Product prioritization is the artwork of choosing the proper options to develop, within the right order on the opportune time. It balances the significance of options alongside their complexity and the tip worth they’ll ship. The principle thought of prioritization in Product Administration is to maximise enterprise outcomes with the obtainable assets. Product prioritization is just not restricted to solely CPO roles. It might be additionally lined by Product Advertising and marketing, Product Design, or engineering groups.
Whereas working as the Head of Advertising and marketing at a high-growth no-code startup, I led Product Advertising and marketing and oversaw Product Administration capabilities. Each of the capabilities had been extremely linked with testing product hypotheses for our web site, customers’ and builders’ onboarding, and the product itself. In complete, we examined greater than 50 product concepts and elevated funnel conversion nearly 6x occasions throughout all phases of the shopper journey. Ruthless prioritization was the important thing to my group’s success.
Prioritization as a startup superpower
There are a whole bunch of encompasses a startup may wish to construct. In addition to a whole bunch of UI enhancements to tweak, tens of millions of selling concepts to check, and dozens of development techniques to attempt. Which of these concepts would transfer the needle to your startup? And which might take plenty of time and produce mediocre traction?
Excessive-growth startups function within the ocean of chaos and uncertainty. So well-thought-out prioritization of each exercise is the one strategy to drive development for startups with a restricted time, consideration, and price range. Whereas this information is solely targeted on product prioritization, you need to use the identical frameworks for advertising and marketing, development, and design speculation.
As Lenny Rachitsky from Airbnb as soon as wrote, “unhealthy prioritization is a wonderful strategy to kill your startup”. Don’t let it occur.
Function prioritization at startups — Why it’s so exhausting
Profitable corporations begin with the merchandise folks love. Nevertheless, choosing the proper options to develop is tough for thus many causes, particularly for startups. I’ve been working inside startups for the final 10 years and Product Improvement has by no means been simple. So let’s speak about typical issues startups have when making an attempt to determine what to construct: restricted assets, excessive likelihood to be biased, not sufficient knowledge, lack of alignment and absence of Product Technique.
Restricted assets
Startup founders don’t have the posh of calmly constructing a lot of small options, hoping that a few of them will enhance the product. Neither have they got an opportunity to guess on one big function and danger one yr of improvement. Startups ought to concentrate on the “pain-killer” options which is able to deliver the “AHA second” nearer and improve utilization metrics. If this doesn’t occur, the startup will run out of cash whereas the product can be ineffective. The much less funding a startup has, the less errors (iterations) it may afford to make when constructing an MVP or determining Product-Market Match.
Excessive likelihood of bias
When you learn The Mother Check guide, you in all probability know that folks will lie about their expertise along with your product to make you’re feeling snug. Startup founders are typically very biased in the direction of options they consider in, particularly when “high-potential” customers bathe the product with compliments. Which means that product prioritization will be influenced by biased opinions, having “nice-to-have” options on the high of the record. Most startup founders have their very own imaginative and prescient and “Product Instinct”, generally it really works however not all the time.
Not sufficient knowledge
Startups won’t have sufficient knowledge to prioritize one function over one other, each from the affect or issue to construct perspective. Typically having somebody who can collect and interpret knowledge is a problem for startups. Even within the PM & PMM world, having a robust data-driven group is extra typically a dream moderately than a present actuality.
Lack of alignment
When a startup tries to maneuver on the velocity of sunshine, that motion might be in all method of instructions. Totally different groups may have various opinions as to what’s “essential”. Product prioritization turns into a battle between what brings Product-Led Development, extra leads, increased Internet Promoter Rating, higher Consumer Expertise, increased retention, or decrease churn. Lack of alignment is just not the final difficulty startups face when prioritizing options.
Absence of Product Technique
Typically startups get too obsessive about constructing what rivals have moderately than what their customers want. In different instances, a Product Technique with a transparent roadmap doesn’t exist in any respect, so options will fill pressing wants moderately than assist obtain strategic objectives.
Function prioritization frameworks
Regardless of all difficulties with function prioritization, you may get it proper utilizing one of many widespread frameworks. Take into account them a strategy to construction your considering course of, hold focus and keep on target. The job of the Product Proprietor main this course of is to select the right framework for the startup’s wants.
