I wrote up a rant-y style summary of thinking about ROI when it comes to planning out Agile, DevOps, cloud native, and otherwise “new ways of doing things in IT” schemes.
A little excerpt:
Doing “agile,” however, isn’t like dropping in a new, faster and cheaper component into your engine. Many people I encounter in conference rooms think about software development like those scenes from 80s submarine movies. Inevitably, in a submarine movie, something breaks and the officer team has to swipe all the tea cups off the officer’s mess table and unfurl a giant schematic. Looking over the dark blue curls of a thick Eastern European cigarette, the head engineer gestures with his hand, then slams a grimy finger onto the schematics and says “vee must replace the manifold reducer in the reactor.”
Solving your digital transformation problems is not like swapping “agile” into the reactor. It’s not a component based improvement like virtualization was. Instead, you’re looking at process change (or “culture,” as the DevOps people like to say), a “thought technology.” I think at best what you can do is try to calculate the before and after savings that the new process will bring. Usually this is trackable in things like time spent, tickets opened, number of staff needed, etc. You’re focusing on removing costs, not making money. As my friend Ed put it when we discussed how to talk about DevOps with the finance department:
In other words, if I’m going to build a continuous integration platform, I would imagine you could build out a good scaffolding for that and call it three or four months. In the process of doing that, I should be requiring less help desk tickets get created so my overtime for my support staff should be going down. If I’m virtualizing the servers, I’ll be using less server space and hard drive space, and therefore that should compress down. I should be able to point to cost being stripped out on the back end and say this is maybe not 100% directly related to this process, but it’s at least correlated with it.
In this instance, it’s difficult to prove that you’ll achieve good ROI ahead of time, but you can at least try to predict changes informed by the savings other people have had. And, once again, you’re left to making a leap of faith that qualitative anecdotes from other people will apply to you.