Agile product management depends on an iterative and incremental framework with a focus on continuous improvement. It is the new norm for successful businesses.
Its modern approach to the product development process enables organizations to develop effective product roadmaps, make better products, and improve customer satisfaction.
That’s all great, but how much value are agile processes really driving to the business and its customers?
Measuring the impact of agile processes on software quality and product value can be difficult which is why every project manager needs agile metrics.
Agile metrics help agile teams measure productivity, assess quality, and set goals to evaluate performance. This makes agile metrics essential for long-term, sustainable success for the organization.
In this article, we’ll dive deeper into agile metrics and why they’re important. Then we’ll present the 10 best agile metrics you need to be aware of.
What are Agile Metrics?
Agile metrics are benchmarks that help agile teams measure the impact of their outcomes across different stages of the software development lifecycle (SDLC).
An agile metric tracks:
- Team productivity
- Project progress
- Quality of work
- Team performance
- Level of success
- Team health
They are used by project managers to identify the team’s strengths and weaknesses, and to address problems in the initial phases and prevent them from occurring later.
In an agile environment, teams implement these metrics primarily to align the development team with the agile principles stated in the Agile manifesto.
One of the 12 principles of agile states: “Continuous attention to technical excellence and good design.” An agile metric such as quality intelligence helps measure the quality of products rather than just the production processes, which helps the software development team factor in potential improvements.
Types of Agile Metrics to Measure the Development Process
There are different agile frameworks that businesses adopt according to their goals. As you might expect, different types of agile project metrics complement each business model. Agile metrics can be divided into three further types.
Lean metrics focuses on maximizing the value products deliver to customers, by eliminating wasteful activities. By adopting lean principles and measuring their impact with lean metrics, businesses can identify and eliminate wastages to ensure maximum productivity. Common lean metrics include lead time, cycle time, and throughput.
Scrum metrics are used by a scrum team to track and improve the efficiency and effectiveness of sprints. These metrics help inform scrum teams to make better decisions, set targets, and effectively execute strategies to achieve business goals. Common metrics include sprint burndown, agile velocity, and workload distribution
Kanban metrics are used to measure “time taken,” “time to value,” and “time to market” to accurately estimate when a project will get done and the value it will have for end users. Common metrics used in Kanban include cycle time, blockers, and cumulative flow diagrams.
Why Are Agile Metrics Important?
Agile project management focuses on continuous improvement and reinforcing the deployed software quality through extensive testing. Organizations use agile metrics to ensure consistent performance and adhere to agile principles.
By tracking the team’s performance through agile quality metrics, businesses can identify improvement opportunities to maximize output, productivity, and value delivered to customers. Agile predictability metrics on the other hand help managers to make well-informed decisions during the process.
Agile metrics also enable businesses to effectively track the team’s progress towards set goals. By establishing agile key performance indicators (KPIs), it is possible to gather quantifiable data, which shows that the team is on track and that newly implemented tactics are working.
Finally, the biggest benefit of agile metrics is the behavioral improvements that the team undergoes. These metrics indicate team effort and contribution and promote self-improvement that leads to a company’s success, boosts productivity, and maximizes profits.
What Are the Criteria for an Effective Agile Metric?
There are many agile metrics to choose from, but it’s essential to derive only meaningful metrics to reap the benefits of measuring team performance. Listed below are some factors to consider before assigning agile metrics to make sure it’s the right one for your business.
Metrics should be easy to understand. They aren’t just a bunch of numbers and shouldn’t be complex; rather, agile teams should have a clear idea of what’s expected of them and how their performance is measured.
Different metrics target various components of agile development. Choosing agile metrics that cover the entire process–including predictability, quality, productivity, and value–will help accurately measure and keep track of agile performance.
Having a single agile metric be the main focus can lead to agile teams overemphasizing just that metric and ignoring others. This causes an imbalance and may lead to a deviation from the original goal.
For example, delivery speed may be used to measure how long it takes for the software team to deliver the product to the customer, but they may do so at the expense of a low team happiness score – decreasing the overall benefit to the company.
It’s vital to choose metrics that accurately measure success and that measure the behaviors that keep your team on track.
Metrics can’t be something the company “sets and forgets.” Each metric needs to be properly monitored and tracked by the development team. To enforce this, a team member needs to take responsibility and ensure timely reporting of team progress.
Speaking of progress, the metric should accurately track progress through quantitative or qualitative data. They should provide valuable insights about the team and be easy to calculate to guide day-to-day activities and highlight opportunities for improvements.
Some metrics are made with specific agile methodologies in mind. Scrum, Kanban and Scaled Agile Framework (SAFe) have built-in metrics which measure business performance within the context of that framework and assess how it aligns with broader company goals.
If a specific framework isn’t defined, you can choose any metric you like and stick with the ones right for your business through some trial-and-error.
