How do you know whether your Agile transformation is on the right track, or heading in the right direction? Understanding Agile transformation metrics for executives is key to proving the ROI of your Agile transformation.
Making the switch from measuring outputs to measuring outcomes can make it difficult to know exactly what you should be measuring… and what it all means. If you’ve been struggling to find meaningful ways to measure the big-picture impact of your Agile transformation, this list of Agile transformation metrics for executives is for you.
Read Next: Are these Agile transformation blind spots holding you back?
Before we dive into the question of, “What should we be measuring?”, it’s important to take one step further back and ask, “Why do we need metrics?” Agile transformation fundamentally changes the role of metrics and how they are used.
Traditional business practices are organized around the planning and delivery of outputs. Metrics, therefore, are indicators of how well, or how efficiently, the organization is planning and delivering those outputs. KPIs are the most commonly used types of metrics – lagging indicators that tell the story of what has already happened.
In Agile, the metrics themselves are not the goal.
Metrics are a means of, “…tracking your journey, testing hypotheses, and providing feedback as you head towards your next goal.” KPIs certainly still have a place, but are not the only means of measuring progress.
The OKRs (Objectives and Key Results) framework is frequently added alongside KPIs as a way to not only set and achieve ambitious goals, but to encourage alignment between various parts and levels of the organization throughout your Agile transformation. OKRs help organizations take big-picture, “fuzzy” goals and turn them into measurable, actionable plans.
Objectives (within the OKRs framework) are not themselves metrics, but a way to set and align around goals. Your Key Results will include metrics, as a way to measure progress towards those goals. But again, the metrics are not the goal in Agile – the metrics are a way to tell the bigger-picture story of how your organization is progressing toward its goals.
Use the following list of Agile transformation metrics for executives as inspiration, to help you gain a more accurate picture of your Agile transformation, both as it’s happening and as it evolves over time.
Here are nine Agile transformation metrics for executives to watch.
Are your employees feeling motivated, productive, and satisfied in their roles? Regularly, anonymously measuring your eNPS (employer Net Promoter Score — a measure of whether your employees would recommend your workplace to a friend or colleague) can give you insight into employee engagement.
Is your Agile transformation helping to facilitate continuous improvement in your processes, practices, and company culture? If so, you should see positive changes in product quality, safety, speed, customer and employee satisfaction.
Read Next: Continuous Improvement Tools and Techniques
Are all these changes actually helping your organization become more innovative? There are many ways to measure this: Number of new products, time to market for new products, customer satisfaction, and time spent on high-value/innovative products.
Is your Agile transformation having its intended effect: Creating more measurable value for customers? Customer satisfaction can be measured through qualitative and quantitative means, including customer surveys, revenue, customer lifetime value, repeat purchases, etc.
Are the changes you are implementing having a positive impact on market responsiveness? In other words, is your Agile transformation actually making your organization more agile – better equipped to respond and adapt to market changes? This can be measured through time to market, lead and cycle times, and other speed metrics.
Is your Agile transformation making your teams more productive? It’s important to define productivity correctly here: Not by sheer output, but by the output of value created. What percent of projects completed were of high value? How efficiently are teams able to create value for customers?
Like with productivity, it’s important to define speed correctly during and after your Agile transformation. Speed metrics should be used to measure the delivery of value, as well as market responsiveness. They should not be used as vanity metrics to measure the execution of low-value outputs.
Is your Agile transformation helping your organization create more value with less waste? Quality can be measured by measuring defects, rework, and waste.
Finally, is your Agile transformation helping your teams deliver more predictably? Predictability is a measure of how accurately your teams can plan, execute, and deliver work in the expected time frame. Predictability metrics help teams make more accurate estimates about the completion and consistency of their work items.
Track These Agile Transformation Metrics for Executives
A different way of doing business requires a different approach to metrics. In Agile environments, metrics are used as a way to measure progress towards goals, test hypotheses, and analyze patterns. Incorporating these Agile transformation metrics for executives into a larger goal-setting framework (such as OKRs) is the best way to keep your finger on the pulse of your Agile transformation.
Get a first-hand account of an Agile transformation from an executive who has been there. Read the takeaways from Planview Chief Product Officer Louise Allen in “Agile Transformation: 10 Lessons Learned (so far) on our Agile Journey” as she recaps year one of Planview’s own Agile transformation.