Executive summary - An Adaptive Performance Management System

Posted by Jim Highsmith on Aug 09, 2006

Community

Agile

Topics

Delivering Value ,

Leadership

Tags

Budgets ,

Management ,

Business/IT Alignment ,

Value & Metrics ,

Performance Evaluation

InfoQ.com offers readers a free pdf of the Executive Summary of Jim Highsmith's Cutter Executive Report: An Adaptive Performance Management System

As the Agile emphasis on transparent reporting works its way through an organization, managers at various levels start to identify existing metrics that actually work against  the adaptability offered by Agile software development.  Not surprisingly, managers are starting to look for alternatives to traditional budgeting systems. 

Jim Highsmith quotes Jeremy Hope and Robin Fraser on the subject of traditional budgeting:

Budgets have ... been hijacked by a generation of financial engineers that have used them as remote control devices to "manage by the numbers." They have turned budgets into fixed performance contracts that force managers at all levels to commit to delivering specified financial outcomes, even though many of the variables underpinning those outcomes are beyond their control.
-- Beyond Budgeting: How Managers Can Break Free from the Annual Performance Trap

Highsmith identifies three measurement ideas critical to creating an adaptive organization:

1. We must acknowledge that our performance measurement system impacts agility.
2. We must alter our obsession with time to become an obsession for customer value.
3. We must separate the project performance management system from the team performance management system.

In this Executive Report Summary, Highsmith goes on to outline a project performance management system, focusing on outcomes that generate customer value; and a team performance management system, providing informational metrics that teams can use to improve their ability to deliver.

The report includes a free 4-week trial of Cutter's Agile Project Management E-Mail Advisor, designed to help management take Agile from the project level to the enterprise level.

About the author

Jim Highsmith is Director of Cutter Consortium's Agile Project Management practice, and is considered a leader of the agile methodology movement. He consults with IT and product development organizations and software companies worldwide to help them adapt to the accelerated pace of development in increasingly complex, uncertain environments. Mr. Highsmith is the author of Agile Project Management: Creating Innovative Products; Agile Software Development Ecosystems; and Adaptive Software Development: A Collaborative Approach to Managing Complex Systems, which won the prestigious Jolt Award for Product Excellence. Mr. Highsmith is the recipient of the 2005 Stevens Award, in recognition of his work on adaptive software development and agile processes. He is coauthor of the Agile Manifesto and a founding member of the Agile Alliance. He can be reached at jhighsmith@cutter.com.

About Cutter Consortium Agile Project Management Practice

Cutter Consortium's Agile Project Management practice provides information and guidance to help organizations transition (or make the decision to transition) to agile methods. Led by Practice Director Jim Highsmith, Cutter's team of experts focuses on agile principles and traits -- delivering customer value, embracing change, reflection, adaptation, etc. -- to help you shorten your product development schedules, and increase the quality of your resultant products. Cutting edge ideas on collaboration, governance, and measurement/metrics are united with agile practices, such as iterative development, test-first design, project chartering, team collocation, onsite customers, sustainable work schedules, and others, to help your organization innovate and ultimately deliver high return-on-investment.

View more Agile Project Management Executive Report abstracts on the Cutter Consortium site.

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