XP sees risk as the fundamental problem of software development projects (Beck & Andres, 2004). According to the Project Management Institute, a project risk is “an uncertain event or condition that, if it occurs, has a positive or negative effect on a project’s objectives”. Examples of this risk include: schedule slips, misunderstood business requirements, high staff turnover, high defect rates, project cancellation without delivering value, high cost of software change after completion, inability to support business changes, feature rich but not delivering sufficient value.
Lower the cost of change.
In traditional waterfall projects, the cost of making changes late in the development process is usually exponentially high. One of the goals of XP is to lower and flatten out this cost of change by working in short iterations.