This is the fourth in a series of eight articles on CPO Solutions. Over the past year Products That Count has been investigating the role of the Chief Product Officer. That investigation has included original research by our own CPO, Renée Niemi, resulting in the white paper “The Rise of the Chief Product Officer: Study of the Most Important Role in Business.” We also recently published an eBook on “The State of the Chief Product Officer in 2022.” That latter work focused on the eight top challenges facing the CPO of today, one of which is prioritization. That is the topic of Renée Niemi’s article below.
Stay tuned to Products That Count for more CPO-related content, including the rest of this series on CPO Solutions.
Introduction
In my last LinkedIn article, I wrote about annual planning. A few similarities bear mention. For example, in that article I argued that planning is a continuous process. Likewise, in this article below you’ll hear from Chief Product Officers who encourage a regular reassessment of priorities. I also discussed carving out time for long term strategic bets, not just focusing on the year ahead. In the same way, CPOs often build priorities by starting from the long view and then work their plans backwards.
Taken together, the planning and prioritization articles should provide insight on how Chief Product Officers drive and shape an organization’s vision, strategy, and execution. From both micro and macro perspectives, to typical models, to how to be flexible and maintain communication within the company, this article shares best practices for how CPOs set priorities.
The Macro Lens: Starting from the Long View
Prioritization is about choices, because resources aren’t infinite. This is what we get to do, and this is what we don’t get to do. Often the decision of what we don’t do is the bigger decision of the two. What can help, as Autodesk CPO Amy Bunszel told me in a conversation this year, is by visiting the long view on a regular cadence. Keeping that focus on the macro perspective is important when considering the tradeoffs. Along these lines, I recommend using a framework like the “Vision, Strategy, and Execution” document pictured below.
Amy explains the need for a macro perspective, saying, “We could have twice as many resources and still not have enough to do all the great things the team wants to do. That’s a constant. At Autodesk, we have a pretty good strategy process where every year we look at the 3- to 5-year horizon. Then we align with leadership and the board. We bring this back to the team and we back it up to the 1-year horizon. Then there is a collaborative effort between the product, sales, and marketing teams. Lots and lots of data and micro decisions go into the annual view. This might include looking at the install phase, or if we should expand in new markets or new countries. Should we implement new use cases for new personas? Out of that falls a lot of the broad product initiatives.”
From Macro to Micro: Ruthless Prioritization
Moving from the macro to the micro view, enacting the prioritization plan comes down to product teams and individual product managers. CPOs know the key here is hiring the right people. (We covered this topic in a prior article on the talent challenge.)
In a recent conversation, Teladoc Chief Product Officer Donna Boyer shared that PMs need to practice ruthless prioritization. She hires people who can filter out what matters, in terms of the end goals, on a daily basis.
The ability to prioritize is a skill. Donna says, “First and foremost, one of the things I interview for is critical thinking. There’s so much coming at you all the time. It’s really understanding what matters most in the problem that you’re trying to solve. Being able to prioritize and understand, of all the features that are coming at you from every which way, what are the things that actually matter the most, in order to actually solve the problem?
“That requires ruthless prioritization. You’re making decisions all day long, every day. There’s no process that you can go through to actually substitute for judgement. So being able to really synthesize, simplify, and make very clean, crisp decisions around that that drive forward your goal is, first and foremost, a critical skill.”
Feature Prioritization Models: MoSCoW and RICE
To help with that decision making, it can be helpful to use feature prioritization models. There are many useful methodologies, but two of the most common are RICE and MoSCoW.
The MoSCoW method is commonly used in agile product management, and it lays out priorities in clear rank order. The acronym shows priorities in descending order of importance:
- M: Must have
- S: Should have
- C: Could have
- W: Won’t have (or, sometimes, Wishlist)
In other words, success is predicated on delivery of the Ms, with the S, C, and W following behind. I have seen this method work well for communicating prioritization to stakeholders.
Another common method is RICE. This can be shown as a mathematical formula, as follows:
[Reach * Impact * Confidence] / Effort
2022 Product Award winner Hootsuite appreciates the RICE method, as SVP Darren Guarnaccia explained in a recent Product Talk episode. For Darren, RICE is useful for determining how impactful a certain opportunity could be. He calls this “sizing the opportunity,” a clever phrase I absolutely love.
Darren says, “Sizing is everything. What’s the opportunity size? We often start with an inception process. It really kind of sizes the opportunity, depending on how big this thing is. If it’s feature level, and we want to build it, then we need to have a point of view about what is the impact. Is this going to help drive better trials, paid conversion, or win rates? Or is this going to save us on churn? If it’s bigger than that, then what’s the market space? And the opportunity?
