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approach is right for my ERP project?

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CONFERENCE PAPER ǀ Quality Management, Agile ǀ 9 May 2012
Fair, Jason

How to cite this article:

Fair, J. (2012). Agile versus Waterfall: approach is right for my ERP project? Paper presented at PMI® Global
Congress 2012—EMEA, Marsailles, France. Newtown Square, PA: Project Management Institute.

Abstract

Traditional waterfall project methodologies have been used for years to implement complex and
large-scale enterprise resource planning (ERP) projects. Often, ERP projects are over budget and
late in schedule. Stakeholders are often disappointed in the delayed realization of benefits and the
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quality of the delivered product. In today's economy, it is a reality that we need to be able to deliver
our projects with fixed constraints on resources.

In this session, discover how you can use Lean principles and agile techniques to create a high-
performing ERP team that will deliver high value and high quality products to your stakeholders in a
shorter period of time. Learn to create cross-functional teams that are collaborative, adaptive, and
responsive to customer needs. Find out how you can transform your ERP team to increase
productivity so you can realize benefits sooner.

In addition, in this session, you will be introduced to assessment areas and evaluation criteria on how
to determine the appropriate approach for your project. This evaluation will help you determine the
best approach based on your organization's culture, project characteristics, and resources.

Introduction
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By Ratnaraj, David Y. ǀ Quality has long
been a major issue in the IT industry,
Lean and Agile Concepts
typically resulting in billions annually
industry wide in lost revenues due to
Lean is a “thinking principle” that focuses on the tasks and activities that are being conducted to system downtime. In this paper, the author
complete the building of a product or a process to deliver a service. Additionally, the concepts of demonstrates a…
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analysis and changing the way we think about our work, we are able to identify the specific areas that
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Organizational Project Management, Manufacturing
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As we change the way we approach our work, and as we focus on increasing our efficiencies to
deliver our projects to our stakeholders with higher quality products, it is helpful to focus on “Leaning Making better, more responsive
out the waste.” Often, we work on projects in which we are required to participate in meetings or organizations
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“overhead” activities that we are asked by our project managers to perform, which have little value to technologies serve as an imperative part in
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Frequent inspection and adaptation

A leadership philosophy that encourages team work, self-organization, and accountability
A set of engineering best practices that allow for rapid delivery of high-quality projects
A business approach that aligns development with customer needs and company goals

Some of the foundations of agile include the following:

Empiricism – Ability to perform, stop, reflect, improve, and continue in a step-by-step process in
efforts to increase productivity
Prioritization – Deliver work based on value to the business
Self-Organization – The team knows best how to deliver the work based on the resources and
constraints
Time-Boxing – The team is required to complete the assigned tasks within the defined timelines.
Collaboration – The team commits to delivering the final products within the given timelines,
which will encourage cross-team collaboration and ingenuity in completing the tasks.

Key aspects of the agile project include the following:

The Overall Team – Team, Scrum Master, product owner

Product Backlog – the ongoing, prioritized list of “to do” tasks and features that are defined by
business customers
Sprint Planning and Backlog – planning session at the beginning of a sprint to determine the
items that the team agrees to take on and deliver as the output of a sprint
Stories/Story Board – collection of collective elements, functions, or “features” that are to be
delivered within a sprint
Daily Standup – daily discussion on what was accomplished, what remains to be done, and
obstacles
Sprint Burndown Chart – artifact showing progress and work remaining in a sprint
Sprint Demonstration – demonstration conducted at the end of the sprint to show product(s)
delivered
Retrospective – team discussion following the sprint to identify successes and improvement
opportunities

Exhibit 1 – Waterfall and Agile Project Approaches

Agile Project Techniques

A few techniques typically used on agile projects and that directly contribute to accelerating the time
to delivery and the increased quality of the product being delivered, include the following:

Frequent inspection of the product and adaptation to the changes and input during the project
Aligning development with customer needs and company goals
Co-location of resources to the same work space
Self-organization and accountability
Becoming a team player
Elimination of “waste” and “ceremony”
Empirical demonstration of results
Customer is always present
Product managers and owners
Focus on key planning events: product planning, release/feature planning, iteration planning,
sprint review, and stand-ups

Waterfall versus Agile

There are some key differences between a traditional waterfall project and an agile project and these
include the following:

Waterfall

Detailed, long-term project plans with single timeline

Definitive and rigid project management and team roles
Changes in deliverables are discouraged and costly
Fully completed product delivered at the end of the timeline
Contract-based approach to scope and requirements
Customer is typically involved only at the beginning and end of a project
Linear-phased approach creates dependencies

Agile Project

Shorter planning based on iterations and multiple deliveries

Flexible, cross-functional team composition
Changes in deliverables are expected and less impactful
Product delivered in functional stages
Collaborative and interactive approach to requirements
Customer is involved throughout the sprint
Concurrent approach seeks to reduce dependencies

Challenges of ERP Project Management

Over the past 10 years, as agile adoption has grown, the primary focus has been on custom
application development projects. Projects implementing commercial off the shelf (COTS) or
enterprise resource planning (ERP) products have had a slow transition to adopting agile as a
preferred project methodology. The reasons for this include the fact that COTS software vendors
typically prescribe an implementation methodology with their software. For over 20 years these
software packages have been delivered with traditional waterfall implementation methodologies.
Therefore, the systems integrator communities have also adopted their implementation models to be
in alignment with the ERP vendors.

