What to measure in the Agile world?
You should probably be focusing on the ‘how’ rather than ‘what’ to measure.
We tend to focus on how fast we can run but not on how well the baton is moving throughout the entire organization.
Organizations tend to have middle offices, back offices, and heaps of other offices which seldom talk to one another, yet we don’t see a strong focus on collaboration and communication to improve how we learn and work together.
How to measure agility
EBM looks at the following measures:
- Current value, which is a way of evaluating how well you are milking the metaphorical cow that you have at the moment?
- Time to market, which measures how quickly you are serving the market and how often you are releasing products or features that delight customers?
- Ability to innovate, which I often refer to as ‘inability to innovate’.
- What is slowing us down?
- What is preventing us from delivering value?
- Unrealised value, what experiments are we doing to discover
- the next customer job?
- the next customer?
- the next product?
- the next service?
All the things listed above are useful measures of agility in your organization.
There is another model called ‘the logic model’ where you can measure outcomes and look at changes in customer behaviour and looking at impact.
The entire revenue of the company is a bit too much for teams to be looking at too closely, but they can focus on whether the features or changes they delivered to a customer had a significant impact on that customer and their business.
They can assess how much of a difference the product or feature makes to an end-user.
Often, these outcomes take a while to happen, so we recommend that you focus on leading indicators and outputs as a useful measure of agility. Just make sure that you include countermeasures.
If you focus exclusively on output, you could end up with a feature factory that delivers high output but creates no value for customers or has any real, valuable impact on their business.
So, it is important that you include those countermeasures to ensure that you are measuring the right things in the right way.
One of my favourite measures is ‘switching cost’.
- How much does it cost us to switch from one idea to another?
- How long does it take us to get a project or an investment through the system?
- How can we switch to a different idea without cancelling the current idea that is in progress?
- How quickly can we turn on a dime, for a dime?
That is what is meant by switching cost.
It is important that your people are inspired so I would include measures that are people-oriented rather than product-oriented. These are harder to measure but they truly matter.
- How are people feeling?
- How engaged are they in the work?
- How satisfied are they in the team and organization?
- How satisfied are people with the working relationships within the team environment?
There are a whole set of measures that you could include to assess the satisfaction your people.
In closing, I would reiterate that it is important to focus on the ‘how’ of measurement not the ‘what’.
John Coleman has deep experience and expertise working with executives, #leadership teams and product development teams to achieve increased #businessagility and create environments where creativity and collaboration produce high-performance teams.
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