Digital Product Discovery A Fantastic Guide For Digital Product Leaders
Digital Product Discovery is the process of deciding what to build. If we define Digital Product Discovery as opposed to Product Delivery, then discovery is doing the right thing and delivery is doing the thing right.
Digital Product Discovery is the process of learning what to build. It is about discovering what to build. Making sure that what gets into the product backlog is validated in advance, and do it as part of your normal product team operation.
Digital Product Discovery is not something that happens once in a while; it is a continuous process that high-performance product teams do as part of their normal activity.
Why do We Need This?
The reasons for adopting a continuous product discovery mindset in your organization might be various, but among them the most important could be:
- Failure rate of new features is pretty high
- Uncertainty about customers’ needs and pain points
- Uncertainty about what to build next, how to build it and for whom
If any of the previous situations is normal in your team you should really look into Digital Product Discovery.
Digital Product Discovery enables real product teams for modern product organizations, where teams can move away from receiving requirements, features and predefined business cases and can discover and own their solutions to achieve a business outcome or an strategic goal.
However, it is not just a process it is also a mindset. Your organization must be prepared to really benefit from Digital Product Discovery.
Many companies operate under the assumptions that they know what customers want, they know how to build it and that nothing is going to change along the way. And that’s a recipe for failure.
After 15 years of Agile and DevOps failure rate of new products and features is demoralizing. The era of continuous delivery is over, now we are in the era of continuous discovery.
What is Digital Product Discovery?
Digital Product Discovery is the process of iteratively and incrementally reducing uncertainty about an idea or problem to make sure that we build the right thing for the right people.
The process is composed by two interconnected learning loops: an exploration loop and a validation loop.
Digital Product Discovery enables product teams to discover what to build by getting rid of the waterfall big-design-upfront process full of assumptions and wishful thinking that ends up in a business case and a list of requirements.
The problem with traditional approach to decide what to build is double:
- First of all, the elapsed time is usually huge due to delays, different departments being involved, turf wars, number gaming and all sort of waste.
- On the other hand, the actual amount valuable time dedicated to market research and validation is pretty low.
So, we end up building something nobody wants.
We must turn this around, and dedicate quality time to Digital Product Discovery upfront but in small cycles and then also combine Product Discovery with Product Delivery as we move forward.
This article from Intercom explains their approach really well. In order to create great products we need to shift the balance from delivery to discovery. We must spend more time in the “problem space” and we must do that as part of our normal operation as a product team not just once in a while in a Design Sprint or Lean Inception.
Modern product teams must integrate product discovery with product delivery.
Everything that ends up in a product backlog for delivery should have gone through a discovery process. This discovery process will be different depending on the risk and the uncertainty associated with the idea or product. For instance, it is not the same to deliver a new campaign for Black Friday, than to target a new market segment, add a new product category to our eCommerce or develop a brand new business idea.
Thanks to Agile and DevOps companies have been able develop the capability of continuously deliver quality software to production. However, success rates of products and innovations are still depressing.
Apparently, we learnt how to do things right, but we still didn’t learn how to do the right things.
The reason lies in how many companies still operate in a siloed and waterfall way regardless of how agile they say they are.
Modern product organizations must learn to integrate Digital Product Discovery and product delivery to build the right thing and to build it right.
The real business agility comes from enabling continuous discovery all the way down from strategy to operations: strategy, business model, goal setting, product roadmaps, digital product discovery and product delivery.
Digital Product Discovery is the learning process which connects company’s strategy with product delivery.
Digital Product Discovery vs Digital Product Delivery
- Digital Product Discovery = figuring out what to build
- Digital Product Delivery = building it
However, traditionally, companies have put all the focus into building stuff.
Digital Product Discovery is the process of figuring out what to build. In order words, to progressively reduce uncertainty around a business idea or product that ends up with validated backlog items in your product backlog.
Depending on your stage of the product life cycle there is going to be a different balance between digital product discovery and product delivery.
It is not the same starting from scratch with a new business idea than to target a new customer segment or to launch a Black Friday campaign that you have done several times before.
Every effort will require different amounts of digital product discovery.
