Team Processes at Different Stages of Product Development

Product development is a time-consuming process that involves improving the functionality, design and usability of a product, as well as adapting it to constantly changing market needs and requirements. This can include adding novel features, optimizing the existing ones, changing the interface and design, improving product performance and security, etc. Every product development process consists of many different stages carried out by a team of specialists, who are united by a goal of building a successful and sought-after product.

One of the crucial stages of product development is releasing a minimum viable product (MVP). It’s a product that contains all basic functions and can theoretically allow the customers to achieve their goals by using it. As a rule, an MVP doesn’t contain any additional functions or features that may be unnecessary or redundant for the user.

Another vitally important stage of product development is product scaling, i.e. increasing the production and sales volume of a product to meet growing market demand. At this stage, the team enhances the number of production facilities, expands the distribution network and improves product quality.

MVP: its mission and creation

I would define the role of an MVP as providing the basic functions of a product, while being:

1. user-friendly;
2. fast-operating and efficient;
3. affordable for your target audience;
4. well-designed;
5. of minimum possible size and weight.

In general, an MVP is a key contributor to the team in the following ways:

• It allows you to test a market fit before building a full-fledged product.
• It significantly reduces time-to-market for the planned releases.
• It proves your hypotheses with actual data.
• It helps you collect viable data on user behavior.

When working on an MVP, the team is usually faced with daunting challenges that they must overcome with their heads held high. One such challenge is dealing with a limited budget while working under tight deadlines. Moreover, the team has to ensure that an MVP meets all customer needs and expectations. Another important aspect is that the team has to identify the unique competitive advantages of their MVP in order to further develop a particular dimension of the product that could turn out to be a gold mine.

There are plenty of versatile approaches to the creation of an MVP, so I’d like to familiarize you with the most common one:

1. Determine the purpose of your product: Why would customers buy my product?
2. Identify the product’s target audience and highlight its core: Who would buy my product?
3. Explore your rivals: Why are people buying their product?
4. Analyze your product: What are the strengths and weaknesses of my product?
5. Prepare a roadmap: How and with whom will I develop my product?
6. Point out vitally important features of your product: What should we develop first?
7. Choose the most suitable methodology: Should I use Agile, Waterfall, or something else?
8. Test your product: What are the shortcomings of my product?
9. Release an MVP.

As it has been evidenced hundreds of times, you need to assemble a trustworthy team in order to build a high-quality MVP. Nowadays, it is too hard to succeed on your own. Here is a real-life example of a team structure that enabled a small startup to release its tech Saas platform, which is currently in high demand:

• Product Manager: defines the way the team sees their product and coordinates all the work processes.
• 2 Software Developers: write code for an MVP, test it and optimize its performance.
• Outsourced Designers: create UI and UX. In the later stages of MVP creation, the team decided to hire a full-time Designer to increase the UI/UX quality.

Scaling: why and how it’s done

If you want to expand your production, increase sales or attract new audiences, that means you want to scale the product. Product scaling is a must if you want to make your business profitable in the long term. As I have briefly mentioned, there are several benefits scaling can bring:

• increased sales, which allows your company to make more money and continuously grow;*

• improved product quality, which can increase product value for users and lead to greater customer loyalty;

• expanded audience, which makes it possible for you to add new product features specifically for the new layers of target audience.

  
  

  

  When scaling a product, the team may face a number of challenges, such as:

• Lack of resources: scaling requires additional resources, including staff, finances, infrastructure, etc., which may be limited at the outset.
• Difficulties in change management: scaling often involves changes in certain work processes, technology and infrastructure used, which may require significant effort to cope with.
• Competitive market: scaling in a highly competitive market may result in lower product margins and higher marketing and promotion costs.
• Lack of expertise: scaling might require new knowledge and skills that are not always available within the team, which may slow down the whole process.
• Lack of strategy: scaling should be based on a clear strategy that defines goals, metrics and pathways to success. If there is no strategy, scaling can become chaotic and inefficient.

