The Guiding Spirit for Assigning Business Value to Planned and Actual Business Value of a Business Objective During ‘PI Planning’ and ‘Inspect and Adapt’

Tuesday, September 25, 2018, I passed by a bake sale for the Susan G. Komen for the Cure and originally as The Susan G. Komen Breast Cancer Foundation, often referred to as simply Komen. Lots of goodies and very friendly volunteers.

Two items caught my attention… I asked how much $ for the two items. The volunteer informed me that it is up to me … to self-determine the $ value of it… the $ that I give is a donation to the foundation… I could even opt not to give any money at all and take the goodies with me! Self-determination … what a concept… I like it a lot! Lean-Agile is all about self-determination. My cup of tea!

I liked what I heard…

So, self-determine I did… I gave $5.00 — that was what I thought the value of those two items were without even tasting a sample — and left with my goodies.

When I got home… got busy… I did homely stuff at home … and I almost have forgotten about the goodies I bought. I searched my bag for those…put those on the table… and paused… not sure what to do next. I got options to think about doing next with these…

Several things could happen next: 1) I could take a bite and taste these and see if these are really worth what I perceived to be worth $5.00, or would these be worth more, or worth less, 2) I could decide that I really don’t want it… don’t even want to taste it… my appetite for it is gone…it’s value to me then becomes zero.

I’ve decided to take a bite…

Both were yummy!!! The value to me upon tasting it is worth more than my initial valuation of $5.00! My post-taste valuation is $8.00!

That’s the guiding spirit to use when assigning value to a business objective. Use this guiding spirit at pi planning (that is the self-determined $5.00)… and during ‘inspect and adapt’ after the system demo by the product manager to the business owner, customers, and other key stakeholders (that is the $8.00 that I have self-determined after taking a bite off the goodies).

In SAFe, business owner (in collaboration with customers and key stakeholders) self-determines the value of planned and actual business value of each business objective; business owner uses a range of 0 to 10 — a set of unit-less numbers — for the value.

So there you have it: key word is self-determined value…don’t look for standardized guideline to base value on. It’s all on your perception as a business owner that drives the valuation considering what you see and other factors like the marketplace. Alan Greenspan had a famous line: ‘irrational exuberance’ — the then USA federal reserve chairman meant that investors’ enthusiasm is driving the stock prices up to levels not supported by fundamentals; in this business value valuation, we have similar line: ‘irrational perceptive valuation’ — business owner’s perception (including the marketplace as a factor in his/her perception) drives the value of an objective up or down…to levels not supported by fundamentals.

Cutting back to the first scene of this write up to tie everything up — to close the loop: i’ve self-determined the value of the goodies from the get go without fundamentals …like tasting it first. I valued it — using my irrational perceptive valuation — at $5.00…. and I’m glad that the post-taste self-determined valuation of these two items is at $8.00!

Note: per SAFe: it is hard to hit a moving target (i.e. Business Value is fleeting). Therefore, if the team meets (achieves)  the promised PI Objective, then the Actual Business Value number (also called assessed score) is the same as the Planned Business Value number (also called assigned score).

This leads us to the notion of ‘Predictability’. Take the goodies as example. After tasting the goodies, my valuation changed from $5.00 to $8.00 — this means they have delivered more than I have initially perceived…I will buy from them again next time… they earned my business! Had my valuation to the goodies remained as what I perceived initially as their value to me… they still earned my business. If my valuation went 80% less than what I perceived initially as its value, then I will not be buying from them again. If I did not touch the goodies because I have no appetite for them anymore then it is on me not the sellers that drove the predictability down.

FedEx is aware of the power of predictability … they are always on time anywhere in the world … delivering value as planned. Just watch the movie ‘Cast Away’ … the protagonist (Tom Hanks) delivered the package that went down with the plane crash. Yup, FedEx earned my business because it is predictable in delivering value to customers.

Trust between entities/people rises and falls on predictability — CPG

October 15, 2022: My new book, “SAFe Is Like …“, is now available on Amazon

You will get a FREE SIGNED COPY if/when you register, pay, and complete a class by the Lean Agile Guru.

By Clarence Galapon

CE, MBA, Lean Agile Coach, Trainer, Teacher, SPC, RTE, PSM, PMI-ACP, PMI-PBA, PMP, CC, ABNLP NLP (Neuro Linguistic Programming) Practitioner, NLP Coach, NLP Trainer, Practical Psychologist, Life Coach, Software Executive, Entrepreneur, Author, Investor, and Innovator with a Creative, Lean, Agile, and Wander mindset.

Related Posts


Forgot Password?

Join Us

%d bloggers like this: