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Evidence-Based Management (EBM) for Reporting

Basic

difficulty

Stage 3

Agile IQ® Level

Value Metrics

Reporting

Introduction

Evidence-based management (EBM) involves managerial decisions and organisational practices informed by the best available evidence. It’s based on the principles of:

  1. Peer-reviewed evidence.
  2. Judgement and experience from contextual management practice.
  3. The preferences and values of those affected.

Organisations can use EBM to assist them in measuring, managing, and increasing the value they derive from product delivery. 

Empirical Goals

The EBM framework consists of:

  • A strategic goal
  • Intermediate goals
  • Immediate tactical goals
  • A starting state
  • A current state

In order to progress toward the strategic goal, organisations conduct experiments which involve forming hypotheses that are intended to advance the organisation toward its intermediate goal. As experiments are conducted the results are gathered and related evidence. [4] Experiments can be viewed as actions or activities that introduce change (or development) within the organisation that propels the organisation toward its strategic goal.

EBM provides a set of perspectives on value. They are:

  • Unrealised value: What is the additional potential value that could be achieved?
  • Current value: What value is currently delivered by the organisation?
  • Ability to innovate: How effective is the organisation at improving value?
  • Time to market: How long does it take to deliver new value?

Metrics detailed by EBM include:

  • Unrealised value – market share, customer satisfaction gap, desired customer satisfaction.
  • Current value – revenue per employee, product cost ratio, employee satisfaction, customer satisfaction.
  • Ability to innovate – innovation rate, defect trends, technical debt, change failure rate.
  • Time to market – build and integration frequency, release frequency, mean time to repair, lead time, deployment frequency.

When your team uses EBM, their Sprint Goals should contribute to these key value areas.

What to Watch Out For

  • Metrics that do not relate to one of the four key value areas may not yield benefits to the organisation.
  • It can be difficult to associate work items in a Sprint to strategic goals (or key value areas).

Actions to Try

Add EBM Measure to the Product Goal

What is the team’s Product Goal? Improve customer satisfaction with a new feature? Meet specific SLA’s? Improve the team’s Net Promoter Score (NPS)?

Add EBM measures to the Product Goal and review the team’s progress toward those measures at Sprint Review.

Report on and Review EBM Progress

During Sprint Planning:

  • Examine progress toward the Product Goal.
  • Review at improvements in EBM metrics.

For future Sprints:

  • Continue to work on Backlog Items that are known to improve the metrics.
  • Discontinue working on Backlog Items that have not impacted the metrics.

Report on:

  • Movements in the metrics.
  • Where the Product Owner has chosen to focus for future Sprints.
EBM and Reporting

Download the EBM Guide

Find the right measures for your product and team

The EBM Guide is published by Scrum.org

References

1. Pfeffer, J. (2006) Hard facts, dangerous half-truths, and total nonsense.
 
3. Sutherland, J. & Schwaber, K. (2020) The 2020 Scrum Guide.
 
4. Scrum.org (2020) The Evidence-Based Management Guide: Measuring Value to Enable Improvement and Agility. https://www.scrum.org/resources/evidence-based-management-guide
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