Managing product risks

When you create and manage products and services you face a number of risks that could result in undesirable outcomes such as:

  • Customers don’t value them enough to pay for or use them
  • Customers can’t use them
  • Your organisation doesn’t have the resources or skills to deliver them
  • They don’t result in the outcomes for your business that you need them to
  • They may cause harm and have unintended consequences
  • They may break the law

I like this idea of framing these as risks as much of the work we do in product discovery is about trying to reduce risk of failure.

It would be interesting to give stakeholders £100 each and asking them to tell you how much they want to invest in exploring each of the areas of risk.

This would to help to uncover what they are most uncertain about and where to focus you efforts in exploring further..

In Marty Cagan’s book ‘Inspired‘ he discusses how important it is to explore the threats posed by each of these risks in order to create a product that your customers will love and that also works for your business.

He identifies these as what he sees as the four biggest risks.

Viability riskHow confident are we that this product/ service will deliver what the business needs it to?

Value riskHow confident are we that people will value the benefits it provides enough to buy it or choose to use it instead of alternatives?

Usability riskHow confident are we that people will be able to figure out how to use it ?

Feasibility riskHow confident are we that we can build and deliver it with the resources and skills that we have ?

There are many other kinds of risks you may choose to explore but I think these two are really important additions:

Ethical riskHow confident are we that it will have no harmful unintended consequences for people, the economy or our planet?

Compliance riskHow confident are we that we are not breaking the law in any way?

The best time to start exploring risks such as these is as early as possible during your product discovery where you can begin to get a feel for what represents the biggest potential threats to the success of your new product ideas.

Interestingly, Marty identifies ‘value risk’ as the toughest risk to mitigate, which highlights the importance of getting ideas in front of potential customers as early as possible to understand if they solve real problems for people in ways that people value enough to find them useful and are willing to pay for them.