How Do I Determine Agile Business Value?
Here are high-level steps for determining Agile business value. See our definition of business value. To recap, the business value is tangle and non-tangible in nature. Tangle items are things you can see, hear, feel, touch, or smell. Intangible things are finical measurements, or other non physical measurements such as customer attitude towards the product.
Determine Business Values to Measure
Determine a meaningful business value metric to measure the business values. Please keep it simple and easy to measure. If you have a list of values, keep the list to 5-7. The more concise the list, the more likely you are to achieve it.
Prioritization Strategy
Determine how the metric would drive prioritization of the backlog and your sprint goals. How would the business value metric drive prioritization of the backlog? How would it impact your sprint goals?
Expected Outcomes
Now that you measure it, what will that measurement drive? How will this metric drive the team and organization? As an example, the business value is to decrease work effort. How will that drive decisions your team and organization will make? The focus will be on reducing the complexity and effort when engaging with the product or system. That could lead the team to make decisions that focus on front-end design and the customer journey.
Reality Check
Talk with the team to see if the business value metrics make sense. This is the realistic part of the equation. It looks good to have specific business value metrics because they are popular with other organizations, and hey, we read it on the internet, so it must be essential for us too. Check the metric with the team. Is it a realistic business value metric? We have had many examples of business value metrics that seem perfect at the high level but don't make sense at the team level.
Here's an example. Reduce real estate expenses by having more team members work from home. The team's application provides truck drivers optimal routes for deliveries. There is a disconnect because the team wouldn't have any way to contribute to the goal.
Keep it easy, keep it concise, and keep it real.