Due to my expertise with these frameworks, I can share some sensible and fascinating use instances from my time at WeLoveNoCode, each from Product and Advertising and marketing views. Clearly, we didn’t use all of them on the similar time however examined how these prioritization frameworks will swimsuit us:
1. RICE Technique
2. Affect–Effort Matrix
3. Feasibility, Desirability, and Viability Scorecard
4. Weighted Scoring Prioritization
5. MoSCoW Evaluation
6. Value of Delay
RICE Technique
Let’s begin our deep dive into prioritization with a framework developed by the Intercom group. It charges each function, speculation, or thought based mostly on 4 elements — Attain, Affect, Confidence, and Effort. As a Product Proprietor in a startup, you’ll take into consideration every issue from a really pragmatic perspective:
- Attain
You need to take into consideration what number of customers the function may affect in a particular timeframe. For instance, the variety of new engaged b2b prospects you’ll be able to acquire in the event you launch this function. Or the quantity of recent no-code builders who can begin working by way of our market, if we implement a brand new builders’ onboarding. It’s regular to place estimates right here. - Affect
How essential will this function be for customers? Even when the function has a small attain however helps clear up the large downside of the high-LTV purchasers, then its Affect could be excessive. Your group ought to find a way to empathize with the purchasers’ pains to accurately consider affect. - Confidence
Can this product thought deliver vital attain and affect? The Confidence issue comes from 0 to 100% the place 100% is a complete confidence, and 0% is a whole insecurity. Product Homeowners in startups are evaluating chances. So when my group works on a brand new speculation, we go away ourselves house to be incorrect and it’s completely high-quality. - Effort
When your assets are very restricted, the time it takes to develop options is important. Ultimately, it comes all the way down to the complexity of the function and measurement of your tech group. So the Effort issue is scored as “the required variety of folks monthly” worth. The decrease, the higher.
Often, the Product Proprietor will rating all options within the spreadsheet like this based mostly on the Attain, Affect, Confidence, and Effort. Then focus on scoring with the group. All scores go into the formulation. The primary three parts are multiplied collectively after which this complete is split by “Effort” to present a remaining rating for every function. Product concepts with the largest rating go into the event backlog.
After we used RICE for WeLoveNoCode builders’ onboarding, we had a speculation that if we lower steps in builders’ onboarding from 4 to 2 it is going to improve the variety of builders’ registrations.
Let’s say that the Attain for us was round 3,000 new devs/monthly. The Affect was huge, with a rating of three. Our sign-up type abandonment fee was 66%! The Confidence was 90%, as we had knowledge on how comparable modifications influenced prospects’ onboarding, on high of suggestions from builders.
The Effort was low, as we had a robust Bubble developer to construct it. On the finish of prioritizing all product hypotheses, this one had the very best rating and went into improvement first. The RICE framework is appropriate for some instances but additionally has some downsides:
- Execs of utilizing this framework
Its spreadsheet format and data-base method are superior for data-focused groups. This methodology additionally filters out guesswork and the “loudest voice” issue due to the boldness metric. Sometimes, we examined 10-15 product hypotheses per week at WeLoveNoCode, so having a spreadsheet format is definitely excellent.
- Cons of utilizing this framework
The RICE format could be exhausting to digest in case your startup group consists primarily of visible thinkers. Whenever you transfer quick, it’s important to make use of a format that everybody will discover snug. Typically it’s a prioritization for 30+ attainable options for complicated merchandise, let’s say a brand new animation editor. So it turns into a protracted spreadsheet to digest.
Affect–Effort Matrix
In case your group is stuffed with visible thinkers, the affect–effort matrix will swimsuit you. This 2-D matrix plots the “worth” (affect) of a function to the consumer vs the complexity of improvement, in any other case often known as the “effort”. When utilizing the affect–effort matrix, the Product Proprietor firstly provides all options, or product hypotheses. Then the group who executes on these product hypotheses votes on the place to position the options on the affect and energy dimensions. So each the whole lot goes into one in every of 4 quadrants:
- Fast wins
Low effort and excessive affect are options or concepts that can deliver development. For WeLoveNoCode, fast wins had been optimization of touchdown pages’ design/content material for Google Advertisements campaigns. This considerably boosted advert efficiency, introduced us extra leads and made the expertise higher for these pages. Whereas it was a speculation in between paid and Product Advertising and marketing, it labored very nicely and required simply minor modifications on our Tilda web sites. - Huge bets
Excessive effort however excessive affect. These have the potential to make an enormous distinction however have to be nicely deliberate. In case your speculation fails right here, you simply waste plenty of improvement time. As another real-life instance, our huge guess was redesigning purchasers’ dashboard and making a funnel to guide customers to purchase trials with out calls with gross sales managers. Consider it as designing a self-serve mannequin for a sales-led product. Consequently, throughout the first week we applied it, we achieved 4 trials (with the potential of a $4000 month-to-month subscription) per week with out gross sales touches. - Fill-ins
Low worth but additionally low effort. Fill-ins won’t take a lot time however can solely be justified if different extra essential duties are full. It’s not “quick wins” however moderately backlog objects that you just may wish to construct. As fill-ins, we redesigned the animation on our touchdown web page header. It didn’t have a excessive affect and didn’t take time, as we made animations quite simple and proper in Tilda. On the similar time, it regarded extra according to the remainder of the touchdown web page design.
