Andreas Opelt is Vice President for Sales, Product Marketing, and Partner Management at Infonova.Boris Gloger is ranked worldwide among the pioneers of Scrum. He continues to develop practices and set training standards internationally.Wolfgang Pfarl is a trained lawyer and is responsible for the IT procurement at the Austrian Post.Ralf Mittermayr is a partner at BearingPoint and focuses on conceptual design and delivery of complex software solutions to the banking, telecommunications, and supply industries.

“Given what FAR says so eloquently and the Office of Management and Budget (OMB) and Office of Federal Procurement Policy have reaffirmed, it is not surprising that on June 14, 2012, the OMB provided a 25-page memorandum providing guidance to support modular development that specifically addressed the practices and issues raised here. I recommend this book to all members of any integrated product team tasked with IT acquisition and contracting.”  (Computing Reviews, 7 January 2013)

• Preface ixAcknowledgments xiii1. Agility: What Is That? 11.1 The Agile Manifesto of 2001 61.2 Agile Development Based on Scrum 111.2.1 The Principles of Organization 141.2.2 The Process Model 141.2.3 Estimation in Scrum 191.3 Agility from the Perspective of Procurement 231.4 Agility from the Perspective of the Software Provider 251.5 The 12 Principles of Agile Software Development 261.6 Summary 322. The Missing Piece of the Puzzle 332.1 The Problems with Traditional Fixed-Price Contracts 372.2 The Problems with Time and Materials Contracts 432.3 Something New: The Agile Fixed-Price Contract 442.4 Summary 453. What Is an Agile Fixed-Price Contract? 473.1 Existing Approaches 483.2 The Agile Fixed-Price Contract 493.2.1 How Is an Agile Fixed-Price Contract Set Up? 503.3 Summary 714. Sample of an Agile Fixed-Price Contract 73Preamble 74§1 Definitions and Clarifications of Terms 75§2 Contract Scope and Hierarchy of Documents 78§3 Usage Rights 79§4 Transparency and “Open Books” 79§5 Acceptance 80§6 Obligation of Both Parties to Co-Operate 81§7 Client’s Obligations 84§8 Escalation to the Steering Board and the Independent Experts 84§9 Project Period 85§10 Warranty, Compensation, and Indemnifi cation 86§11 Limitation of Liability 86§12 Contractor’s Compensation 87§13 Force Majeure 87§14 Secrecy 87§15 Severability Clause 88§16 Place of Performance, Jurisdiction, and Applicable Law 88Appendix A: Commercial Agreements 88Prices 88Commercial Approach to the Project 90Payment Milestones 92Appendix B: Technical Scope and Process 92Requirements: Backlog and Vision 92Process for Development and Approval 93Changes to the Contract (Exchange for Free) 95Deliverables and Services 97Mechanism to Calculate Costs of Future User Stories 98Appendix C: 12 Principles of Cooperation 101Appendix D: Quality Standards—Definition of Done 1075. Tendering Based on an Agile Fixed-Price Contract 1095.1 Appropriate Tender Content for an Agile Fixed-Price Contract 1125.2 Requirements for Tendering and Selection 1165.2.1 Competition 1165.2.2 Comparability and Transparency 1195.3 Tendering Steps with a Focus on Agile Fixed Price 1225.3.1 Internal Goal Setting and Coordination 1235.3.2 Preparation for the Invitation to Tender 1245.3.3 Tender 1265.3.4 Awarding of the Tender 1305.3.5 Price Optimization Options 1325.3.6 Project and Contract Management 1345.3.7 Effort Inherent in the Tendering Process 1345.4 Summary 1346. Special Requirements for the Legal Framework of an Agile Fixed-Price Contract 1376.1 Adaptable System for Scope 1396.2 Warranty and Damages 1406.3 Schedule and Milestones 1416.4 Path of Escalation 1426.5 Obligations 1436.6 Summary 1437. Guideline for the Negotiation of an Agile Fixed-Price Contract 1457.1 Objectives of the Client 1477.2 Objectives of the Contractor 1487.3 Objectives and Bonus Payouts of the People Involved 1497.4 Strategy for the Project and the Negotiation 1517.5 Tactics for the Negotiation 1527.6 Price Determination 1557.7 Conclusion of the Negotiation and Project Steering 1557.8 Conclusions 1568. Advantages and Disadvantages of Agile Fixed-Price Contracts 1578.1 Detailed Analysis of the Pros and Cons 1588.1.1 Budget Security 1598.1.2 Requirement Flexibility 1598.1.3 Detailed Requirements 1608.1.4 Negotiating Costs 1608.1.5 Estimate Security 1608.1.6 Quality Risk 1608.1.7 Price Elevation Tendency 1618.1.8 Probability of Winning a Project Tender 1618.1.9 Cost Risk 1618.1.10 Security to Deliver a Project as a Whole 1618.1.11 Acceptance Efforts 1748.1.12 Pricing Transparency 1748.1.13 Progress Transparency 1748.1.14 Permanent Regulation 1748.1.15 Securing the Investment 1748.2 Summary and Overview 1828.3 Conclusions 1849. Toolbox for Agile Fixed-Price Contracts 1859.1 Stimulating Interest Before the Negotiation 1869.2 Identifying Issues of the Other Party 1899.3 Establishing Common Language and Experiences 1899.4 Feature Shoot-out 1919.5 The Black Swan Scenario 1929.6 Workshop on Contract Setup 1929.7 Reports and Metrics 1969.7.1 KISS Backlog View 1969.7.2 Focus: There Is a Single Goal! 19710. Practical Examples 19910.1 Example 1: Software Integration in a Migration Project 20010.1.1 Initial Situation 20010.1.2 Contract and Procedure for Traditional Methodologies 20210.1.3 Contract and Procedure for Agile Methodologies 21310.1.4 Contract for Example 1 22210.2 Example 2: Creating a Software Product 24010.2.1 Initial Situation 24110.2.2 Contract and Procedure for a Traditional Fixed-Price Contract 24110.2.3 Contract and Procedure for a Time and Materials Contract 25310.2.4 Contract and Procedure for an Agile Fixed-Price Contract 26110.2.5 Conclusions 268Appendix: Questions and Answers 271References 275Index 279