When a team puts effort into identifying areas of improvement, brainstorming new ideas, or gathering feedback, it will lead to the creation of a comprehensive product roadmap. Once the product roadmap is created, the next thing is to decide which one to emphasize first. This requires product managers to spend some time prioritizing.
To facilitate this scenario, RICE prioritization is an effective framework to prioritize product roadmap. It helps managers make a clear decision regarding which ideas to prefer based on a final score. The framework follows a systemic approach based on four solid metrics, i.e., reach, impact, confidence, and effort. Therefore, this guide will discuss in detail the RICE prioritization framework, its working principle, and other details you need to know.
- Why is it Difficult to Prioritize a Product Roadmap?
- Introducing the RICE Scoring Model For Prioritization
- A Quick Look at the RICE Prioritization History
- How Does the RICE Prioritization Framework Work?
- How to Calculate the RICE Score?
- Effective Way of Using the RICE Prioritization Framework
- Why Do Product Managers Prefer a RICE Score for Prioritization?
- Wrapping Up
Why is it Difficult to Prioritize a Product Roadmap?
A product roadmap comprises various elements, like new ideas, scope of improvement, customer feedback, etc. However, the order in which product managers tackle these aspects can make a huge difference. They might face challenges in prioritizing these ideas for the following reasons:
- Preferring plans based on personal bias instead of focusing on initiatives that can benefit customers.
- Working on smart or clever ideas might be tempting over practical ones, which might push the main goal backward.
- Jumping to new initiatives rather than sticking to the current projects with higher potential.
- Overlooking how much more effort one project may need over another.
All these challenges and more can compromise the prioritization process and the product in the long run.
Introducing the RICE Scoring Model For Prioritization
The RICE prioritization scoring model is a solid framework that helps product managers prioritize the products and features for their roadmaps. The selection of the relevant items is made based on four factors, i.e., reach, impact, confidence, and effort - hence the acronym RICE.
This model, if used properly, offers a plethora of benefits for product managers, including:
- Helping them make informed decisions regarding product selection.
- Reducing involvement of personal opinions in decision-making.
- Providing a solid plan allowing managers to explain their decisions to higher authorities.
In short, the RICE prioritization method streamlines the process of prioritizing the product roadmap and helps product managers plan smartly and effectively.
A Quick Look at the RICE Prioritization History
When it comes to the history of the RICE prioritization method, the messaging software company Intercom is credited for its development. It was created to enhance the organization's internal decision-making regarding products and soon got worldwide recognition.
Basically, many prioritization models existed before RICE, but none were able to match Intercom's unique requirements. This led to the development of criteria to prioritize products based on four categories (reach, impact, confidence, and effort). In addition to this, they even devised a formula for calculating the RICE score.
The output figure could then be used for various purposes, allowing product managers to prioritize beneficial initiatives for an effective roadmap.
How Does the RICE Prioritization Framework Work?
There are separate criteria to determine each RICE prioritization factor, as discussed below in detail:
1. Reach
Reach refers to the number of customers a project will affect within a specific time period. For its mathematical calculations, you need to use actual metrics related to the product rather than any superficial figures. Simply put, reach is about the number of people or transactions over a specific duration, such as customers per quarter, transactions per month, etc.
Let's understand the reach RICE method prioritization factor with a few examples:
- Project A manages to attract 500 customers till the signup stage of the funnel every month. However, only 30% are in favor of a particular option. To calculate the reach for this project in a quarter, you multiply the number of customers attracted per month (500) by the percentage of customers interested (30%) and then by the number of months in a quarter (3). So, the reach is 500 x 30% x 3 = 450 customers per quarter.
- Project B comes with a few changes in features, so every customer who uses it will come across the development. This way, the reach would be 1,500 customers per quarter.
- Project C will only affect 600 existing customers as its one-time changes won't reflect in subsequent quarters. In such a scenario, the reach would be 600 customers per quarter.
2. Impact
Impact refers to the effect a project is estimated to have on a single person. This helps managers prioritize the projects that bring the company closer to its goals. For example, it could be the conversion rate that an initiative attains. However, it's not limited because you can adjust the goal according to your business needs, like how a project helped improve the adoption rate or led to maximum happy customers.
