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Lead Time Vs. Cycle Time in Software Development – What Are the Main Differences, and How to Optimize for Each?

August 5th, 2022
Cycle Time
Software Development
Software development analytics
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In engineering organizations, growth is strictly related to producing fast and reliable software. In the software development industry, nearly everyone, from developers and engineering managers to C-level executives, wants to deploy software more quickly, write better code, and provide end users with greater value.

A key component of Agile software development is focusing on the right metrics. As an engineering team leader, it’s your job to increase velocity by constantly improving how your team works. Regarding accelerating the software delivery process, cycle time vs lead time are two essential velocity metrics to measure and monitor.

Although understanding the nuances between Lead Time vs. Cycle time is critical if you want to harness their true potential, it’s just as important to have an overview of these two velocity metrics to reduce and optimize them.

At Waydev, we understand the challenge of accurately measuring these metrics. Our platform offers you instant access to this data so that you can assess DevOps velocity and performance in no time.

The article aims to clarify the differences and similarities between lead time vs cycle time, why it is essential to measure, and how to optimize DevOps processes by reducing the two metrics.

What is Lead Time for Changes?

Lead Time is a term borrowed from the manufacturing method “Toyota Production System.” It calculates the time between a customer placing an order and the time the order was shipped and received by the customer.

Lead Time for Changes is specific to software development. It is a velocity DORA metric that measures the amount of time needed to implement, test, and deliver changes to the codebase. This metric measures the time between committing and sending the code to production processes.

In other words, Lead Time for Changes calculates the time elapsed between the identification of a requirement and its fulfillment. Simply put, it is an indicator of how long it takes for a client’s requested feature to be completed. 
With Waydev’s DORA metrics dashboard, Lead Time for Changes and the other three metrics are pulled automatically in a single dashboard so you can make informed decisions based on actionable insights related to your team’s performance.

DORA metrics

How to Calculate Lead Time for Changes?

There are two ways to calculate lead time for changes vs cycle time to spot bottlenecks and assess areas for improvement.

The traditional way means asking your developers about their average Lead Time for Changes, manually checking Jira statuses, creating reports, and holding daily standups to gather all information to obtain a clear overview.

Lead Time for Changes is then calculated by comparing the time each revision was initiated with the time at which the same revision completed the deployment pipeline’s final action. You can only imagine that this is not only a tiresome process, but also an inaccurate one that is susceptible to flaws.

Nowadays, thanks to data-driven engineering management analytics platforms like Waydev, this metric is pulled automatically due to our CI/CD integrations, such as GitHub Actions, Jenkins, and CircleCI. 

The benefit is that it reduces the deployment’s overall time by accelerating deployment through automation. With our development analytics feature, all DORA metrics, including Lead Time for Changes, are displayed and tracked automatically in an easy-to-read dashboard without requiring you to aggregate all this data manually.

What is Cycle Time?

Cycle Time is also a velocity metric in manufacturing and an important strategic tool for project management. Actual Cycle Time measures the time an engineering team takes to finish a project. Simply put, it reflects the time spent producing a feature until it is ready for shipment. 

It is an indicator of development processes’ velocity, showing how fast an engineering team can deliver a product to customers, from when work has started until the moment it’s been delivered. It all comes down to the team’s development velocity.

As an engineering manager, you’re probably already using DevOps KPIs to measure your development pipeline and make informed purchasing and budgeting decisions. 

However, your road to success is unfinished without something to link these crucial metrics together. To differentiate yourself from the competition, use a Cycle Time analysis to make the connections between your KPIs and improve your production process.

How to Calculate Cycle Time?

When calculating actual cycle time, you need to know your production time and how much of a product/feature is produced in this time. Target cycle time is calculated by dividing the total production time by the units produced.

You also need to consider the time when production was paused, meaning the waiting period between active production work.

At Waydev, we measure Cycle Time from the first commit until that feature is deployed to production and made available to users. Thanks to our CI/CD integrations that pull DORA metrics automatically, you’ll have access to Cycle Time and gain insights about the development processes’ velocity with no manual input.

Waydev Cycle Time breakdown

What are The Main Differences Between Lead Time and Cycle Time?

