Growth Rates

Best in class companies have small project growth rates, and the worst in class have large project growth rates. Growth rate is measured as the increase in the functional size of a software project. The software industry as a whole experiences a lot of growth in projects. It is common that projects will grow two and three times from the requirements phase until implementation. Those organizations with the highest growth rates are those with the lowest levels of productivity and quality. There is an inverse relationship between growth and productivity.

Best in class companies have growth rates of less than fifteen percent while worst in class have growth rates that can exceed three hundred percent. Most organizations are unaware of their growth rates or how much a project grows throughout the software lifecycle. They are also unaware of when the growth occurs. The best in class companies experience most of the growth early in the lifecycle while the worst in class companies experience most growth during the testing phase of the project.

Cost by Phase

The cost to implement the same piece of functionality is not constant throughout the life of a software project. The later a project functionality is implemented in the life of a software project, the more expensive per unit it will be. This means it costs about ten times as much to implement functionality during the testing phase as it does in the requirements phase.

These numbers also fall in line with other industries too. The cost to make changes late in a project applies to every industry from construction to weddings. The difference is most other industries can articulate the cost and most software organizations do not know the impact of making changes late in a project.