Your organization has gone Agile, what metrics do you use to gauge how you are doing? How do you evaluate team progress in real-time or ensure you are delivering value? Traditional metrics, like measures of employee utilization, aren’t good measures of Agile success. Employees can be busy and fully utilized while not delivering value.
Some Agile organizations are focused on velocity as a key success metric. If you’ve embraced Agile to increase speed to market, velocity might seem like a good success measure, but what does velocity measure? Technically, it measures the number of story points completed per iteration. What are story points? They are abstract units of measurement Agile teams can use to determine how much effort is required to complete a piece of work. Teams assign story points based on their assessment of the difficulty and complexity of a unit of work, called a user story using this terminology.
Story points are unique to given team based on their own story point estimation. One team can use a scale where they estimate five story points for the most difficult, time-consuming task, while another might adopt a scale where they assign ten points to a similar task that they assess similarly.
Velocity based on story points can help individual teams estimate timelines and workloads per Sprint but it doesn’t work well as a broad measure of Agile success.
It can be easily manipulated. If a team’s velocity is 20 story points per Sprint, they can adjust their estimation and assign 30 story points to the same amount of work and it will appear they are doing more.
It is difficult and too abstract for Stakeholders to understand.
Increasing employee utilization or velocity measures do not necessarily mean there is an improvement in business value delivery, which should be a key focus of Agile success measures.
Effectively Measure Agile Success
What are the characteristics of effective measures of Agile success? Your teams should complete and deliver usable products to customers as quickly as possible so that you can start getting feedback. That flow of work, or throughput, is a crucial indicator. Throughput measures the number of usable work items delivered per specific unit of time.
Getting usable products in the hands of customers determines how successful we are. A Minimum Viable Product (MVP) or proof-of-concept, delivers value to customers and allows us to validate if we are on track, adjust and improve our product as needed or pivot in a new direction based on what we learn. The flow or rate at which we deliver usable products and continuously improve product quality through feedback and learning effectively measures Agile success.
By tracking completed tasks, throughput keeps things simple and transparent, eliminating the confusion and complications we see with velocity and story pointing. It clearly shows where teams can improve and provides useful insight into the overall flow of work and value delivery.