January 16, 2018
You’ve weighed your options and have decided outsourcing certain development projects is not only beneficial for your pocket, but also provides concentration within project development (i.e., a skilled expert in one area of focus). The decision to outsource was not the tough choice here at hand. Offshoring and nearshoring software providers are everywhere and narrowing down that list is already a pretty tough pill to swallow, but that still is not what’s important.
Even after you have made your selection and landed on one of many nearshore service providers in Romania with excellent reviews, you still had something more to look at. As a business owner, project leader, or other type of team leader, when it comes down to actually managing, we need metrics and data to implement required actions in order to meet company goals accurately. WAIT!!! Don’t turn and run, I know the words metrics and data are very scary and for most is enough to turn in the other direction, but we need to see progress and find out if everything is moving as it should.
When being put on the spot, determining what you want to track in terms of your nearshore service provider’s performance can be a heavy load to carry. Lucky for you, we’ve taken the time to help you quickly get the answers you need by following the metrics that matter the most to your project. Follow along, as we take an informational journey into 7 ways to measure your current nearshore service provider to make sure you are achieving growth, expansion, and steady development.
Before we dig in, maybe we should consider what type of metrics we need to look at for our project and software development. What is important to our business’s needs and growth? Finding a perfect blend of metrics is an art that is only masterfully expressed by experts at the top of their fields. They know what to look for, when to look for it, and frankly what path you should take to get there, which is another reason nearshore service providers are better than sourcing globally, as nearshore service providers are familiar with local and regional policies and economic infrastructure. While software performance metrics are certainly critical to measuring the success, there are also other departmental metrics to be keen on. Some of these departments are marketing, customer service, and overall business functions. These are valuable metrics to track to ensure your project is growing as it should, and that progress is being made. First, we will look at a couple of software metrics, followed by some marketing, customer support, and a few important business metrics to make sure your nearshore service provider in Romania is performing as they should.
Pedal to the Metal: What’s Your Cycle Time Saying?
When looking at how long an issue or bug is in play, the cycle time is a reliable KPI (Key Performance Indicator) used to determine the amount of time spent resolving the issue, versus the amount of time the issue has been active. This metric helps evaluate the effectiveness of the productivity of your team. For instance, if you were looking into the quality or BCT (Bug-Turnaround-Cycle), you would like to learn how long from open to close a ticket or issue has taken to resolve. From type, status, to time, there are several Cycle Metrics to think about considering, but when it boils down to it, it is all about efficiency and productivity. Is your team addressing problems promptly?
Build Up Momentum: What’s Your Nearshore Service Provider’s Velocity?
For obvious reason, velocity is one of the most looked at, sought after, and studied metric of software development. It basically says it takes this long to implement this many features, finish backlogs in this much time, and is a baseline for measuring team productivity. When velocity drops, there is something that is blocking your team’s progress and needs immediate attention. Find your mistakes and get them under control quickly by closely monitoring your project velocity.
Go Ahead, Send it Through: What the Throughput Metric Screams About Your Nearshore Software Development Status.
Up until now, we were just seeing what the team is doing and how long it takes to do certain tasks. The Throughput metric shows a visualization of the total work output (TWO). Your Throughput can be measured by looking at the totality of the number of bugs, chores, features, or tasks that have been completed within an agreed time. Completion of this encompasses the whole process testing-to-shipping. Throughput metrics can also be used as a way to spot bug and ticket trends. What type is occurring the most and what can be done to decrease these issues?
Your Software development project requires more insight than merely software metrics. If you are looking to track the progress, status, and planned route of your nearshore service provider, then you will also need to see how well their efforts are operating inside your actual business processes. TO do this, we will look at a few metrics that lie outside the technical software realm and focuses on everyday need-to-knows for the overall business health and survivability of your software project.
It Costs to Get Customers: Customer Acquisition Costs Matter to Your Nearshore Service Provider
For software companies, businesses, and other marketing ventures in, around, and far from the software industry focus on their CAC or “Customer Acquisition Cost.” Did you know that how much effort goes into the development of your software is also a factor of your CAC? Your CAC is the total cost it takes to bring a visitor or guest to convert and slide down the full sales funnel. This metric is extremely important when scaling software growth. Your customer acquisition can be broken down into traffic source, letting you know which part of the funnel is working most effectively. From email campaigns to paid ad clicks, there are tons of variables that go into determining your CAC.
Can You Feel the Churn? Your Nearshore Service Provider Can
Any business or software savvy individual will understand the vital importance of knowing, learning, and completely delving into figure what your churn rate is. Your churn rate is like something burning. How do you tell how bad something was burned? You look to see what was lost, damaged, and destroyed during the causing incident. Similar to this your churn rate determines a wide range of loss metrics. From customers to dollars and from software performance and more, there is a lot the churn rate can tell you. The most important use of the churn rate is to follow the loss versus gain of customers. Your churn can be tailored to find out how many customers you are losing during a period of time. This can be used in combination with other metrics to find out why your churn rate may be up past your generous allowed margin.
Isn’t it Always a Work-In-Progress?
Your Work in Progress or WIP as we like to call it is a cumulative measurement of the total number of open tickets currently being tended or serviced by your development team. This metric is similar to your Throughput metric. It objectively calculates a measurable speed of performance in the sense of real-time, instead of waiting for a lagged report from your Throughput data. So, why is this metric important to your nearshore software provider’s development progress? The most vital aspect of your WIP is to quickly identify and handle hiccups or barricades that can potentially bottleneck your project and bring it to a halt. Keep an eye on your WIP to keep progress rolling.
Cumulatively Flowing Over the Edge: Iteration Flow Established Team Synergy
This metric formally known as the cumulative flow is a collection of total phase progression. More commonly referred to as the Iteration Flow, this metric calculates how long each ticket or state remains in a certain phase. For instance, how long a new ticket stays in the Open, In Progress, Resolved, and Closed phase. This lets you know how your well your team is working together to keep the system flowing smoothly. This ultimately oversees several metrics. For example, let’s say you have a lot of tickets in the “In Progress” phase at any point in time. This is your WIP metric needing to be addressed and looked into. Your Cumulative Flow metric does just what it indicates, keeps your operations flowing and growing.
Your Nearshore Service Provider Should Show Growth
Technically, this last section is not a metric; well by itself, it is not. At the end of the day, every project has obstacles, bumps in the road, and hold-ups from time to time. It is to be expected, especially with larger more complexed projects. There should always be growth somewhere in the funnel that shows accomplishments toward achieving your desired results. Whether it is the operational status of software development or what KPIs to track current software performance, a reputable nearshore service provider in Romania should be able to show you, tell you, and explain what progress is being made and how your project goals are being met by showing growth in progression. There are lots of other metrics that play a role in measuring your team’s progress, but if you are looking for a quick overview and an accurate assessment of how things are really going, taking note of these 7 key metrics will certainly help you to gain valuable insight into your project’s status.