Every framework and every system uses some kind of metrics to determine outputs, efficiency, performance and other viable results, including Kanban.
While it is quite easy to go down the hole of tracking and abusing the wrong metrics, there are still those that can be useful for your Kanban process.
The key is in understanding what should be measured, when and why so that you can have some useful insight from it all. That said, here are a few Kanban metrics and important factors you should focus on.
Good vs. Bad Metrics
As mentioned before, there are always good and bad metrics at your disposal but how do you differentiate them and prevent the bad ones from misleading you?
It's fairly simple, if metrics help improve the system, they are good. On the other hand, if they reward or punish individuals, they are bad.
- Actionable -Improves the decision-making process.
- Lead to better results.
- Improve behavior.
- Portray the state of reality.
- Vanity metrics - Make individuals feel better.
- Usually, lead to bad results.
- Focused on the past.
- Used as targets.
Now that we got that out of the way, let's focus on the good metrics and how to make the best of them.
In the Kanban framework, cycle time refers to the amount of time it takes for a work task to pass from work in progress to being finished. It represents the efficiency, responsiveness and the ability of the team to deliver a task within a certain time period.
- When should you measure this metric? - The best way to measure cycle time is from the exact moment the team starts working on the task until they successfully complete it.
- Why should you measure this metric? - This metric is actually designed to help spot issues, obstructions and difficulties within the workflow and not to measure the team's performance. Short cycles mean that the team is quite effective, whereas longer cycles indicate there's a problem somewhere along the way.
That said, you can use the cycle time metric to determine the obstructions and clear them out of the way in the best way possible.
Unlike cycle time, the throughput does measure the team's performance. In other words, this metric shows how many cards the team delivered in a certain amount of time, as portrayed on the Kanban board, i.e. finished tasks.
- When to measure throughput? - You can specify any time period you wish, with 4 weeks being the usual average. Like with cycle time, start measuring at the begging of the specified period until the end and count the number of cards delivered each week.
- Why measure this metric? - Again, this metric is not designed to measure the way your team can improve their performance, although they can choose to find ways to improve their work productivity if they decide to do so. This metric portrays the amount of work your team is able to accomplish within a specified time period. You can use the data to make forecasts for future projects or monitor the productivity levels so they don't fall below the estimated average.
Cumulative flow diagram
As you may already know, Kanban is an approach that is based on incremental improvements. The cumulative flow diagram is the visual metric that represents how these changes are improving the system over time.
In short, this metric measures the improvements in process efficiency over longer time periods. Consider it the mother of all Kanban boards in visual terms.
- When to measure this metric? - As you've probably guessed, the best time to start with this metric is at the beginning of the project until the end, of course.
- Why measure this metric? - It gives you a visual assessment of the project's status. The metric shows the number of tasks in each stage that accumulate over time. The bands on the chart are color coded to better represent the team's performance and potential issues that are beginning to show up.
One of the metrics that are crucial for Kanban can be easily spotted through the flow chart. That metric is called bottlenecks. Bottlenecks metric shows a problem or a potential problem in the team's capacity and performance.
The best way to spot them is to look for the obvious signs, such as an increase in cycle time, a decrease in throughput and of course, a sudden spike in the flow chart gradient. This metric alerts you about the team's inability or lack of resources to deliver a certain amount of tasks within a given time period.
- When to measure it? - As soon as you spot any signs that indicate a potential bottleneck.
- Why measure it? - It will help you get to the root of the problem before things get out of hand.
Work in Progress (WIP)
WIP is more of a Kanban practice than a metric but it can also serve as such. In fact, it's arguably the most important Kanban element to measure. What it does is help limit the work tasks that are in the WIP stage, in order to optimize work efficiency and allow teams to deliver maximum value.
- When to measure it? - First of all, the limit to the WIP will depend on the number of people within a team. Ideally, one task per person but it's never as simple as that because task size may vary. Ultimately, the team decides on the WIP limit based on their estimates and once the limit is established you must measure it so that it doesn't increase at any given moment.
- Why measure it? - WIP limit is there to help the teams focus on getting things done and becoming more self-organized. Once the flow is established, increasing the WIP can overwhelm your team and make them less productive, as well as less efficient.
Metrics can be a valuable asset in any environment. However, the key is to focus on the good ones that can improve the process and make everyone's lives a lot better. In the Kanban framework, these metrics are focused on removing obstacles and allowing teams to achieve maximum efficiency.