PSPO I Questions - TCO, value and success metrics

Last post 03:39 am August 20, 2014
by Olivier Ledru
9 replies
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11:14 am August 14, 2014

Hi,

first post, please go easy… ;)

I recently passed the PSM I which I think is easy to do with some reading and the forums help (also reading).
Now I am preparing for PSPO I and found a thread in which a member failed to pass the PSPO I assessment. I am not quite sure what the PSPO I will be all about since it has no free assessment and some kind of questions I found here (the thread mentioned before: https://www.scrum.org/Forums/aft/846 ) I couldn't find any answers for. I know what TCO is. I think I understood the value concerning scrum. But I got my problems with the following topics (please be aware that I am aware of the subject areas, books and so on):

1. What is the total cost of ownership of a product, and how would the PO control that?

2. How does the PO determine value?

3. What are the success metrics for products?

4. And lust but not least: The cone of uncertainty. I know about it. I think I know what it is and how it is used (as far as you use it) but I can't imagine a question regarding the cone of uncertainty.

For 1. is there a special TCO thingy in scrum I oversaw? How can I scrum specifically measure or interpret the TCO of a product? How does a PO control the TCO of the product peculiarly since I thought it would be the byproduct of the whole PO role doing its job.

For 3. Doesn't the PO determine the value in advance and after that it is only the def of done?

I would appreciate any help regarding this matters?

Please excuse the maybe bad english - non native here.

01:02 pm August 14, 2014

The best advice I can give having done this self study is really do get into the books.
Read the books they recommend and try to get a good "in depth" feel for the product owner.
I appreciate your aware of the subject areas but you will be tested in areas from all of them.
You need to be more than aware of the areas, you need to know them.
Exam questions are based on the books, so for optimizing value, take the answers from there too.
I was surprised what was in the exam, saying that I was also surprised what was in the books.

Areas tested are:
Scrum Framework.
Scrum theory and principals.
Cross functional and self organizing teams.
Maximizing value.
Product backlog management.

Really do immerse yourself in those books is the best advice I can give.
Good luck with the study on the PSPO, its not easy but it is rewarding.

Michael

04:01 am August 18, 2014

Hi,
I did the PSPO I with 99% first attempt and did not read any of the recommended books. However I had the 2 day course which I found very helpful.
1. I guess you know what the TCO is. As the name suggests, the total costs the product causes over its whole product lifecycle. What exactly is included is very specific for the product, but exam question go for example in the direction of technical debt. PO would control that by talking to the dev team, asking them if they are creating technical debt and asking the Scrum Master and dev team for help how to avoid that.
2. Again, this is specific for the product. For most companies there is value in revenue, so the Product Owner would set release goals that make more customers buy the product. For non-profit organizations, there can be value in many different things.
3. Success metrics include innovation rate, strategic alignment index, installed version index, delivery index, operational excellence, usage index. You should find explanations in the books mentioned. The point is, if you multiply these indices you see what percentage of your investment actually reaches the customer as usable software.
4. If you know what it is and how it is used, you will be able to answer questions regarding the cone of uncertainty. It's no rocket science.

12:00 am August 19, 2014

Ludwig,

Great feedback. Re:#3 -- which of the books did you see these metrics in?

cb

03:08 am August 19, 2014

Charles,
I still didn't read the books. But they are discussed in the course, so I just guessed that if they recommend the books, these indices should be discussed there as well...
But I just found some slides here:
http://blog.accentient.com/files/Schwaber-Reston.pdf
The indices are mentioned on page 107.
Best, Ludwig

03:30 am August 19, 2014

Innovation, installed version, and usage indices feature in the Agility Index of Agility Path (or EBMgt as it seems to be called now).

I can't comment on the PSPO exam, but I'd suggest that these and other indices are seen as being representative measures rather than definitive ones. In agile practice, the important thing is that metrics are actionable and do not represent vanity concerns.

03:42 am August 19, 2014

NB as regards:

> 2. How does the PO determine value? 

The short answer is Return on Investment. That's arguably the closest you can get to a "One True Metric" for Scrum, but it is neither perfect nor clear. ROI can be measured a number of ways, and in terms of inspection and adaptation it is almost invariably a lagging indicator.

04:01 am August 19, 2014

In the LeanStartup MVP view, Value can be also estimated based on the cohort of customer (more new customer / more download / less customer that don't renew their licence...) instead of pure financial concern.

11:30 am August 19, 2014

Thanks for the answers. I was aware that many of those metrics are in EBM because I'm an EBM consultant! :-)

My question was around whether they were in any of the recommended books, and I don't think they are. Having said that, many of them are covered in the EBM guide which you can get here: http://www.ebmgt.org/Evidence-Based-Management

(Business) Value is money... now it might mean money in the short or long term, but it's about money. As someone said above, the only exception to that is if you work for a non profit -- and in those cases, the value is in the societal benefit.

03:39 am August 20, 2014

@Charles - thanks a lot for the link ;-)