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The incremental funding method: data-driven software development

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2 Author(s)
Denne, M. ; Sun MicroSysterms Inc., Mountain View, CA, USA ; Cleland-Huang, J.

Software development projects don't get funded unless they return clearly defined value to the business. Demands for shorter investment periods, faster time-to-market, and increased agility require new, radical software development approaches. These approaches must draw on the expertise of both software architects and financial stakeholders and open the traditional black box of software development to rigorous financial analysis. We can accomplish this only by positioning software development as a value-creation activity in which business analysis is integral. The incremental funding method is a financially informed approach to software development. IFM maximizes returns by delivering functionality in "chunks" of customer-valued features, carefully sequenced to optimize the project's net present value (NPV). We derived the IFM concepts from several years' experience in winning competitive contracts for large-systems integration and application development projects.

Published in:

Software, IEEE  (Volume:21 ,  Issue: 3 )

Date of Publication:

May-June 2004

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