10 Essential Agile Metrics
1. Customer Satisfaction Score (CSAT)
This is a broad measure that surveys customers to assess the overall satisfaction they achieved by using a product. Typically customers would rank their experience on a scale of 1-10 with the average number of all responses being your CSAT score.
Through this qualitative data, businesses can check whether the products they are producing carry any significant value to their users. If not, it helps them better tailor their strategy to address concerns.
2. Quality Intelligence
Quality intelligence is used to figure out how good a product is. It helps assess the quality of the product as a whole and improves on weak points. Tracking this helps you know how much time and money should be invested in testing to ensure the optimum quality of the product and reduce the risk of failure.
3. Lead Time
Lead time is the total time taken to complete tasks from the moment they are entered into the product backlog to completion or delivery to customers. It helps measure the total time it takes to complete a task which removes any guesswork and better predicts when it starts generating value.
By identifying the lead time you’re essentially figuring out the time the entire agile system undergoes. Tracking this and making tweaks that reduce lead time will ensure the entire process moves faster.
4. Cycle Time
Cycle time is similar to lead time, but instead of measuring the total time taken to complete the task, it is used to measure the time taken in one phase of development.
Tracking the cycle time helps businesses to improve the planning and predictability of new product development projects. By knowing where the bottlenecks are, project managers can address issues early on to ensure a consistent cycle time.
It is most commonly used in Kanban where work is typically divided into “to-do,” “work in progress,” and “done.”
5. Code Coverage
Code coverage helps understand how much of the source code is tested. These tests are conducted as part of a unit test suite and can be run automatically to test the quality of the code. A low code coverage indicates that the code hasn’t been thoroughly tested which may lead to lower quality and an increased risk of errors. If a team finds low code coverage, it may need to adjust its strategy to consider performing more tests.
6. Static Code Analysis
Although not exactly a business metric, it is an automated process to debug software by analyzing the code without executing the program. It helps provide vital insights into code quality to improve the software.
7. Release Net Promoter Score (NPS)
A net promoter score is a simple business metric that asks customers whether they would recommend a product to someone. The net promoter score is based on a scale ranked from 0-10 with zero being “not likely to recommend” and 10 being “highly likely to recommend.”
This gives businesses an idea of the value it is delivering to customers. If customers are likely to recommend the product, this means they are on the right track. If they are unlikely to recommend the product, it could indicate that something needs to be improved.
8. Cumulative Flow Diagram
A cumulative flow diagram is most commonly used in Kanban and visualizes the status of tasks. It makes use of color coding to help quickly identify obstacles in agile processes. Each color represents a different status such as product backlog, work in progress, and done.
This helps find bottlenecks and address them to get the team back to speed and ensure tasks are completed on time.
9. Failed Deployments
This metric tracks the number of failed deployments within a sprint or within a specified time frame. They indicate the stability and reliability of the code and whether sprints are production-ready.
10. Escaped Defects
Escaped defects are the number of problems discovered after a feature or release went forward with production. They measure the software quality by detecting bugs or technical debt in the production process. This provides the team with a valuable measure of software quality.
Ideally, defects should be minimized to zero. Having several or frequent bugs in the production process could indicate a weak quality check or testing method. Project managers can look at these issues and invest in better testing methods or QA checks.
The above metrics should give you a general idea of quality metrics to measure team productivity, performance, and the overall value a product provides. Still, metrics vary from business to business which is why there are other metrics to choose from.
Some agile metrics are specific to an agile methodology. There are other metrics, related to the Lean, SCRUM, Kanban and SAFe frameworks that often overlap with Agile.
Waste contributes to rising costs and reduces efficiency. Lean practices aim to eliminate any unnecessary steps, improving flow, speeding up the time of delivery, and optimizing operations.
Typical lean metrics include:
Throughput measures how many tasks are completed within a given time frame. It gives valuable insights to stakeholders by yielding an average number of tasks the team can complete in a specified time.
This allows them to identify team strengths and weaknesses, and consistency while making accurate estimations of future deliverables.
When a task progresses from one stage to another there is a delay in the cycle time. This delay is called a queue. Businesses may use queues to track the progress of tasks and find out where they’re stuck. Relieving bottlenecksreduces the queue time and keeps the process flowing smoothly.
In agile methodology, any obstacle that disrupts the flow of production can be considered a blocker. Blockers are represented as visual icons on a chart which allows team members to quickly find out what’s causing production to slow down or stop. This helps businesses to quickly address issues and adapt to various situations to keep things moving.
Scrum is the most popular agile framework and common amongst many agile teams. A scrum team may use the following metrics to track and measure the progress of the sprint.
Sprint Burndown Report
A sprint burndown measures how much work has been completed by the scrum team within a sprint. It visualizes the completed story points and the remaining story points a scrum team has to accomplish to achieve the sprint goal. This is represented as a trend on a sprint burndown report.
Velocity measures how many tasks or story points an agile team has completed within a given time frame, typically a two-week sprint. This metric is calculated on an average and helps in sprint planning and estimating sprint progress.
Sprint metrics like velocity derive the overall value that is delivered to customers.
Workload distribution represents how much work each scrum team member is assigned for a sprint. As operations scale it can be hard to keep track of who exactly is doing what.
This metric helps pinpoint how much work is being taken on by each individual which helps distribute the workload evenly so team members aren’t overburdened.
Kanban aims to organize and prioritize tasks to get them from the product backlog to “done”. The below outlined Kanban metrics help organizations reduce cycle time, lead time, and get work done.
Control charts are a visualization of the time spent on user stories, story points, and feature areas during a set time frame. Cycle time and lead time are also incorporated in the control chart to accurately calculate how much time was taken.
This helps Kanban teams estimate future performance and set realistic goals.
Work in Progress (WIP)
Work in progress is a common kanban metric. It takes into account the story points or tasks that have been started but not yet completed. This keeps a check on existing tasks before taking on new ones. It helps the team improve its delivery speed by prioritizing tasks.
Blocked time calculates the sum of tasks that are being worked on but are stuck due to some issue that needs resolution – which means it is currently “blocked.”
This metric helps the agile team understand setbacks that may have occurred during that work period.
For larger enterprises, the scaled agile framework, or SAFe, is an obvious choice to implement agile practices. As organizations scale, tasks get more complex and exhaustive which can also make them difficult to measure.
To combat that, there are specific agile metrics built into SAFe to help businesses effectively track and measure team performance. Below are some of the metrics that are used in SAFe.
This is a broad metric that measures how competent the organization is in applying agile principles and managing core competencies of SAFe: Alignment, built-in quality, transparency, and program execution.
Flow efficiency measures how much time is spent completing tasks and waiting between stages. It is calculated by dividing total active time by flow time which gives us a ratio of the two.
This is a helpful metric to understand how well value is being delivered. A low flow efficiency indicates that there is waste and opportunities to improve productivity. These issues and delays can then be addressed to achieve a higher flow efficiency and ensure the continuous delivery of high-value products.
Flow predictability measures how well agile teams can meet performance goals. It helps businesses set realistic delivery commitments and address underlying issues that may be causing the team issues in delivering the product on time.
Flow velocity tracks the number of backlog items (user stories, features, epics, etc.) completed in a specific period. This shows how much output an organization is producing and indicates any bottleneck that may be slowing down production.
Generally, a higher velocity means higher output. However fluctuations in the team’s velocity are also bad. Ideally, velocity should keep increasing and then plateau as the agile team maximizes productivity. Substantial drops in velocity may present problems that need to be addressed.
How to Set the Right Agile Metrics for an Agile Team
We discussed many agile metrics that may apply to businesses of all shapes and sizes, but choosing the right ones depends on multiple factors including company goals, work culture, and team capacity.
Some may think that it’s a good idea to track 20+ metrics at the same time, but that may negatively affect agile teams. Teams can only process and focus on a few metrics at a time, so it’s worth looking into the right agile metrics that will resonate with your business.
Analyze Your Goals
When it comes to setting the right agile metrics you need to first ask yourself why you need to measure performance in the first place.
Why do you want to use the specific metric to track performance? Who will report it and how will it be reported? What do you want to accomplish with it? Does the metric align with your goals and help you move closer to achieving them?
Asking yourself the above is a good starting point before jumping in to establish standards that may distort the team’s focus unnecessarily.
Narrow Down Your Choices
Picking only a handful of metrics enables self-organizing teams to better measure team performance and focus on improving that metric.
Typically, fewer metrics is better. That’s because the fewer metrics the team has to worry about the more focus they’ll be able to give each one.
Remember that metrics can become expensive. Each new metric you add increases the amount of time, effort, and burden put on the team. If your team is unable to focus on all of them, values will start trending down, productivity will decrease, and quality will deteriorate.
Get The Team on Board
When setting metrics for the first time, most businesses would go through trial-and-error to work out what’s worth tracking and what isn’t.
It helps to get input from your development team since they’re the ones whose performance will be measured. Ask them which metrics sparked conversations, ideas, and insights during stand-ups. The ones that did are likely the ones you should focus on.
Your team is hands-on with the process, which is why they would know it better than anyone else. Also, as most agile teams strive to be self-managing, with Scrum making it a prerequisite, it makes sense to gather their input when deciding on the right metrics for your business.
You can’t improve what you can’t measure, which is why agile metrics are being readily implemented by organizations to track and measure their team’s performance.
These powerful metrics help identify and address issues, tackle bottlenecks, and track progress towards set goals.
Setting a lot of standards is a bad idea as it may overburden teams. Agile metrics should serve a purpose for the team, keep them motivated, and promote self-improvement. This leads to team members voluntarily improving the production process, delivering higher customer value and achieving targets.