Evaluating schedules of iterative/incremental software projects from a real options perspective

Vassilis C. Gerogiannis, Androklis Mavridis, Pandelis G. Ipsilandis, Ioannis Stamelos

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

In an iterative/incremental software project, software is built in a sequence of iterations with each of them providing certain parts of the required functionality. To better manage an incremental delivery plan, iterations are usually performed during pre-specified time boxes. In a previous work, we addressed the problem of optimizing the schedule of incremental software projects which follow an iterative, timeboxing process model (TB projects). We approached scheduling as a multi criteria decision problem that can be formulated by a linear programming model aimed to overcome some "rigid" simplifications of conventional timeboxing, where durations of time boxes and stages are equal and a priori fixed. In this paper, we move this decision making process one step forward by applying real options theory to analyze the investment risks associated with each alternative scheduling decision. We identify two options in a TB project. The first is to stall (abandon) the development at a pre-defined iteration, while the second is to continue (expand) development and deliver the full functionality. Thus, we provide the manager the flexibility to decide the most profitable (valued) combination of delivered functionalities, at a certain iteration, under favourable or unfavourable conditions.

Original languageEnglish
Title of host publicationICSOFT 2008 - 3rd International Conference on Software and Data Technologies, Proceedings
Pages224-233
Number of pages10
VolumeISDM
EditionABF/-
Publication statusPublished - 2008
Event3rd International Conference on Software and Data Technologies, ICSOFT 2008 - Porto, Portugal
Duration: 5 Jul 20088 Jul 2008

Other

Other3rd International Conference on Software and Data Technologies, ICSOFT 2008
CountryPortugal
CityPorto
Period5/07/088/07/08

Keywords

  • Iterative/incremental software projects
  • Real options analysis
  • Timeboxing

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  • Cite this

    Gerogiannis, V. C., Mavridis, A., Ipsilandis, P. G., & Stamelos, I. (2008). Evaluating schedules of iterative/incremental software projects from a real options perspective. In ICSOFT 2008 - 3rd International Conference on Software and Data Technologies, Proceedings (ABF/- ed., Vol. ISDM, pp. 224-233)