By The Book 3: Throughput Accounting
This is the third part in a series on management accounting for software development. The material is from a book I am working on. To make sense out of it, read part 1 and part 2 first. Let's look at the diagram modeling team A and B again: The developers in team A are already working at full capacity. Thus, they are the constraint of the process. Adding 8 hours of work for a developer, means adding 8 hours to the constraint. Adding 8 hours to the constraint is the same as adding 8 hours to the whole project . The cost is €175 times the number of developers and testers, plus an additional €200 (8 * 4,000 / 160 = 200) for the team leader. This works out to €1,425 (7 * 175 + 200 = 1,425) in increased project costs. In addition, there may be a considerable cost associated with delaying delivery. I'll leave that can of worms alone. (Read about it in Lean Software Development by Tom and Mary Poppendieck, or check out a blog posting by Gustaf Brandberg .) Team B has an easier tim