For calculating impact, there is no specific formula to follow. Instead, you can opt for a multiple-choice scale for this purpose, as stated below:
- 3 - Huge Impact
- 2 - High Impact
- 1 - Average Impact
- 0.5 - Low Impact
- 0.25 - Minimum Impact
Here are a few examples of impact:
- Whoever comes across Project A is highly impressed by it. So, you can easily allot a 3 to it.
- Project B failed to impact many customers. Thus 1 impact score would be suitable in this situation.
- Project C brings out average results, so you can decide the score to be 2 (medium impact).
3. Confidence
Many times, you will come across ideas that sound exciting but lack solid data to back them up. Confidence tells you when to step back by evaluating how certain you are about the estimations regarding such a project.
While it's tempting to execute interesting ideas, not thinking practically can get you stuck in the middle of the process. Therefore, a confidence percentage can be used to determine whether the project should be carried forward or not. The scale goes like this:
- 100% - High Confidence
- 80% - Medium Confidence
- 50% - Low Confidence
A figure below 50% should not be considered, as the project has a chance of flopping in such a scenario, leading to a waste of resources and time.
Here are some examples of this RICE prioritization metric:
- Project A has quantitative and qualitative data to back up reach and impact, along with a solid effort estimate. In this case, your confidence in the project must be 100%, and it can be executed successfully.
- For Project B, you have access to reach and impact estimates but no data for efforts. It gets an 80% confidence score.
- Project C's evaluation shows that its reach and impact are lesser than estimated, and your team has to put in higher efforts, so its confidence score would be 50%.
4. Effort
In the effort metrics of RICE prioritization, you need to calculate the total amount of time a project will require from start to finish. It must include the efforts of all members.
For precise calculations, the effort is estimated based on "persons-months", i.e., the work that a single employee in a team can complete in one month. You can use whole numbers to estimate the effort score. In case the work is significantly less than a month’s worth, then you can go for a 0.5 effort score as well.
Unlike other factors that increase a project’s positive impact, more effort is not something that’s appreciable because it divides the total impact.
Here are some examples to understand this metric better:
- If Project A takes one week of planning, 2 weeks of design, and 4 weeks of engineering team, its effort score can be set to 2 person-months.
- Project B requires a number of planning weeks, several days for designing, and a few months for engineering, so its effort score would be set to 4 person-months.
- Project C is simple and needs no prolonged time of planning and designing. It just requires some days of the engineering team, so its effort score can be set to 1 person-month.
How to Calculate the RICE Score?
Once you are done with estimating the four factors, it's time to get a final RICE score based on a simple formula:
The resultant figure will tell you the total impact per time worked, which needs to be maximized for the best results. The easiest way of calculating the RICE score is to use a spreadsheet. Once you have the final results, re-evaluate the estimates for projects that lack optimal scores and prioritize effectively.
Effective Way of Using the RICE Prioritization Framework
RICE prioritization scores are based on estimations. Thus, you don't need to use them strictly. For example, sometimes you must continue with a project despite it having a low score. There might be several reasons for it like:
- One project might need to be done before starting another one because they are connected.
- A certain feature may be necessary to make a sale to some customers, so it gets priority.
In short, you have to make decisions which may seem unusual. It is where the RICE scoring model gives you a clear picture of such exchanges so you can explain it better to executives.
Why Do Product Managers Prefer a RICE Score for Prioritization?
RICE score for prioritization is popular among product managers due to many reasons, as follows:
- The RICE prioritization model helps sort out which ideas to work on first based on their potential benefits toward a particular goal.
- It splits big tasks into four smaller metrics, making it easier to think and manage the entire process.
- RICE scores are versatile and can be used for different things like assessing new features, product updates, or projects.
- It helps promote better teamwork by allowing everyone to understand why certain decisions are made.
All the above reasons and more make the RICE prioritization framework a favorite choice of product managers. However, a major roadblock may arise, i.e., the team members may face issues in understanding this model. While you can arrange workshops for this purpose, a solid idea is to incorporate an AI chatbot by Shulex that can answer their queries 24/7.
The best part is that you can train the bot based on your own data, so it will provide accurate answers. This way, you can cut down the resources spent on training employees with respect to the RICE prioritization framework.
Wrapping Up
The RICE prioritization model is a solid framework that gives product managers a clear picture regarding which idea should be worked on first. If used precisely, it can enhance the data-driven decision-making of your organization while giving personal bias and emotions a backseat. To wrap up, it is recommended for product managers to deploy RICE prioritization and achieve better ROI by working on valuable projects only.
