A conversation has been going on lately among a community of experts around the concept of #NoEstimates. A lot of great points are being made, but as with every business topic, the swirl always evolves back to "It depends." It depends on what your stakeholders require to give you funding. It depends on the maturity of your team and the maturity of your partners. But, most importantly, it depends on the expectations of your customers (external and internal).
In my world, there is only one real goal to estimation—buy-in. Buy-in from Marketing that the product we
will make is what they want. Buy-in from
our Executive Leadership that there is a path to profit and we are the right
team to do the work. And, buy-in from us
that we understand what is being asked of us and that we will commit to do what
it takes to earn the business.
As a new product development department, we are running an
engineering services business. As
business owners, our goal is to be profitable.
This means we want our customers to pay us as much as possible and to
come back time after time with more for us to do. As a captive design services business, the
benefits get realized in the following ways:
- Growth: we are able to hire more people so we can do more cool things more quickly
- Competition: we capture a higher percentage of the work, without it going to outside firms.
But, at the end of the day, there are two key deliverables
that govern whether or not we’re a useful team:
- Dependability
- Are we in control? Does what we say match what we do?
- Value
- Do we help the company do what it needs, with a higher value proposition than any other option?
Value is not created if we are not dependable. Being a captive engineering services house,
we get benefits—biggest among them, that our partners must consider using us
first. But, even there, if we do not deliver to our customers' expectations, the organization will look for alternatives (3rd party houses, partnerships, etc.). Dependability, therefore, is first and
foremost about getting what we DO to match what we SAY. This requires control at the beginning: we need consensus with our partners on
requirements to increase the probability that we will delight them. Our estimates are our first deliverable on the requirements--they are the basis of our promise of dependability.
Assuming dependability, our biggest differentiator is value. Simply put, our goal is to meet the needs and
wants of the company more efficiently than anyone else can. Showing value is a difficult balance between exceeding
expectations through awesome execution and managing expectations through
education and partnership. Our success is directly dependent upon how successful our customers (the marketing and
sales teams) are. From the beginning , estimates provide our customers the value proposition they need to make the case to "hire" us.
Ultimately, marketing exceeds expectations when they deliver
business opportunities that bring in a bigger pile of money than anyone
expected. They have their own
challenges to work through to manage expectations and delight their
stakeholders as they define opportunities.
But, as their partner, we have a huge stake in their success—our participation
determines their timing and and our estimates determine the payback time period on their business cases.
Our work estimate is the basis of our contract—the basis
of our reputation.
As a result, estimation is a core skill for the success of
our team—and of every engineer. While we can't guarantee that we're right, we create a series of conversations with our customers and stakeholders. To provide #NoEstimates is to bypass those conversations and that misses the point.
