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Prioritization

Value Prioritization

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Value Prioritization Definition

Value prioritization is a way of prioritizing items (products, features, projects, tasks, etc) that take into account the value of each item. 

Value prioritization is a core principle of the Scrum framework and should be at the heart of any organization that wishes to work with agile methodologies. Value-based prioritization tasks the team with identifying which items must be completed immediately and which can wait until a more appropriate time. 

While running prioritization sessions with value-based prioritization, you need to consider the following factors: 

  • Value: How much value will this item add to the customer experience?

  • Risk or uncertainty: Will this item be worth pursuing, or could it set the development process back?

  • Dependencies: Will the dismissal of this item cause problems with items we’re developing in this upcoming sprint?

By prioritizing items in this way, projects can be completed in a more streamlined fashion. It also allows teams to pivot on a dime as they’re not working on too many items simultaneously. Most importantly, it ensures that value to the customer is considered throughout every stage of development, from ideation to finalizing features. 

What is business value prioritization?

Most prioritization frameworks look at things from a customer’s perspective, especially those with agile methodologies. Yet, a business doesn’t run on customers, it runs on income and profit. With that in mind, it’s worth looking at prioritization from the point of view of your business from time to time.

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Unfortunately, business value prioritization is a tricky task. The more business-minded people within your organization will be management or other non-development roles. The development teams have been trained to think of customer value as the number one priority. This means most teams struggle, and often fail, at business value prioritization

As a product owner looking to start prioritizing your backlog by the business value you should have the following questions in mind:

  • What can we do that has never been done before?

  • What do customers really want to see?

  • What could potentially hold up the release?

These questions help teams to develop in a way that prioritizes features that have the biggest advantages for the business, be it a feature no competitor can offer or a popular feature that will score well with marketing.

Benefits of value-based prioritization

Aside from identifying ways to offer something your competitors can’t and creating fresh marketing opportunities, value-based prioritization can make life easier for product managers in the following ways:

Better ROI

Value-based prioritization can help you build features your competitors can’t afford, which translates directly to new customers. You’ll be directing your resources in a way that can only bring value to the customer. This will reduce resource wastage to bring development costs down. 

Better customer satisfaction

When we talk about value, we’re talking about how the customer benefits from our actions. This customer-centric ideal is perfect to drive customer satisfaction, which in turn boosts word-of-mouth marketing.

Improved team efficiency 

Value-based prioritization means your team only works on tasks that will benefit the user. With value-based prioritization, you’re getting rid of needless tasks and “nice to have” features. There are no distractions, meaning your team only focuses on what matters. 

Helps prioritize limited resources

Value-based prioritization is extremely useful for smaller businesses, or teams with limited resources. By eliminating low-value tasks, you’re not wasting resources on something that won’t add anything to the customer experience.

Challenges of value-based prioritization (and their solutions)

Value-based prioritization is an incredibly helpful tool, but it’s not without fault. Like all prioritization efforts, value-based prioritization can get a little complicated and messy. Here are a few common challenges you might face.

Picking a framework

It’s not always clear which framework is best for value-based prioritization. What works “best” is specific to your team. If you’re struggling to find a framework to use, try one of the following:

Backlog organization 

It’s easy to let your backlog get a little disorganized as other things take priority. However, a messy backlog is going to make it tough to prioritize the right items. It’s good practice to regularly assess your backlog and clear out anything that you know you won’t get to.

Dependencies

Value-based prioritization has a nasty habit of eliminating dependencies. While they may be classed as low-value tasks, you need to make sure you’re considering dependencies during your prioritization sessions.

Focusing on the competition

It’s nice to get ahead of the curve and wow potential new customers with shiny new features your competitors don’t have. Yet this mindset often leads to building “cool” features that don’t actually address any of your customer’s needs. Always keep your users in mind at all times when using value-based prioritization. 

What is the value vs effort prioritization model?

Value vs effort prioritization enables teams to weigh up initiatives against the technical complexity involved in delivering them. Those items with the highest value to the customer or business and are simple to implement will be pushed to the top of the list. Those that fall into the opposite category will be left until later or even removed entirely.

Some value-based prioritization techniques

MoSCoW: A tool for establishing a hierarchy of priorities during a project. Defines factors like product cost, quality, and requirements as early as possible. Kano Analysis: A method of identifying the most important features when creating a product based on expected user satisfaction. Buy-a-feature: Where the development team works directly with customers or other stakeholders to determine which features they value most.

Click here to learn more about value vs effort prioritization.

General FAQ

What is value-based prioritization?
Value-based prioritization is the process of arranging items in order of how important they are to the business or customer.
What are some value-based prioritization techniques?
MoSCoW: A tool for establishing a hierarchy of priorities during a project. Defines factors like product cost, quality, and requirements as early as possible. Kano Analysis: A method of identifying the most important features when creating a product based on expected user satisfaction. Buy-a-feature: Where the development team works directly with customers or other stakeholders to determine which features they value most.
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Glossary categories

Agile

Agile

Feedback Management

Feedback Management

Prioritization

Prioritization

Product Management

Product Management

Product Strategy

Product Strategy

Roadmapping

Roadmapping

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