A framework for Product Discovery
In this guide, I’ll wrap up my years of work in product strategy to help you understand the process of product discovery and the techniques that teams use to develop insights that lead to innovative products.
More and more, orgs are looking to innovate—and fast. There is enormous pressure, both from consumers and from stakeholders, to come up with something (anything!) new.
But to create truly innovative—not just “novel”—products, the best product teams use a set of carefully crafted continuous discovery techniques. I’ll explain these techniques below, along with a process and framework to help you better understand product discovery so you can position your teams to create industry-leading products.
Read straight through or jump to the sections highlighted in the menu to the left.
Product discovery checklist
- Idea is aligned with strategy
- Increases revenues
- Leverages the brand
- Leverages distribution
- Team staffed for success
Product discovery can be a significant investment for any company. Before you launch a team into the discovery process, ensure that the idea is one where you can win, and that it is worth it. The effort should leverage what the company is known for and use existing channels. Ensure the team is entrepreneurial and has a clear product owner.
What Are Product Discovery Techniques?
Most commonly, competitive pressures, dynamic information, and new technologies drive changes in markets. It is crucial that companies respond to these changes. It is often the first to field a new product that captures market share and profits.
Goals of Discovery
- Conduct customer visits
- Perform user observation
- Create Journey Maps
- Create Prototype – Test Idea
- De-risk concept
Product Discovery is a way for companies to assess the market worthiness of a given product concept. In startups, it’s common to use product discovery techniques in order to determine what a minimum viable product (MVP) could be—or to iterate on the MVP.
The primary purpose of discovery is to understand product market fit.
There are many techniques teams use in Product Discovery, including:
- Conducting customer feedback interviews and running focus groups
- Observing users as they use clickable prototypes or interact with mockups to better understand user needs and behavior
- Creating user journey maps based on user research (also referred to as story mapping)
- Prototyping and testing the viability of the product (a/b testing being a well-known example)
Product Discovery is essential to innovation. Most companies come at it from these three tiers, and in all of them, you need to use Product Discovery techniques (along with a discovery process and framework, as you’ll see below) to innovate on your products.
Many firms create a balanced innovation portfolio with three tiers:
- Products that speak to your company’s core business model
- Products that expand on that core into adjacent product markets
- And brand-new offerings
Discovery is problem oriented not solution oriented; it works best with a full stack product team including Marketing (Product), Engineering and UX. It is agile, and it fundamentally involves users (current customers, potential customers, even lost customers).
Why Use Product Discovery Techniques?
Very simply because you want to get early feedback on product market fit without investing a lot of resources and time.
This allows you to be agile and adjust the concept or the market. It is fundamentally problem or need based, not solution based. It gets companies out of the “solution mindset” and into the “problem space mindset” of prioritizing early work on problem definition and then working out the best solution.
Why User Feedback Is important In Product Discovery
There are several reasons that user feedback is an integral part of the overall discovery phase. The most important and obvious reason is that they help you understand the true need. You are unable to imagine the depth and specificity of user challenges until you walk in their shoes. To walk in their shoes, you need to experience what they experience in the context of actual user stories. We call this “Contextual Inquiry”.
Second, the customer is part of the innovation team (even though they don’t know it)! They help define a language to give solutions context and immediacy. By their constraints and view of the problem they help shape “the art of the possible” and provide possible clues to possibly hidden aspects of a required solution.
Using minimum variable product (MVP) solutions can also provide indications of whether your product has customer appealㅡseeing what customers do with a prototype of a product, or a simple landing page is key in understanding product success in a market. They might even suggest partners, participants or other types of customer interviews needed in a total solution.
Finally, they help prioritize the need for space. They clarify the personas that would be part of the decision and consumption lifecycle and help you put dimensions and quantify the important questions of “where are the pain points, how tedious, how big” is this problem. After getting this kind of feedback on a qualitative dimension, quantitative feedback can (and should) be used to confirm the broader market needs.
Despite the wide variance in time to market even for products in the same industry, KPMG research (2015) found the following typical ranges for time to market by industry.
Why You Also Need A Product Discovery Technique Framework
Discovery is more than a process, it includes three important factors to manage your validation of product market fit:
Get the right leaders and stakeholders to the table and have them understand the process, financial investment, and roles. They need to allocate capital to the product portfolio.
Create a specific investment level for Discovery and have it approved in a yearly budget. Make it large enough to start at least three projects (for example in a B2C tech company about $10M).
Establish a process for the intake of ideas, understand how Discovery is managed, and know how to successfully transfer to Development for execution and product delivery.
To ensure that teams, product managers, and the governance body understand the Product Discovery rules, create Entrance and Exit Criteria to move new ideas in and development-ready projects out of your backlog.
- Entrance Criteria: Ensure strategic fit, large market potential, capable leader
- Exit Criteria: Verify the business case, budgeted in Development, development plan
What Is The Product Discovery Process?
Product discovery techniques are used within a process. This Discovery process is a protected space for early stage product idea concepts.
“Discovery offers the protected space that shields the teams from process and bureaucracy so they can assess product-market fit, usability, and technical feasibility for new product concepts.”
Once companies have organized their investments and assessed their risk tolerance they typically look at the potential of new products, and if they fit the right product portfolio, move them into a Discovery process and then into Development.
Discovery offers the protected space that shields the teams from bureaucracy so they can assess product-market fit and technical feasibility for new product portfolio concepts, be they incremental improvements or startling new innovations.
Discovery Is Not A Milestone Process—it Is Agile
While projects within development have gates, roadmaps, and timelines, companies should manage the front end of development (Discovery) in a very different fashion.
A normally messy (and that is OK) innovation process has clearly defined funding and allocation stages, it has few rules within it.
