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Alex Tacho is a product leader with almost 10 years of experience in product management in fast-growing startups in the developer tooling space. Alex has experienced the ups and downs at the intersection of design, engineering, marketing, and business firsthand, in building products and solutions customers love. He deeply cares about product leadership that enables action and drives towards outcomes for the business and the customers alike.
Addressing needs that are important to the customer and not satisfied by the current solutions. That requires you to understand the priority and importance of these customer needs, pain points, and desires. This is an integral part of an outcome-driven product discovery process which allows you to find the needs that form the biggest opportunities to impact your business.
That is an important question to ask. If you skip this step, all subsequent steps most likely won't get you the results you are looking for. Your (potential) customers will have a lot of needs, pain points, and desires, but not all of them are worth solving. Not every problem is critical to your target customer. Some might just not be important enough for people to spend money on or to abandon their current solution.
In the end, you are looking for a need that is unmet and of high importance to your (potential) customers and that you as a company can deliver on.
Some ways you can approach this are:
Marty Cagan provides ten fundamental questions to assess product opportunities. That includes questions around the problem to solve as well as the solution. The questions below are limited to assessing the problem space.
1. Exactly what problem will this solve? (value proposition)
2. For whom do we solve that problem? (target market)
3. How big is the opportunity? (market size)
4. What alternatives are out there? (competitive landscape)
5. Why are we best suited to pursue this? (our differentiator)
6. Why now? (market window)
7. How will we get this product to market? (go-to-market strategy)
8. How will we measure success/make money from this product? (metrics/revenue strategy)
9. What factors are critical to success? (solution requirements)
10. Given the above, what’s the recommendation? (go or no-go)
Answers to these questions provide insights into who the audience is, how many people have the problem and how important it is to them. As well as, how are they solving this today, how much are they spending, and the company's ability to pursue a solution for this problem. Subsequently, this allows you to look at multiple top-level opportunities and assess which one is most likely to impact business objectives.
Opportunity Solution Tree (OST) is a framework developed by Teresa Torres. An OST provides structure and hierarchy to the problem/opportunity space. This is helpful to simplify and limit customer needs, pain points, and desires when prioritizing. Instead of having to look at all the opportunities at the same time, you only need to compare and contrast the ones on the same level of the tree, drastically simplifying the decision-making.
When comparing opportunities you are asking similar questions as above around opportunity size, market, company, and customer factors.
This requires you to already have a solid understanding of the problem space through generative research, like customer interviews. To prioritize these opportunities, use direct user/customer feedback to learn what problems are most critical to your target audience. There are two major dimensions to the criticality of a problem:
1. Importance of the problem
2. Satisfaction of the current solution
Problems that are very important to your customers where current solutions are not satisfactory represents the biggest opportunities for your business.
The ODI (Outcome-Driven Innovation) process suggests having potential customers rate identified problems for importance and satisfaction by using a survey taking the whole problem space into account. This can provide a good amount of data and can substantially increase your confidence for your prioritization. The drawback here might be how quickly you can turn this around and get to the needed learning.
Another approach to get good directional data that will inform your prioritization is by leveraging customer interviews and the aforementioned Opportunity Solution Tree. This allows you to limit the problems the customer needs to evaluate during the interview. Rating importance and satisfaction stay the same.
With the data from the survey or interviews in hand, you can rank these opportunities relative to each other and identify the most critical ones to your target segment.
Sidenote: If it turns out that the responses are all over the place and there are no higher-rated opportunities emerging, you might want to revisit your target customer segment.
I recommend picking the best out of each of these methods that work for your case and timeline. The main goal is to minimize risk and uncertainty. You want to address a problem that is important and unmet and that you, as a business, can execute on. You can't skip this work of understanding and assessing the problem space. Doing this right will help you to find better solutions that your customers love.
This article was originally posted here.