How KPIs Assure Happiness for Agile Business Partners and Stakeholders

It’s an age-old question of service delivery organizations: Is the work we are performing today of sufficient quality to ensure an ongoing partnership tomorrow?

Often, this understanding can be a moving target -- particularly for businesses that don’t take time out from executing to quality-check the status of the overall relationship. The Agile process -- which we use here at iTexico to ensure positive outcomes -- is GREAT at managing the former, but not so awesome at gauging the latter.

Enter the key performance indicator, or KPI -- three little letters that can have an outsized impact on overall quality, customer service -- and the strength of the business partnership.

Think of KPIs as an electron microscope -- scanning the software development process and outcomes at the macro level, identifying both perfections and imperfections, and setting up concrete measures that can be used to maintain greatness, or to foster improvements.

Explaining this further: software development organizations that adopt the Agile Manifesto and the twelve Principles behind the Agile Manifesto, do so to better meet the needs of their business partners and stakeholders who need quick delivery of high quality features. Agile ensures those features are delivered within a high-confidence forecast time frame, enabling stakeholders to react to continuously changing business conditions.

We build lightweight processes and procedures to help us deliver this vision - now we need to measure how well we execute against this vision.

Of course, the selection of the KPI criteria is of paramount importance. Deciding what factors to measure can make all the difference in the development of your customer experience scorecard. Here are five such measures that we use to illustrate the value Agile brings to our partners’ projects, as well as to identify areas of opportunity for improvement.

1. Delivered Features Meeting Expectations

How often does the product owner reject a feature for not meeting their expectations? If business people and developers work together daily throughout the project, then expectations should be very high that delivered features meet expectations. We can easily track the feature acceptance rate with a goal of 100%. If we find the acceptance rate falls below 100% then we can work together to identify the root cause and adjust our process and procedures to increase the likelihood of obtaining 100% acceptance.

Did we adequately discuss the feature before development began? Did we work together sufficiently during development to ensure we maintained a shared understanding of the feature? These are typical areas to explore when acceptance falls below 100%.

2. Forecast Accuracy

We owe our business partners and stakeholders guidance as to when we expect to deliver a specific feature, and when we expect to deliver the total set of desired features. But how accurate is this forecast guidance, and how much advanced notice are we able to provide in situations that will require our business partners and stakeholders to reset their expectations? This measure is a great way to make sure that timeliness is taken seriously on both sides of the paradigm.

3. Average Cycle Time

Smaller units of work take less time to get to done, and are more quickly monetizable. How quickly can we get features through the development system and into production? Is the average amount of time trending upward, downward, or remaining static? Measuring the average cycle time will ensure you are stepping through the process with maximum efficiency.

4. Production Defect Rate

We don’t compromise on quality. But software has bugs -- even in production. Bugs found in production are costly to repair. What is our production bug rate? Is that rate trending upward, downward, or remaining static?

5. Cost per Story Point

Agile development teams are afforded the opportunity with a regular cadence to tune their processes and procedures to do things smarter, faster, and better. If we are making great choices in this fine tuning, then we should realize this in a cost-per-story-point metric. An increase in this measurement can be an indication of a need to further examine our decisions.
Though your organization might find that other criteria deserve measure, it’s important to make sure that you are measuring something. Gauging quality and delivery success is not just a good idea -- it’s a critical way to keeping all partners infatuated with the process.