An innovation process ensures that
- The right basis of ideation or product lines are funded, and
- The cross functional team in the Discovery space is protected so the firm will maximize innovation while ensuring product market fit.
Protected Space for Product Discovery with Criteria
This protected space is defined only by fit and potential at the start, and by demonstration of technology and product-market fit at the end. Use entrance and exit criteria to allow ideas to enter and leave the protected space, or if need be, to die off. This is also a good way to continually perform ongoing product portfolio management strategy analysis.
Move from idea/concept into Discovery (protected space)
- Ensure that product decisions and ideas and congruent with the vision
- Ensure the team is free to innovate and iterate
- Ensure there is product-market fit
- Ensure the technology is tested and ready for Development
- Ensure that projects are staffed properly with the right resources
- Ensure that projects are free from anything that impedes fast and iterative development
- Ensure that there is a meaningful commercial potential
Move from Product Discovery into Development
- Have tested for product-market fit
- Have vetted the technology
- Have defined use cases
- Have estimated Development stage costs
- Have confirmed commercial potential (including profit potential)
These Entrance and Exit criteria are summarized in the graphics below:
Discovery Checklist Enter Discovery Process
Ensure that the idea has a clear leader, the idea is aligned with the brand and fits the current business model. Strategic alignment and potential revenue impact are typically the most important considerations.
Discovery Checklist Exit Discovery and enter into Development
These are considerations for ensuring the idea is vetted and that management is comfortable with moving to the next phase, which would be to scale up the team and begin product development.
A Discovery and any product portfolio management methodology also includes a related set of deliverables that proposed programs (products, technologies, metrics, and investigations) must pass through in order to ensure that the team is ready to hand off (or continue with the intact team) into development.
This handoff is something that our product development consulting team helps with in many engagements.
A Great Product Discovery Process Leads To Product-Market Fit
“Use the least amount of process, but no less.”
The foregoing list of deliverables should be minimal and situational. The purpose of Discovery is to show Product-Market fit, Commercial Potential, and estimate the cost of Development. If vague concepts populate the pipeline then the result too often is vague, undifferentiated offerings—created at a huge expense.
By placing gates around hypothesized programs, with a few deliverables, product teams and decision-makers clarify whatever can be known about them. This approach to Product Discovery reduces risk, refines markets, and generates more predictable results to increase market share by bringing a measure of prioritization and precision to the front end.
Simply put, an innovation process will help load your company’s pipeline with the very best—and only the best—product concepts.
As the early stage product portfolio level ideas move into the Discovery process, executives have an opportunity to assess their fit with the current product strategy, choices that involve judging the potential and fit of new products within the portfolio. The Product Vision ensures that only the best ideas are funded, that the portfolio in Discovery resembles the corporate vision, and that there’s a clear business case.
The Product Vision and Entry criteria should also consider the company’s existing brand, reputation and capabilities. We’ve also found that it helps if the team leader for the project has signs of potential CEO-level leadership talents.
Why Are Teams So Important In Product Discovery?
Accountability is one of the major benefits. Consistent use of teams is a proven way to accomplish any corporate objective that requires multiple disciplines so that it produces a result that is accountable. These teams are assembled to produce a specific result in a fast and efficient manner. In the technology space, they always include Product Management, Development, and User Experience.
For technology programs, they are full stack and they are small and dedicated. For non-tech, they need to include a small team (2-5) that represent the key functions required for innovation, market proof, and concept development.
Teams may also become a hothouse for design thinking, design brainstorming and innovation. Innovations often come from combinations of disciplines. These teams often exceed expectations because of the catalytic nature of putting talented minds together and being in a protected space that allows them to focus on one specific challenge. Cross-pollination can occur when distinctions from one domain port to another, fostering an environment that facilitates innovation. It is a stretch to assert that the team organizations cause it, but cross functional collaboration can enable innovation.
In the case of a product development process, cross functional teams can reduce time to market and increase product throughput and efficiency. This is one example, there are many examples with different functional compositions: IT, construction, marketing, finance, and Human Resources. Even a traditional marketing team, development team, or sales team can benefit by adding core functions outside marketing and sales.
In teams, subject matter experts work together as part of a cohesive group with shared common business goals, a social milieu that many people find uniquely rewarding and engaging. More engaged employees perform better, make decisions faster, and work longer and harder, with satisfaction. Cross Functional Teams are a way to get the most out of your people.
This also concentrates resources and improves their efficiency. Team leaders make sure that process and functional bureaucracy don’t get in the way. They use resources in a targeted way that employs them and then releases them when the project has no further need for them.
How To Help Product Teams Do Product Discovery
Sometimes it is hard to pry away team members from their workplace, or worse yet, the corporate Slack channel, and the endless sea of corporate emails. One technique we have found very useful is to create virtual co-location by using a technological firewall, protecting them from the overhead and distraction, and from the constant burden of being part of a mid-size or large company. A technological firewall creates virtual co-location and helps teams execute their portion of the product portfolio.
“Use a technological firewall to create virtual co-location.”
You accomplish this by creating a new Slack messaging space and new email accounts for the Discovery Teams. This has made an incredible difference if you can’t create a physical space for the team. We also recommend that the Discovery teams do not attend Town Hall, Staff, Communication Meetings, and Departmental meetings. They need to focus to be successful and it is management’s responsibility to protect them.
Product Development Expert
John Carter is a widely respected expert on product development. He is an inventor of Bose’s Noise Cancelling Headphones and designer of Apple’s New Product Process. As Founder of TCGen Inc., he has consulted for Abbott, Amazon, Apple, Cisco, HP, IBM, Mozilla, Roche, and 3M.