The Juicy Bits: Risk, Value and Maximising Value for Money

16. 01. 20 John Chapman

‘A classic struggle exists between the high-risk and the high-value features of a project. Should a project team start by focusing on high-risk features that could derail the project? Or should a project team focus on what Tom Gilb called the “Juicy bits”, the high value features that will deliver the most immediate bang for the customer’s buck. …The solution is to give neither risk nor value total supremacy when prioritizing. It is important to give both risk and value a weighting.’ (Extract from Agile Estimating and Planning, Mike Cohn)

The relationship between risk and value mapped to four quadrants

The relationship between risk and value mapped to four quadrants

The appropriate development sequence

The high-value, high-risk features should be developed first. These features deliver the most value and working on them eliminates significant risks. Next are the high-value, low-risk features. These features offer as much value as the first set, but they are less risky.

The appropriate development sequence

Use the guideline to work first on high-value features, but use risk as the tie-breaker.

The implications for business intelligence projects

Often when starting a business intelligence project, the initial request is to replicate the current reporting pack in the Business Intelligence Solution; move away from spreadsheets and replicate the As Is in a different software tool.

This is a high-risk, low value piece of work. It is high risk as it will spend the project budget yet offer little in terms of added value to the organisation.

Instead, consider what could be the High Value High Risk item first.

An example is the CEO report. This would be a dashboard of the overall health of the company. To provide this requires the collation of data from disparate sources such as Sales, Procurement, Finance, Operations and Marketing. Once in a data-warehouse, the content is summarised and presented in a combination of graphical and non-graphical ways.

Schematically this would be

Organisation Chart

The individual silos in the organisation would have their own reporting in place based on internal systems such as:

  • Sales Director:forecasts, sales made, sales lost, contribution analysis
  • Finance Director: Profit and Loss, Balance sheet reporting, Head Count
  • Marketing: Google Analytics, Customer numbers, campaigns
  • Procurement: Number of suppliers, stock items, contract metrics
  • Operations: Profitability by product lines, planned and unplanned maintenance costs.

However what is now possible is the ability to draw together data to provide a combined view using common analysis structure.For example Sales and Operations can look at both the order book and the sales forecasts using a common set of codes (such as customer identifier).

Sales Chart

This gives the ability to see into the future and identify if the organisation will meet its revenue targets. In addition to consider the priority of orders received such as by particular customer. This would be a high value business intelligence item to deliver. However it is low risk as the implementation of the CEO reporting would have provided the requisite infrastructure.

Conclusion

At TouchstoneBI we start with an assessment of the decisions to be taken. From this to identify the information requirements, then to agree the priority order for the development of the business solution. The priority order based on the High Risk High Value return approach; ‘the juicy bits’

Only once these are agreed can the process of configuration commence.

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John Chapman

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