Risk And Rewards

The Risk Reward Curve

The risk/reward ratio (often illustrated as a curve) marks the prospective reward an investor can earn for every dollar, pound or yen they risk on an investment. Many investors use risk/reward ratios to compare the anticipated returns from an investment with the amount of risk they must undertake to earn these returns.

Investing in Agile Software Development

Adopting an Agile development approach is a kind of investment decision, much like any other investment decision. NB. Not all the investment is financial/monetary in nature, and neither are all the anticipated returns.

Your Winning Rate

Investors have long understood the necessity of combining the risk-reward ratio with the “winning rate” to know whether a given investment decision or strategy will prove a winner.

Agile Adoptions Are Highly Risky And Offer Limited Rewards

Agile adoptions have a remarkably low “winning rate”. Something like 75-90% of all attempted Agile adoptions fail.

It sure beats me why so many decision-makers fail to investigate (and thereby, understand) the risks and winning rates of Agile adoptions. Especially as the rewards accruing from adopting an Agile software development approach are so limited (read: minimal, or negative).

Is your organisation contemplating adopting Agile? Has it done its homework?

– Bob