Modern product companies enable continuous digital product discovery and emergent strategy in their product teams.
Digital Product Discovery vs Business Discovery
Now, I’d like to differentiate between to different concepts that are deeply interrelated but are not exactly the same.
A product (or service) is the thing you buy as a customer. But, surrounding the product there is a business model. Actually, the difference between success or failure of a great product is oftentimes the business model.
If you are starting a new company or creating a new product you must also perform business discovery. Which is the process of coming up with a sustainable and scalable business model. That’s what Lean Startup movement taught us.
Imagine you are starting a shoe business. As a shoe maker your product are the shoes but as a business model you must also discover what is the price tag, how big is the market opportunity, which are the best channels to acquire and to deliver the shoes to customers, partnerships required to implement the whole value stream and some other important topics which might mean the success or failure of your business.
When we think about Digital Product Discovery we are thinking mainly in the product-related risks. We are making sure that we build the right product for the right audience.
So, we are finding out answers for the following questions:
- Is this product desirable (does it solve a problem?) – DESIRABILITY
- Is it usable (does it solve the problem in a nice way?) – USABILITY
- Is it feasible (can we build it?) – TECHNICAL FEASIBILITY
However, when we think about Business Discovery we are thinking on the surrounding business model and strategy. So, we are finding out answers for the following questions:
- Is there a market opportunity? (market risk) – MARKET OPPORTUNITY
- Is this business feasible (partnerships, required activities and resources) – BUSINESS FEASIBILITY
- Are we going to make money out of it?, how fast?, what are the revenue models?, what channels are best for our model and pricing? – BUSINESS VIABILITY
As a Product Manager you must care about both. Obviously, at the beginning you should work on the whole business model but as you advance into Product-Market Fit and later phases your teams should engage in continuous Digital product discovery to enable growth and to fix product performance issues whenever they occur.
To summarize, business discovery is about building a business and Digital product discovery is about building a product.
What Digital Product Discovery is Not?
For many companies the traditional way of doing Digital product discovery looks pretty much like the following:
- A long list of ideas, initiatives, or projects is collected from executives, stakeholders and throughout the organization
- A group of people (sometimes executives, sometimes a budget oversight committee, sometimes a product manager) prioritizes and funds those ideas, initiatives, or projects
- Resources get assigned to ideas and a product manager starts gathering requirements
- The product manager interviews key stakeholders to understand what they want
- The requirements go to engineering for delivery
There is a recent evolution of this, which you will know as Lean Inception or Agile Inception. It is a compressed collaborative two-day process to decide what to build and align everyone. It is better than pure waterfall, but still waterfall. And, mainly focused on solutions, not on exploring the problem space and discovering what to build.
Sometimes when we present our Digital product discovery training or coaching programs to our prospects or clients some people say “we are already doing Digital Product Discovery, we do Design Sprints or Design Thinking” or “we always start new projects with a Lean Inception workshop”.
First of all, let me say that incorporating Design Sprint or Lean Inceptions to your product development process is good, it is a good starting point, but it is definitely far away from Digital Product Discovery.
Lean Inception vs Design Sprint vs Digital Product Discovery
Digital Product Discovery is a mindset which translates into organizing in product teams that are responsible end to end from ideation to delivery. Teams do both Digital product discovery and product delivery, they involve customers in their exploration, validation and delivery cycles.
Lean Inception is a concept developed and coined by Paulo Caroli, a Principal Consultant at ThoughtWorks, which is typically used to kick-off agile projects.
As it name denotes, it is an inception, it is a creation that happens in one or two days followed up by delivery. It is mainly an alignment effort to make sure everybody is on the same page about the goals, constraints, risks, scope and high level roadmap.
A few techniques in Lean Inception are the same to the techniques in Digital Product Discovery, but Digital Product Discovery is a continuous process and it is also a mentality.
Lean Inception is mainly and alignment tool with the purpose of collaboratively defining a solution and an implementation roadmap.
Design Sprint covers a bit more space.
It begins with an ideation phase to then create prototypes and validate with customers. That’s much better, but it is naive to assume that a new business idea, product or big development will be fine with just 5 days of Design Sprint.
