Plutora Blog - Agile Release Management, Business Intelligence, Digital Transformation, Software Development, Value Stream Management
Understanding, Measuring and Improving Time To Value (TTV)Reading time 7 minutes
The aim of every business, product, or service is to provide value to its customers. The business value refers to the benefits or unique selling propositions (USPs) that the customer believes they gain from your product. This value makes the customer’s life easier and better. It’s also the key reason why the customer invested in the product in the first place. Thus, customers expect every product to provide them with maximum value efficiently at minimum cost. Another factor, though, is how quickly the customer realizes this value from the product. This is where time to value comes in.
This post will look at what time to value (TTV) is and why it’s a key metric to track during software development. We’ll also discuss how you can measure TTV at your organization. Finally, we talk about managing value streams to improve TTV.
What Is Time To Value (TTV)?
TTV is the metric that measures how quickly your customers get value from your products. The time is typically from the initial action by the customer till the moment they gain value from their actions. For example, let’s say a customer buys an e-book online and can immediately download the e-book. In this case, the time to value is maybe seconds. However, let’s say a customer buys a subscription to a data analytics tool. In this case, the tool will take some time in collecting and analyzing the business data. The customer won’t receive the key actionable insights from this data immediately. Thus, the time to value may be days or even months.
Delivering enterprise software is complex. Plutora’s Value Stream Management Platform makes it easy.Learn More
Therefore, TTV measures how quickly your customers think they benefit from the value your product provides. It’s one of the most overlooked and underrated metrics for a software business.
Benefits of a Low TTV
- Get to the market faster
- Increase the customer retention rate
- Lower the number of resources spent on providing value
- Increase the chances of high customer satisfaction
- Get faster feedback on your product
- Increase upselling opportunities
- Start earning revenues from your products as early as possible
Value Delivered Is the Most Important Aspect of Software Development
Every business knows that customer is king. But in this day and age of abundance in options, the customer is probably emperor. If your product doesn’t deliver value, then the customer will easily switch to your competitor. The cost of switching in the software as a service (SaaS) era is really low. In fact, it’s the perceived value that matters. The customer needs to believe that your product provides them with enough value. If you continuously provide value, you’ll satisfy the customer. And satisfied customers lead to business growth.
Moreover, customers nowadays expect value from your product as soon as possible. Businesses have a very limited amount of time to convince their customers of the value they can provide. For example, when a customer signs up for a free trial on a SaaS product, then the product needs to quickly satisfy the customer. Otherwise, they won’t convert into a paying customer and their free trial will end. The business will lose an important lead that was ready to onboard just because the customer couldn’t perceive the value quickly enough.
Thus, value delivered to the customer should be the driving factor of your software delivery life cycle (SDLC). Given that TTV is so critical, it’s imperative for businesses to measure and improve their time to value.
Before you can measure time to value, you need to identify what value is. As mentioned, the value should be defined in terms of what your customers perceive as value. You need to understand their business objectives and how your product is going to spur them in this direction. Only when you ensure that you and your customer define value in the same way can you think of improving this value. Some of the key values, or benefits, provided by software tools include the following:
- Increase in customer acquisition
- Higher personalization of products
- Increase in overall revenues
- Decrease in operational expenses
- Improvement of the customer experience
Thus, it’s critical for the business to identify what value the customer wants them to provide. Once you identify this value, it can guide you as a north star throughout the software development process. The business needs to map its value stream throughout the process to ensure the final product will provide the desired value.
Map the Value Stream In the Software Delivery Life Cycle (SDLC)
Before you understand how to map a value stream, you need to understand what a “value stream” is. Value streams are the series of steps in the SDLC from idea to production needed to deliver software products or services to customers. Too often, businesses lose track of the value being provided while developing the software. The process is complicated, requires various teams, and spans across months. All of this makes it even harder for each step to be aligned in the same direction to provide maximum value. That’s where value stream mapping comes into the picture.
By mapping the value additions in the development process from end to end, the business gains visibility on where exactly the actual value is being added in the process. This makes sure that the executives, stakeholders, and team members of every team involved are on the same page. They have a common understanding of what the customer needs and what value they’re looking for. This helps make the development process customer-centric at every stage to ensure maximum value is provided.
But just mapping the value streams isn’t enough. You need to actively manage them. Value stream management helps businesses act on key insights and continuously improve their delivery process. TTV is just one aspect of value stream management. With a better visualization of the business value flow, businesses can ensure an efficient process that provides high value with a short development time. Value stream management platforms, such as Plutora, help to decrease TTV by providing full visibility of the software delivery process.
You cannot improve what you can’t measure. Thus, value stream management will not only help you measure time to value but also empower you to improve it. There are various ways to do that:
- Focus on the key issues that add the most value: One big mistake that businesses make while developing software is to dilute their focus. They try to build too many features at once. This increases the development time while also using up a lot of resources. Thus, businesses need to prioritize a few key features that add maximum value so that they can ship them faster. Sometimes a few tweaks can add much more value than complicated shiny new features.
- Leverage the people, process, technology (PPT) framework: The PPT framework helps to map the people, processes, and technology across the value streams in your organization. This will help optimize the operations to empower your teams to ship faster.
- Conduct A/B testing to get fast feedback: By getting fast feedback on customer expectations, you can ensure that your software development is always aligned toward providing value. The team would be able to make faster data-driven decisions, rather than second-guessing what to build only to find out later that the user doesn’t want that particular feature. In which case, a lot of time was wasted in development and your team would need to spend even more time modifying the product to suit customer needs.
- Simplify the product: Even after a feature is shipped to a customer, they need to be able to use it to get value. Thus, easy usability and simple onboarding help the customer realize the value faster.
Manage Value Streams To Reduce TTV
There are many ways to improve TTV. But first, businesses need to constantly measure and manage their value streams. This will help them visualize TTV on a dashboard. By gaining this visibility, you can deliver software that adds maximum value faster.