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Engineering productivity can be measured, just not how you'd expect

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Re: Engineering productivity can be measured, just not how you'd expect

#81

Post by dmos62 »

username90 wrote: post #50
andrey_utkin wrote: post #28

Earlier quoted context omitted.

Simply: does revenue exceed cost of running it? The book I referred to answers the "but engineering team doesn't have revenue". Engineering can be art, sure, and if you like, we can even discount the idea that art creation can be seen as economic activity. But is there a need to measure productivity then?

> Simply: does revenue exceed cost of running it? Cost of running it includes engineering salaries, so isn't a good measure to include when you measure productivity of engineers. A productive engineer would be worth a higher salary, but if you include the cost of that higher salary reducing his value would that also reduce the salary you want to pay? Doesn't make sense.

Also, what if engineering is good, but sales is bad? Engineers might exceed their productivity goals, but it wouldn't amount to profit.

Re: Engineering productivity can be measured, just not how you'd expect

#82

Post by marcus_holmes »

andrey_utkin wrote: post #28
dmos62 wrote: post #25

Earlier quoted context omitted.

So what is that true way to measure productivity you alude to? By the way, engineering can be an economic activity, but it doesn't have to be. Could be an art as well, for example.

Simply: does revenue exceed cost of running it? The book I referred to answers the "but engineering team doesn't have revenue". Engineering can be art, sure, and if you like, we can even discount the idea that art creation can be seen as economic activity. But is there a need to measure productivity then?

Engineer A built the new widget that Sales have been talking about for months. This immediately generates $1m in revenue.

Engineer B removed some tech debt. Future efforts to build widgets will take less time to build.

Engineer C rewrote the backend to prevent a vulnerability exposure that could have lead to disaster.

Who was most productive? Who deserves a raise?

Re: Engineering productivity can be measured, just not how you'd expect

#83

Post by marcus_holmes »

I don't actually see a productivity measure in all this, though.

If there are more blockers, is the team doing better (because they're covering ground faster and finding new blockers faster). Or worse (because they're being blocked more)?

If I have to report to the CEO on the Dev team productivity, do I tell them how many blockers we removed?

Re: Engineering productivity can be measured, just not how you'd expect

#84

Post by simon_000666 »

or... Just use the metrics outlined in the accelerate book, which have been fairly well studied and have quite a lot of quantifiable evidence to back them up.

E.g.

Deployment frequency

Lead time for changes

MTTR

Change failure rate

A quick google reveals a fair amount of existing material :

https://leadingagileteams.com/2020/04/07/forget-dumb-product...

Re: Engineering productivity can be measured, just not how you'd expect

#87

Post by andrey_utkin »

dmos62 wrote: post #81
username90 wrote: post #50

Earlier quoted context omitted.

> Simply: does revenue exceed cost of running it? Cost of running it includes engineering salaries, so isn't a good measure to include when you measure productivity of engineers. A productive engineer would be worth a higher salary, but if you include the cost of that higher salary reducing his value would that also reduce the salary you want to pay? Doesn't make sense.

Also, what if engineering is good, but sales is bad? Engineers might exceed their productivity goals, but it wouldn't amount to profit.

Then from the internal market economics PoV, here's how it looks:

Engineering: costs (salaries + infra) are covered by revenue (services rendered to exec team). Executive team: costs (execs salaries, expenses to pay engineers and sales for their services, accumulating interest to be returned to investors if any) are NOT covered by revenue (which comes from customers).

I find this decomposition incredibly neat and enabling solving the right problems.

Re: Engineering productivity can be measured, just not how you'd expect

#88

Post by andrey_utkin »

marcus_holmes wrote: post #82
andrey_utkin wrote: post #28

Earlier quoted context omitted.

Simply: does revenue exceed cost of running it? The book I referred to answers the "but engineering team doesn't have revenue". Engineering can be art, sure, and if you like, we can even discount the idea that art creation can be seen as economic activity. But is there a need to measure productivity then?

Engineer A built the new widget that Sales have been talking about for months. This immediately generates $1m in revenue. Engineer B removed some tech debt. Future efforts to build widgets will take less time to build. Engineer C rewrote the backend to prevent a vulnerability exposure that could have lead to disaster. Who was most productive? Who deserves a raise?

Each of these tasks, or ongoing commitments, has a clear price when you run an organization the Internal Economics way.

Whoever consistently "earns" more than their salary this way, deserves a raise.

Re: Engineering productivity can be measured, just not how you'd expect

#89

Post by andrey_utkin »

visarga wrote: post #66
andrey_utkin wrote: post #16

Engineering activities are economic activities. Engineering activities must make sense as economic activities. Engineering activities productivity can be measured the same way the productivity can be measured for any economic activities. See "Internal Market Economics: Practical Resource-Governance Processes Based on Principles We All Believe In", Book by N. Dean Meyer. The posted article came so close to the idea of…

> Engineering activities productivity can be measured the same way the productivity can be measured for any economic activities. The economy is basically a population based evolutionary process. Its nature is open ended - things that seem important now might have been seen as being useless or stupid a decade or two ago, like neural nets in 1985 and personal computing in 1950's. So we can't tell ahead of time which wi…

So what's your point? Mind you, we're discussing an article on engineering productivity in business.

Nothing is happening without funding.

Business can't run producing things which are not valuable in the moment, it will go bankrupt.

Government can sponsor such things as it sees fit, best if guided by a clear hypothesis that funding it makes the outcomes probabilistically better than not funding it.

When nobody is paying you but you're tinkering with some stuff, then it's you who is sponsoring it with your time and other resources.

Re: Engineering productivity can be measured, just not how you'd expect

#90

Post by andrey_utkin »

username90 wrote: post #50
andrey_utkin wrote: post #28

Earlier quoted context omitted.

Simply: does revenue exceed cost of running it? The book I referred to answers the "but engineering team doesn't have revenue". Engineering can be art, sure, and if you like, we can even discount the idea that art creation can be seen as economic activity. But is there a need to measure productivity then?

> Simply: does revenue exceed cost of running it? Cost of running it includes engineering salaries, so isn't a good measure to include when you measure productivity of engineers. A productive engineer would be worth a higher salary, but if you include the cost of that higher salary reducing his value would that also reduce the salary you want to pay? Doesn't make sense.

> but if you include the cost of that higher salary reducing his value would that also reduce the salary you want to pay? Doesn't make sense.

It indeed doesn't. Where did you get that idea? It's not as complicated as you probably think.

If the engineer has rendered services which are worth his salary + his actual expenses to achieve that, he has earned exactly his salary, high or low.

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