What is Cost of Delay? Why is it the “one thing” to quantify? How can I get started with Cost of Delay? How do I quantify the Cost of Delay for my feature or project?
Cost of Delay is a way of communicating the impact of time on the outcomes we hope to achieve. In this way, Cost of Delay combines urgency and value – two things that humans are not very good at distinguishing between. It should matter to us to know not just how valuable something is, but how urgent it is. The value that we miss out on when we deliver slowly or “late” can be enormous. It is often far more valuable to get something even a week earlier than it is to make it slightly cheaper to develop. These trade-offs are simply not obvious though, unless we understand the Cost of Delay.
As you will learn, quantifying the Cost of Delay not only helps improve prioritisation, it also help with making trade-off decisions, creates a sense of urgency, and changes the focus of the conversation.
Maybe this has got you interested in experimenting with it, but you’re not sure how to get started? If so, you’ve come to the right place. We’ve done this for lots of different organisations: from Fortune 500 giants like Apple and Maersk to smaller startups, as well as both public and private sector.
“We need Cost of Delay to evaluate:
- the cost of queues
- value of excess capacity
- benefit of smaller batch sizes
- value of variability reduction
“Cost of Delay is the golden key that unlocks many doors. It has an astonishing power to totally transform the mind-set of a development organisation.”
– Donald G. Reinertsen
When people hear about Cost of Delay they sometimes doubt whether their organisation is ready for it. They say things like, “We don’t have the maturity for it”, or “We couldn’t do that because our stakeholders wouldn’t support it”.
We’ve heard people say this too. And yet, in hindsight, people find it much easier than they thought! We will show you how to get started with using Cost of Delay, despite these doubts.
“Sounds good, but are we ready for this?”
A three minute intro…