Q: Tell us a little about your environment?
A: We at the Danish IT & Telestyrelsen invest in public sector IT projects. We have three types of contracts in the public sector: Time and Material (hourly rate), Direct standard contracts for projects below €65000, and EU tenders for anything above.
Q: What triggered the Danish IT og Telestyrelsen to rethink how to purchase and manage their IT portfolio?
A: An investigation by the Ministry of Finance in 2007 showed that project that ran well contained up to 60% not needed features. Also 60-70% of public IT projects fail due to budget / time slippage. This triggered the move to more Agile contracts and projects.
Q. What is the experience now after four years of agile projects?
A: Interestingly it has not been cheaper projects. But rather they are more frequently on time and the efficiency gained is used to deliver more value to end users.
Q: How did the transition happen, where was the biggest resistance?
A: There is always a risk in getting stuck in usual behavior. There’s the biggest challenge.
Q: What is the difference of Agile contracts compared to traditional?
A: One key difference is avoiding locking down too much in the contract. Rather maintaining options throughout the process. As an example, we list maximum of 2 sprints worth of requirements in our contracts today.
Q: How do you ensure that the contractor is mature enough for the project?
A: We check the CV for all participants in the projects. For new subcontractors / teams we run a “sprint 0” where we verify that they have the capacity to deliver something runnable.
Q: What are the important factors in selecting a subcontractor?
A: For us, skills are the key in selecting subcontractors.
Q: How can a customer make the argument for Agile contracts?
A: A key difference is that in traditional projects you actually have less control, since you don’t see anything before the end. But you need also to be mature to think in terms of value, not only time and money.
Q: What are the important parts of an Agile contract?
A: Boundaries, Vision, Working Agreement and Verification criteria. Boundaries defines the limits, Vision the business case and Working agreement. The working agreement describes the way of work, methodology used and who participates in what meetings. An important “feature” for us is that all participants, including the developers sign this document.
We run two types of contracts, i01 and i02 based on the standard k01 and k02.
i01 are made for phased projects with one single and FINAL test delivery for the customer
i02 are made for longer and more complex projects with ongoing delivery
For the I01 contract we use the restriction of length > 6 months and a budget < €100 000.
Q: Will you keep using Agile contracts for upcoming projects?
A: Yes. Because once you moved away from traditional contracting you will never go back again!
Thanks Christian for your time!
