Delay or pay: When poor developer velocity slows your product roadmap
Published December 2nd, 2021
Those 26,275 lines of code have multiplied. And even with eight developers, 16.2 months work has crept to 22.5 and then 28.6, so the $1,178,921 development budget has exploded. All that… to build just one new feature, for a rich text editor.
Communications Specialist at Tiny
Gary Oak*, VP of Engineering at InGen, is worried. The development timeline has repeatedly blown out, and he’s not exactly sure where things went wrong. Although, perhaps it was a single decision taken, at the very start. That was, to take on a project outside his dev team's core specialization – building a Rich Text Editor (RTE) clean copy-paste feature – and expecting it to be easy.
Every project hits a critical point, where you realise you’ve not leveraged your developer talent, scope-creep continues to grow, and the company launch window and revenue are in jeopardy.
“All we wanted was to control the development process, and now we’re dangerously close to not reaching our quarterly revenue projection, for the third consecutive month,” said Oak. In hindsight, perhaps the agility offered by buying and assembling some specialist components for their tech stack, instead of building it all, would have been a wiser choice.
In specialized fields like rich text editors, an inexperienced in-house development approach often adds uncertainty to the scoping equation. Then costs increase when teams get side-tracked on building deep user features, or the requirements transform due to a market change and user preference. Scope creep expands. Again. And again.
In the end, speed-to-market suffers and time is money.
A recent report by payment platform Stripe identified that “the average developer spends more than 17 hours a week dealing with maintenance issues, such as debugging and refactoring. In addition, they spend approximately four hours a week on “bad code” which equates to nearly $85 billion worldwide in opportunity cost lost annually, according to Stripe’s calculations on average developer salary by country.”
What happens to inelastic dev talent and labour?
It breaks. And so does your company's revenue.
$75K (projected initial monthly revenue) x 6 (month delay) = $450K (lost potential initial ARR)
Teams eventually deliver, but only after considerable blow-outs in costs and hours... and sometimes only with the help of additional, costly contract resources. Then, as projects and initiatives increase – each with its own custom-build development focus – there’s a replication of effort and wastage of scarce talent resources.
That’s when a company decides that things need to change.
Empowering your team adds developer velocity
Software development is now at the core of almost every business.
According to a 2020 McKinsey report on developer velocity, “With technology powering everything from how a business runs to the products and services it sells, companies in industries ranging from retail to manufacturing to banking are having to develop a range of new skill sets and capabilities. In addition to mastering the nuances of their industry, they need to excel first and foremost at developing software.”
Or do they? No, they don’t.
Leading digital organizations use a different approach. They’re shaping a new set of principles for scoping, procuring, renewing, and operating their digital assets. By assembling a plastic, not static, tech stack.
This decision is particularly relevant when considering whether to buy or build a rich text editor.
Buy vs build was once a singular question. It’s now become two-part: “What out-of-the-box software components can we selectively buy, integrate, and assemble to create a flexible software stack? and “Where does our development expertise and true market need lie, to build the rest?”
When you’re considering buy vs build, you need to factor in that a rich text editor is like a complicated Swiss watch with many unseen parts that work in synchrony, so it’s never a once-and-done project. It requires deep domain knowledge and year-round maintenance – to keep up with browsers, edge cases, and changes in technologies.
That requires ongoing investment, maintenance and extensibility work. Without developer velocity, your cost projections and timelines continue to blow out.
The average enterprise spends approximately $3.5M per year on integration-related IT labor according to the Mulesoft 2021 Connectivity Benchmark Report, yet just 37% of organizations say IT completed all their projects, with fewer than 4 in 10 teams fulfilling their project commitments to business stakeholders.
Poor developer velocity impacts costs, time lines and labour estimates
Gary Oak* obviously had this problem. Because scheduling the build of a single new rich text editor feature crippled his speed-to-market and revenue projections. Let’s look at how he initially scoped the project, when he assumed he had a dev team with deep experience in rich text editors:
An Advanced RTE Feature – Build Cost Estimate
(excl. core editor)
An advanced feature that helps users cleanly transfer content from its source, to the rich text editor, should automatically parse the content for security vulnerabilities, remove unnecessary style elements as well as generally clean up and modernise the HTML.
That's no short order. Using a normalised COCOMO Model, the estimated engineering requirements for building that single feature, using:
- A Senior Software Engineer
- Average salary rate (US$128,749 p/yr excluding oncosts, RSUs and bonuses)
- 39836 lines of code (The total LOC includes 23085 LOC for the plugin itself, as well as 16751 LOC for the dependent libraries that are maintained ongoing, as part of the feature)
- Excluding ongoing maintenance and extensibility work
- Excluding the additional support costs required for the development of a product ready feature: Senior Product Manager, Senior Product Designer
Advanced RTE Feature COCOMO Modeling
Software Development (Elaboration and Construction)
total equivalent size
effort adjustment factor (EAF)
Acquisition Phase Distribution
As you can see, it’s definitely not a build-and-forget project. Even with experience, copy-paste features require constant monitoring – for changes to both MS Word and Google Docs – to catch up with new developments. Extensive engineering time and resources are also required to both maintain and keep pace with market changes.
That’s where managing your developer talent pool, equipping them with great tools and knowing where to (and not) best employ their skills, delivers greater velocity in engineering plans.
