Delivered value beats delivered features

In The Productivity Metric James Shore adds fresh fuel to the “running tested features” debate. The article is well worth reading, and James concludes:

“There is one way to define output for a programming team that does work. And that’s to look at the impact of the team’s software on the business. You can measure revenue, return on investment, or some other number that reflects business value.”

I whole-heartedly agree with this conclusion, although in my experience there are a couple of hurdles to overcome:

First, the figures may be hard to come by or difficult to compute. This is particularly true of infrastructure software, or tooling that’s used internally to the business. How do you compute the development team’s ROI from the impact they have on an admin clerk’s day-to-day? There will always be the danger of monetising some intermediate measure, and thereby creating a local optimum. (If you have examples of this being solved successfully, please get in touch.)

And second, the development team may feel that the figures are too dependent on other business processes, such as sales or dispatch. Even where the software is the company’s product, the value stream is often not as short or highly tuned as one might wish; and so the developers may not wish to be measured against the whole stream’s effectiveness. In theory, rapid feature development and compelling usability ought to energise the sales team and the market to the point where demand dominates supply; in which case the value/time metric will work well. In practice, the necessary pull is too often absent. (Maybe in that case the metric is still valuable, telling us something about the whole value stream…)

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