourcing Leadership Client-led Mostly client-led Mostly vendor-led Vendor-led Benefits Partial use of vendors’ best practices, standards, expertise, and experiences › › Sourcing model › › › Vendor accountability › › › Client-controlled flexibility Higher business differentiation Acquisition of talents Client imposes his own best practices. › Cost reduction Medium business differentiation Client learns and acquires best practices from the vendor. Staff augmentation Output-driven Capacity management Mostly staff augmentation Low (whole project) High (for output/outcome, e. g. , testing) Low Medium © 2015 Forrester Research, Inc. Reproduction Prohibited › › Cost reduction based on low-cost resources. Use of vendors’ best practices. Highest level of vendor accountability for Sprint outcome Output/outcome › › High for doing “things right” Low for doing “right things” 16

Appoint great product owners, and keep the key roles in-house › Appoint the best PO(s) from their business. › Ensure that Scrum masters are great coaches — not project managers. › Give architects a seat at the table. › Facilitate collaboration with other roles. © 2015 Forrester Research, Inc. Reproduction Prohibited 17

Be flexible about the scope, but plan ahead › Commit teams to fixed “units of work. ” › Use the “cone of uncertainty” to prove that the scope must be flexible. › Measure uncertainty in order to reduce it. › Define the overall business objectives and goals. › Define what to expect from sprint zero. › Agree on the size and scope of the sprint backlog. © 2015 Forrester Research, Inc. Reproduction Prohibited 18

The maturity of the Agile relationship influences the pricing model © 2015 Forrester Research,

Other sourcing criteria for Agile services › Metrics and service-level agreements (SLAs) › Continuous improvement › Vendor governance › Change management › For more, download our research on Forrester’s website. • “Developing Modern Applications With Agile Outsourcing: Part One” • “Developing Modern Applications With Agile Outsourcing: Part Two” © 2015 Forrester Research, Inc. Reproduction Prohibited 20

Who are the service players, and how do you select them? Where and who

Agile services market players overview › › › › Advisory Coaching Training Agile transformation (AT) strategy Tasks outsourcing People 10 Technologies, agile 42, and Emergn Agile transformation Catalyst IT services › › › Small specialized players less than 100 Midtier technology service providers System integrators › Consulting boutiques and pure players Large-scale service providers › Large-scale delivery outsourcing plus other services IBM, HP, Accenture, Atos, and Capgemini (plus see next slide) Agile advisory, coaching, training, and AT strategy Agile delivery co-outsourcing Magenic, Pivotal Labs, Thought. Works, EPAM, and 3 Pillar © 2015 Forrester Research, Inc. Reproduction Prohibited 22

Agile services companies profiled for this research Pure players: Persistent Systems Thought. Works, CI&T, EPAM, and Global. Logic Midtier technology service providers: Tech Mahindra, Luxoft, Virtusa, NIIT Technologies, Torry Harris Business Solutions, Birlasoft, and Mindtree. com Large-scale service providers: Cognizant, Tata Consultancy Services (TCS), HCL Technologies, Infosys, and Wipro Source: December 8, 2014, “Market Overview: Agile Development Service Providers” Forrester report © 2015 Forrester Research, Inc. Reproduction Prohibited 23

Some vendors make more than 50% of their total revenue with Agile © 2015

Vendors tailor capabilities and offerings to handle every type of client. . . › Assessment frameworks › Transformation frameworks › Agile coaching › Modern applications develop-test-deploymaintain services › Agile testing services › Agile methods applied upstream and downstream. . . and are introducing Dev. Ops © 2015 Forrester Research, Inc. Reproduction Prohibited 25

Vendors deliver mainly Agile services for app dev and maintenance © 2015 Forrester Research,

Vendors use a mix of de facto standard Agile methodologies © 2015 Forrester Research,

Vendors invest in their Agile resources © 2015 Forrester Research, Inc. Reproduction Prohibited 28

How to select? › Review your sourcing strategy: Why? › What are the business needs: What? › What type of services do you need: How? • Assess where your are (beginner, mature, or scaling). • Do you need coaching, advisory, training, delivery, testing, and Dev. Op? © 2015 Forrester Research, Inc. Reproduction Prohibited 29

How to select? (cont. ) › Decide the right sourcing model: Who? • Insource, co-source, and outsource • Complement large with small and pure with hybrid. • Leverage a trusted relationship. › Where? Onshore, nearshore, and offshore © 2015 Forrester Research, Inc. Reproduction Prohibited 30

Thank you Wolfgang Benkel wbenkel@forrester. com Diego Lo Giudice dlogiudice@forrester. com Twitter: @dlogiudice forrester. com