Cost Benefits Analysis Method CBAM

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Cost Benefits Analysis Method(CBAM)

• Presented by
• Monte Jones

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Overview

• What is CBAM?
• Steps in the CBAM Process.
• What are the pros and cons of CBAM in terms of
  decision making.
• What are the pros and cons of CBAM in terms of
  implementing.
• Summary
• Questions

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What is CBAM?

• CBAM is an attempt to assign a dollar value to
  identified features and utilities (benefits),
  resource expenditures (costs), and risks.
• The potential benefit, cost, and risk items are
  identified during the Architecture Trade-off
  Analysis Model (ATAM) evaluation process.

SOFTWARE ARCHITECTURE IN PRACTICE

• CBAM is an evaluation tool designed to aid
  architects and stake-holders in choosing between
  different architectural options in order to
  maximize the benefits while reducing the costs.

Making Architecture Design Decisions An
Economic Approach
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Output of the ATAM Process

• Description of the business goals that are
  crucial to the systems success.
• A set of architectural views that document the
  existing or proposed architecture.
• A utility tree that represents a decomposition of
  the stakeholders goals for the architecture
  starting with high-level statement of quality
  attributes and ending with specific scenarios.
• A set of identified risks.
• A set of sensitivity points (architectural
  decisions that affect some quality attribute
  measure of concern).
• A set of trade off points (architectural
  decisions that affect more than one quality
  attribute measure).

SOFTWARE ARCHITECTURE IN PRACTICE
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Steps in the CBAM Process

• Collate Scenarios
• Refine Scenarios
• Prioritize Scenarios
• Assign Utility
• Develop Architectural Strategies for Scenarios
  and Determine Quality Attribute Response Levels
• Determine the expected utility value of
  Architectural strategy using interpolation
• Calculate total benefit obtained from an
  architectural strategy
• Choose architectural strategies based on ROI
  subject to cost constraints
• Confirm results with intuition

SOFTWARE ARCHITECTURE IN PRACTICE
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The pros and cons of CBAM Decision Making

• Pros
• Brings together decision making stakeholders.
• Can aid architects in discovering and
  communicating high-costs for limited benefit
  scenarios.
• Provides a means to elicit and document the
  costs, benefits, and uncertainties.
• Provides a framework from which stakeholders can
  apply a rational decision-making process.
• Cons
• Potentially leaves many options open for
  stakeholders to chose from.
• Some costs and perceived benefits are entirely
  subjective.
• Even known costs can be subjective i.e. hourly
  wages are known, but a precise schedule and
  exactly who is going to work on the project are
  often difficult to establish early in the
  architectural and design process leaving the
  total labor cost as a subjective measure.

Using Economic Considerations to Choose Among
Architecture Design Alternatives
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The pros and cons of CBAM Implementation

• Pros
• The decision making stakeholders are present and
  have the opportunity to voice an opinion
• Cons
• Costs are often underestimated while benefits are
  often overestimated.
• Many estimates are based on past projects, often
  significantly different in function or size, with
  different team knowledge and experience levels.
• Many estimates are based on the collective memory
  of the stakeholders regarding the significant
  cost drivers.
• Many estimates are based on rules of thumb to
  estimate the monetary costs of intangible
  elements
• Stakeholders are often unable to dispel their
  biases of other team members and the natural
  psychological tendency to think positive.
• I think a major con is the inability of
  stakeholders to admit, let alone set aside, their
  political view points concerning the project.

wikipedia.org
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Summary

• What is CBAM?
• Steps in the CBAM process.
• What are the pros and cons of CBAM in terms of
  decision making.
• What are the pros and cons of CBAM in terms of
  implementing.

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References

• Bass, L., Clements, P., Kazman, R. 2007.
  Software Architecture in Practice, 2nd Edition.
  Westford, Massachusetts Carnegie Mellon
  Software Engineering Institute
• Kazman, R., Asundi J., Klein, M. 2002. Making
  Architecture Design Decisions An Economic
  Approach. Retrieved Oct 19, 2008.
  http//www.sei.cmu.edu/pub/documents/02.reports/pd
  f/02tr035.pdf
• Asundi J., Kazman R., Klein M. 2001. Using
  Economic Considerations to Choose Among
  Architecture Design Alternatives. Retrieved Oct
  19, 2008 http//www.sei.cmu.edu/pub/documents/02.
  reports/pdf/02tr035.pdf
• http//en.wikipedia.org/wiki/Cost-benefit_analysis
  

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Questions?