For years, large-scale ERP projects have been delivered using these “tried and true” project
approaches. Unfortunately, however, we also have seen many projects that have under-delivered in
quality or functional capability as well as run over schedule and over budget. There are many
reasons why these projects experience these challenges, which are usually not due to the
methodology or approach. The agile approach, however, where it is deemed to be the best approach,
will expose project risks to management earlier in the project and force key decisions that may
prevent typical project issues from arising.

When considering adopting agile as the ERP project implementation approach, there are key
considerations that the project management team needs to consider. Based on their ERP
implementation experiences and the resources they have to dedicate to the project, the team should
be aware of the following typical challenges:

Agile is a new way to manage projects:

Makes all the typical “dysfunction” in a team or organization visible

Depending on how agile is introduced to a team, there may be resistance to the adoption and
it ay follow the mechanics but not the values of agile

Agile is not right in all environments:

Spend time up front in assessing the environment and culture to determine agile readiness

If agile adoption is not managed well, the team will continue to deliver bad products but
sooner, and doomed projects will fail faster.

People are most comfortable with what they know:

Project team members are familiar with the phases and deliverables of the waterfall life cycle

ERP consultants have an attachment to waterfall development

Lack of incentive to increase speed to delivery

ERP solutions are all encompassing:

Environment includes development, proprietary programming system/language, a run time

environment, a source code control system

Integrated end-to-end business process that are difficult to decompose

ERP is about business process configuration; it is NOT about development, coding, and
programming
Managing dependencies and sequencing of stories, tasks, and activities
Management of large development objects (e.g., interfaces and conversion programs) in line with
Sprint delivery
Integrating off-shore development

Evaluation Criteria to Determine the Best Approach for Your

Project

When the project management office is faced with the business case of a project and needs to
decide on which project methodology is best to use, there are key areas that need to be evaluated in
making this recommendation and some of the key areas to review include:

Project Characteristics:

Requirements – how rigid and defined are the requirements?

Effort/duration – How long is the planned project duration? >6 months, >12 months, >18
months?

Interfacing systems – How many interfacing systems are in scope? How complex are these
interfaces?

Regulatory compliance – Are there any compliance requirements that provide restrictions or
additional requirements for the project team?

Project inter-dependencies – How many other projects are running concurrently? What is the
impact to the key decision-makers? Are they any overlaps with project resources?

Sponsor Characteristics

Sponsor buy-in – Does the project have the right level of sponsorship? Are they committed to
the mission of the project?

Sponsor time commitment – Is the sponsor dedicated and willing to support the project as
needed?

Training for agile – Is there an investment for training the team/organization in agile?

Periodic validation – Will the sponsor be available to participate in key validation sessions?

Project Resources

Team size – How large is the team? Can it be broken down into teams of 8 to 12 people?

Resource dedication – Are key resources dedicated to the project? If not, can parameters
around resource availability be established and supported?

Technology/business domain knowledge – How well do team members know the product
being delivered? Is their domain expertise at the level that it will not impede the team's
velocity?

Collaboration – Does the project environment foster collaboration? Are there tools in place to
facilitate project team collaboration (e.g., video conferencing, shared document repositories,
and so forth)

Co-location – How many of the team members are co-located? How many are distributed to
different locations?

Testing – automated – Are there any automated testing capabilities?

Agile Awareness and Acceptance

Training at all levels – Has the organization committed to training the executive, project team,
and subject matter experts in agile?

Ability to apply agile techniques for all aspects of the project – Is the project management
team committed to the values of agile and to the techniques being used?

Coaches are available – do not do it alone – Are there agile coaches available to support the
project team?

Below is an example of an evaluation template that can be used to assess the agile readiness of a
project; it takes the characteristics discussed above and asks the user to evaluate his or her project
environment. This will help identify the key risk areas and starts the conversation of where to focus
improvements to becoming more agile.

Exhibit 2 – Evaluation Scorecard – Waterfall vs. Agile

Success Criteria for Your Agile ERP Project

Over the past two years, as we have worked with many large organizations that have experimented
with agile in ERP environments, we have been able to consolidate the common lessons learned and
key success criteria. These items are critical to any organization considering implementing an ERP
project using the agile approach and they include:

Conducting an agile readiness and cultural assessment before starting the project
Identify the executive champion(s) – make sure they support this approach
Establish “buy-in” to the agile process at all levels
Be flexible in creating a model that works for the culture of the organization – Establish a process
and framework that works best with your culture, resources, and environment
Consider varying the steps of adoption of agile techniques (it's a journey…)
Select the right first project – Not all projects are good candidates for agile
Start with something that can deliver a quick win – Establish confidence with the new approach in
the organization
The “art of storytelling” – be able to effectively define your requirements in the format of a story
Do not be discouraged at the moment of “first awkward use” because it takes time for the team to
adjust to this project approach
Integrating members of the team who are not co-located
Ability to remove impediments
Manage the flow of work
Continuously update the agile process and framework – Learn and adjust
Train the team – at all levels
Develop a product council that is willing to do the work
Find the right product owner and engage stakeholders
Focus on team work over mechanics
Collaboration over co-location –it is important to have the team collaborate; we all need to deal
with the reality of distributed resources.
Set rules of engagement for the team
Select the right metrics and the right reporting tools
Align team and individual performance metrics to tangible project goals

By adopting these key lessons learned, a project team should be able to assess and implement an
ERP project using the agile approach. Remember that not all projects are a good fit for the agile
approach. Assess each project with the evaluation criteria and make a decision based on what works
best in the organization's environment. Agile is a very successful project approach, and ERP projects
provide a great target for achieving accelerated benefits by using this approach.
This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this
material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.
© 2012, Jason Fair
Originally published as a part of 2012 PMI Global Congress Proceedings – Marseille, France

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