September 30, 2023

The Framework of Importance vs. Satisfaction

Once customer needs are identified, the pivotal question arises: Which needs to be addressed? A robust strategy is to prioritize based on customer value.
The Framework of Importance vs. Satisfaction
Importance vs satisfaction framework

Product management often entails a deep dive into the problem domain to discern the myriad of customer needs. Once identified, the pivotal question arises: Which needs to address? A robust strategy is to prioritize based on customer value. One of the approaches is about pivoting on two axes: importance and satisfaction.

Importance: Quite simply, it's a gauge of how important a specific need is to a customer. This exists independently of any product solution. Needs possess varied importance degrees across different customers. Taking the example of social media, while some deem privacy paramount, others place more emphasis on sharing their life's snippets.

Satisfaction: This pertains to the satisfaction a customer derives from a specific solution catering to their needs. Products can elicit varied levels of satisfaction even for the same customer, and vice-versa.

The true potency of this framework unfolds when juxtaposing importance and satisfaction. Visualize a graph where importance scales the vertical and satisfaction the horizontal. Splitting this graph into four quadrants allows us to assess product avenues effectively.

Lean product management: Importance - satisfaction framework
importance - satisfaction framework

The bottom half of the grid, whether leaning towards high or low satisfaction, revolves around low importance. Investing in low-importance areas might not yield substantial customer value. The upper-right section, characterized by high importance and satisfaction, denotes market segments where leading products effectively address customer needs. Microsoft Excel, dubbed "the industry standard for spreadsheets," is a fitting example of a product that occupies this space.

For product features assessment, this high-importance and high-satisfaction quadrant signifies features that perform exceptionally well in catering to crucial needs.

Conversely, the upper-left quadrant, though echoing high importance, signals low satisfaction with current solutions. This is where significant opportunities lie. Uber, the ride-hailing behemoth, exemplifies this quadrant's power. Traditional taxis served the essential need but left much to be desired. Uber seized this gap, using technology to enhance the riding experience.

One of ideas in Importance - Satisfaction framework: Disruption vs. Incremental Shifts in Innovation. You can read about it here.

How to measure satisfaction and importance:

To understand how valuable or important a particular aspect of a product or service is to your target market, you can utilize a straightforward survey method.

We must make sure that our measurement system has enough discrimination to capture the difference between importance of different features.

For instance if we have 3 types of answers: Bad, neutral and good, we might not be able to capture small difference between different importance or satisfaction. Better discrimination helps to capture smaller differences. Lean six sigma also have same rules.

General rule of thumb:

  • For a single-sided gauge, consider having a minimum of 5 measurement values (such as neutral, slightly good, good, very good, and exceptional). Often used when measured Importance.
  • If you have 2 sided gauge, then use at least 7 measurements: (example: Strong discomfort, discomfort, slight discomfort, neutral, slight comfort, comforte, strong comfort). Often used when measured Satisfaction.
  • If you measure continuous data (its more related to industrial processes) you should follow at least 1:10 rule. This implies that the resolution should be at least ten times finer than the measured value. For example, if a process has a tolerance of 10mm, the resolution should be at least 1mm. ( for instance, tolerance of process is 10mm, you should have resolution at least 1 mm). This is the most common in Six Sigma processes.

Now lets get to our calculations

Imagine surveying a pool of potential customers about the importance of same day delivery when they order goods. The response could be gauged using a 5-point scale:
" How important same day delivery for you? "

  1. Not important
  2. Slightly important
  3. Moderately important
  4. Highly important
  5. Extremely important

Taking an average of these responses gives an importance rating. For more intuitive analysis, these scores could be translated to a 0-100 or 0-10 scale. Similarly, one can evaluate the importance of other factors like reminders and notifications, 2h delivery windows or estimated time of delivery .

The same approach we can use for satisfaction but with 7 points gauge(see above why)

"How satisfy you with delivery time for orders you made in the last half year?"

