The Definitive Guide to

Flow Metrics

What are Flow Metrics and how can they optimize software delivery? Learn about the framework that takes your tech-driven business to the next level.

Introduction

What are Flow Metrics and why are they gaining importance alongside DORA metrics? While DORA makes up a small part of Value Stream Management (VSM), the development part, Flow Metrics are being used to measure the end-to-end flow of a software value stream.

In this article, we’ll explain how the Flow Metrics; Velocity, Efficiency, Distribution, Time, and Load help business leaders and IT measure the value software generates for their organization and how these metrics facilitate decision-making processes.

 

What are Flow metrics?

Flow Metrics are used to measure how value moves through the value stream of a software product from one end to the other end. Once evaluated against business results, the five metrics Velocity, Efficiency, Time, Load, and Distribution offer important insights and expose weaknesses and bottlenecks.

Metric Explanation
Flow Velocity Measures how productive a process actually is.
Flow Time Captures the time that a flow item takes from start to completion, which includes both active times and wait times.
Flow Efficiency Identifies whether the waste is increasing or decreasing within the delivery value stream.
Flow Load Refers to the number of flow items that are part of the value stream.
Flow Distribution Helps decision-makers prioritize the flow items that matter most.

The metrics that were first presented in Dr. Mik Kersten’s Flow Framework are calculated on specific Flow Items that can be defined as units of work that are crucial to a software delivery organization. These Flow Items are Features, Defects, Debts, and Risks – any effort or transformation that a company undertakes in relation to software delivery can be assigned to one of these core categories.

Read on and learn about each Flow Metric and how it helps companies optimize their software value streams.

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Flow Velocity

Flow Velocity is a metric that measures how productive a process actually is. In practice, this means tracking how many items or units of work are completed within a specific period of time – this could be a week, two weeks, or month-to-month. Over time, the metric accumulates historical data that teams can use to determine whether delivery rates are accelerating or if they need improving.

Along with Flow Time, Flow Velocity is also referred to as the “money-metric” – together, these metrics reveal how much business value is being delivered and how quickly it is being delivered. Example: If a company delivers features at a low flow velocity, it runs the risk of losing customers as they might not be willing to renew the service. It’s important to identify the reason for any delays and improve the rate by investing in new talent or infrastructure.

Example Possible consequence Potential solution
Delivering features at low velocity Customers churning
  • Invest in new talent
  • Invest in new infrastructure

Flow Time

Flow Time is a metric that captures the time that a flow item takes from start to completion, which includes both active times and wait times. Knowing how long things take, helps teams in predicting delivery speed while answering the common question “Why are things taking so long?”. Whereas delivery lead time in DevOps only covers the time span from committing to deploy, Flow Time is a customer-centric measure that takes the entire product journey into account.

The Flow Time metric allows you to analyze trends over time and can therefore be used to measure the efficacy of acceleration investments. A long flow time means that there are elements in the process that could be improved – in many cases, a long wait time is a cause for unnecessary delays. Once you can identify what the potential hold-up is, Flow Time can be reduced by optimizing work processes, hiring the right experts, or lowering your Flow Load.

Example Possible consequence Potential solution
Bringing flow items from the start to the customer takes a long time Customers churning
  • Optimize work processes
  • Hire the right experts
  • Lower your Flow Load

Flow Efficiency

The metric Flow Efficiency is used to identify whether the waste is increasing or decreasing within the delivery value stream. It is closely related to Flow Time above as it is comprised of the ratio of active time and wait time. In other words, Flow Efficiency shows the percentage of time that flow items are being worked on vs. the total amount of time they spend in the value stream.

The lower the Flow Efficiency, the more waste is being produced in the process. Thus, you need to identify why items are stagnating and come up with ways that eliminate wait times and thus long queues of items that are stuck in the value stream. This could mean less context switching for teams or reducing the time it takes to approve a specific feature that the customers are waiting for.

