Little's Law and Product Development
For product development, we can use a transformation of Little’s Law, like the following:
[(Throughput) = (Things-in-Process) / (Average Completion Rate)]
What this equation tells us and what experience has shown time-after-time, is that the number one driver of Product Development Cycle Time are the “things-in-process” [which is also called the "work-in-progress"]. There is no quicker way to reduce the cycle time by which your company can get a product from concept-to-delivery than through first prioritizing all the projects or products and focusing on the ones that make strategic and tactical sense, and killing the lower priority projects.
You might be thinking: “True, but couldn’t we also increase the average completion rate”? You’re right, but the impact of doing that is much lower than reducing the TIP — that is, influencing the average completion rate is rather difficult and is often a function of available resources, scope creep, market demands and changes, etc. Here’s the bottom line: the number one driver for shipping products quicker is by focusing on the important ones and killing the unimportant ones.
-- Pete Abilla
Quoted on Thu Aug 2nd, 2012