Why Laughter Is a Better Indicator than Velocity

And Why False Metrics Mislead Us

Imagine losing your wallet at night and searching under the streetlight—not because you know it’s there, but simply because it’s bright. Many companies behave in a similar way: they focus on what’s easy and visible to measure rather than capturing true value. It’s called the streetlight effect.

In this article, we not only critique familiar issues like the difference between output- and outcome-oriented metrics and the deceptive allure of velocity, but we also go into less obvious yet equally dangerous factors—such as managers’ fear of losing control and the distracting flood of numbers that often substitute for clear goals and an inspiring vision.

By the way: If you wanna work with me on the metrics of your company, let‘s talk!​

1. Output vs. Outcome: The Seductive Charm of Easily Measured Metrics

In software development, metrics like lines of code, test coverage, or the number of features produced per week are ubiquitous. These output-oriented metrics are practical data points—measurable and historically entrenched. But what do they really tell us? They capture the quantity of work done, not the true value delivered to customers or the business. The real benefit lies in the outcome.

Goodhart‘s law condenses it perfectly:

“When you make a metric a target, it ceases to be a good metric.”

When talking about metrics, I often hear another quote I absolutely dislike: “If you cannot measure it, you cannot manage it.“ This thinking is flawed. Frankly, if you can only manage what you measure, you might want to work on your management skills! Numbers alone cannot replace a clear vision or genuine leadership.

2. The Illusion of Velocity: More Appearance Than Substance

Velocity—the number of story points a team completes in a sprint—is a favorite metric in many agile teams. And while velocity can be an informative data point, focusing too much on this metric creates subtle issues:

• Subtle Adjustments and Manipulations:​
  Some teams may inflate their story point estimates simply to show improvement when pressured to increase velocity.
• Fear of a Decline:​
  More critically, there’s a pervasive anxiety that any experiment—like optimizing workflows or enhancing CI/CD pipelines—could cause a temporary dip in velocity.

This fear is very real because velocity is often seen as a direct measure of productivity. When the number drops, employees worry about negative consequences—poorer performance reviews, lower raises, or even missed promotions. As a result, the courage to experiment is stifled. On paper, velocity might continue to climb, but the genuine value delivered to customers remains in the shadows.

​Learn more about the subtleties of velocity as a metric.​

3. Laughter (Laughs per Day): A Numeric Indicator Aligned with True Outcomes

Imagine tracking “laughs per day” instead of your standard KPIs. This isn’t about replacing conventional metrics—it’s about forcing a hard look at what really drives a team’s success.

• A Leading Indicator for Team Health:​
  A high count of laughs per day signals that team members feel safe and valued. It’s an indicator that they communicate openly and trust one another—a clear sign that the team environment is conducive to creative problem-solving and continuous improvement.
• Directly Aligned with Outcome Metrics:​
  Unlike traditional output metrics such as velocity, measuring laughs per day provides insight into the qualitative aspects of team culture. This metric aligns closely with your desired outcomes by showing whether your team is fostering the kind of environment that drives innovation and high performance.

Ultimately we seek to improve our outcomes like customer satisfaction and ultimately profits. And we know how important innovation, high performance, and quality are to achieve that. Laughter might be a much better leading indicator for this than many of the common output metrics.

Challenge the metrics you use and look for true leading indicators of the outcomes you seek. You might also want to look at how to measure psychological safety in agile teams.​

4. Fear of Losing Control: When Managers Hide Behind Numbers

A less obvious but crucial issue is the fear of losing control—not just among team members, but among managers as well. Many leaders cling to hard metrics because they believe it gives them a firm grip on their team’s performance. This reliance on numbers creates a false sense of security.

But what happens when you depend too much on data?

• Stifled Communication:​
  Mistakes are often hidden rather than embraced as opportunities for growth.
• Crushed Innovation:​
  Teams avoid experimenting because any change might jeopardize those “safe” numbers.

Managers who hide behind the comfort of measurable data risk overlooking the human element. True leadership is built on trust, courage, and the willingness to openly discuss uncertainties—not on the illusion of rigid control.

5. Metrics as a Substitute for Clear Goals and Vision: Losing Focus in a Sea of Numbers

Another critical point is that metrics are often used as a band-aid when clear, inspiring goals and visions are missing. In the absence of a compelling strategic direction, companies tend to focus on whatever they can measure easily. This results in a deluge of numbers that distracts from the real mission.

When metrics become the sole benchmark of success, they mask the absence of a robust vision. Leaders then end up chasing “obvious” data points rather than steering toward genuine customer value and sustainable innovation. In this way, strategic focus is lost in a jungle of numbers.

See also: The overlooked management strategy that works wonders​

6. The Streetlight Effect: Searching Where It’s Bright

Remember the joke about the drunk searching for his keys or dropped quarter under the streetlight? When asked where he lost them, he replied, “Over there.” Yet he continues to search where it’s bright—not where the keys actually are.

This joke perfectly illustrates our problem: we often measure what is easiest to capture, rather than what truly matters. Just because a metric is easy to track doesn’t mean it’s meaningful or valuable.

This phenomenon is known as the streetlight or drunkard effect. And it’s a common fallacy in the corporate world.

7. Embracing a New Metrics Mindset: Concrete Steps Toward True Value

So what can you do when conventional metrics mislead you? Here are some practical steps to realign your focus on genuine value:

• Be Clear Why You Measure:​
  Metrics that don‘t lead to different decisions are useless. Do you want to predict, motivate, evaluate employees, allocate resources, …? Once you know why you measure, it‘s easier to find fitting metrics.
• Acknowledge Managers‘ Fears:​
  Managers are humans, too. Their fear of losing control is real. Coach them and help them understand ways to more effectively achieve their goals.
• Encourage Experimentation:​
  Cultivate an environment where a temporary dip in numbers is not seen as failure, but as a necessary step toward long-term improvement.
• Look In Unfamiliar Places:​
  Instead of recycling the same old metrics, discover new metrics like the number of laughs.
• Foster Open Communication:​
  Leaders must be brave enough to admit their own uncertainties. Only then can mistakes be transformed into learning opportunities.
• Set Clear, Inspiring Goals:​
  Rather than clinging solely to metrics, establish a strong vision that serves as your guiding star—imbuing numbers with real significance. And if the vision is already there, make sure it is also communicated.

8. A Call to Agile Coaches, Scrum Masters, and Leaders

If you notice your team getting lost in a maze of numbers—where the fear of a drop in velocity stifles innovation and genuine customer value is ignored—then it’s time for a change.
Let’s have the courage to look beyond the figures and recognize the true worth of our work. I invite you to join me in developing new approaches that not only look good on paper but also drive genuine progress in everyday work.

Question the numbers. Don’t just search where it’s bright—discover the true value your team creates every day. It’s time to rethink metrics and open up space for real innovation.

This article is intended as a starting point for establishing a culture in your organization where clear goals, an inspiring vision, and authentic collaboration take center stage—not just the easily measured data points. Use these insights to empower your teams and pave the way toward sustainable success.