Example Possible consequence Potential solution
Waste is being produced within the process/long queues of items Customers churning
  • Eliminate wait times
  • Less context switching
  • Reduce the feature approval time

Flow Load

The metric Flow Load refers to the number of flow items that are part of the value stream. In other words, it’s the work in progress (WIP) that is being measured. Too many items in the value stream tend to have a negative effect on Flow Efficiency, Velocity, and Time. However, tracking the Flow Load helps teams recognize at what point added items are impacting the output.

The right Flow Load highly depends on the context. In general, you want to strike a perfect balance between Load, Time, and Velocity. The ideal Flow Load will minimize Flow Time and maximize Flow Velocity. If you have smaller teams, it might make sense to reduce the workload to increase efficiency. However, seasoned teams who are working on mature products are much more likely to succeed with a bigger load.

Example Possible consequence Potential solution
Too many flow items in the Work in Progress (WIP) stage Low team output
  • Reduce the workload
  • Hire more talent

Flow Distribution

Flow Distribution is an additional metric that helps decision-makers like Engineering Managers prioritize the flow items that matter most. And here is how: The metric shows the proportion of the four flow items features, debt, risk, and defects in a specific value stream. This visibility gives important insight and can start conversations between developers and leadership about trade-offs when it comes to improving singular metrics.

With Flow Distribution, it’s easy to see how many features are being worked on compared to other items like defects or risks. It clearly illustrates where the priorities lie – after all, a decision to work on one thing will put something else on the backburner. However, ignoring important items like bug fixes over a longer period of time for the sake of developing new features, will lead to bigger problems in the long run. Thus, re-assessing and re-distributing the items is necessary.

Example Possible consequence Potential solution
Ignoring bug fixes or deploying only new features Misdirection in focus
  • Reassess prioritization
  • Hire more talent
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The benefits of Flow metrics tracking

Using Flow Metrics to measure performance in software delivery means that the entire value stream of a specific product is being exposed. With this visibility, it is much easier to spot weaknesses and bottlenecks and make improvements to maximize benefits not only for customers but also for teams.

At tech-driven organizations, it is especially the CTO, engineering staff as well as the product manager and product operations manager who benefit from value stream management based on Flow Metrics.

Below are the three main benefits that Flow Metris can offer you, your team, and your organization when properly implemented

Measure what matters – End-to-end flow

While other metrics only focus on specific parts of the value stream, Flow Metrics allows teams to create full end-to-end visibility of the software delivery chain. With modern tools that are connected to the cloud and other used applications, this happens with real-time data, so you get to paint an accurate picture of process times and efficiencies.

Move from project to product

With a project-centric approach in software development and delivery, it is difficult to see the big picture and even more difficult to measure progress and efficiency. When applied in their value stream management efforts, Flow Metrics help companies move to a product- and customer-centric approach as they can tie the flow items to specific products and adjust the process.

Correlate Flow Metrics with business outcomes

If a company is not able to measure how its investments in business-transforming software are affecting overall business outcomes, there is bound to be waste and many misinformed decisions. With an exposed value stream, however, leaders have tangible data that can easily be correlated to business outcomes and overall performance.

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How to use Flow Metrics?

There is more than one way to use Flow Metrics to your advantage. In fact, they can be easily integrated into existing approaches that organizations have practiced for years. This includes Agile & DevOps approaches and OKRs (Objective and Key Results). Read on and learn how to use Flow Metrics and how they can become part of your established tracking practices.

Measure value delivery with Flow items

With the Flow Items we mentioned earlier – Features, Defects, Risks, and Debts – it’s much easier to measure value delivery in your Value Stream Management efforts. Both Features and Defects are pulled by the customer and can include things like user stories, customer requirements, or bugs and incidents. Risks and Debts on the other hand are pulled by architects or risk officers that know about legal and regulatory requirements.

Support your Agile & DevOps approaches

Find out below, how Flow Metrics can support popular approaches like SAFe (Scaled agile framework) and Agile & DevOps in the most effective way.