The main difference between Lead Time for Changes and Cycle Time is that Lead Time is measured from the customer’s perspective, whereas Cycle Time is measured from the internal process point of view.

Lead Time for Changes includes Cycle Time and depends on it, whereas Cycle Time does not have Lead Time for Changes.

Lead Time for Changes measures the time from receiving the order to delivery, while Cycle Time measures the time taken to complete the production process.

Another key difference between Lead Time for Changes vs. Cycle time is the units in which they’re measured. Lead Time is measured in elapsed time (weeks, hours, seconds), while Cycle Time is measured in time per unit/process/task.

Lead Time vs Cycle Time

The relationship between Lead Time vs Cycle Time is described by Little’s Law as follows:

Lead Time = Cycle Time x WIP (Work-In-Progress)

AspectsLead TimeCycle Time
DefinitionThe total time from starting a task to finishing development and deploying to productionThe time to complete one full development cycle, from requirements to deployment
IncludesRequirements, design, coding, testing, integration, deploymentCoding, testing, integration of one feature/story
ExampleNew feature request to feature live in productionCoding, testing, integration, deploying one user story
GoalShorten lead time from concept to customer deliveryOptimize cycle to deploy smaller features faster

Importance of Measuring Lead Time for Changes and Cycle Time in Software Development

Lead Time for Changes vs Cycle Time are essential velocity metrics to track in DevOps, and they can help engineering managers understand the dynamics of their team’s workflow.

These metrics give insights into the relationship between an order being placed and completed. They’re also a good indicator of your engineering team’s capability to deliver value to your customers.

Waydev DORA metrics
With our DORA metrics dashboard, you’ll get clear visibility on how deployments perform.

By measuring Lead Time for Changes, engineering managers can understand the average time their customers receive their orders. If the Lead Time is high, it can negatively affect customer satisfaction and the overall user experience.

By analyzing Cycle Time, engineering managers can determine the overall efficiency of their production unit. With this information, they can spot the inefficiencies and bottlenecks that may slow things down.

To increase productivity, efficiency, and cut costs, Lead Time for Changes and Cycle Time should be reduced as much as possible, as this is something highly valued by customers. In a competitive environment, such as the software development industry, you must ensure that your customers receive valuable products and services in the most efficient way possible.

As an engineering manager, you’ll help increase your organization’s overall productivity and deliver a better customer experience by measuring, reducing, and optimizing Lead Time for Changes and Cycle Time.

Why You Should Measure Lead Time and Cycle Time?

Understanding lead time and cycle time is essential for increasing the efficiency of business functions and software development. While these terms are sometimes used interchangeably, they have distinctive purposes. Here are some key reasons businesses should monitor both lead and cycle time metrics:

How to Measure and Improve Lead Time for Changes and Cycle Time with Waydev

Measuring Lead Time for Changes and Cycle Time metrics is vital in ensuring your work processes flow in the most efficient manner possible. 

Understanding Lead Time vs Cycle Time will help you keep track of your team’s progress while ensuring that your customers are satisfied.

Reducing Lead Time for Changes and Cycle Time isn’t hard if you have the right tools on your side. The challenging part is realizing that, given the volume of issues and tasks a software development team typically handles, you need an automated measuring method.

Waydev offers different solutions to help keep track of the statuses of all your projects, orders, and tasks.

One of the biggest obstacles in reducing and improving Lead Time for Changes and Cycle Time is accurately measuring them. 

With Waydev, you can measure both Cycle Time vs Lead Time and have a clear overview of all four stages of the development process. Speed up the velocity by receiving insights into the efficiency of your software delivery process, from the moment the first commit was created up until the moment it got deployed.

The next step is to optimize Lead Time for Changes and Cycle Time. As an engineering manager, you can use Waydev to benchmark your team’s results with the industry and ultimately improve your DevOps processes and your team’s productivity. 

Ultimately, if you want to get more granular, you can use Waydev’s Project Timeline feature and analyze how your team’s work focus and volume modify over time.

Contact us to find out how Waydev can help you optimize your team’s Lead Time for Changes and Cycle Time!

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