What is value versus effort?
Value versus Effort is a model used to prioritize features and build a practical roadmap. The Value versus effort paradigm requires teams to assign each element a monetary value (for example, income potential) and measure their Effort (e.g., hours to build). Teams can rapidly determine which features are high Value and low Effort — priorities — and which parts are poor value and high effort — things you should drop outright.
The value versus effort method is not confused with the Value versus complexity paradigm discussed below. Even though the two phrases are synonymous, their definitions are vastly different.
The ultimate Value and Effort is a manifestation of Lean Prioritization. A simple 22 product prioritization matrix represents the Lean Prioritization technique. It aids in decision-making and identifying what is essential or risky and where you should direct resources as a manager or a company owner.
This matrix is frequently used to prioritize product development. This notion is sometimes linked to the traditional Eisenhower matrix. In addition, The matrix is utilized for prioritization since it may assist product managers in sorting out and organizing all of the components.
What is the purpose of the Value Versus Effort method
The Value vs. complexity framework enables teams to assess the importance of projects, project managers and the difficulty of putting them into action.
Typically, those efforts that are the simplest to implement while also having the most significant potential to add value will be given the highest priority. Those who fall into the opposite category are either postponed to a later date or deleted from the roadmap entirely.
The Pros And Cons of the Value Versus Effort method
One of the most significant advantages of employing the Value versus effort model is that product teams can determine which additions are most likely to impact consumers and at what expense positively. This results in a more solid structure and decreases the danger of investing time, money, and Effort into adding features that will ultimately be ineffective or even counterproductive.
As a result, the Value versus effort model may increase production and profits. Product managers may find it easier to allocate the appropriate personnel to the right tasks if they are aware of the crucial features to the success of a given product.
One major disadvantage of the Value versus Effort approach, on the other hand, is the possibility of over-or underestimating the worth of a feature. Teams may believe that a particular idea will be of great advantage to users, but this may be incorrect in the long run. That point would have expended much work without yielding the desired results.
It is for this reason that careful study is essential. Product teams should thoroughly understand their target audience, goals and desired outcomes, rivals, market, and common concerns addressed by similar solutions. Gathering this information allows product teams to determine the most accurate appraisals of features before prioritizing them, enhancing their ability to innovate.
Additionally, it is possible to underestimate the Effort required to create a feature. As a result, teams would have to invest more time and money to see their ideas through to completion. As a result, it could have a cascading effect on other functionalities, perhaps resulting in delays and disruptions down the road.
Why To Use Value Versus Effort
Product teams can use a lean prioritization matrix to help them prioritize their efforts to decide which features are critical and which offer the most significant risk. The goal is to design a product that provides the most incredible Value while requiring the least effort. Combining too much of the latter and not enough of the former might harm potential profitability.
The lean prioritization matrix
The lean prioritization matrix entails determining the Value and Effort associated with ideas you may explore. In a simple chart, the vertical axis is labeled “value,” and the horizontal axis is labeled “effort,” this can be expressed as follows: Product teams collaborate to determine the exact amount of each ingredient to achieve the highest level of accuracy.
The Value of a feature may be determined by factors such as its ability to assist in attracting new users, whether the new feature will benefit all users or only some of them, the amount of revenue that you may generate by implementing the quality, and how effective it will be in retaining existing users.
How to estimate Value Versus Effort
As a company owner or as part of the management, you will require a lengthy process, and a study will be necessary to provide the most accurate measurements possible.
Take into account the amount of time (hours per week multiplied by the number of weeks overall, for example), money, and resources required to properly integrate a new feature into a product when quantifying Effort.
The position at which you place a feature will fall into one of four categories based on its worth and Effort. In general, the specific titles for each are “easy wins,” “large bets,” “incremental,” and “money pit,” except for “incremental.”
Prioritizing is more accessible by separating the chart into four equal zones. Product teams may quickly know which features are worth keeping and which ones should be eliminated by simply looking at the data.
Determining whether or not to discard “money pit” ideas can be challenging, especially if they are favored by the team or are thought to have significant promise. Removing these organizations from the roadmap is in everyone’s best interests if the process reveals that they provide little value for the Time and Effort.
Those characteristics that come into “easy wins” require little work but promise many benefits. As a result, you can treat them as if they were a given. They should be given more priority because they have the potential to provide a better user experience with little cost.
“Big bets” are riskier since they have the potential to bring in a large amount of money but at a considerable expense. They remain a top priority, but putting them into action is more complex, particularly for small teams working on massive projects.
Even though “incremental” may add some value at a cheap cost, they are not deemed necessary for enhancing the value of a product’s overall worth.
Conclusion
When using the Value versus effort model, product teams consider the amount of Effort required rather than the level of complexity involved in executing particular activities. This is where the term “effort” refers to the number of resources, hours, and money that must be invested to deploy new features. The more Effort was necessary to add a part to a product, the greater the Value it must provide to justify the investment.