Curious about the cost of building your
own rich text editor?
Read the total cost breakdown in: Buy vs Build White Paper
Plus, get the cost breakdown of building, maintaining
and extending advanced features:
What is developer velocity and what’s it deliver?
Developer velocity occurs when developers are equipped with the right tools, in the right environment and friction points are removed – so they can then innovate in their areas of core talent. It also minimizes barriers to productivity, so it takes a critical role in the agile approach, by driving business performance.
It allows your developers to build on the shoulders of specialist experts.
After their first velocity study, in late 2020 McKinsey conducted further research (in partnership with Github and HashiCorp) and found a clear link between “unleashing the full potential of developers and business success.”
Along the way, McKinsey created the Developer Velocity Index (DVI), “...a holistic measure of a company's software development capabilities that pinpoints the most critical factors (related to technology, working practices, and organizational enablement) for software excellence. [...] companies in the top quartile of Developer Velocity Index scores outperformed bottom-quartile peers by up to five tims on their 2014-2018 revenue growth.”
It was noted that organizations with developer velocity in the top quartile achieve:
4-5 times faster revenue growth
55% higher innovation
The research also showed “that best-in-class tools are the top contributor to business success – enabling greater productivity, visibility, and coordination. [...] The underinvestment in tools across the development life cycle is one reason so many companies struggle with “black box” issues.”
How does developer velocity influence buy vs build decisions?
Leading digital organizations no longer buy monolithic suites or build custom software beyond their specializations. They’re combining buying, subscribing, or renting, with building – and are iteratively reshaping their software stack to fit the company’s changing goals and increasing speed-to-market.
That means buying smaller specialised components with APIs, as building blocks – like a rich text editor – that fit within the company’s larger IT/dev software toolkit. Those APIs are stitched and restitched together, while other parts are developed inhouse.
McKinsey has dubbed this tech assembly approach a ‘digital factory’, where a company “brings together the skills, processes, and inputs required to produce high-quality outputs. […] The best digital factories can put a new product or customer experience into production in as little as ten weeks. The innovation can then be introduced and scaled up across the business in eight to 12 months.”
Why does it produce results?
Assembling maximizes the horsepower behind third-party specialization, empowers developer expertise to focus on what they do best and delivers the nimbleness to move beyond productivity obstacles.
World-class tools empower developers
McKinsey’s research has proven that best-in-class tools are the primary driver of developer velocity.
“Leading companies also use tools to unleash Developer Velocity by investing in low-code and no-code platforms. These platforms enable the average business user to develop applications without any software experience, freeing up seasoned developers to focus on the most challenging tasks.”
Those businesses are getting better at leveraging their existing software engineering talent, which allows them to move faster, build more new products, and tap into new and emerging trends.
However, there are still those who believe the true problem is not having enough developers on their team. That's wrong. It’s how developers are being leveraged and supported. Failing to deploy the best talent on the right project is repeatedly becoming the biggest threat to a company’s digital transformation and market success.
Slow developer velocity is an even bigger threat to success than access to capital.
According to a recent report by payment platform Stripe, “As technology fracks into every aspect of the world economy, software engineers are becoming one of the world’s most precious resources. While businesses today face myriad issues – security vulnerabilities, trade tariffs, complex government regulations, increased global competition – how they deploy their developers may be the most overlooked factor impacting their future success.”
The report goes on to name developers as the ‘force-multipliers’, who when deployed effectively, “have the collective potential to raise global GDP by $3 trillion over the next ten years.”
Future-facing businesses are leveraging their existing software engineering talent, so they can move faster, build new products, and tap into new and emerging trends.
The Stripe survey questioned thousands of enterprise leaders and they learned:
81% of C-level executives think software needs to become more of a core competency for their company in the next 10 years
40% of developers say they’re hindered by custom technology
52% say they’re held back by legacy systems or technical debt
Open source and Cloud adoption offer alternate accelerators
While buying specialist components offers one approach to assembling a flexible tech stack, so too does open source software and Cloud adoption.
The Mckinsey data showed that “...top-quartile company adoption of open source, has three times the impact on innovation as compared with companies in other quartiles. Top-quartile DVI companies are especially active adopters, scoring 36 per cent higher in open source adoption than the next quartile.”
Utilizing an open source core like TinyMCE – that has components your dev team can use as a framework for customization – and supporting it with a professional team and advanced features can offer the best of both worlds.
Which also means you don’t need to scour the world for rock-star experts in rich text editing to deliver your project ontime.
Download the white paper:
The Great Debate: Buy vs. Build
Rich Text Editors
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Note: All estimates exclude on-costs, RSUs and bonuses
*Using the Basic COCOMO Model (Accessed 1 July 2022)
Average base salary for a Senior Software Engineer is US$128,749 per year in Silicon Valley, CA
Estimated base salary for a Senior Product Manager is US$157,340 per year in Silicon Valley, CA
Estimated base salary for a Senior Product Designer is US$145,700 per year in Silicon Valley, CA (Accessed 1 July 2022)
A person-month is equivalent to approximately 160 hours of labor, and is the amount of work performed by a single average worker in one month (ie. 12 person-month project will take 4 developers 3 months work to finish). A person-year is the total effort in person-months divided by twelve, to estimate the project length in years.
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