In Agile teams, measuring performance helps us understand where we’re doing well and where we can improve. Among the most straightforward and insightful metrics are Cycle Time and Velocity. Let’s take a closer look at each and how they work.

What is Cycle Time?

Cycle Time is the time between when work starts (when it’s “in progress”) and when it’s completed. Think of it as a window into your process efficiency. It tells the story of what happens “in the kitchen” as your team gets things done.

Imagine you ordered a pizza. The waiter tells you it’s being prepared in the kitchen. How long will it take to get to your table? Now, lots of things can affect that time:

• Are the ingredients ready to go?

• Is the dough already prepped, or will it need to be made from scratch?

• How many people are working on it, and how smoothly do they hand off tasks?

In a team, Cycle Time shows how efficiently work flows through each step. If your team’s Cycle Time is long, it might mean there are bottlenecks or handoff issues. Shorter Cycle Times suggest a smooth, efficient process.

Now, What is Velocity?

Velocity measures your team’s capacity to deliver work within a sprint. It’s expressed as the number of story points the team completes during a sprint.

For instance, if your team completes 50 story points over the last few sprints, that’s their average Velocity. While Velocity doesn’t measure process efficiency directly, it gives insight into your team’s work capacity and how much they can typically handle within a given sprint.

In summary:

• Cycle Time = Process Efficiency: It shows how well your team navigates tasks internally.

• Velocity = Team Capacity: It shows how much work your team can complete within a sprint.

With these two metrics, you get a 360 degrees view of both how well your team works together (Cycle Time) and how much they can accomplish (Velocity).

In my opinion, and according to my experience, in lean organizations focused on minimizing waste and adopting Agile principles, it’s more valuable to prioritize improving Cycle Time over focusing on Velocity. Enhancing Cycle Time helps refine the process itself, making the workflow more efficient. Velocity, on the other hand, can sometimes put unnecessary pressure on teams and may be influenced by subjective estimates, making it less reliable as a true measure of productivity.

What do you think?