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3 Steps for Planning to Team Capacity

Planning to realistic capacity

 

2021 is still shiny and brand new and I’m sure we’re all ready to leave 2020 in the rear-view mirror. We’ve all got big plans for 2021 and are thinking about how to bring our product roadmaps to life. Many organizations have already started this process or are still working through it.

Your Executive team may have laid out ambitious goals to grow by 200% or enter a hot new market and everyone is excited by the prospects of making it happen. And now your teams are trying to figure out exactly…“How do we get this done?”

When it comes to planning there are several common components:

  • The product ideas on your roadmap

  • The strategies or work-streams you associate those ideas to (ex: “business as usual”, Client-driven work, Strategic work, etc…)

  • The relative priorities of each product idea

  • The estimated sizes of each product idea

  • How those ideas map to your team's skillsets. Are they front-end heavy, backend heavy, require new expertise?

  • The capacity of your teams

These are all important and today we’re going to focus on the capacity dimension. First, let’s level set exactly what we mean by capacity and work-streams.

Capacity is the measure of how many points a team (or organization) can complete in a given time period”

ex) If a team Alpha regularly completes 100 points of stories each week then over the course of 6 weeks we can calculate the team has a capacity of 600. Many organizations planning in Quarters so with 13 weeks in a quarter team Alpha has 1300 points of capacity per quarter.

Work-streams refer to categorizations of work into business themes”

Pretty much all software companies have the following work-streams:

  • Required Maintenance - bug fixes, patches, system upgrades, etc. Things that must be done to service your existing customers

  • Client Driven Work - Work that is done for specific customers

  • Strategic Work - Things that expand product capabilities, keep the product competitive or enhanced the market reach (this is not an exhaustive list but we trust you get our point)

Now we're ready to talk about 3 steps we can take to figure out how much work our teams can confidently commit to. We don't want to over-promise or under-promise because being realistic will help us create the best business outcome.

Step 1: Establish the baseline of your mandatory and discretionary work streams

In order to understand how you want to spend your time, it’s best to start with an understanding of how you currently spend your time. There is usually a work-stream of mandatory things that must be done and therefore planned for (ex: Required Maintenance). Understanding how much capacity is needed for mandatory work lets you know how much is left for discretionary work. Most organizations wish to have as much capacity as possible allocated to discretionary work since it's usually the strategic work that enables new sales and grows the bottom line.

For users of Jira, one straightforward (but tedious and painful) way to do this is to inventory all of the Epics your teams have worked on in the last quarter and tag them to your work-streams. This usually is done manually in Excel or Google Sheets. From there you can sum up the points of all the stories in those epics and use them to figure out your current breakdown. If you are thinking to yourself, “but we don’t use Epics”, we’d say, you really should start (for this and many other reasons related to better organization and visibility).

For our hypothetical team Alpha they had 12 Epics which showed they did:

  • 15% Required Maintenance

  • 25% Client-Driven work

  • 60% Strategic Work

We’ve got our baseline! As we're looking forward to the next quarter we should keep this in mind in how we expect it to be similar or different.

Step 2: Categorize your strategic backlog

Now we need to look at all the awesome things the teams have scoped out to make your goals a reality and hit that 200% growth target. Let’s assume that we've already created, prioritized, and estimated a set of epics. Now we should look at those Epics through the lens of our work-streams and tag them. Unfortunately, again you need to do this outside of Jira because while labels are great you’ll still need to manually aggregate up the points.

With that work in clear view ask yourself: Are all of our work-streams represented in the list? if not, add epics for them.

Pro-tip: Sometimes organizations may view work as a hybrid that doesn’t exclusively fit into 1 work-stream. In this case, we recommend that you pick the dominant stream and use it. Usually, it's a hair not worth splitting but if it is…then split the Epics and categorize specifically.

Great work! Now that you’re comfortable that you’ve got the full set of work you’ll need to get accomplished visibility you can again sum up all the epics towards each of your tags.

Let’s imagine it looks like this:

  • 10% Required Maintenance, 200 points

  • 40% Client-Driven work, 800 points

  • 50% Strategic work, 1000 points

  • Total: 2000 points

We can see we've got a little less Required Maintenance and Strategic Work but a lot more Client-Driven work on deck.

Step 3: Figure out what can be committed to

So with the data, we’ve sorted out, what do we know?

  • 2000 points in the roadmap are more than 1300 of the quarterly capacity so not everything can reasonably be done in 1 quarter by team Alpha.

  • Prioritization will be important to make sure Alpha is working on the most impactful things since they can’t do it all

Let’s look at some of the ways prioritization plays a huge role. Our assumptions:

  • Required Work must be done

  • Client-Driven Work is usually more important than Strategic Work

  • We want to do as much Strategic Work as possible

 

Scenario 1) Prioritized by Tags

This scenario gives us a view of where all the Required Maintenance and Client-Driven work are at the top.

Capacity  Scenario 1

 

Observations:

This breaks down to be:

15% Required Maintenance, 200 points

62% Client-Driven work, 800 points

23% Strategic work, 300 points


 

 

Scenario 2) Heavy on Strategic Work and only Client-Driven work for Top 10% revenue clients

Capacity Scenario 2

 

Observations:

This breaks down to be:

12% Required Maintenance, 200 points

37% Client-Driven work, 475 points

48% Strategic work, 625 points


 

 

 

Scenario 3: No Client-Driven Work, We must get into the Cloud!

Capacity Scenario 3

 

Observations:

This breaks down to be:

12% Required Maintenance, 200 points

0% Client-Driven work, 0 points

88% Strategic work, 1125 points

The full 1300 points of capacity were not used but maxed out on Strategic Work


 

 

The goal of these scenarios (and there are many more possible ones) is to illustrate several points:

  • Having a clear understanding of your capacity will help drive decision making around priorities.

  • Product Owners still have a great deal of flexibility in decision making to enable strategy.

  • Thinking about “mandatory” vs “discretionary” work is important. In each of these scenarios, we stayed faithful to prioritizing “Required Maintenance” to ensure it would be done but we’ve all seen scenarios where this does not happen.

One of the best things about planning to capacity (and involving the teams doing the work in the process) is people are more likely to put in discretionary efforts when they participated and agreed to the commitment. It fosters a culture of accountability.

It also enables leaders to have informed conversations about staffing allocations and hiring. If your team is fully allocated but the business wants to get more done it's not much more effort to figure out how many people should be hired or moved into the team to add capacity.

 

Hakkiri Helps You Deliver Software Predictably™

Hakkiri empowers software organizations with our Continuous Clarity Engine™ to deliver products with speed and predictability. We are big believers in doing ambitious things but also managing to capacity. Our platform’s deep analytics and tagging capabilities make Steps 1 & 2 a breeze and Step 3 is coming soon on our roadmap!

Stay tuned to our blog as we continue to discuss more topics that aim to make delivery more predictable. In the meantime, check out our product page to learn more about how our platform can help you.

 

 

James Smith

Written by James Smith

James Smith is a co-founder of Hakkiri. With over 20 years in technology he has been instrumental in numerous transformative initiatives as an engineer and executive. As the Senior Managing Director of Engineering at Eze Software Group, James brought 3 legacy organizations, spanning 350+ people at 7 sites around the world, together as a unified team. He guided process modernization and technology adoption to enable the business to move into the cloud. These experiences have given him deep insights into organizational change and how the culture of technology teams can impact results.