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Agile

PRIORITISING ON CUSTOMER VALUE

The Product Backlog is ideally suited for organisation wide application.
In Scrum we recognise the Product Backlog and the Sprint Backlog. The Product Backlog describes all requirements that are necessary to establish a software product. The requirements are prioritised on the basis of customer value, and the most important of these are then taken into the Sprint Backlog. This is where the Scrum team defines the necessary actions to reach the requirements that will be made during that sprint.

On an organisation level we can include projects, promotions, campaigns, products and other elements into the Product Backlog. This helps to get an overview of what has the highest value to the customer. Often there is a parallel with what needs to be done internally to be able to deliver something externally. But often the customer does not really have compassion about what needs to be streamlined internally. These matters need to be taken care of in the background.

How does prioritizing on customer value work exactly?

When organizing the Product Backlog, it is important to ask the customer which of the items required has the most value for him or her. This is measured as a relative value, not in terms of money. For example, you may strive to perfect something down to the last detail before showing it to the customer. The customer, on inquiry, would be satisfied much earlier. In order to continuously deliver as much customer value as possible, it is therefore important that you have a good understanding of the wishes and needs of the customer, including timing requirements. A close customer relationship with good communication is essential here. Once you know how much value each activity has from a customer point-of-view, it is time to define the workload per activity.

Defining the workload is, just as with the customer value, relative. It is therefore not about exact working days or hours, but about the amount of work of one activity compared to another activity. For example, one activity may be four times more work than another activity, although you still do not know exactly how many hours that is. You can estimate that one has been tagged and that the other requires more research.

By mapping the workload per activity, you can start prioritising in combination with the given amount of customer value. You of course want to start with those activities that generate the most customer value. Which of these are first to turn depends on the associated workload and available capacity of the employees. If there is little time besides the normal activities, you first pick up those activities where the workload is low but the customer value is high. If only activities with a high customer value and a large workload have come true, it is time to revise the Product Backlog. Maybe activities can be split up into smaller parts, so that the customer value remains high, but the workload becomes smaller. This way you can present or deliver something to the customer every few weeks (sometimes even days) which has added value for him or her. This ensures transparency, trust and a closer customer relationship.

During our one-day workshop ‘Prioritizing on customer value’, we clarify this principle further and help to set up the first Product Backlog, so that you can start working on it the next day.