Agile teams work is driven by the Product Owners Vision. A more holistic, encompassing view is often needed in bigger organizations in order to mantain focus on the overall goal of delivering real customer value. Measuring the value delivered will help improving and giving evidence to the value creation process.
The Evidence-Based Management (EBM) is a framework for measuring results and making fact-based decisions in Agile organizations.
EBM Evidence Based Management Framework
The EBM approach uses a holistic view on product delivery performance, with 4 Dimensions (Key Value Areas KVA) each with a mix of lagging and leading indicators (KVMs Key Value Measures) focused on different value delivering abilities.
- Current Value (CV)
This area encompass the value we are currently delivering. Examples of measures are Customer Satisfaction, Employee Satisfaction, NPS, Revenue per Employee, Customer Usage.
- Time To Market (T2M)
T2M goal is to actively manage the speed in processes of learn, adapt and rapidly arrive to market with new solutions. Some possible measures are Build Frequency, Release Frequency, Cycle Time, Lead Time.
- Ability to Innovate (A2I)
In this area you include the set of KVMs aimed to improve your capacity of delivering new capabilities and innovative solutions. Technical Debt, Innovation Rate, Defect Trends are possible KVMs.
- Unrealized Value (UV)
Here you track the potential value you could realize when perfectly meeting the customers needs. Example of measures are Market Share and Customer Satisfaction Gap.
Measuring is not enough
While measuring the right value creation indicators (KVMs) alone can provide some benefits -you will see the areas of possible improvements-, better gains are created establishing a learn-and-improve loop
EBM Evidence Based Management Key Take Away
While Scrum and Agile are intrinsecally aimed to delivering value, agile Organizations can improve their focus on outcomes, reduce risks and optimize their investments adopting the Evidence Based Management approach