■ Optimal project staffing levels

■ Effects of uncertainty Previous approaches to understanding soft-ware dynamics and costs include building sys-tems dynamics models or detailed cost equa-tions.1,2 Although they can be enlightening, these models are complex, they focus on cost rather than value, and they typically don’t con-sider uncertainty. Other models use net pres-ent value to focus on value and uncertainty.3,4 My team set out to develop a relatively simple project dynamics model to use in conjunction with market sensitivity and economic analysis to help optimize profitability. Some of our ideas and results are similar to those of Preston Smith and Donald Reinertsen, who examined the im-pact of time-to-market sensitivity.5 However, our approach is a more detailed model tuned to software development issues. The model Our model features a set of functions and parameters that can be applied in a spreadsheet. You can obtain data curves in many ways, in-cluding using industry data, historical metrics, or from the team’s subjective assessments. The curves I present here are of a sample base case in our commercial-project portfolio. Land-mark has collected development and testing duration and effort metrics for its projects from 1995 to 2003. Although I believe the curves’ focu