Too many businesses make the same mistake of leaping straight from a business idea into the development stage. Requirement elicitation, deliverable planning, and market research are swept aside as secondary, low-impact precursors.
The result? Budget overruns, scope creep, and project failure are the typical pitfalls for projects with no discovery phase.
Conversely, successful products often emerge when consistent ideation for each aspect, requirement, and deliverable is thoroughly validated and planned. This detail is what the discovery phase is all about.
What Is the discovery phase?
The discovery phase, also known as the scoping phase, is a process that precedes the development stage. During the discovery phase, your team collects and analyzes information about the future product, including its target audience, market trends, and close competitors. These insights allow the team and idea owner to calibrate the product vision, validate its viability in the market, and prioritize deliverables.
What is the importance of the discovery phase for your product development?
No project at Orangesoft is complete without the discovery stage. We get to know the client, assess the business challenges, identify stakeholders, and set goals, objectives, and project boundaries during this pre-development phase.
The project discovery phase is important for a number of reasons:
Minimized risks
The development team can only generate accurate time and cost estimates if they have a strong understanding of your objectives and needs. According to our experts, the discovery phase reduces the risks of missed deadlines by 75% and accounts for a 50%+ reduction in development costs. Last but not least, the depth and thoroughness of the product research process decide the success or failure of your future solution.
Market-oriented product
A discovery phase lets you clearly understand what the target audience wants. Further, it informs you of how you can provide said solution and how your product holds up. Project scoping also enables you to test the alignment between your idea and market trends to assess your product potential in the wild.
Accurate product requirements
Functional requirements are the lighthouses for the entire development process. They provide a realistic basis for cost estimation, reduce design and development efforts, and, among other things, impact the team structure involved in the project. A project discovery phase gives you a head start on requirement elicitation and indicates a general drift of the product development.
Consistent development process
With explicit requirements, it’s much easier for the team to build and follow a step-by-step strategy. You'll set a project timeline with goals, deliverables, and deadlines. It means that no rescheduling or major adjustments are needed from idea to launch, accelerating your time to market.
Investor buy-in
Functional requirement documents and wireframe prototypes are one of the deliverables of the discovery stage. These can maximize a startup's attractiveness to investors and bring in more money during the discovery stage. Also, prototyping helps validate the product's usability, design, and functionality among test groups.
Provider trial period
Even after hearing a convincing sales pitch, you may still be uncertain if the company you’ve selected is the best option. Regular communication and in-depth talks about your project during scoping allow you to understand your development team better. In the worst case, this approach gives you time for a do-over with another partner before the deal is sealed.
Five reasons why you shouldn't skip the discovery stage
Let’s say you pass on the scoping and jump straight to the development. Here is how this speeding up of events may backfire:
1. Project failure
According to the Harvard Business Review, a mere 35% of the projects undertaken worldwide are successful. Although the failure points vary by project, lack of communication and misalignment account for the lion’s share of unsuccessful projects.
Thus, early miscommunication leads to more misunderstandings further in the development process. As a result, your expectations and the final product diverge, wasting time and money. Not to mention that you won't be able to validate your idea and check it against the current market.
2. Scope creep
You can’t manage what you can’t measure. Therefore, a product without measurable outcomes tends to increase over a project lifecycle, e.g., what once started as two deliverables become six. The easiest way to avoid scope creep is by creating a detailed scope statement to align your team before the project begins.
3. Overspending
Without defined goals and purpose, requirements frequently change; this leads to increasing costs and unjustified expenses. As a result, your funds run out before the team can develop a full-fledged product.
4. Missed deadlines
Without precise project boundaries, the development process can easily stretch out. Scope creep also adds to general laxity, causing timetable adjustments and delivery delays. And if you don’t get to the market early, you risk giving primacy to your competitors and losing potential profit.
5. IT vendor lock-in
Without documentation, switching development teams is difficult. So if you start afresh, don't skip the discovery step.
Who is involved in the discovery phase?
Projects are what define the structure of the discovery team. Therefore, the team may change based on the complexity of your venture. But some key roles are always present during the scoping phase, including:
Project managers
The project manager (PM) is the point of contact between you and the development team. They are directly involved in organizing and planning the project. In addition, PMs conduct workshops to ensure you have a defined set of deliverables and objectives before development starts.
Business analysts
A business analyst (BA) is a professional who does the heavy lifting of research. During the discovery phase, a business analyst will analyze the target audience of the future product, research customer needs, and perform competitor analysis. Then, a business analyst will collect and document the initial requirements for the product.
UX/UI designers
Since a user-friendly interface is based on user needs, a UX/UI designer will map the user journey of your product, including user goals and expectations. They also assess competitors’ solutions present in the market to identify opportunities for a product in a specific niche.
Based on the insights, UX/UI designers provide their perspective on the product architecture to the business analyst and tech lead. Once the groundwork is done, UX/UI designers are joined by BAs to create prototypes that demonstrate the layout of your website, app, or other product.
Tech leads
During the discovery phase, a tech lead discovers the most feasible tech solutions to meet your product's business challenges and develop technical specifications. Also, they select a development approach, assist PMs in estimating project costs and timelines, and create a single project vocabulary with the business analyst, so all team members use the same language. Moreover, tech leads advise business analysts on the tech capabilities and system limitations.
How does Orangesoft conduct the product discovery phase?
The discovery phase is a step-by-step process that goes from high-level objectives to detailed guidelines. We move from global business goals to specific user actions in the system.