Some companies, however, implement Design Sprints for several weeks to come up with a clear roadmap for building. And that’s pretty much similar to the process of Digital Product Discovery that could easily take 6 to 8 weeks for a new product.
Digital Product Discovery is Messy
Digital Product Discovery is a non-linear, unstructured and unpredictable process. It is quite difficult to know in advance when you are going to learn something or how long is it going to take.
Depending on the level of uncertainty and risk associated with the business idea you are willing to develop there will be lots of backs en forth between exploration and validation.
Some of the tasks will require a few days to develop and test, but some others will require weeks to develop and some more weeks to validate.
On top of that you must recruit customers for interviewing or testing on a frequent basis.
Many teams struggle to put an effective discovery process in place and they are basically inventing the wheel every week or trying random stuff to see if it works. This creates a lot of frustration in the team and distrust in stakeholders. Which might facilitate going back to old ways of managing product development.
To prevent this from happening and make sure that teams get off to a good start we recommend you to put in place our practical Product Discovery Framework, which over time you can adapt and modify based on your own context and learning.
Product Discovery Framework
Digital Product Discovery is not a linear one-way process, as you can imagine. It is often messy and unpredictable.
Digital Product Discovery is not something that should happen once in a while but a continuous process that high-performance product teams do as part of their normal activity.
However, when it comes to organizing Digital product discovery and integrating it with delivery most teams get stuck. They have a hard time knowing exactly what they should do. They understand the high-level concepts, but they don’t know how to apply them.
Some other teams just go to the opposite extreme and suffer from paralysis per analysis. They spend so much time in discovery that they forget about delivery.
You must learn to keep an effective dynamic balance between Digital product discovery and product delivery, and to achieve that it is key to have a product discovery framework.
You can build your own, but if you don’t know where to start from, we recommend starting with our product discovery framework.
With this framework you can align team efforts, provide visibility to stakeholders and make sure that you are on track towards achieving your businesses goals.
Begin With the End in Mind
The starting point is always a goal (or a challenge). The end point is always the decision to build a product or feature. In between, lies the digital product discovery double-loop of Exploration and Validation.
Very importantly, in the middle of this double-loop that connects exploration and validation, there is a decision point:
- Can we move straight ahead to building from the goal?
- Do we need to explore the problem space?
- Can we just build after exploring the problem space?
- Do we need further exploration?
- Do we need to validate with customers after exploration?
- Can we build already after validation or do we need further exploration because we learnt something?
- Do we need further validation?
- Should we cancel or pivot?
Everything starts with a goal. This goal can be a business objective, a problem with your product growth or perhaps a theme in the roadmap.
This step is the initial kick-off and it is fundamental for the success of the Digital Product Discovery process.
Once the goal and success criteria is clear we must do the following:
- Design the Team
- Create a Supportive Environment
- Build Alignment
The outcome of the Exploration loop are ideas worth pursuing.
They are solutions to customers problems, expected outcomes while performing jobs or growth ideas for the product.
In the exploration loop you shape and reshape ideas for achieving a business goal and/or creating an impact to your customers.
The first iterations might be based on your intuition but as soon as possible you should do some research to discover what your customers really need.
As many ideas cross towards the Validation loop some will come back as new insights to be explored or new ideas to be validated.
The purpose of the Validation loop is to design experiments to validate ideas before going into delivery.
To achieve this we build different prototypes with different levels of fidelity based on the strength of the evidence we need to gather and also based on the type of thing we want to validate: Desirability, Usability or Feasibility.
You have come a long way. Now, it is time to decide what to ship to the customer.
Summary of Digital Product Discovery
Modern product organizations are characterized by a continuous learning process at all levels of decision taking: from strategy down to delivery.
Product Teams must combine both discovery and delivery in their normal routine. Continuously researching the market, involving customers and experimenting in fast and short cycles to make sure that what they build is likely to have an impact.
Digital Product Discovery is the continuous process of reducing uncertainty around an idea. Companies must move away from the one-off big design upfront approach to enabling and empowering their product teams to continuously evolve their product in pursue of a business goal.
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