“We use tools like RICE to prioritize features. What I like about RICE is simply that it makes you think about the reach and the impact. And then how confident you are in that data. Then you divide it by effort. So it’s helpful, because it helps you prioritize. But bigger than that, when you get to the multi-epic level, now you need to start to really think business cases. What’s the opportunity, size, and space? And what is your competitor doing?”
Customizing Models and Listening to Customers
Since no two product organiations are exactly the same, it makes sense for Chief Product Officers to customize existing models. That is exactly what Chargepoint CPO Bill Loewenthal and his organization do. When determining priorities, Chargepoint considers a range of factors, from compliance to customer feedback.
Bill explains, “In our business, there are a lot of compliance attributes to what we do. We combine MoSCoW and RICE, and we’re continuing to perfect how we do it. You want to prioritize quantitatively, but you can’t rely on that wholly.
“In any business, you will always have specific customers asking for things. And I do believe that you want to be pulled by your customer, especially in early markets. At the same time, you want to really listen carefully. Is this something that is unique to what one customer needs? Or does it signify something that your other customers will need too? Perhaps it was already planned in the roadmap, but it’s needed sooner. Those are all things that would affect our prioritization.”
Flexible Prioritization & Goal Maturity
Once you’ve moved through the longterm view, a methodological framework of prioritization, and the right people to carry out the plan on a daily basis, you’re all set, right? Not quite.
It is vital to keep in mind that sometimes priorities will shift. What you thought was going to be third on your list might suddenly move up to number one. In the language of MoSCoW, your “could-have” may become a “must-have.” As ApartmentList CPO Katrina Benjamin argues, this flexibility is ofen directly related to the maturity level of your initiatives.
Katrina says, “There are nuances around priorities. There are nuances around planning and goal setting, especially for new products, things that are completely new and innovative. For the most part, I don’t want PMs to change their plan during the quarter. But it happens, right? Things come up. Maybe we want to put more resources on this other thing that we now realize is going to be really beneficial. Or we may have learned new information over the course of the quarter, and so we’re diverting resources to double down on what we learned. Possibly we measured something the wrong way. Perhaps we were double counting, and so the baseline changes in terms of where we set the goal.
“In general, goals are relatively fixed over the course of the quarter for a particular kind of mature initiative. But for really new initiatives, you might actually need either monthly goals, revisited monthly, or to just build in more flexibility where you’re fine changing the goals over the course of the quarter. That planning will look different at different stages of the company. When you’re at product market fit, and you are scaling up, that looks different than when you’re trying to get to product market fit, and you’re trying a bunch of things. So prioritization depends heavily on your initiatives’ stage of maturity.”
Communicating change within the organization
Given flexibility to change, the CPO is then tasked with communicating those changes. This is so critical, because if the cross-functional teams are not up to speed on prioritization pivots, teams risk running into dreaded misalignment. That is what Optimizely CPO Justin Anovick spoke to me about in our recent Product Talk: CPO Rising conversation. Similar to Katrina Benjamin, he stresses the need for flexibility, and says the priorities will change due to factors outside of the team’s control.
“I feel it changes every few months. The moment I feel like I have it nailed, there is something new. It might be due to a new acquisition coming in and inherently resetting some of the things that we’re doing, or other factors. We have a monthly review with our leadership team to talk about our priorities, what we’re investing in, getting buy-in and agreeing on things not to do. We can’t do everything.
“Where I think we get in trouble most often is because we avoid making the decision not to do something. Or specifically, when we don’t clearly articulate it to the business, and there’s still an expectation that we are working on it, because it was on the ‘do’ list previously..
“Communicating decisions, that’s the biggest thing. Of course, they’re gonna get upset because they were counting on it. Or they’re expecting it and we never informed them of the change. So it’s less the prioritization using business case, and all the correct logic. It’s the what are we not doing and communicating it clearly That is our biggest struggle.”
Summing Up
From various models, to marrying long- and short-term perspectives, to being flexible and communicating cross-functionally, Chief Product Officers have their hands full with prioritization. That is why Chargepoint CPO Bill Loewenthal says prioritization is the hardest part of being a product leader. I agree, and I think that getting this challenge right is absolutely crucial to the success of the CPO – and the product organization.
In terms of takeaways and best practices, there are several:
- Begin with the long view and work backwards to generate priorities.
- Choose a model that works for your org. If an existing methodology isn’t a good fit, customize until you create a framework that is functional for you.
- Hire the right people who can ruthlessly prioritize daily tasks in line with your larger prioritization plan.
- Be flexible with your priorities; regularly look at the data and adjust as necessary. Keep in mind, that if you change too often or for the wrong reason, it will create organizational chaos. So you need to be thoughtful.
- Changing course will happen – but be sure to communicate that clearly across the impacted teams.
I hope you can use these best practices as practical solutions for your prioritization challenges. Drop me a line and let me know how it’s going. And if you have another perspective, I want to hear that, too!