How do you determine the value of your agile initiatives?

1 Value vs output

One of the key distinctions between agile and traditional approaches is that agile focuses on delivering value, not output. Output is what you produce, such as features, products, or services. Value is what you achieve, such as customer satisfaction, revenue, or social impact. Output can be easily measured by counting, tracking, or reporting. Value can be harder to measure, as it depends on the context, the stakeholders, and the outcomes. To determine the value of your agile initiatives, you need to identify and prioritize the value drivers that matter most to your organization and your customers.

2 Value metrics

Value metrics are indicators that help you measure and evaluate the value of your agile initiatives. They can be qualitative or quantitative, objective or subjective, leading or lagging. Qualitative metrics capture the perceptions, opinions, or feelings of your customers or users, such as feedback, ratings, or reviews. Quantitative metrics capture the numbers, data, or facts that show the performance, impact, or results of your initiatives, such as revenue, retention, or conversion. Objective metrics are based on facts, evidence, or standards, such as benchmarks, tests, or audits. Subjective metrics are based on opinions, judgments, or preferences, such as satisfaction, loyalty, or advocacy. Leading metrics are predictive, proactive, or forward-looking, such as demand, engagement, or quality. Lagging metrics are reactive, retrospective, or backward-looking, such as profit, cost, or defect.

3 Value stream mapping

Value stream mapping is a technique that helps you visualize and analyze the flow of value from your agile initiatives to your customers. It involves identifying and mapping the steps, activities, and processes that create and deliver value, as well as the inputs, outputs, and resources involved. It also involves identifying and eliminating the waste, inefficiencies, and bottlenecks that reduce or prevent value delivery. By using value stream mapping, you can improve your understanding of your value proposition, your customer needs, and your value creation and delivery capabilities. You can also identify and prioritize the improvement opportunities that can increase your value delivery efficiency and effectiveness.

4 Value-based prioritization

Value-based prioritization is a method that helps you rank and select the most valuable items or tasks for your agile initiatives. It involves estimating and comparing the value and the cost of each item or task, and choosing the ones that maximize the value-cost ratio. Value can be estimated by using value metrics, customer feedback, or business analysis. Cost can be estimated by using effort, time, or resources. Value-based prioritization can help you align your agile initiatives with your strategic goals and customer expectations. It can also help you optimize your resource allocation and return on investment.

5 Value-based feedback

Value-based feedback is a practice that helps you validate and improve the value of your agile initiatives. It involves collecting and analyzing feedback from your customers, users, or stakeholders on the value of your initiatives, using value metrics, surveys, interviews, or experiments. It also involves using the feedback to make adjustments, enhancements, or changes to your initiatives, based on the value impact and the customer needs. Value-based feedback can help you ensure that your agile initiatives are delivering the expected value and solving the right problems. It can also help you foster a culture of learning and adaptation in your agile team.

6 Value-based communication

Value-based communication is a skill that helps you communicate and demonstrate the value of your agile initiatives to your organization and your customers. It involves using value metrics, stories, or visuals to convey the value proposition, the value drivers, and the value outcomes of your initiatives. It also involves using value-based language, tone, and style to engage and influence your audience. Value-based communication can help you increase the visibility and credibility of your agile initiatives and your agile team. It can also help you build trust and collaboration with your stakeholders and your customers.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?