Value Methodology

Function point analysis (FPA), a method to quantify software’s functional requirements, has been commonly discredited for some purposes, such as calculating the productivity of an IT group. But Nielsen Media Research has been successfully using FPA in a new way. About three years ago, Nielsen Media began to use an FPA-based productivity model to estimate the size, duration and staffing requirements of software projects up front. Today Nielsen Media also uses the model to help negotiate contracts with an outsourcer.

Nielsen Media Research needs little introduction: It is the preeminent supplier of data on measured TV viewing. The New York City-based company’s ratings help advertisers and TV producers understand the value of individual programs and guide the buying of $45 billion worth of TV advertising every year.

Nielsen Media entered the Internet ratings business more than a year ago when it launched a joint venture with NetRatings of Milpitas, Calif. Nielsen Media has since become the majority owner of Nielsen/ NetRatings. The service does for the Internet what Nielsen Media has traditionally done for TV: measure usage from the end user’s perspective. With the two medias converging, the same ad buyers are now interested in both TV and Internet viewing.

One of Nielsen Media’s core competencies is its ability to develop systems to acquire, measure, manage and distribute viewing data, says CIO Kim Ross, who joined Nielsen Media eight years ago as vice president of software development. Accordingly, the company maintains an operations and development center with 300 software developers and 100 systems administrators in Dunedin, Fla.

When Ross became CIO about three years ago, he wanted to understand why software development projects at the company took, on average, twice as long as expected. Nielsen Media used standard techniques to plan projects, including estimating lines of code and task-based Gantt charts. But lines of code bear little relation to software function. And while Gantt charts were OK for tracking tasks, they were inadequate for estimating size. Indeed, "the Gantt chart is most accurate at the end of the project," Ross notes wryly.

Instead, Ross turned to KnowledgePlan, a productivity modeling tool from Software Productivity Research (SPR). By analyzing a given project’s size, duration and staffing together, the model spells out the optimal resource requirements for the project. Users can also adjust the three variables to generate what-if scenarios. (For more on Nielsen Media’s use of KnowledgePlan, see "Nielsen Media Research’s Software Estimation System," CIO, March 15, 1999.)