After each stage, we provide a separate artifact (documentation) with fixed requirements. These artifacts are usually separated into mandatory and non-mandatory categories, and the customer's objectives determine the final set.
Let’s briefly go over the main steps of the project discovery phase based on how we approach it at Orangesoft.
Defining the project’s main goal and limitations
To shape your product vision and make it stand out among competitors, we devote a significant amount of time to numbers, competitor research, and business analysis. If we want to deliver unique value packed into a worthwhile solution, we have to do something no one has done before, something that clients don't ask for because they don't even know it exists.
The product vision guides us on our quest for originality. It keeps us on the right track and gives context to each metric, client demand, and insight.
Here, we get the first artifact, the mind map, which describes the overall scope of the identified business goals. This map also helps you to brainstorm organically and organize an idea flow.
Deliverables:
- Project mind map
Completing stakeholder analysis and defining goals and problems
Collecting requirements is one of the most critical processes in developing any information system, be it a full-grown application or a system upgrade. But before we begin gathering requirements, we must first identify all the system’s stakeholders. The more specific this list is, the more accurate the requirements will be.
Stakeholders are persons and/or organizations actively involved in your project and whose interests may be affected not only during the system's development but also directly after the project's completion. For example, they can be managers, department heads, directors, or other employees who will engage with the final solution whose requirements (needs, expectations, and problems) will be gathered.
Several requirement collection approaches can assist you in better understanding what the consumer needs. The most popular methods include:
- Interviews with the client and stakeholders
- Studying the existing documentation
- Learning the domain and the main forums
- Brainstorming
- Story detailing
- Сompetitor analysis
Deliverables:
- Stakeholder identification
- End user persona
Creating a discovery backlog and gathering requirements
The discovery backlog is a space for all ideas, features, and user insights that can be useful now or further in the development process. To make it more digestible and straightforward, we organize all ideas by topics, initiatives, and logical chunks.
If the concept was originally stated as a problem, we recommend recording the problem's most explicit meaning and a version of its answer as a hypothesis. That way, when you begin to look into the issue, you may discover that there is a better option.
Any problem should be solved with a particular goal in mind, such as your strategic objective or a specific metric. Therefore, our team usually creates a section in the document where we list all goals. In this section, when an idea or an issue is added, we connect it with a goal, while all other thoughts are stored in a different section.
The Orangesoft team creates a backlog in the form of a list of user stories. Then, we reinforce the project's concept with a user flow and upper-level verbal agreement on how the system should react to a particular user or other system activities.
To get a big picture of a solution, we also create a business process flow chart. This chart describes a positive application usage scenario and outlines the interaction between the user and the business and its system.
Deliverables:
- Delivery backlog
- User stories
Defining the delivery backlog and dividing user stories into iterations
So, now we have a delivery backlog that consolidates all user stories, contributes to a well-balanced product vision, and pinpoints the project constraints, we need to prioritize each user story using the Must, Should, Could, Would (MoSCoW) approach. Once priorities have been set, the business analyst and client decide whether to implement all the features at once or deploy the MVP first and improve the product after release.
Deliverables:
- Prioritized product backlog
- Must-have product features
Creating and approving UX/UI design
At this point, our business analyst collaborates closely with the UX/UI designer to create a vision of the future system. To define the core aspects of the system and construct the architecture, BA creates an upper-level product prototype. Based on the finished prototype, the designer prepares a design of the application to get approval from the client.
Deliverables:
- Clickable prototype
- Application design
Completing the functional requirement document
This stage progresses in parallel with the design development. A thorough specification and documentation of the collected requirements make things easier for everyone, including the business analyst, the client, and the development team; it aids in the creation of better estimations, lowers costs, increases customer satisfaction, and accelerates time to market.
The functional requirements document (FRD) is a formal statement that breaks down the requirements needed to meet business requirements. The document serves as a contract, allowing the client to validate each capability of the future product. It is a critical piece of documentation for product development that increases the odds of successful delivery.
The FRD describes how the system should function to meet business needs and user requirements, including tasks, services, and/or functions. Functional requirements, in turn, define product features. This documentation is the result of the collaborative effort of each team member, including business analysts, tech leads, and designers.
Deliverables:
- Function requirements document
- Product architecture
Finalizing the application’s development time estimate
At this stage, developers can provide accurate time and cost estimates of the product's implementation based on the documentation and prototypes. All the functionality of the existing FRD and design is assessed consistently, including layout, implementation of business logic, and integration with third-party services.
Deliverables:
- Final timeline estimate
- Final cost estimate
How much time and money should you spend on the discovery phase?
There is no cut-and-dried formula for estimating the timeline and costs of the discovery stage. Instead, the calculation is based on unique project variables, including the complexity of the product, team structure, and other drivers.
At Orangesoft, the discovery phase costs from $15,000 to $30,000 for 1-2 months of scoping. If your project is small-scale, the discovery stage will take us around a few weeks with an average cost of no more than $10,000. We usually start by discussing your project idea, including its look and feel, to get a high-level hold of an idea and launch the discovery stage.
What’s next?
The true value of the discovery phase goes beyond the requirement specification and cost estimates. It sets the direction for the entire project, helps to look at the essence of your future product, and enables you to solve user needs with the right features and design elements.
After the discovery stage, you already have system requirements specification, a preliminary app design, and a project roadmap – the best starter pack for a smooth and predictable development process.
If you’re looking for an experienced team to facilitate your product discovery, Orangesoft is always there to help you. Drop us a line, and we’ll analyze, shape, and strategize your business idea.
