Agile Contracts – Approach Two

We discussed a Traditional Approach to Agile Contracts in the previous post. In this post, we discuss a slightly more Pragmatic Approach, that keeps with the spirit and letter of Agile but you can expect slightly more bickering here. However, its still better than the traditional fixed price approach. So, here is what we have been trying.

  • Estimate like any fixed price project
  • Make a project backlog – as detailed and as accurately as you can at a time
  • Estimate in real time units each item in backlog [no relative units like story points]
  • Allow customers to change stories that team has not started working on from future sprints with same weight stories [weightage estimated by the team]
  • Provide working software at the end of every release
  • Ability to cancel future sprints at a given pre-project cancellation fee

The only real problem that this kind of approach brings is that after the first few sprints, keeping track of what can be taken out and inserted needs a bit more analysis and discussion than a traditional Agile team would like. Another side disadvantage can be to not implement proper SCRUM/ Agile rules [as you are doing fixed price]. Hence, you need to add a fixed time dimension for this which unless estimated carefully can be a double edged sword. The advantage of this approach is that you can readily sell this to the clients and sort of marry Agile with fixed price approach very well. We have started this approach with two recent projects and would like to see how this goes.

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