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Flow Efficiency

Flow efficiency is the proportion of time where the team effectively spent active work within the total cycle time of the task.
#agile
#cycle-time
#product-development
Zettelkasten, April 24th, 2022.
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Notes

  • Flow efficiency is the proportion of time the team effectively spent on active work within the total cycle time of the task.

  • Higher flow efficiency, higher active work, lower inactive work.

flow efficiency=active workcycle time=active workactive work+inactive work\text{flow efficiency} = \frac{\text{active work}}{\text{cycle time}} = \frac{\text{active work}}{\text{active work} + \text{inactive work}}

  • For example, suppose that a team takes ten months to finish a task, considering its entire stream of value—from ideation to delivery to final customers—and that the team effectively spent one month of active work. The flow efficiency, in this case, is 1/10=10%1/10 = 10\%.

    • In 10%10\% of the time, the team acted on the task.
    • In 90%90\% of the time, the team waited—waste. For instance, the team could have to wait until the strategic meeting to decide if the company would implement the task or if some bureaucratic process took months before shipping to customers.

  • A large creation chain can reduce the flow efficiency because the team does little work and has to wait on a decision, which can take several months.

  • A system with much work in process (WIP) tends to decrease the flow efficiency. There is a difference if the team constantly jumps between ten or one task.

References

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