Day 4- What do I build first in my Product? - Is there a cost of delaying a feature/capability?

As Product Manager, two questions are always going to puzzle you what do I build first?

How do I create the product soon which has the highest value to the customers and the lowest effort required?

Time to market is very important. You may build a great product, but if you are not able to bring it to the market there will be a significant impact on TAM ( Total Addressable market)?and TPR ( Total Projected Revenue per customer)

We need to use a combination of two Product Frameworks.?

Framework -?1 - Classic Product Prioritization Framework - MoSCoW

This prioritization method was developed by Dai Clegg in 1994.

MoSCow is used with?timeboxing, where a deadline is fixed so that the focus must be on the most important requirements, and is commonly used in?Agile Software Development.

Framework 2-?Weighted Shortest Job First (WSJF)

It is a prioritization framework used to sequence jobs (eg., Features, Capabilities) to produce maximum economic benefit.?

WSJF is calculated by dividing the Cost of Delay (CoD) by the duration. CoD is the money that will be lost by delaying or not doing a job for a period of time.

For example, if a prospective feature would be worth $100,000 per month, and there was a delay of three months, the total CoD would be $300,000.?

Jobs that can deliver the most value (or CoD) in the shortest duration provide the best economic return.

This framework helps product managers

• Taking an economic view of the feature
• ?Ignoring sunk costs
• Making?financial choices continuously
• Using decision rules to decentralize decision-making and control
• Quantify the Cost of Delay

It would be challenging to determine the cost of delay for the things that haven't ever been built so far.

Teams compare backlog items relative to each other using the same modified Fibonacci numbers as in ‘estimating poker.” Then the (relative) CoD is calculated as follows:

User-business value – What is the relative value to the customer or business? Do our users prefer this over that? What is the revenue impact on our business? Is there a potential penalty or other negative effects if we delay??

Time criticality – How does the user/business value decay over time? Is there a fixed deadline? Will they wait for us or move to another solution? Are there Milestones on the critical path impacted by this? What is the current effect on customer satisfaction??

Risk reduction-opportunity enablement value – What else does this do for our business? Does it reduce the risk of this or a future delivery? Is there value in the information we will receive? Will this feature enable new business opportunities?