SAFe: This framework is used to scale Agile and connect it to business objectives. However, SAFe operates on a much more granular level than Flow Metrics and therefore produces so much data that decision making is still difficult. Flow Metrics take the items in SAFe and put them into four categories only, providing structure and a high-level view.

AGILE & DevOps: While metrics like DORA are more developer-centric and therefore don’t cover the entire value stream, Flow Metrics are needed to address other items and concerns that affect the success of software delivery. That’s why they complement Agile & DevOps metrics in the best way.

Incorporate Flow metrics in OKRs

Many companies use OKRs (Objective and Key Results) to track processes and drive business goals. However, it is quite a challenge to apply these metrics to the world of software delivery. That’s why Flow Metrics should be used instead of traditional OKRs. Not only do they measure business outcomes, but also value stream improvements such as reducing bottlenecks by optimizing the Flow Distribution or reducing the overall time when treating Flow Efficiency as an OKR.

 

Best practices

When implementing Flow Metrics for the first time, there are a few best practices that you should stick to in order to unleash their full potential.

  • Keep in mind that every company and every product is different. That’s why you should always define your own base and target levels for metrics on a product, team, or company level.
  • With such compact metrics that can be applied to any software product, it can be enticing to make direct comparisons. However, you shouldn’t compare apples with oranges. After all, a mobile app is not the same as a backend service.
  • Treat metrics as a path to self-improvement and not as a control mechanism. This will motivate team members and foster empathy and communication.
  • Learn from other teams that perform better or start to gamify. This doesn’t imply a competitive company culture but should be rooted in an atmosphere of teamwork and active knowledge-sharing.

Conclusion

With a massive shift towards tech-driven solutions, businesses can no longer apply their traditional metrics to measure how successful or efficient their value streams are. That is why new frameworks that are optimized for software delivery are needed.

Alongside DORA metrics in DevOps, Flow Metrics are a powerful tool that helps organizations measure the value of software and whether their investments in digital transformation are effective or wasteful.

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Answers to frequently asked questions on Flow metrics

What are the Flow metrics?

Flow Metrics are used to measure how value moves through the value stream of a software product from one end to the other end. Once evaluated against business results, the five metrics Velocity, Efficiency, Time, Load, and Distribution offer important insights and expose weaknesses and bottlenecks.

What is Flow Velocity?

Flow Velocity is a metric that measures how productive a process actually is. In practice, this means tracking how many items or units of work are completed within a specific period of time – this could be a week, two weeks, or month-to-month.

What is Flow Time?

Flow Time is a metric that captures the time that a flow item takes from start to completion, which includes both active times and wait times.

Knowing how long things take, helps teams in predicting delivery speed while answering the common question “Why are things taking so long?”.

What is Flow Efficiency?

The metric Flow Efficiency is used to identify whether the waste is increasing or decreasing within the delivery value stream. It is closely related to Flow Time above as it is comprised of the ratio of active time and wait time.

In other words, Flow Efficiency shows the percentage of time that flow items are being worked on vs. the total amount of time they spend in the value stream.

What is Flow Load?

The metric Flow Load refers to the number of flow items that are part of the value stream. In other words, it’s the work in progress (WIP) that is being measured. Too many items in the value stream tend to have a negative effect on Flow Efficiency, Velocity, and Time. However, tracking the Flow Load helps teams recognize at what point added items are impacting the output.

What is Flow Distribution?

Flow Distribution is an additional metric that helps decision-makers like Engineering Managers prioritize the flow items that matter most. And here is how: The metric shows the proportion of the four flow items features, debt, risk, and defects in a specific value stream.

This visibility gives important insight and can start conversations between developers and leadership about trade-offs when it comes to improving singular metrics.

How to incorporate Flow metrics in OKRs?

Flow Metrics should be used instead of traditional OKRs. Not only do they measure business outcomes, but also value stream improvements such as reducing bottlenecks by optimizing the Flow Distribution or reducing the overall time when treating Flow Efficiency as an OKR.