At the same time, you choose from a lot of different structures when scaling a product, and AARRR is one of them. AARRR (Acquisition, Activation, Retention, Referral, Revenue) is a marketing and product framework based on a conversion funnel. This structure is often exploited to manage the product scaling process and improve user experience. With the help of AARRR, you can build a transparent metrics structure that is accessible and easily understandable by all the team members. The more detailed structure of this framework is presented below:

Scaling in practice

However, if a Project Manager tries to blindly impose one of the scaling structures on the team, without considering the pros and cons of each framework, the whole team is set to fail. It’s common knowledge that every scaling structure (including AARRR) has its blind spots, and if the team doesn't understand what it’s doing, each member will pointlessly meet their own goals and KPIs, which won’t lead to anything good. In this context, I can’t but mention Groupon and its failed scaling.

In 2008, Groupon, the pioneer in coupon sales, was widely regarded as the fastest-growing company ever. To build on its resounding success, the company decided to go through yet another scaling process. Nevertheless, drunk with success, the Groupon management treated this pivotal process half-heartedly: its scaling plan wasn’t detailed at all, and the scaling structure was chosen at random. As a result, the company lost around $37 million at the start of 2012 and its share price fell twice.

To avoid Groupon’s mistakes, all the team goals should be coherent. This means that each member of the team should work towards a common goal and strive to achieve it, not just their own personal interests or goals. Goal alignment can be reached by setting clear and precise goals that are understandable for each team member. It is also important that the team has a clear structure and role assignment so that each member can do their best work. In addition, it is crucial to ensure communication between team members and to maintain an open dialogue so that all members can exchange information and ideas. This will help to avoid conflicts and disagreements related to different goals and priorities.

Speaking of alignment in team goals, I’m pleased to mention Amazon. As Jeff Bezos was developing the world’s largest ecommerce company in his garage with his small team, they made sure to grow slowly but efficiently. They carefully studied all the scaling opportunities and chose the one that suited their situation the best. Eventually, after three years of incremental development, the team acquired a customer base of 1 million people.

Metrics tree and North Star Metric

In order to visualize and analyze the data related to product development, a helpful tool called a metrics tree can be used. It is a tree-like structure in which each branch corresponds to a specific metric or indicator, and the leaves (if present) correspond to specific values of these metrics.

The metrics tree provides a visual representation of the relationships between different metrics and their impact on the bottom line. It also helps identify problems and bottlenecks in the data analysis process, which can lead to better decision-making and improved performance of the whole team. A metrics tree should typically be created based on the aligned team goals that have been set.

As you might notice, all the metrics on the tree lead to one special metric called North Star. This is the most important metric that captures the core value of your product. Some of the North Star Metric examples are:

• Monthly Active Users for Facebook;
• Messages Sent for WhatsApp;
• Rides per Week for Uber;
• Daily Active Users for Slack;
• Time Spent Listening for Spotify.

A metrics tree, and in particular the North Star Metric, can have a huge impact on the team and entire product development process in terms of:

• Overall focus. Everyone is united with a single goal.
• Clarity. Everyone can see the level of development progress.
• Focus on customers. Every team member is occupied with delivering additional value to the customers.

When a team has a useful tool such as a metric tree and an excellent landmark in the form of North Star, it is much easier for them to align their goals and allocate all responsibilities in the most efficient way possible. In such a unified structure, the distribution of roles is much more rational, and some parts of the team are able to multitask. In this connection, Marketing Specialists can be responsible for both marketing and acquisition divisions and, at the same time, closely interact with Product Managers in charge of the core product.

Hence, the alignment of team objectives, coupled with the right metrics tree based on those goals, enables any product development team to become extremely flexible and streamlined when distributing their roles and allocating responsibilities.

Conclusion

The product team plays a central role in the product development process. Their work makes the product better, more convenient and user-friendly. Each member of the team contributes to the achievement of common goals, and it is only through their work together that the product becomes successful.

In this regard, we should remember that the lack of alignment between company and individual team goals can have a major negative impact on the growth rate of a product. Besides, even though the North Star Metric is an important tool for setting coherent team goals, the right North Star Metrics alone won’t solve all of your problems. The properly selected structure is the thing that can do so. What is more, the right structure can resolve motivational conflicts at different levels of the company and have a positive impact on the rate of product growth. It is also important to bear in mind that the conflict between user goals and company goals is an extremely dangerous thing that can lead the entire product development process to failure. Therefore, every team member should do their best to avoid it.