The user should be the main focus of all product development activities, not the customer! This is a simple statement made to me not too long ago that had some significant consequences. The important thing in the statement for me was highlighting that user value and customer value are not necessarily the same. This realization led to a significant change in my thinking about the value we generate in product development.
We are currently working on a B2B service that is integrated in our customer´s products. As such, we are receiving revenue from someone that is not actually using our product. Our customer is not the end user. I always knew this but wasn’t focused on it.
We were and currently still are in a high growth phase. My implicit assumption was always that as long as the growth was continuing, we were delivering value. And this is true. However, we weren’t clear on who we were actually creating value for.
Surely, some part of our work was creating user value. Some other part – actually the larger part – of the work was creating business value. In the past we weren’t actively distinguishing between the two. However, I have now realized (with some help) that this distinction is very important. For long term success the value to end users needs to be (back) in the center.
More broadly, we reframed how we think about value in general. The experience was very enlightening to me. Thus, I would like to share my current thinking around the different types of value product increments can generate.
The Backlog is a bi-weekly newsletter about the undervalued and overlooked in modern product development. It covers product development, self organization, and productivity. I include methods, books, and write about my own experience. The target audience are Product Owners, Scrum Masters, Developers, and project leaders. The Backlog is about getting the most out of product development.
Subscribe to get new posts straight to your inbox.
Four value buckets
My current thinking is that there are four distinct categories in which to sort any tasks or stories we are working on.
- User value
- Business value
- Tech value
- Maintenance & Bugs
User value generating are any and all developments that improve the experience for the end user of the product. These are all the things that make users at the end of the delivery chain happy, the things that could turn them into a superfan.
Some products have a direct relationship between user and business value. In the case of a B2B service this is not necessarily a reality. Here, user value creation means solving needs that the users of our customers have, or that the users of the customer´s customers have. It can be really tricky to find out what those really are if you have no direct relationship with the end users.
User value is what enables long term success for a product!
All developments that satisfy business requirements but do not necessarily impact the user, I group under business value generation. This is generally related to revenue, costs, or both.
When customers are users, a better experience for users can directly lead to more revenue. In this case user and business value are identical. When customers are not users, the relationship is not as direct. In the long term, user value will lead to positive outcomes for the business. In the short term, however, business value generating product increments may not impact the user at all.
They are often needed to unlock new growth opportunities. Thus, they can be features needed to serve new markets or new customer segments without impacting the experience of the end user.
A team can also create tech value. Essentially, this is all about fulfilling technical, almost exclusively non functional requirements. These don’t bring immediate user value and are usually not directly business critical. Regardless, they are often needed to keep all services running in the long run.
Tech value generation does mean new product development, in contrast to maintenance which is about keeping existing systems running. This can be in the context of (sometimes huge) dedicated projects, e.g. moving to the cloud.
Tech value is created by new developments that enable e.g. scaling, tracing, monitoring, a more stable architecture, or security. These are all important and need to be done. Indirectly and long term they are the prerequisites for user and business value because the services will be stable, reliant, and secure.
Maintenance & Bugs
Anything that keeps the current system running falls under the final bucket, maintenance and bugs. Maintenance is anything that needs to be done so that the existing product keeps on running according to some requirements or industry standards. Upgrading libraries, removing tech debt, data updates, or upgrading the programming language to its latest version are examples of maintenance.
The important thing is that maintenance is scheduled, whereas bugs are not. Bugs are errors in the code or unwanted behavior of the service that needs to be fixed. Bugs are not planned and we generally try to do them as soon as they come up.
Why is user value so important?
Having established the framework on the different types of values that can be created in product development, let’s try to answer the question of why user value is so important. At first glance it seems so obvious that this is the case. After all, the users are the ones using the product.
In practice, however, it may be less obvious. This is especially true if users are not the customers. In our case – and I speculate that it will be similar for others who are responsible for a B2B service – we were mixing user and business value.
Since we were mainly focused on growth, we were primarily building features that made our customers happy. The implicit assumption was that a happy customer equals a happy user (business value = user value).
We were mixing the two types of value without really understanding who we were delivering value for. In truth, we were mainly focused on business value generation. And this can be perfectly fine! There are many reasons why business value needs to be in the center – for a time.
In the long term, however, user value generation needs to be the focus in order to have sustained, long term success. Even if you have no direct relationship with the end user, this is so important. A happy end user will create demand for your product at your (potential) customers. This in turn will lead to more business value even if you are not directly focusing on it.
How to make sure user value is the focus
All of the above sounds logical (I hope). The question then becomes how exactly do you actually ensure that the user is at the center of your thinking. Numerous frameworks or methods exist that can help:
There are many more and I will not go into detail about them here. Your local UX expert will be able to explain them much better than I can. I think there are two things they all have in common that I do want to elaborate on: mindset and direct user interaction.
All of the above methods are fed by talking directly to users and trying to build empathy. To create user value you need to really and deeply understand the users´ needs and problems that you can solve. For this, there is no substitute for direct user interaction!
The second important point is that all of the frameworks aim to feed a user value centric mindset, ideally of the entire organization. In case of any questions during product development you always need to try to think from the users point of view. It has to become a habit to always want to ask What would our user do or want in this situation?
When writing epics, stories, or roadmap items, phrase them from the user’s point of view. When creating a mission make sure you answer what user problems it will solve. When conducting a review or demo, explain how it helps the user. Phrase the product vision from the user’s point of view.
These are all small individual steps. As a whole they can lead to significant change within the organization towards a more user value driven product development. This is what is necessary for long term product success.
Mindset is more important than methods
I believe it is very important to be aware of for whom all product increments deliver value. There are good reasons to be creating business value, tech value, for maintenance, and for solving bugs. It’s perfectly valid for one of those to be dominant for a period of time. However, in the long run the value created for end users needs to be the main focus in order to have sustained success.
There are many methods to choose from in order to better understand users. I believe that it doesn’t really matter which one you chose. They can all work. The important thing is to be aware, to directly talk to users, and to foster a mindset where the user is always in the center. Then just pick one of the frameworks and go with it. I strongly believe if you do that you’re already ahead in the game.
Coverphoto by Lidya Nada on Unsplash