A Framework For Assessing Product Opportunities

Over the years, one of the big challenges I’ve experienced as a Product leader is in creating objective decision making frameworks. One of the most important frameworks is one that can be used to objectively prioritize emerging product opportunities…i.e., ideas for innovation. With smaller, growing companies this is even more crucial because executives (including the CEO) are typically still involved in deciding on Product priorities, development bandwidth is thin and there is no shortage of product roadmap ideas. Without a high level framework that provides objective guidance on discerning great vs. not so great opportunities, you’ll quickly find yourself with a roadmap full of disparate initiatives that are subjectively prioritized and a constant mis-alignment among the Product leadership team. This is the road to product and company obscurity.

I’d like to share one of the frameworks I’ve used in the past that helps to get everyone on the same page and helps to quickly isolate the best opportunities from the rest.

The first step is to define the key pieces of criteria that will be used to assess the attractiveness of each potential opportunity. Making this information available beforehand will help your colleagues determine which ideas might be winners (and thus submitted for consideration) and which ones should be left out of the discussion. For instance, here’s a list of potential “opportunity assessment” criteria that might be used:

Severity and Breadth of Problem Addressed – How painful and widespread is the current problem that this feature/enhancement will address?

Alignment w/ High-Priority Business Goals – How significantly will this feature/enhancement contribute to achieving one or more of the company’s top business priorities?

Alignment w/ Key Product Differentiator(s) – How will this feature/enhancement strengthen one or more of the product’s key differentiators?

Competitive Differentiator – How does this feature/enhancement help to differentiate the company’s product from the competitors? Is it a stop gap, thought leadership, best of breed, etc.?

Urgency – How important is it that the feature/enhancement be implemented immediately?
Implementation and

Delivery Feasibility – How much confidence do you have that the company is equipped to implement/deliver/support this feature/enhancement with existing resources?

Once you have this rubric in place, you can solicit innovation ideas and hopefully trust that what comes back has the potential to move the needle on several of these fronts.  Once you have your ideas to evaluate, you’re ready to start your prioritization process. Here’s an approach that I’ve used in the past:

1. Assign importance weights to each piece of assessment criteria.

For instance, use a scale of 1 – 5 (1 = somewhat important and 5=very important) and rate each piece of criteria based on its importance to assessing the overall product opportunity. For instance, you might assign a 5 to “Alignment w/ High-Priority Business Goals” and a 2 to “Competitive Differentiator”. The point of this is to separate out the really important criteria from the less important (but still important) criteria. So, try to use the whole rating scale.

2. Rank each idea on each piece of assessment criteria.

Rank each idea (e.g., 1 – 3, where 1 = low and 3 = high) based on its potential contribution to each piece of assessment criteria. For instance, if the idea addresses a very painful, widespread problem then it gets a 3 out of 3 for “Severity and Breadth of Probem Addressed”. If the idea will not provide competitive differentiation, then it gets a 1 out of 3 for “Competitive Differentiator”. I also like to give guidelines on what’s a 3 and what’s a 1 for each attribute so that everyone’s scale is as consistent as possible.

3. Calculate an “Opportunity Score” for each idea.

For each idea, multiply each assessment factor’s weight by the idea’s corresponding ranking and create a summation score for each idea.

4. Estimate the cost of implementing each idea.

I like to use “Low, Medium, High” for estimating cost just because at this point it’s difficult to get an accurate estimation on cost. Also, make sure you’re considering not only development cost but also delivery and support costs involved.

5. Sort the ideas by opportunity score and develop priority segments.

Once you have the ideas in order of opportunity score, it makes it easier to focus additional conversation on a smaller group of ideas in order to finalize the priorities. For example, you might segment the list into 3 or 4 equal buckets based on the opportunity scores so that you can dedicate more time to further consider the priorities in the top scores bucket.

6. Optimize priorities as necessary. 

Once you have your top opportunities isolated, you can spend more time fine tuning those priorities. But, by now you’ve got a good sense for what’s worth discussing more and what’s not. The estimated cost may also trigger some changes in priority (e.g., an idea with a high opportunity score and low cost might be moved up the priority list, and vice-versa). The bottom line is that at this point you should be making slight changes to priorities and not doing things like moving ideas with the lowest opportunity scores to the top of the list.

You’ll likely need several iterations of this methodology before you start getting into a groove. But, with a bit of practice you’ll have a logical, repeatable process to make and justify high level priority decisions within the Product team and across the company.