Assess the Value Drivers Within Your Solutions

Implement a balanced value measurement framework to align product roadmaps and projects with enterprise goals.

EXECUTIVE BRIEF

Analyst Perspective

Use value drivers, not mythical estimates and intuition.

Value is probably the most challenging thing to define and measure in information technology (IT). Value is relative to the observer, and it is complex and often indistinct. The challenge is even harder when trying to compare and prioritize opportunities in different departments and service lines. Even when we are able to make hyper-localized prioritization decisions based on our day-to-day experience, how do we know if those decisions are the best uses of resources for our organization?

It’s time to flip the script. Instead of chasing discrete localized value, align your intake prioritization with value drivers assessed through key performance indicators (KPIs) or objectives and key results (OKRs). A value driver is a success factor or enabler that is directly aligned to an enterprise goal, making it actionable. We prioritize opportunities that have the best chance to influence and achieve enterprise goals.

First, understand what goals your organization wants to achieve. Next, determine what drivers or factors will bring you closer to these goals. Then, estimate the impact of each intake item to influence the drivers and achieve these goals. You can refine your estimation accuracy by tracing KPIs and OKRs to the value drivers, enabling you to measure the value or impact realized.

It’s not easy, but it will be more valuable than throw-away business cases that aren’t measured.

Hans Eckman

Principal Research Director, Application Delivery and Management
Info-Tech Research Group

Executive Summary

Info-Tech Insight

Solution value is not about revenue. Since value is relative to the consumer, prioritize opportunities by determining their impact on value drivers aligned to enterprise goals. A balanced value framework provides a way to compare disparate initiatives and changes across your enterprise, not by how much localized value they provide, but rather by how influential they would be for reaching the overall goals and priorities of your enterprise. That is the true measure of success!

Drive better decisions with a value-driven approach and framework

Value drivers provide an enterprise framework to connect organizational goals and priorities with your intake process, improving alignment to the goals that are valued the most by your senior leadership team.

Strategic Enterprise Goals

Value Drivers

Prioritization Framework

Include balanced value as part of your prioritization framework

Value unlocked in your product delivery pipeline is only as good as the return on investment (ROI) of the items prioritized and ready in your intake process.

Determine your value drivers

Competent organizations know that value cannot always be represented by revenue or reduced expenses. But how to envision the full spectrum of sources of value is not always apparent. Dissecting value by benefit type and orientation of the value source allows you to see the many ways in which a product or service can bring value to your organization.

Financial Benefits vs. Human Benefits (Improved Capabilities)

Financial benefits refer to the degree to which a value source can be measured through monetary metrics. They are often quite tangible.
Human benefits refer to how a product or service can deliver value through a user’s experience.

Inward vs. Outward Orientation

Inward refers to value sources that have an internal impact and improve your organization’s effectiveness and efficiency in performing its operations.
Outward refers to value sources that come from your interaction with external factors, such as the market or your customers.

Use product families to translate enterprise goals

Enterprise goals and priorities must be cascaded and interpreted down to the application, product, or service level, where changes can be made.

Without common goals, teams are independently successful but fail as an enterprise.

– Patrick Lencioni, “The Five Dysfunctions of a Team: A Leadership Fable

For help validating or establishing your product and service families, download Deliver Digital Products at Scale.

Estimate your value scores

The key to prioritizing intake across disparate products and services is to shift evaluation from localized value to the impact that the change will have on the organization’s ability to reach its goals. A balanced value score determines which opportunities will have the greatest impact on, and alignment with, enterprise priorities.

Build your balanced business value score using key value drivers

Determine your scoring method

Find the approach that matches your organization’s ability to estimate intake items. Add quantitative metrics and complexity to improve estimation accuracy.

Simplified: MoSCoW

• Use MoSCoW to estimate the impact on each value driver.

Unweighted Scoring

• Estimate the impact (numerical) on each value driver to create a calculated score.

Weighted Scoring

• Estimate the impact (numerical) on each value driver.
• Multiply the impact by the value driver weighting to create a calculated score.