Comparing Value and Velocity

WRITTEN BY Mike Cottmeyer

Is there a difference between the value a team delivers and their velocity? Said another way… if I increase the velocity of the team… aren’t I getting more value from them over time? Like so many things we talk about here… the answer really depends on your context.

You might be inclined to make the argument that velocity is really just a measure of how many story points the team can complete in a given iteration. There is no explicit dealing with value… only relative size. But… if the Product Owner is prioritizing the backlog… and asking the team to deliver the highest value features first… isn’t there an implicit correlation between value and velocity?

My take is that there is a correlation between value and velocity at the team level… it is when we get beyond the team that relationship starts to break down.

Think about this scenario… let’s say them team is cranking out feature after feature… adding great stuff to the product… their velocity stabilized a few sprints back and is getting better and better every iteration. The company has a great product but a terrible sales team and even worse marketing. While the product is technically superior to their competition… how valuable is it if no one buys it?

You might make the case that all those really cool features ended up having very little value to the market. Great velocity… not so much value.

Here is another scenario for you… let’s say you have four teams that have to work together to deliver a new product suite to the market. Teams A, B, and C have fantastic velocity but team D just hasn’t been able to get their stuff together. Team D ultimately delays the release… and the overall product is late to market. In the meantime… the competition just released the latest version of their product and yours doesn’t do so well.

How much did the velocity of teams A, B, and C help the overall value of your product? Again… great velocity… not so much value.

Okay… last one. Let’s say you have 7 component teams that have to deliver features into several major architectural sub-components. All the teams are rockin‘… they have met all their high level milestones… they know where they need to take their part of the project. One of the teams realizes a significant risk and their velocity tanks. The rest of the teams keep going… they are building great stuff… stuff that certainly has to be built someday… but again… that one team causes us to delay the release.

Most of the teams were doing great… one team not so great… where did all the value go?

Lean tends to take a broader look at value delivery across the entire value stream… across the enterprise… Scrum by it’s very nature tends to look only at the delivery team. So… at the single team level… you can make a great case that there is a correlation between velocity and value. It’s an implicit link, but it is there. When you start looking outside the team… across the entire value stream… that is where the correlation between value and velocity starts to break down.

When the Lean folks say that Scrum focuses on velocity and Lean focuses on value… as I see it… this is the reason why.

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3 comments on “Comparing Value and Velocity”

  1. Tungano

    What "value" is really depends on the mission. Typically the 'value' we have to add is simply satisfying whatever idea, good or bad, our customer or his/her representative has (PO or business consultant).
    We aren't expected to play a role there, even though we sometime try, "just build it"… Velocity is a tool used to whip the construction team into building potential junk faster and faster with those people designing it and coming up with the bright ideas staying out of the loop. So I guess you have a point somewhere yes…

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  2. Scott Duncan

    Lots of points along the way when someone can decide that some level of value has been achieved. Perhaps the same can be said for quality. This suggests that there may not be some ultimate definition of value or quality except with regard to someone putting a stake in the ground. That stake could be put in another position in the ground.

    Even if you say the customer is the ultimate definer of value and quality, when do they do that? When they get the final product version from development? When it gets into production use by the customer? When the customer can measure some return on the use of the product?

    Is there value in a home loan until most of it is paid off given that it can be defaulted on? So is there value in a software product until its original cost has been recovered plus some net return above that?

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  3. Hunter555

    I'm wondering on the deffinition of value… We would probably consider adding a cool feature or fixing an important bug adding value. But the part I'm a little hesitant about with the correlation between velocity and value is that as velocity increases does quality not decrease and thus value?

    I guess it depends on your situation and the importants of quality because there is also a correlation between value and quality.

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