What is Cost of Delay?
Represents the economic impact of a delayed delivery over time.
Definition
The Cost of Delay (CoD) represents the economic impact of a delay in the delivery of a product or service.
Purpose
To raise awareness of the financial impact of delays.
Calculation
Involves estimating the weekly revenue that the delivery would generate and dividing it by the project's duration.
Technique
CD3 is a technique that helps prioritize a backlog. It is calculated by dividing the Cost of Delay by the project duration to obtain the order of magnitude for ordering each PBI (Product Backlog Item).
Want to learn more?
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