A lot of our clients at AgileSparks ask us how to measure their effectiveness. Some of them are already using Agile styles of product development, others are not yet there, and another important variant is the Enterprise with mixed ways of doing things, that wants to get more visibility, and use measures as a way to drive towards improvement.
As we all know, we need to be very careful what we measure, and on top of that a lot of measurements require a lot of work – and people don't really like to feel they are working for the measurements. They want the measurements to work for them.
Be very careful of reports for Management that require the team/production floor to go out of their way.
Having said that, ever since we started to focus more heavily on Kanban and Lean thinking, a couple of simple KPIs have emerged, with the added attribute that if you're already using Kanban to manage your work, you get most of them for free.
Chris Hefley, one of the guys behind LeankitKanban, was interviewed recently to SPaMCast 100 (which is a very good podcast, worth listening to), and some of the discussion is around this point of Kanban providing great metrics that don't require any effort other than managing the work.
I've been presenting these kinds of metrics to a couple of clients lately. Here is my presentation. Notice it mainly references Lean/Kanban concepts but doesn't describe them in detail. Go to www.agilesparks.com/kanban or www.limitedwipsociety.org for references to resources about those concepts.