February 11, 2016

The Two Most Important Metrics for DevOps

BY :     February 11, 2016

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In my earlier blogpost I discussed the purpose of DevOps, namely reducing the time and effort it takes to put software into production and allowing for more (continuous) production deployments. Why is this important? The typical answer is that in the digital age, SPEED is the name of the game and it is important to be able to increase the speed to market of IT solutions. Doesn’t everyone expect cool new features for their favorite software to be available on an on-going basis? Doesn’t “the business” require enhancements and new capabilities in business applications to be in production as quickly as possible? So great, DevOps (and Agile) should give us this speed to production. But how is success measured? Increased frequency of releases? Reduction in the amount of time it takes to perform a deployment? Reduction in the lead time from the start of a “project” to the production release of this project? Levels of automation? All these are certainly valid ways to measure progress in DevOps, but they are not the most critical “macro” metrics that tell us if we have improved SPEED in IT. These are  WIP and Throughput.

Let’s start with WIP. WIP stands for Work in Process and represents the sum of all the cost tied up in the entire IT department forall ongoing projects and feature development efforts that have been started but not yet been put in production. So, this is really all the capital tied up in the system at any given time trying to produce software. If a decision was made to halt all development activities, this number would represent all the investment dollars that would have to be written off. Any time a new project starts or any time effort is expended on existing projects WIP is increasing. Any time a project or feature set is put in production WIP is reduced by the amount of the investment made on this project or feature set. If a project is cancelled mid-stream, WIP is similarly reduced by a write-off of the corresponding investment.

Since WIP represents tied up capital, it isgood to have low WIP, and bad to have a lot of WIP. Increasing the release frequencies and thus allowing to have (parts of) projects put in production earlier, reduces WIP and thus frees up working capital. There is a long way to go, because most IT organizations have a lot of WIP, sometimes up to a full year of productive capacity of IT. Because of internal resource dependencies between projects, having a lot of WIP also causes poor throughput.

Throughput is the amount of WIP that is put in production in a given period, usually a month. If you have high throughput, you are not only putting a lot of projects or features in production in a given period, you can also start many new initiatives or projects without increasing WIP. So high throughput is good and low throughput is bad. Obviously, increasing release frequencies will increase throughput. Again, there is a long way to go, since most IT organizations have very low throughput (and high WIP) and if you have high WIP and low throughput, it will take a long time to produce anything.

Which now brings me back to the purpose of DevOps and Agile, which is to increase SPEED. Speed is gaged by looking at throughput and WIP. Measure these and you will know if your DevOps initiative is actually helping accomplish your goal or just another excuse to add a couple of cool tools to your inventory.

Kasper de Boer

About

Kasper de Boer is a Vice President in Sogeti US, where he is currently responsible for the Infrastructure Practice. Kasper has 25 years experience in IT Consulting and is particularly interested in IT organizations and how to make these more efficient and effective. He advises clients on how to reduce the on-going maintenance burden of IT systems and technology, achieve better alignment between IT capabilities and business needs, increase speed-to-market of IT solutions, and increase the overall responsiveness of IT.

More on Kasper de Boer.

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  1. Erik · February 12, 2016 Reply

    DevOps is about speed, but mostly about agility: speed of change-in-course. It’s interesting that your argument above and the need for agility coincide on the need for shorter cycles, giving you double bang for the buck: quicker response times AND more efficient IT process altogether. Nice!

  2. Jos Putner · February 12, 2016 Reply

    Thanks for the article, interesting read.

    I think that you introduce a big risk if you focus this hard on WIP,. Why ? Well…
    It could/will give metrics that certain people will use as a control device. They will do everthing to create a great WIP and throughput. So they deliver at insane speed, but what they deliver is never used. Focus only on speed is not really handy in an agile setting.

    Tho.. speed is important that’s true, but for multiple reasons. One of them is Fail fast ! So you can learn and adapt. By doing so you can start create the right thing ( what people/users/clients need), stuff that actually works ads value and is used. A low WIP and high throughput wil get you faster feedback, so you can adjust to the actuall demand of the market. So you will have to answer a question first, why is speed so important to my company ? (in my opinion, not solely to deliver fast)

    It’s not very smart to measure succes with 1 metric, it’s more about how you interpreted the data. And use that data for improvements. There is no silver bullet. Your WIP could be so impresive yet it is all about the product that never is perfect, measure that ! (not by 1 metric please)

  3. Lee · February 21, 2016 Reply

    To put it a different way, lead time and cycle time….

*Opinions expressed on this blog reflect the writer’s views and not the position of the Sogeti Group