6 Agile Metrics That Matter

The metrics in Agile project management are one of the main aspects that transformed how knowledge work teams measure their projects’ progress.

Agile metrics are performance indicators related to outcomes that allow teams to reflect on their process and make data-driven decisions for future actions.

To begin our discussion of Agile project metrics, let's first see how they differ from the traditional ones.

Traditional vs. Agile KPIs

The main difference between traditional and Agile performance metrics is that the former focus on output while the latter on outcomes. Many traditional project management KPIs can provoke teams to take wrong actions in project management on all levels.

For example:

• Quality is measured by the number of documented requirements, instead of collaborating with the customers to determine if they are satisfied with the results.
• Productivity and progress are measured only by tracking planned hours vs. the baseline without considering the team's actual capabilities.
• Performance is measured by how fast you can deliver, even if these are the wrong things to deliver.

When discussing the highly volatile world of knowledge work, measuring metrics traditionally won't help teams finish projects faster but may amplify the pressure.

That's why, with the vast adoption of Agile project management, new Agile metrics for reporting have emerged. They are meant to help you better analyze and understand your workflow, discover flaws, and improve so your team can focus on satisfying customers through the continuous delivery of value.

How to Use the 6 Agile Metrics to Boost Work Delivery?

Lead and Cycle Time

Lead and cycle time are two essential Agile project metrics that have their beginnings in the Lean management world. Both show you how long work items spend in a given process. However, there is also a clear differentiation between them.

Lead time shows you the total time (including wait time) a work item spends in the entire process from the moment it is requested to the time it is delivered.

To give a short example of this Agile metric, let's say that a customer of yours has requested a service or a feature for development. From the moment you commit to delivering the given service/feature, lead time starts accumulating, even if you haven't started working on it yet. An easy way to think of lead time is as the "customer timeline."

In Agile, cycle time starts accumulating once you begin working on the requested item. In other words, with cycle time, you can measure how many hours/days someone actively worked on a task to complete it. This allows you to track the duration of all the work items in a project and eventually use that as input to make better forecasts for project completion. As opposed to lead time, you can think of cycle time as the "team timeline."

Tracking the lead and cycle time metrics is easy with the help of a Kanban board. You can visualize when a work item is committed for execution and when the actual work begins. This usually happens with the "Ready to Start"/" Requested" and "In Progress"/" Working" columns on your Kanban board, as seen from the image below.

Visualization of lead and cycle time on a Kanban board

Throughput

In Agile, throughput measures the average number of work items processed per unit of time.

In a Kanban system, for example, as work is visualized in cards, throughput is measured based on how many Kanban cards were finished in a given period (weekly, monthly, etc.)

Here we should briefly mention that many teams believe that throughput is pretty much another word for productivity in Agile. While they are very close, throughput measures how many work items teams can complete in a specific time frame, while productivity is more about efficiency.

In general, throughput is one of the most crucial Agile performance metrics. It gives you great details into your team's real capabilities, so you can better plan how much work you can deliver in a given period. Combining average throughput and cycle time can become the secret weapon for any team looking to improve their project delivery's predictability.

To measure the throughput of your team week-by-week, you can use the Throughput Run Chart. There, you can see how many work items teams can complete, analyze their average throughput, and use that as input for future planning activities.

Visualization of the throughput metric using a Throughput Run Chart in Kanbanize

Work In Progress (WIP) 

Work In Progress is another one of the most important Agile metrics. Work in progress shows how many work items you currently have "in progress" in your working process.

WIP is a critical Agile KPI to keep track of because any unfinished work represents sunk costs. This also results in multitasking, which hinders the team's throughput.

That's why Agile teams look to limit their work in progress, which ensures that any work started will be finished as soon as possible, and thus the team's throughput will increase. Limiting work in progress has a positive effect on cycle time by decreasing it.

The best tool for visualizing WIP is the Kanban board. There, you can also set corresponding limits on your work stages to ensure that only a certain number of tasks can reside in every Kanban column.

Visualizing WIP limits on a Kanban board

Doing this will allow you to focus your attention on the most critical tasks and make sure that you release value to the market more frequently.

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Work Item Age

Work item age (aging work in progress) is the amount of time passed between a work item that was started and its current time.

This Agile project metric is a relevant leading indicator only for non-finished work items. It complements the cycle time, which is a metric appropriate for finished work items.

The work item age metric has mainly two uses – first, it indicates how your current tasks are moving forward, and second, it gives you a clear idea of how you were performing in similar contexts in the past.

Measuring aging work in progress is crucial in a knowledge work environment because you can see how your tasks progress through your workflow. This shows you in which stages of the process tasks reside the most and how long, on average, any emerging work items are expected to age.

Combining this information with cycle time data will allow you to make valuable data-driven decisions to optimize your workflow to better meet customers' delivery expectations.

To visualize all of that information, you can use a powerful measurement tool called the aging work-in-progress chart.

Visualizing work in progress using the Aging Work in Progress chart in Kanbanize

Flow Efficiency

Another one of the highly important Agile project metrics is flow efficiency. It shows you how efficiently you can process work from start to finish.

To calculate flow efficiency, you need to divide the value-added time by the total work time, including stages where no active work is done.

This Agile metric works perfectly in a Kanban system where you can visualize both active and non-active stages in your process. In Kanbanize, for example, we mark the non-active stages as "queues" on our Kanban boards, which means that work sits idle there and is dependent on someone/something.

With the help of the flow efficiency chart, our teams input active and queuing stages to monitor how efficiently they can process work regularly. This helps you spot issues promptly and resolve them as soon as possible.

Using the Flow efficiency chart in Kanbanize to visualize workflow efficiency

Blocked time

In an Agile environment, as everything is visible, work that cannot be moved forward for some reason should be visible too. In a Kanban system, for example, such items are marked with a "blocker" sticker.

Work item blocked on a Kanban board

A blocked card usually means a task is waiting on an unforeseen event or dependency which is hindering the assignee from proceeding with the work.

A blocked card on the Kanban board signals to all team members that the given work item needs immediate attention to resolve the blocker. Therefore, tracking blocked time is a valuable Agile metric.

To measure blocked time, in Kanbanize, we use the Block Clustering chart. It reveals the most common blockers in your process and how much time work has been impeded by specific blockers. Regularly monitoring the chart allows you to gauge the impact of your process impediments, so you can progressively mitigate them and, as a result, optimize your flow.

Analyzing process blockers using Blocker Clustering chart in Kanbanize

Cumulative Flow Diagram (Bonus)

The cumulative flow diagram (CFD) is not a metric. However, it is one of the best agile tools to measure:

• Lead time and cycle time
• Throughput
• Work in progress

These are all agile flow metrics, which we have already discussed above.

The CFD is a graphical representation of your WIP flow in a Kanban system. With the help of this chart, you can understand the state of your work in progress and analyze the stability of your workflow - the entry and exit rate of your work items.

What you will see on a CFD are color blocks representing the work stages on your board, and the width of those blocks represents the number of cards in it.

Cumulative Flow Diagram visualizing workflow stages, average cycle time, and the number of work items in progress

The cumulative flow diagram provides clear visual signals of where process bottlenecks may be forming. With such an overview, you can then investigate why they have formed and how to can improve the workflow.

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In Summary

Agile metrics will help you analyze and understand your workflow, discover flaws, and improve, so your team can focus:

• on satisfying customers 
• on continuous delivery of value 
• on eliminating wasteful activities