We live in a world of finite resources and choosing to spend them wisely is an essential ingredient of your journey to the summit. Feature prioritization is one of the most crucial aspects of product development. Avoiding this critical activity can put you at a disadvantage. You must start with a clear strategy and high-level roadmap that was created based on careful review of customer needs, and subsequent company vision to achieve these requirements, before embarking on a structured method to prioritize features.
Let’s Start with Vision and Purpose
Feature prioritization starts with a shared vision and purpose for your company. Your team’s shared vision will then infuse your high-level roadmap, which identifies the type of functionality you need to develop in the near- and mid-term, to satisfy your customer’s needs as well as your internal company desires and constraints. The shared vision and purpose need to be clear before you can identify and debate the merits of each feature. Often, the struggle to prioritize features is a symptom of the lack of strategic vision or direction.
Developing a shared vision and purpose for your product can be fraught with natural bias that needs to be objectively sorted out. For example, is the vision being influenced by the loudest stakeholder, largest customer, or a “squeaky wheel”? Are you trying to chase the latest industry trend? Are you trying to match (or improve upon) the features of the competition? Last but not least, is the envisioned product simply beyond the resources and budget of the company?
The Role of the Product Manager in Feature Prioritization
Feature prioritization is one of the most important duties of a Product Manager. When prioritizing features, the Product Manager needs to act as a collaborative leader, a role that has the capability to engage people and groups outside your formal control and inspire them to work toward common goals, despite differences in interests, convictions, and operating norms. The role requires the ability to make tough choices and break the deadlock of “designing by committee.” Further, one of the more difficult parts of this role is weighing input. Not everyone on the team can have equal say in product prioritization, because team members may not have the context and experience to make major product decisions. Finally, your role as collaborative leader does not end with shared vision. Stalemates and decision deadlock may occur after the team has agreed on a shared vision.
Basic Do’s and Don’ts of Feature Prioritization
Once the shared vision and objectives have been developed, a structured process for product feature prioritization can commence. The idea is to collaboratively identify features and objectively evaluate each with some structured, but practical criteria and metrics. You need to connect priorities to larger company strategies and avoid personal bias, and not succumb to short-term thinking. While it is relatively easy to identify the obvious priorities, those ideas should be backed up by supporting data or user research. You want to avoid gut reactions, individual customer reactions or requests (i.e., not a trend observed across multiple customer experiences), ideas that are not substantiated with data, or isolated features opportunities that do not jive with the overall product vision.
The Objectives and Key Results (OKR) framework is a great way to structure your organization’s key business objectives (grouped into functional areas such as marketing, sales, customer success etc.) and the key results – metrics associated with each objective. For example you could have an objective of improving customer satisfaction, with a key result of improving NPS score for 5 points in Q2 of 2021. An objective can have one or more key results. They key thing to note here is – you need to define very specific and measurable metrics, along with a timeline in which to achieve the goal. This OKR framework can serve as a backdrop when applying various feature prioritization techniques.
There are a number of practical ways to prioritize features. The cornerstone concept for all these techniques is to maximize the return on investment (ROI) to your business. That is your overall goal in all of these techniques. Also note that you could use more than one technique in combination with another.
Here are the Six key techniques for mastering feature prioritization.
1. Prioritization by Key Results
This approach is metrics based, where you can rank order the features in terms of the specific key results and metrics (e.g., increasing sign up to purchase conversions from x% to y%; reducing time for customer onboarding from x to y). An OKR framework (Objectives & Key Results) works very well in this context. Once you have your OKRs defined, it’s easy to prioritize the features that help you move the needle when it comes to the OKRs. You prioritize the features that should help achieve the most key results for the business objectives. This will require a fair amount of analysis and intelligent estimation in many cases.
2. Theme Based Prioritization
Themes are groups of features that align with a company goal, product vision, or overall strategy. They help you make sure you are working on the types of features that are most important right now, while also avoiding the issues of too many options. A typical thematic approach is the use of established Product Roadmap themes (e.g. Analytics, Reporting, Collaboration, etc.). This way, you know you are working towards specific parts of your product and your strategy. Once you have correctly categorized the feature into themes, you have to decide on the relative priority of the themes, as well as the priority of features within a given theme. It is thus a two-step process.
3. RICE Scoring Model
Another attribute-based evaluation is the RICE Scoring Model. This method allows the simple quantification (i.e., scoring) of attributes and is often used with a more complicated set of features. Created by Intercom Software , the acronym RICE represents Reach, Impact, Confidence, and Effort. Reach provides an indication of how many people you estimate your product will reach in a given timeframe. Impact can reflect a quantitative goal, such as how many new conversions for your project will result in when users encounter it, or a more qualitative objective such as increasing customer positive feedback. Impact can also be estimated using the OKR framework. Confidence refers to how successful you think a feature will be. Effort refers to how much time and resources the project will require from product requirements, design, and development teams.
RICE score = Reach x Impact x Confidence / Effort
Note that the RICE score approximates the ROI delivered to your business, as it takes into consideration both the benefit and cost associated with delivering the feature.
4. Priority Scorecard Method
Analogous to the RICE Scoring Model, you may also choose to build a custom priority scorecard to score features by custom criteria that are unique to your product or market. With a priority scorecard, you start with a proposed list of parameters and assign relative weights, which is their importance as a percentage of the whole project. The raw score calculated is given as:
Raw Score = Attribute1 x Weight1 + Attribute2 x Weight2 + …… (Weight is 0 – 1.00)
Once the raw score is calculated, it can be scaled to a normalized score (e.g. a 0-10 scale). The normalized score makes it very straightforward to prioritize the features.
5. Business Value vs. Complexity Chart
In this approach, you look at the ROI delivered to your business by the feature. You compare the business value delivered by the feature to the cost of development. A simple approach could start by segmenting the business value and development effort into t-shirt sized buckets such as low, medium, high etc. This can be best visualized in a 2D plot of the two variables, with higher priority (i.e. higher ROI) features appearing on the top left corner. It is also possible to assign a scaled score (0-10) which makes it easier to numerically compare the features, and use a fine-grained numerical score for prioritization.
6. Prioritization by Constraints
Finally, you can prioritize product features by focusing on constraints. Constraints such as time, resources, funding and process can be useful to eliminate options and focus on product features that are the most realistic given your constraints. Resources include the number, expertise, and availability of the team required to develop the feature. Processes include prerequisite elements (e.g., contracts, licenses, market research) and dependencies (e.g., requisite companion software development). Often you could use this method in combination with the other techniques, usually as a first step of elimination.
Feature prioritization is both a crucial and exciting early activity in product development. As you systematically prioritize features into your product roadmap, remember that your overall shared vision and purpose always need to be in the forefront. Long-term strategy should prevail over short-term interests. Collaboratively identify features and objectively evaluate each with some structured, but practical criteria and metrics. Collaboration will require integration of many individuals’ opinions, so cross-examining them through multiple perspectives will help maintain objectivity. Having solid supporting data and research helps this process. Armed with a structured process and supporting data, the Product Manager can successfully steer the effort and serve as a voice of reason.