- Cash pit
Low worth and excessive effort. These are the options that may kill a startup if time is wasted on them. In 2015 I used to be engaged on my startup known as Flawless App. Again then we spent 12 months constructing a fully-functional MVP with three plugins, an online model, and a web site. Too many options, not sufficient analysis, and no prioritization resulted within the failure of the primary model. Ultimately, we constructed options which customers needed, getting 17,000+ designers & builders from huge corporations to make use of our merchandise. Afterward Flawless App was acquired by Summary, so my startup story had a cheerful ending.
Affect–effort matrix can dwell inside your group’s Miro or Mural board. This method is good when you have got many contributors and want to decide on between a couple of key options/product concepts. Like every other framework, the affect–effort matrix has its professionals and cons:
- Execs of utilizing affect–effort matrix
It permits fast prioritization and works nicely when the variety of options is small. It is rather visible, ideally suited for design-led corporations. Additionally, it may be shared throughout the entire startup group, because it’s simple to grasp from the primary look.
- Cons of utilizing affect–effort matrix
It doesn’t work nicely when you have got plenty of options, concepts, and objects to debate. It’s exhausting to visually prioritize many concepts with a excessive stage of accuracy. For instance, if two product hypotheses are “fast wins”, which ought to go first? Additionally, generally “fill-ins” take rather more time and assets than anticipated and create lack of focus, which may be very harmful for startups.
Feasibility, Desirability, and Viability scorecard
Developed by IDEO within the early 2000s, this scorecard takes three core standards — feasibility, desirability, and viability. It scores every criterion for each function and takes a complete to determine on the precedence. Scoring work from 1 to 10. Based mostly on my expertise, it’s framework for evaluating high-level options for future merchandise (nevertheless it’s not purely for PM). We used it throughout dialogue at my startup Flawless App. Listed below are what each dimension means:
- Feasibility
Can we construct this function with abilities and assets obtainable? Is it attainable to make this explicit product speculation quick and with out hiring additional folks? Do you have got an obtainable tech stack/instruments/cloud storage to do it? - Desirability
Does this clear up the ache for the purchasers? Do they really need this function? Will they be able to pay for it? - Viability
Will customers truly pay for it and the way a lot? Is it price investing in it (ROI)? Is there any unit financial system behind this function?
Utilizing this framework, your group creates a spreadsheet with product options and places a rating for every parameter. One other method to make use of this framework is to judge MVP concepts for feasibility, desirability, and viability by way of a group dialogue. Concepts which have probably the most assist from the group on these parameters can go proper into the design dash. Use the related folks to assist the evaluating, for instance, builders to have a look at feasibility or Product Advertising and marketing Managers to debate desirability. This scorecard is fairly easy with clear professionals and cons:
- Execs of utilizing a feasibility, desirability, and viability scorecard
It’s versatile and will be custom-made to work for the precise necessities of the startup. For instance, feasibility, desirability, and viability scorecards can be utilized for evaluating advertising and marketing initiatives, hypotheses for buyer success groups, or MVP ideas. As some startups don’t work nicely with inflexible frameworks, this mannequin is usually a good possibility.
- Cons of utilizing a feasibility, desirability, and viability scorecard
This method depends rather a lot on information of what the shopper needs and the way complicated new options are. That isn’t all the time knowledge {that a} startup has. Additionally, it’s extra appropriate for a workshop, or dialogue on the chief stage. For Product Advertising and marketing or Product Administration groups, it’s not a day-to-day instrument (I could also be biased, so be at liberty to share your opinions right here).
Weighted Scoring Prioritization
This methodology follows an analogous sample to different frameworks on this record however with the numerous addition of weighting how a lot of every class counts in the direction of the ultimate complete.
The method begins by deciding on the factors/classes you’ll be utilizing to fee the options. For instance, you may choose “consumer expertise”, “gross sales worth”, “strategic affect”, “consumer adoption” or any of the Acquisition, Activation, Retention, Referral, Income (AARRR) metrics if you wish to concentrate on consumer habits.
