How to choose the right Agile value metrics

  • Fred Champlain
  • IT Management
  • Solutions
  • 2022
November 30, 2022

Agile value metrics: man in front of a laptop looking out a window

Nearly every business leader these days is focused on achieving value—and for good reason. Business leaders are accountable for ensuring all the work they do delivers the most value possible to the business. Some have adopted Agile methodologies to achieve this.

For Agile methodologies to be effective, you need to measure the right things. And to measure the right things, you need the right data producing the right information to provide you with the right insights. Agile value metrics can help.

Traditional Agile metrics such as customer engagement, burndown charts (which show the amount of work remaining on a project), and velocity (units of work completed in a given time frame) may seem naturally value-oriented for several reasons.

Customer engagement can imply that solutions meet customers’ wants and needs. Burndown charts and velocity indicate value is being delivered consistently and at a reasonable pace. However, these factors aren’t enough to indicate true value.

Limitations of intuitive value measurements

Value metrics around discretionary investments are changing. Anyone managing Agile projects must adapt as well and use the most relevant Agile value metrics.

If an Agile team is delivering a customer-facing product or service, value ultimately comes from sales of that product or service. But that’s not the best measure, as it can take a long time—years, in some cases—to determine that value. Similarly, internal customer satisfaction doesn’t translate directly to dollars and unit sales.

For internal customers, value comes from cost reductions, performance increases, reduced failure rates, and so on. However, those take time to identify and quantify. Users simply saying they like a product isn’t enough. Business leaders must use metrics that are accessible and point to value delivery.

3 metrics that indicate value delivery

Other Agile value metrics can yield relevant data quickly. They include:

  1. Newness percentage

  2. Prioritization stability

  3. Adoption and usage rates

Newness percentage measures how much of the team’s work is on new features versus changes, updates, fixes, or removal of existing functionality. The greater the focus on newness, the greater the chance value is being delivered.

Consider also prioritization stability. If the prioritized backlog of features never changes, it might suggest no one cares about the product and the value is low. On the other hand, if the prioritization changes constantly, it may indicate a lack of understanding of what customers and users value. Either extreme is undesirable.

Don’t ignore adoption and usage rates— both Day One rates and the sustainability of those rates. Subjective measures such as surveys can also be important tools.

Find out how ServiceNow Strategic Portfolio Management helps deliver value. Listen to our podcast for more information.

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