In Agile environments, performance measurement is often misunderstood. Many organizations rely on velocity (story points completed) as a key success indicator. However, does velocity truly reflect value? Completing a high number of story points does not guarantee that meaningful outcomes are being achieved. Agile methodologies, particularly SAFe (Scaled Agile Framework), emphasize delivering value, not just work.
To effectively measure performance at the Agile Release Train (ART) level, organizations must move beyond team-based metrics and focus on business outcomes and customer impact. This article explores better ways to measure value and performance in Agile environments and how organizations can shift their mindset toward outcome-driven success.
The Pitfalls of Story Points as a Performance Metric
Story points are a popular tool in Agile teams, but their effectiveness as a performance metric is limited. While they help teams estimate effort, they do not inherently measure value.
Here’s why story points can be misleading at the ART level:
- They measure effort, not business impact – Completing 100 story points does not necessarily mean delivering a feature that improves customer experience or increases revenue.
- They can encourage gaming the system – Teams may inflate estimates to create an illusion of high productivity.
- They create false comparisons – Since story points are relative estimates within a team, they should not be used to compare performance across multiple teams in an ART.
Instead of focusing on how fast teams complete work, organizations should focus on whether that work drives meaningful results.
Shifting Focus: Measuring Value Instead of Velocity
To effectively measure value, organizations must shift from tracking effort-based metrics to outcome-driven indicators. The following categories provide a better way to measure ART-level performance:
1. Business Outcome Metrics (OKRs and Value Measurement)
- Objectives and Key Results (OKRs): Align feature delivery with measurable business goals.
- Customer Satisfaction (CSAT) & Net Promoter Score (NPS): Measure the impact of delivered work on customer experience.
- Revenue Impact & Cost Savings: Assess whether new features increase revenue or reduce operational costs.
- Lead Time for Value Delivery: Measure the time it takes to move from an idea to working software in production.
- Flow Efficiency: The percentage of time work is actively being worked on versus waiting.
By using OKRs, organizations ensure that Agile teams focus on outcomes rather than output. Instead of measuring how much work gets done, they measure what impact the work has on business goals.
2. The Dangers of Running Too Many Initiatives at Once
One of the biggest challenges in Agile transformations is the tendency to take on too many priorities at the same time. While the intention is often to maximize throughput, the reality is that spreading effort too thin can dilute impact and delay results.
- Multitasking reduces efficiency – Teams working on multiple initiatives simultaneously experience more context switching and slower progress.
- Delayed value delivery – Instead of getting impactful features to customers quickly, everything moves forward incrementally, without delivering full value until much later.
- Lack of clear priorities – Without strategic focus, teams struggle to align their work with the most important business outcomes.
A great example is a software company that cut its Work in Progress (WIP) by 30% and saw a 25% faster time-to-market with significantly fewer defects in production. Instead of trying to ship everything at once, they focused on delivering fewer, high-impact features faster.
The OKR framework helps mitigate this issue by forcing organizations to focus on a limited set of high-impact goals per Program Increment (PI). If everything is a priority, nothing is a priority.
Example: Measuring Velocity vs. Measuring Value
Company A: Measuring Velocity Instead of Value
A financial services company launched an Agile Release Train (ART) to improve their digital banking platform. Their leadership team tracked velocity (story points completed) as the main measure of performance.
What Happened?
- Teams worked hard to complete stories and maximize their velocity.
- Every PI planning session focused on committing to a high number of story points.
- After multiple PIs, leadership was frustrated because customer adoption and business impact remained stagnantdespite high velocity.
Key Issue: They were optimizing for effort, not impact. Features were being delivered, but they weren’t driving measurable business outcomes.
Company B: Measuring Business Outcomes & Value
A competitor took a different approach. Instead of measuring story points, they tracked:
- Customer Activation Rate (How many users engage with the new feature?)
- Task Completion Time (How much faster can users perform key banking operations?)
- Revenue per Active User (Did the feature improve customer spending behavior?)
What Happened?
- Product Management worked closely with Business Owners to define success metrics before feature development.
- Features were broken into smaller, measurable increments (instead of large “Scrum epics”).
- By PI3, leadership saw a 20% increase in active mobile banking users and a 15% reduction in customer service calls (indicating better user experience).
Key Takeaway: The second company optimized for business impact, not team activity, leading to measurable success.
Applying These Metrics in SAFe
Product Management plays a crucial role in defining what constitutes value and ensuring that value is measured effectively. This includes:
- Working with Business Owners, customers, and stakeholders to establish clear success criteria for features.
- Defining key value indicators such as business impact metrics, usage analytics, and customer feedback mechanisms.
- Embedding measurement practices into the product development lifecycle to ensure that teams deliver work aligned with strategic goals.
Instead of defining success as “Feature X is delivered,” a strong Product Manager sets success criteria like:
- “Feature X adoption reaches 70% within 3 months.”
- “Customer retention improves by 10% after release.”
By refining backlog prioritization and ensuring that every feature has a defined measurement of success, Product Managers help maintain alignment between execution and value delivery.
Conclusion
Measuring performance in Agile should not be about speed alone. Instead of focusing on how much work gets done, organizations should evaluate how much value is delivered. By leveraging business outcome metrics, flow efficiency, and stakeholder alignment, Agile teams can ensure that their work is driving real business impact.
To succeed, organizations must adopt a value-first mindset, where every feature and enabler is measurable and aligned with strategic goals. By doing so, Agile Release Trains can move beyond the limitations of story points and towards a more impactful, value-driven approach.
Are you still tracking velocity as your primary metric? What’s one business outcome metric you could track instead? Drop your thoughts below!
