This question came up on the Scrum Development List yesterday. Here's my take on it:
> Can Scrum play a key role in fixed price projects achieving their target?
Absolutely! In fact, the more I think about it, the more I think Scrum is the best way to take on a fixed price project.
The process starts in pre-sales so that you set the expectations with
the customer and leave yourself some maneuvering room to even out the
risks of various pieces of the project. Some things will go quicker,
others slower. You need to make sure that even if some things turn
against you, the project as a whole stays within bounds.
Ron
Jeffries will probably point out at this point that you need to add
good engineering to your sound management practices. An he will be
right. So you need good engineers working on your project. If they've
been working together for a while, been working on a similar project, or been working with
Scrum before, you improve the odds in your favor. If they were involved
in the sales process, that's even better.
Basically you strive
to deliver
Running Tested Features every sprint (and this implies a fair
amount of automation in your quality assurance). Every Sprint you
deliver functionality to the customer. And you give him his most
important features first. Add in some sensible buffers (Must Have /
Should Have / Nice to Have) on the feature side and/or some air the
schedule side for risk management, and you have the basis for
delivering what the customer needs when he needs at.
Why is
Scrum better than a waterfall? Scrum delivers functionality at least
every month. Tested and Done. Think constant positive velocity.
Waterfall has long periods of zero velocity (initial planning phases)
and zero or even negative velocity (periods of testing in which the
team and customer discover that significant pieces of functionality
don't work properly or otherwise do not satisfy customer requirements)
. Highly variable velocity is a significant risk, because you cannot really predict when the product will be ready.
Having said all that, I'm not sure I'd recommend fix price contracts if you can avoid them. Last week, I published on ASD an
analysis of the suitability of various contracting forms for agile development. I think there are better alternatives for both vendor and customer.