The Product Development Process Isn’t as Complex as You Think

8 min read
Frank L.
Frank L.
Published October 15, 2020 Updated March 22, 2021

At the end of the day, what sets your company apart? Some might say branding, others experience. But when it all comes down to it, the answer is actually pretty simple: products. When a consumer chooses your company over another, your branding may have enticed them, and that experience might have swayed their opinion in your favor, but what they actually buy is your product.

That’s why so much thought goes into building engaging and valuable products. So why, according to a Harvard Business School report, do 95% of the 30,000 new products that launch every year fail? There are a number of different answers you can arrive at, but it really comes down to having a well-defined product development process.

With a concrete process in place for your product development, it’s easier to conceptualize, build, and release amazing products for your customers. But to create something of real value for your customers, your team needs to understand why they’re building a specific product. Which means they need to connect with customer needs and business goals throughout the development process.

Sounds complex, right? But it really isn’t; creating a winning product development process for your team is pretty simple. All you need to do is make sure everyone on your team understands why they’re working toward a particular goal. That knowledge, combined with trust and autonomy along the way, helps your team create better product experiences across the board.

What Is the Product Development Process?

The product development process outlines all the steps required to take a new product or feature from idea all the way through to release. It breaks up the work into distinct and easy-to-understand stages for your team to follow and makes executing on individual tasks simple. Each step builds on the previous to keep you connected with overarching business goals as well as customer needs.

Why You Need to Define Your Product Development Process

The product development process has a lot of moving parts. There’s a considerable amount of work that needs to be done from ideation to validation, execution, and release. When you define your team’s product development process, it’s easy for them to see not only how each step flows into the next but also how their work contributes to the overall success of a project.

Gaining this kind of visibility promotes long-term thinking from your team and helps them see how each individual piece of the process contributes to the product’s evolution. When your team understands these fundamental drivers, it keeps them connected with the customer on a more direct level, making it easier for you to create products that solve a real problem.

A well-defined product development process also makes it easier to highlight important milestones throughout your project. That helps every member of the team feel engaged with their work and gives you a way to underscore successes to important company stakeholders.

Increased visibility also helps you identify and correct for potential bottlenecks before they have a negative impact on your team. That makes iterating on various aspects of the product development process easier to refine and cuts down on the time it takes to complete your project.

Defining your product development process builds repeatable structures into your daily workflow as well, reducing the time it takes for individual members of your team to complete a task. These repeatable processes are also easier to measure, because you build up a base of product data to inform future decisions.

Decoding the 7-Step Product Development Process

The product development process follows seven steps, with each step bringing your team closer to accomplishing their goals. Understanding how to efficiently move through these processes is the key to launching truly valuable products for your customers.

1. Ideation

Coming up with a great product or feature idea is one of the most nebulous steps in the product development process. You have the freedom to act on intuition and personal experience, postulating openly about what your customers truly find valuable. But it’s vital that you ground them in customer data. There’s really no substitute for deep user insights when it comes to building something of real value.

That doesn’t mean you shouldn’t document every idea you have. Even a half-formed thought can be the seed of something great. And having a running list of ideas means you don’t have to reinvent the wheel every time your company’s leadership asks what’s up next on the road map.

product plan grid on whiteboard with yellow post it notes


Grounding your ideas with real customer data, like user engagement history or buyer personas, helps keep your team focused as well. Let’s say you’re working on an update to your company’s Chat API. You might start thinking about how to add media into the chat, or creating a package for integrating with your service.

While both are great ideas, one is objectively more functional than the other. So you’d want to figure out exactly which one would provide the most value for real customers. Which brings us to the next step in the product development process: validation.

2. Validation

Validation happens more or less in tandem with step one but is much more important. This is the point in the process where you refine your ideas based on specific metrics and goals, determining which ideas have the most potential impact on both your customers and your business.

One of the best ways to validate your ideas is through discovery interviews with customers and prospects. This helps you get a better sense of what these people are asking for and what they truly need—which is often a different thing entirely. There’s really no substitute for an exhaustive user interview.

Use market research to whittle down your ideas, too. Understanding the influence of customer perceptions and your competition makes it easier to prioritize what your team needs to work on next and provides valuable context to back up your choices. If, for example, you see that one of your competitors just released HIPAA compliance for their messaging tool, you’ll be able to adjust priorities for your team to push that out as well.

