Feedback and the Story of Phineas Guage
Flowconf Istanbul — Online 2020
If an Agile Transformation Initiative is going to improve our ability to deliver value to the business, then we should be able to tell the story of that value in the P&L. It’s true that, under the best of circumstances, the P&L traditionally aggregates cost accounting metrics, while being blind to the value delivered by productivity initiatives. These shortcomings of tradition cost accounting have been taken by Agile advocates as license to just tell a good story in place of doing the hard work of verifiable quantitative analysis.
I understand that it’s not an easy problem, but papering over the misalignment between Agile initiatives and the P&L is a lot like Phineas without the feedback part of the brain. You can count on him showing up to work, but you might wonder what he’s capable of next.
It’s only reasonable the the budget is the voice of the customer. I think that some of the most important work before us today is to strip away the apparent complexity around what we mean by productivity, including how to measure it, and to put those metrics in alignment from the Pull Request Edge all the way through to the P&L.
Let's agree to define productivity in terms of throughput. We can debate the meaning of productivity in terms of additional measurements of the business value of delivered work, but as Eliyahu Goldratt pointed out in his critique of the Balanced Scorecard, there is a virtue in simplicity. Throughput doesn’t answer all our questions about business value, but it is a sufficient metric for the context of evaluating the relationship of practices with productivity.