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Product risk management

The following article is a sample from the full BVOP™ Ultimate Guide and is part of the preparation for the BVOP™'s modern Agile Product Management Certification Program.

Major product risk topics (items) are presented in the Business Value-Oriented Project Management section, chapter Product risk management

Representatives of the Business Value-Oriented Product Management (BVOPDM) office participate in the definition of project risk and play a major role in the prevention of possible product risks.

The BVOP recommends describing negative scenarios for potential undesired product directions after the product is released to the intended audience. Defining of action plans is also recommended.

Major scenarios may include the following topics:

  • Users do not accept and use the product at all.
  • User adoption is below the estimated minimum levels.
  • User adoption is higher than the estimated levels.
  • Product features do not satisfy the users and market demands.
  • Product support is slower than the velocity of the market and users' demands.
  • Usability issues.

Other risk topics and scenarios may relate to:

Operational processes, price, quality, regulations, users' cultural and behavioral specifics, etc.

Users do not accept and use the product at all

Not accepting the product is the worst possible scenario. In this evolution of events, the organization may need strategies to withdraw the product from the market and eliminate procedures to reduce losses.

The BVOPDM office and key roles at the organizational level plan such strategies and prepare for such possible scenarios right from the very beginning of the product planning.

Estimated losses should be defined, and all key roles from the organization must be aware of them.

Users adoption is below the estimated minimum levels

User adoption can be considered as the general acceptance of the product by users and their willingness to use or pay for it.

If the users' adoption is below the estimated minimum, a potential action plan may include immediate product improvement, increasing sales activities, improving marketing strategies, or expanding the intended audience (target users).

Users adoption is higher than the estimated levels

If the quantity of the product does not meet the users' demand, this can lead to negative effects. The quantity of the product may be material or non-material.

If the product is material, its quantity is usually considered to be the number of manufactured physical available items.

Rapid production at a higher, non-optimized price can be the easiest and quickest action plan for this scenario. Rapid production should be applied as a temporary solution until production cost and velocity are balanced.

If the product is non-material (for example, virtual), an example of insufficiently satisfying users' demand may be reaching limits or facing technical constraints.

Users may expect higher limits and fewer constraints in both material and immaterial products.

Product features do not satisfy the users and market demands

Product features may be unsatisfactory, less attractive than expected, or users can expect more features, product capabilities, or higher overall emotional satisfaction.

In this case, innovative and attractive functionalities, pre-documented and not developed, may be planned for further development if needed resources are available. 

Product support is slower than the velocity of market and users demands

Users can expect new functionalities, modules, and parts of the project to be developed faster than the organization's capabilities.

Usability issues

Usability issues can be associated with low levels of accessibility, poor affordance, or negative user experience.

Usability issues should be the lowest possible product risk, as they usually have to be fixed during product development and testing phases.

Every product may face usability problems in a real environment among users. Acceptable levels and negative usability-related scenarios need to be defined.

Although this is a rather unlikely risk, critical points of usability issues need to be defined in the initial stages of product planning.

Defining and managing the product risks

Products typically encounter different types of risks and negative situations in a real environment.

Product risk may include unlimited topics, and the BVOPDM office creates simulations, scenarios, and realistic and feasible risk mitigation actions for situations that are most likely to occur.

Defining and managing the product risks may require the participation of all organizational teams or individuals that may define and plan a realistic and valuable risk definition and mitigation actions.

Product risk management in Product Management
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