Subsequent, you must determine what significance you give to every class, including a share worth to every criterion (as much as 100%). For instance, throughout the early phases, you may concentrate on consumer expertise to make an MVP usable, or when you have a product with a Product-Market Suit you may must assume extra about retention. Every function may have a rating on these classes, from 1 (min affect) – 100 (max affect). Then now you can calculate the ultimate rating for every function.
This methodology has the potential to be very helpful within the startup the place you’ll be able to customise the weighting to suit the altering priorities of the enterprise:
- Execs of utilizing weighted scoring prioritization
The framework is customizable, whereas many others on this record are extra inflexible of their implementation. This lets you make the most of the framework over an extended time period by altering the emphasis to suit the place you’re in your journey.
- Cons of utilizing weighted scoring prioritization
Typically the weighting percentages will be exhausting to place. When you’re a founder who can perceive how every function will affect consumer adoption throughout the entire product ecosystem, then it would work. Nevertheless, PMMs & PMs won’t all the time have such a “bird-eye” view in a startup.
MoSCoW evaluation
This can be a widespread framework inside the agile world that speaks the straightforward language of how you’ll describe the function to a pal. In line with MoSCoW, all of the options go into one in every of 4 classes:
- Should Have
These are the options that can make or break the product. With out them, the consumer will be unable to get worth from the product or gained’t have the ability to use it. The “must-have” options are the explanation why customers can pay to your product. For collaboration-based merchandise these are the power to ask team-members to the workspace/challenge and work collectively. - Ought to Have
These are essential options however not very important to have straight away. Consider them as your “second priorities”. It might be enhanced choices to collaborate higher on some typical use-cases. It might be collaboration templates, just like Miro Templates Library or Airtable Templates. - May Have
Usually seen as good to have objects, not important however could be welcomed. One thing just like “vitamin” options however not “ache killers”. That may be integrations and extensions, including your product to the standard customers’ workflow. - Will Not Have
These are options or product hypotheses that aren’t required and must be dropped. It’s just like the “cash pit” within the affect–effort matrix framework.
The MoSCoW framework can be utilized in a Miro board, so your group can prioritize options visually there. It may be a sensible choice in the beginning when you must outline options to incorporate.
- Execs of utilizing this framework
That is ideally suited when in search of a simplified method that may contain the much less technical members of the corporate and one that may simply categorize an important options.
- Cons of utilizing this framework
It’s tough to set the fitting variety of must-have options. Your Product Backlog can have an excessive amount of must-have options which places stress on the event group.
Value of Delay
Distinctive on this record, as this framework focuses solely on the financial worth because the measurement. The framework is designed to calculate the price to the startup of not producing the function instantly. It’s comparatively easy to grasp, though the calculation itself does require vital thought out of your groups. The calculation is as follows:
- Estimated income per unit of time, for instance, how a lot might be billed over a month interval if the function existed.
- Estimated time it is going to take to finish the event of the function.
- Divide the estimated income by the estimated time to present you the price of delay.
Let’s speak about another instance. WeLoveNoCode had a gross sales funnel when the shopper jumps on the decision with the no-code skilled earlier than beginning the trial. One of many advertising and marketing objectives was to guide MQLs to the decision. By rising the variety of calls, we improve the variety of offers. So the whole lot that slows down this course of prices us income. After we had been prioritizing a brand new set of product hypotheses based mostly on the Value of Delay framework, we had one clear “winner”. This was a speculation about reducing the quantity of friction throughout reserving the decision buyer journey. One level of friction was a protracted gross sales screening questionnaire inside reserving a name software program (Calendly). We estimated the Value of Delay within the misplaced offers alternatives.
This can be a good framework when a startup is concentrated on working by a function record moderately than constructing an preliminary MVP:
- Execs of utilizing this framework
You may straight calculate the worth of manufacturing a function, so it’s a extremely efficient method of prioritizing function backlogs. It’s also helpful in serving to group members perceive the worth of options they may not have appreciated.
- Cons of utilizing this framework
For startups with no steady enterprise mannequin, the income estimate may be very a lot based mostly on a intestine really feel and in consequence, can typically contain inner arguments concerning the remaining determine.
Prioritization inside a startup is (sensible) guesswork
Prioritization in a startup is about laser concentrate on issues that matter probably the most. You want a framework in place that ensures you’re constructing the fitting options, choosing the proper speculation to check, working a promising advertising and marketing marketing campaign, and designing essential consumer interfaces.
Nevertheless, it’s nonetheless sensible guesswork. The choices you must make may have a component of intuition as nicely. So you must be agile in your method. Belief your self, take heed to customers, and don’t be afraid to alter priorities if wanted.
