With Extreme Programming (XP) and various agile development processes becoming increasingly popular, more and more IT organizations are requiring the use of such processes to be specified in their sourcing contracts with systems integrators, consulting firms, and other vendors.

Does your organization require the use of XP/agile processes?

Never	42%
Occasionally	20%
Sometimes	19%
Always	9%
Don't know	10%

According to Cutter Consortium Fellow Ed Yourdon, "Simply requiring XP/agile in an RFP doesn't guarantee that a vendor will provide it; and even if the vendor makes a sincere effort to follow an XP/agile process during the development effort, it doesn't guarantee success. Indeed, frustrations and disappointments are fairly common; and on occasion, the attempted use of XP/agile is the straw that breaks the camel's back -- resulting in project failures and even litigation between client and vendor."

"While some project failures -- and the decision by either the vendor or the client to launch a lawsuit because of the failure -- may be ascribed to personalities, politics, or unexpected external factors such as the sharp and rapid cutbacks in the IT industry after the dot-com collapse, many of them are caused by unrealistic expectations of the XP/agile approach as well as inadequate planning and management to ensure that such an approach will actually succeed."

What kind of benefits do you expect to achieve from the use of XP/agile processes in your outsourcing contracts? (Survey respondents were able to choose more than one benefit)

Shorter time	50%
Fewer defects	47%
Better visibility	45%
Happier users	42%
Greater control	41%
Reduced costs	34%
Don't know	11%

Yourdon points out, "One gets an interesting sense of how serious the vendor and client are about measurement and enforcement by reading the language of the contract between the parties. If the language describing XP/agile primarily involves the verbs 'must' and 'shall,' then you know the parties are serious. If the language primarily involves 'should,' then you know that the parties have good intentions but aren't willing to put their money where their mouth is. And if the language primarily involves 'might' or 'may,' then it's an open invitation for either party to do whatever it wants."

Does your organization oversee and enforce the use of XP/agile processes in its outsourced projects?

Occasionally	11%
Sometimes	16%
Never	17%
Always	26%
Don't know	30%

Just as parents threaten their teenage children with "grounding" and various other punishments for curfew violations, clients can threaten various forms of punishment for vendors who fail to use the XP/agile processes they promised in their proposals and in the contract between the parties. If the violation was only partial, and if the project was still a qualified success, it may be sufficient to tell the vendor that you won't use them again on any future projects; indeed, that can be a serious threat if the client is large and prestigious, and if the vendor is relatively small and struggling.

If the problem is more severe, then the client can threaten not to pay the vendor's invoices. And, in the most extreme case, the client can sue the vendor to recover all of its costs, as well as lost profits and various other damages.

Would you sue a vendor if a project fails and XP/agile was not used as promised?

Always	9%
Sometimes	16%
Occasionally	19%
Don't know	22%
Never	34%

Would you consider suing the vendor for failure to use promised XP/agile processes even if the project succeeds?

Always	3%
Sometimes	12%
Occasionally	18%
Don't know	25%
Never	42%

Yourdon concludes, "It is incumbent upon both parties to identify the risks, quantify the expected benefits, and articulate their respective expectations in clear, concise terms in the contract that they negotiate. If they do so, I believe that XP/agile processes can indeed lead to the shorter development schedules, happier users, and reduced number of defects that we all yearn for."

To request the Cutter Consortium Sourcing and Vendor Relationships Executive Report in which these comments were made, or to schedule an interview with Ed Yourdon, contact .

More information about Ed Yourdon is available at http://www.cutter.com/meet-our-experts/eybio.html

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