Make sure you connect your ideas with specific user personas and customers’ profiles as well. This helps you nail down your target audience for eventual release. The more connections you can make between specific customer needs and your product features, the more value you’ll be able to provide once it’s released.

3. Planning

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Once you’ve validated your product idea, it’s time to create a plan for how your team will handle the rest of the process. Steps one and two are mainly handled by your product team, so this is the point where you bring in the rest of the organization based on what needs to be done.

To make sure you’re being as efficient as possible throughout the rest of the product development process, nail down individual responsibilities using a framework like the RACI matrix. This makes it clear what each member of the team is responsible for as you move through the process.

grid showing raci model of project management

The planning stage is also where you define what success looks like for your upcoming product or feature release. It’s important to set metrics to measure your progress and clarify how each of the subsequent steps helps you actually get the work done.

Just make sure you document and share this plan with your team. It should live in a central, visible, and easily accessible location, such as your internal company wiki, so everyone has access to it whenever they have a question.

4. Active Development

Once you’ve created your plan and gone over it with your team, it’s time to move forward with active development. This is the point where everyone is executing on the work required to build your new product or feature. And it’s where all the hard work you put in through steps one, two, and three comes together.

But that doesn’t mean your work is done. Make sure every member of your team has a clear understanding of what they’re responsible for at the day-to-day level. And check in on the process regularly to ensure you’re staying on schedule. Regular check-ins, whether it’s in the form of a stand-up meeting or a daily update in your shared Slack channel, help you identify potential bottlenecks and address anything that might become an issue.

Document all this in your overall product plan as well. This ensures that when issues arise, and they most certainly will, you can revisit them after the project is done. This helps improve on the product development process for future releases.

5. User Testing

After you’re done working through active development but before you release your new product or feature to the entire market, make sure you test it with a small set of users. The feedback gained from these tests ensures the best possible release experience for your team as well as your customers.

product development process steps written on pink post it notes with a hand pulling one off the wall that says run a usability test

Create repeatable testing processes to help your team execute on these tests autonomously. They should understand the goals of the test, know who is involved in it, and understand why you chose those people in the first place.

This is the point at which you bring back users who match your core audience and personas identified during the validation step. Let’s say Stream found that a large percentage of users really wanted embedded video functionality in their chat platform. We could reach out to those who requested the feature to set up a beta test.

Once you’ve completed these tests, use the feedback from your tests to identify potential bugs before they impact your release.

6. Product Release

It’s launch day. When the release experience has a direct impact on the perception of your new product/feature as well as initial engagement, it’s important to get it right. You’ve put in a lot of hard work, and botching a release can make that look like wasted effort. Make sure you have a set of tasks that people need to accomplish before launch day.

That is why you need a solid release plan—every department, from product and development, to marketing and sales— needs to understand what they’re responsible for on release day. Whether it’s the announcement blog post or the requisite infrastructure changes required to roll out your new feature, everyone should have a clear picture of how their tasks impact the rest of the team.

Try a phased rollout to launch changes slowly as well. Not only will this make it easier to minimize the potential impact on your existing product experience, but it will also give you the option to roll back changes quickly if things go wrong. It’s always important to have a contingency plan in place, with clearly defined steps for what happens if there are any issues.

7. Analysis

You’ve done it! After launching a product to market and having real customers interact with it, it’s time to celebrate. But it’s also time to analyze how the release experience stacks up against your overall product plan. Every release is an opportunity to learn more about your customers and how the product development process helped you make an impact on them.

Start by doing a postmortem with your team to document your success and identify potential areas of opportunity. No matter how well received your new product or feature was, there is always something to learn. Building great products is a long game, made better by tiny improvements along the way.

This is also your time to check in on the metrics you defined at the beginning of the process to track any relevant changes. Setting up a dashboard to visualize these metrics can really help.

screenshot of dynamic product scorecard dashboard with data visualization showing actions, action distribution, new users, and NPS

When you combine this with an honest and open postmortem meeting, it helps highlight the things you can do better in the future and celebrates your wins.

Having a clear picture of your successes and your opportunities is one of the most valuable things you can do for your team.

The Product Development Process Is the Key to Creating Value for Your Customers

According to a Mercer research study, 65% of employees prefer clearly defined responsibilities. When you communicate your product development process to the team, it keeps them engaged with their work as well as your goals. When so much depends on providing a winning experience to your customers with every release, you can’t afford confusion.

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