The Four Big Risks
In the first edition of my book, INSPIRED, I discussed how successful products are valuable, usable and feasible, where I defined “valuable” as both valuable to customers and valuable to your business.
While it’s easy to remember these three attributes, over the years I’ve come to believe that it was obscuring some pretty serious risks and challenges, and making it too easy for product managers to focus on customer value and overlook business value.
The business value (viability) risks can be substantial and I find that these are too often under-appreciated and under-estimated (or simply avoided) by the product manager.
So in my new edition, I now explicitly call out the four types of risk:
- value risk (whether customers will buy it or users will choose to use it)
- usability risk (whether users can figure out how to use it)
- feasibility risk (whether our engineers can build what we need with the time, skills and technology we have)
- business viability risk (whether this solution also works for the various aspects of our business)
Business viability risk includes whether the product fits with the go-to-market or sales channel; whether the product would work within the constraints of contracts with partners and/or legal compliance; whether we can afford to cost-effectively acquire customers, whether we can effectively monetize the product, and whether the product is consistent with the brand promise; as just a few examples.
The Product Manager is responsible for the value and viability risks, and overall accountable for the product’s outcomes.
The Product Designer is responsible for the usability risk, and overall accountable for the product’s experience – every interaction our users and customers have with our product.
The Product Lead Engineer is responsible for the feasibility risk, and overall accountable for the product’s delivery.
While the subtitle of the book is “How To Create Tech Products Customers Love” and I still argue that the toughest risk is usually value risk, I also emphasize in this new book that it’s not enough to create a product your customers love; the product must also work for your business.
In the new edition of the book, I argue that strong product teams have moved beyond Lean and Agile in three important respects:
- Tackle the big risks early – especially value risk and business risk
- Figure out solutions collaboratively – engineering, design, and product, working side-by-side
- Focus on solving problems – it’s not about features or a roadmap; it’s about delivering results
I’m hoping this new edition brings these points home, and helps product managers to have better awareness of the issues and risks, as well as the techniques for tackling these early.
