Cost of Delay
Cost of Delay is a critical concept in product management that refers to the financial impact of delaying the release of a product or feature. It is the cost of not delivering a product or feature at a specific time, and it includes both tangible and intangible costs.
Tangible costs are the direct financial losses that a company incurs due to delayed product delivery, such as lost revenue, increased development costs, and missed opportunities. Intangible costs, on the other hand, are the indirect costs that may not have a direct financial impact but can still harm the company's reputation or brand image. Examples of intangible costs include customer dissatisfaction, reduced customer loyalty, and a negative impact on employee morale.
Cost of Delay can be calculated using various methods, including the weighted shortest job first (WSJF) framework. WSJF is a prioritization technique that helps product managers prioritize features based on their business value, time sensitivity, risk reduction, and opportunity enablement.
Product managers should consider the Cost of Delay when making decisions about product development and release schedules. By understanding the potential financial impact of delayed product delivery, they can make informed decisions about prioritizing features and allocating resources.
In summary, Cost of Delay is a crucial concept in product management that helps product managers understand the financial impact of delayed product delivery. By considering the tangible and intangible costs of delay, product managers can make informed decisions about prioritizing features and allocating resources.