What is Development Velocity?

Howdy, Upstarts!

In some of my previous articles, I have explained some core concepts for managing agile software development teams: User Stories and Story Points. These are important concepts that get bandied about quite a bit every time someone brings up SCRUM Development or KANBAN. My previous articles explained the concepts of User Stories and Story Points, as well as why they are both important for any engineering organization, particularly for startups. In this series of articles, I want to address an important metric that you can calculate using the concepts of User Stories and Story Points: Development Velocity.

Development Velocity is one of the most important KPIs for managing and optimizing your engineering organization. It will drive your product roadmap and help you to craft a successful go-to-market strategy for your startup. In my experience, much of the work of a startup CTO boils down to increasing Development Velocity. But to start leveraging Development Velocity in your engineering organization, it is important to understand exactly what it is and why it is important.

So, in my next series of articles, I am going to take a deep dive into Development Velocity.

This article will focus on providing an in-depth explanation of Development Velocity, and the following articles in this series will explain how to measure Development Velocity and will provide some best practices on how to optimize Development Velocity.

But as always, the first thing we must do is to ensure that we know exactly what Development Velocity means!

What is Development Velocity?

Development Velocity is how fast your software developers can make progress on your technology product.

The key point to remember is that Development Velocity focuses on measuring progress, not work!

That means that your software development teams can only increase their development velocity when they can focus on producing new work.

For example, if a software developer writes code with a lot of bugs, then they will need to spend more time fixing that code; or if a software developer writes code that is hard to maintain, then they will spend more time maintaining that old code. Both of these situations means that they will deliver new code slower because they are spending more of their time on older code. This means that they are not able to make as much progress as they otherwise would be able to, and therefore, they have a slower Development Velocity.

… So, Why is Development Velocity important?

Development Velocity tells you how much your engineering organization can accomplish.

When you plan your Product Road Map, you must determine a strategic objective, then you must gauge how much work needs to be done to meet these objectives, and finally, you must calculate how much time will be needed to meet these objectives.

The KPI that tells you how much time your engineering organization will need to accomplish the strategic objectives of your startup is Development Velocity.

A high Development Velocity means that your engineering organization can accomplish more work, and that means that your startup needs less time, and that means that your startup will survive longer!

Development Velocity will Increase your Startup’s Life Time!

Fundamentally, it is a matter of time.

There is never going to be enough time. You need to pay your bills, and that means that you need to earn enough money rapidly. Your market will inevitably change, and that means that you need to pivot agilely. Your investors will insist on growth, and that means that you need to grow quickly.

When you build your startup, your biggest enemy is time, and that means that managing your technology product means managing time.

This means that the question that your software development teams need to be able to answer is:

“How fast can you finish this software?”

Product Managers, Business Development Executives, and Marketing Directors will all need an answer to this question because time and schedules determine the success of every startup. So every CTO needs to be ready to answer this question, and the best tool of a CTO for managing time if Development Velocity.

As I said, Development Velocity is how fast your software developers can make progress on your technology product, and that means that Development Velocity tells a CTO how much time that an engineering organization will need to meet strategic goals.

That means that Development Velocity is the key KPI of an engineering organization. Development Velocity tells a CTO how efficiently their teams can work, how quickly their teams can deploy new features, and how easily their teams can pivot when the market requires. A CTO should constantly be looking for ways to increase their Development Velocity!

So the job of a CTO is to increase Development Velocity by whatever means necessary!

Use Development Velocity to Manage Time

In this article, I have focused on explaining what Development Velocity is, and why Development Velocity is so important for your engineering organization.

Optimizing Development Velocity is critical for building a startup because it empowers your team to pivot quickly and to develop your product on time and under budget. Every CTO needs to be focusing on optimizing the Development Velocity of their Teams and on finding new ways to optimize and increase the Development Velocity of their engineering organization.

In these next articles, I will explain how to measure Development Velocity and will provide some best practices on how to optimize Development Velocity.