This could be rated on a 7-point scale:

  1. Completely dissatisfied
  2. Mostly dissatisfied
  3. Somewhat dissatisfied
  4. Neutral
  5. Somewhat satisfied
  6. Mostly satisfied
  7. Completely satisfied

Again, this could be translated onto a 0-100 scale or 0-10 scale. Similar questions about other aspects like reminders and notifications, 2h delivery windows or estimated time of delivery

In his book, "The Lean Product Playbook", Dan Olsen provide an example of measuring features in these scales:

Example of different features on Importance - Satisfaction scale

Each of these 13 dots represents an individual feature, with the corresponding number indicating its satisfaction rating.

A particular point of pride can be seen in the top right corner: a feature with an importance rating of 100 percent and satisfaction at a staggering 98 percent. Given its already stellar performance, there is no need to allocate any of  team's valuable resources to enhance it further. Instead, we should focus on features that has high performance but low satisfaction, as they have the biggest opprotunity for improvement and thus can bring the most customer's value. In this example most attention turned to the feature hovering in the upper left quadrant - indicative of high importance but lagging satisfaction. Marked as "55", this feature recorded an 82 percent importance, but its satisfaction lagged at just 55 percent. Although there was one feature with an even lower satisfaction score (41 percent), its importance was considerably lesser at 53 percent.

Why  this process of assessment shouldn't be static?

As products and services grow, adapt, and innovate, the way customers perceive their importance and satisfaction will inevitably shift. The 'Importance vs. Satisfaction' framework is no exception and especially in the software world.

Why the Framework is Not Set in Stone

  1. New Features Redefine the Scale: Introducing a groundbreaking feature can be a game-changer. Not only does it have the potential to bring high satisfaction, but it also sets a new benchmark in the market. This feature may push the framework’s satisfaction scale further right, making it the new standard. As a result, what was previously considered satisfying might now seem mediocre. The entirety of your framework is recalibrated.
  2. Evolving Customer Preferences: Just as businesses evolve, so do customers. With time and exposure to new technological advances, societal shifts, or even global events, what's deemed 'important' can drastically change. A feature considered 'nice-to-have' today could become indispensable tomorrow.
  3. Competitive Landscape: The market is not in a vacuum. Competitors are also making moves, introducing innovations, and influencing customer expectations. If a rival introduces an enhancement that raises customer satisfaction levels, it might inadvertently lower the satisfaction rating of existing features in your product.

The Necessity to Revisit

Considering the factors above, businesses need to periodically reassess their framework:

  1. Post New Feature Introduction: After rolling out a new feature or service, companies must gauge its importance and satisfaction scores. Doing so will indicate how this new feature aligns with existing ones and will provide insights into any recalibrations needed.
  2. Regular Intervals: Even without new features, it's wise to revisit the framework at set intervals. This helps to keep tabs on shifting customer preferences and evolving market standards.
  3. External Indicators: If there are significant changes in the market, such as a competitor's innovation or a change in the regulatory environment, these can be good times to review the framework.

Spotting and Addressing the Shifts

While regularly revisiting the framework is vital, understanding how to adapt is crucial:

  1. Prioritize by Importance: As customer needs change, prioritize features that have moved up the importance ladder. These could be pivotal for customer retention and acquisition.
  2. Re-Innovate on the Left: If previously satisfied needs move left on the framework, consider rejuvenating features connected to them. They might need upgrades or adjustments to meet new market standards.
  3. Feedback is Gold: Always keep channels open for customer feedback. They're the best indicators of shifts in the framework.

Want to know about other important concepts of prioritization of customer needs?

You can read here.

Colnclusion.

This 'Importance vs. Satisfaction' framework is a compass for product managers, directing efforts where they're needed most. As the digital ecosystem gets more crowded, understanding what customers value and ensuring their satisfaction becomes imperative. As we have seen, just because a feature performs well doesn't mean it's the end of its journey; there's always room for enhancement, innovation, and evolution.

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