Value of Training (CSPO)

What’s Scrum training worth?

I am about to lead a Certified Scrum Product Owner course. (2 days in NYC and a bit later in Saratoga Springs.) The question comes up: What is this course worth? I explain this in more detail in the course, but here’s the summary.

In the course we talk about many things, and hope to get many improvements. Imagine, though, that we only make two improvements to a Product Owner, and that the PO manages only one team.

Assume the team costs about $1 million all-in per year. A team of about eight people.

Assume the team currently produces about $3 million per year in NPV (net present value, a core way of measuring Business Value). (Microsoft seems to be averaging about a 5:1 ratio or better overall.)

OK. Say we teach Sam, the PO, how to create 20% better stories overall. So, instead of a $3 million project for the year, the team has a $3.6 million project for the year.

We also teach him the Pareto Rule and how to work at it all the time. (80% of the value comes from 20% of the work.)  We (plus Sam) aren’t perfect, so Sam comes back only able to execute the 85-33 rules, i.e., Sam has to do 33% of the work to get 85% of the value — a lot more work (than 20%) for only a little more value.

OK, this means in 33% of a year (4 months), the team can get 85% of $3.6 million. Let’s round down and call that $3 million.

We assume Sam (and the firm) can find more work of the same value. So, in the next 33% of a year (next 4 months), the team produces another $3 million in BV. And in the last third of that year, the team produces another $3 million in BV.

So, now we have $9 million in BV in one year — 3 times more improvement.

(Note: We assume that the team did *not* increase story point velocity at all. No other impediments removed — very conservative assumption.)

Even if we (Sam) don’t immediately achieve quite the same level of improvement we assumed (which itself was far from perfection), I think you can see that we have a pretty valuable improvement. And, in my opinion, those two improvements alone justify the costs for a 3-day CSPO course, even in a serious recession.

What do you think?  Use your own assumptions.  Calculate it again with your assumptions.