Last but not least, viability addresses the questions whether a product idea will actually work for the business, so is truly a great idea for the company to develop.
Align with Stakeholders
It is a responsibility of Product Management to align with all stakeholders on the relevant constraints such that a product idea, once implemented, will not harm the business. There's hardly any formal framework or sophisticated tooling for that. Rather, in most cases it boils down to involving them early on during Product Discovery and, thus, achieve a close alignment in which any unwanted business impact would quickly be identified.
The main stakeholders typically are:
- Marketing: Are the effects on messaging and go-to-market communications? What will be the impact on sales channel and lead generation?
- Sales: Can the sales team sell it, do they have the right material and skills or will there be a sales training required? Is the new product relevant in their markets and for their prospects?
- Customer Success: How will the new product affect the installed customer base, how to handle migration and concerns among them?
- Finance: Are there any extra costs involved, such as for a 3rd party solution to be integrated or reseller fees? With these costs in mind, can the product still be profitable?
- Legal: What about special regulations in specific markets? How to deal with privacy concerns or compliance obligations? Are there relevant aspects around intellectual property?
- Operations: Specifically in a SaaS business, what does the new product mean for operations, which new tools are needed, how are they installed, operated and maintained?
- IT Security: How could (data) security be affected, specifically in a SaaS environment?
- C-Level: How does the new product relate to the overall business strategy? Are there plans for entering new markets, serving new regions or around M&A that the new product would be in with?
Business Value Estimation
Assuming all of the above stakeholders agreed and there is no viability risk, whether the product idea will actually be profitable is another question. Of course, there are highly advanced frameworks for calculating return on investments — but as much as Product Discovery is about reducing uncertainties and removing risks, as much a ballpark estimate is often enough. Specifically in B2B environments, the following schema often provides enough guidance:
- What is the task that the new product idea addresses, the job-to-be-done (see ???)?
- How is that task addressed today, because only in very rare circumstances will it be totally new. In by far the most cases a solution will exist already, even when that applies a totally different approach which the new product idea tries to disrupt.
- What are the efforts related to the current solution, how mich work goes into it, how many people and resources are required, what are estimated costs?
- Realistically, to what extent could the new product idea solve the job-to-be-done in a better way, how could it be faster or less resource-intense? How does that translate to expected savings?
- What would be a fair share of these savings? How much would customers benefit and how much could be charged for the product idea?