By Andrew Park | 2024-09-17
This morning, I had an insightful discussion with Gary Cohen about the metrics that dominate conversations in product development—flow, efficiency, and velocity. While these metrics can serve a purpose, we should be cautious about how much weight we give them. As product and engineering leaders, it’s our responsibility to ensure that we’re focused on outcomes, not just outputs, and that we preserve an environment where innovation can thrive alongside efficiency.
Defining the Metrics
We often focus on metrics like:
1. Flow: How quickly and smoothly work moves through the system.
2. Efficiency: Minimizing wasted effort, ensuring smooth handoffs, and removing bottlenecks.
3. Velocity: Tracking how much work gets done in each sprint, often measured in story points.
Each of these can tell us something useful, but they come with risks—especially when we start treating them as the ultimate measure of success.
The Pitfall of Prioritizing Metrics Over Outcomes
Yes, improving flow, efficiency, and velocity can sometimes help teams deliver more predictably. But these metrics are not the end goal. As leaders, we need to remember that delivering value is the real objective. A team that moves quickly but doesn’t solve the right problems isn’t successful, no matter how smooth their process.
When we fixate on delivery metrics, we risk losing sight of the broader picture. A team that consistently hits its velocity goals might still be shipping features that don’t align with customer needs or business objectives. In product management and engineering, it’s outcomes that matter most, not just the speed at which we’re able to push code or deliver features.
Efficiency vs. Innovation: Don’t Sacrifice One for the Other
One key insight shared by Gary Cohen was the trade-off between efficiency and innovation. As leaders, we sometimes fall into the trap of optimizing everything for efficiency—focusing on throughput, minimizing waste, and ensuring quick delivery cycles. But Gary has observed that efficiency can come at a cost: inadvertently limiting the space for creativity, exploration, and risk-taking—the very things that lead to groundbreaking products.
To innovate, teams need room to experiment. If everything is about streamlining, reducing waste, and playing it safe, we miss out on the bold ideas that differentiate us in the market. Innovation is messy, and often inefficient—but in the long run, it’s what keeps your product competitive and your company relevant.
Velocity: A Metric with Unintended Consequences
Velocity, especially when tied to story points, is often misused. Story points are meant to loosely represent the effort required for a task, but they are 100% subjective. What one team assigns a certain point value, another team might estimate very differently.
When stakeholders use velocity as a forecasting tool, teams will merely inflate their estimates to hit velocity targets. This doesn’t lead to more work getting done—just higher numbers to appease business stakeholders. Velocity was never meant to be a tool for forecasting capacity, but it’s often used that way because businesses need a way to plan. Unfortunately, this leads to distorted priorities and a focus on delivering more features rather than delivering truly valuable outcomes.
As Marty Cagan rightly points out, “it’s outcomes over outputs”, Roman Pichler echoes this by stating, “The goal of product management is not just to deliver features but to deliver value to the customer and the business.” The goal should always be to create meaningful outcomes, not just more outputs.
Finding the Right Balance
As product and engineering leaders, our challenge is to ensure that flow, efficiency, and velocity metrics are in service of the larger goal: building products that deliver meaningful value and drive business outcomes. We need to make sure our teams have the room to innovate while maintaining healthy processes for delivery.
Don’t let your teams become so fixated on delivery metrics that they stop thinking about the bigger picture. Instead, foster an environment where efficiency and innovation can coexist. This is the only way to ensure that your products remain competitive and deliver real value to your customers.
In Conclusion
The conversation I had with Gary Cohen underscored a crucial point: as product and engineering leaders, our success isn’t measured by how efficiently we deliver features, but by how effectively we solve customer problems. Metrics like flow, efficiency, and velocity should inform our decisions, but they should not dictate them. Always focus on outcomes, ensure that your teams have space to innovate, and remember that creating long-term value requires more than just optimizing processes—it requires clear thinking and a commitment to solving the right problems.
